FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
AND OTHER LOAN DOCUMENTS
This FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT AND OTHER LOAN
DOCUMENTS (this "Amendment") is dated as of March 27, 1996 by and among
BRENTWOOD SERVICE GROUP, INC., a New York corporation, COMPUTER CONSULTANTS
FUNDING & SUPPORT, INC., a New York corporation, LABFORCE OF AMERICA, INC., a
New York corporation, PRO UNLIMITED, INC., a New York corporation, TEMPORARY
HELP INDUSTRY SERVICING COMPANY, INC., a New York corporation, UNIFORCE MIS
SERVICES OF GEORGIA, INC., a Georgia corporation, and UNIFORCE STAFFING
SERVICES, INC., a New York corporation (collectively, "Original Borrowers" and
individually, each an "Original Borrower"), PROFESSIONAL STAFFING FUNDING &
SUPPORT, INC., a New York corporation ("PSF&S") (PSF&S and Original Borrowers
referred to herein collectively, as "Borrowers" and individually, each as a
"Borrower"), UNIFORCE SERVICES, INC., a New York corporation ("Holdings"),
HELLER FINANCIAL, INC., a Delaware corporation (in its individual capacity,
"Heller"), for itself, as Lender, and as Agent for Lenders ("Agent"), and UNITED
JERSEY BANK, a New Jersey banking corporation, as a Lender ("UJB").
RECITALS
WHEREAS, Original Borrowers, Holdings, Heller and Agent are
parties to that certain Loan and Security Agreement dated as of December 8, 1995
(as from time to time amended, restated, supplemented or otherwise modified, the
"Loan Agreement"; capitalized terms used but not otherwise defined herein having
the definitions provided therefor in the Loan Agreement) and various other Loan
Documents;
WHEREAS, UJB and Heller have entered into that certain Lender
Addition Agreement of even date herewith, pursuant to which UJB will become a
Lender under the Loan Agreement concurrently with the effectiveness hereof; and
WHEREAS, the parties hereto desire to amend the Loan Agreement
and the Loan Documents to include PSF&S as a Borrower thereunder and as
otherwise herein set forth.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter contained, and for other good and valuable
consideration, the parties hereto agree as follows:
1. LIMITED CONSENT.
(a) Notwithstanding the provisions of SUBSECTIONS 7.1 and 7.2 of
the Loan Agreement, the Agent hereby consents to the incurrence by Holdings of
its obligations under (1) the Lease Guaranty dated as of October 25, 1995 by
Holdings in favor of PeopleSoft Credit Corporation and (2) the Guaranty dated as
of February 28, 1996 by Holdings in favor of Siemens Credit
Corporation, as each such document is in effect on such date without giving
effect to any amendment or other modification thereto; and
(b) Notwithstanding the provisions of SUBSECTION 7.5 of the Loan
Agreement, the Agent hereby consents to the purchase, on or prior to April 30,
1996, by Holdings from Vince Brannon and Steven Tully of 13,794 shares in the
aggregate for an amount not to exceed $165,000 in the aggregate, together with
all costs, fees and expenses relating thereto.
2. AMENDMENT TO THE LOAN AGREEMENT AND OTHER LOAN DOCUMENTS. Subject to
the terms and conditions set forth in SECTION 5 of this Amendment, the Loan
Agreement and the other Loan Documents identified below are hereby amended as
follows:
(a) The definition of "Borrowers" contained in the preamble to the
Loan Agreement is hereby amended to include PSF&S therein. In addition, each
reference to "Borrowers" contained in any Loan Document are hereby deemed to
include PSF&S therein.
(b) The definition of "Inactive Subsidiary" contained in
SUBSECTION 1.1 of the Loan Agreement is hereby amended to exclude the reference
to PSF&S.
(c) The following text is inserted as the final text of the first
sentence of SUBSECTION 6.4 of the Loan Agreement:
"other than Fiscal Year 1996 and will not exceed $1,900,000
for Fiscal Year 1996"
(d) The Form of Borrowing Base Certificate contained in EXHIBIT
1.1(A) of the Loan Agreement is hereby amended such that each Borrowing Base
Certificate delivered to Agent from and after the date of this Amendment shall
include a reference to PSF&S as a Borrower where applicable therein.
(e) The Form of Compliance Certificate in EXHIBIT 1.1(B) of the
Loan Agreement is hereby amended to include a reference to PSF&S as a Borrower
where applicable therein.
(f) Upon the effectiveness of this Amendment each reference to
PSF&S as a "Guarantor" in the Loan Documents is hereby deleted.
(g) Upon the effectiveness of this Amendment each reference to
PSF&S as a "Grantor" in the Loan Documents is hereby deleted.
(h) PSF&S shall be deemed to have acted in its capacity as a
Borrower, rather than as a "Grantor", in appointing Olshan Grundman Frome &
Rosenzweig LLP ("OGF&R") as its agent to receive service of process in New York
pursuant to the letter dated the Closing Date between PSF&S and OGF&R.
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3. NO WAIVER OF PAST DEFAULTS. Nothing contained herein shall be deemed to
constitute a waiver of any Default or Event of Default that may heretofore or
hereafter occur or have occurred and be continuing or, except as expressly
provided herein, to modify any provision of the Loan Agreement.
4. REPRESENTATIONS AND WARRANTIES. Holdings and Borrowers jointly and
severally represent and warrant to Agent and Lenders that the execution,
delivery and performance by Holdings and each Borrower of this Amendment and the
related Loan Documents are within each such Person's corporate powers, have been
duly authorized by all necessary corporate action (including, without
limitation, all necessary shareholder approval) of each such Person, have
received all necessary governmental approvals, and do not and will not
contravene or conflict with any provision of law applicable to any such Person,
the certificate or articles of incorporation or bylaws of any such Person, or
any order, judgment or decree of any court or other agency of government or any
contractual obligation binding upon any such Person; and this Amendment, the
Loan Agreement and each Loan Document, each as amended hereby, is the legal,
valid and binding obligation of Holdings and each Borrower, as applicable,
enforceable against each such Person in accordance with its terms.
5. CONDITIONS. The effectiveness of the amendments stated in this
Amendment is subject to the following conditions precedent or concurrent:
(a) AMENDMENT. This Amendment shall have been duly executed by all
parties hereto and delivered to Agent.
(b) LENDER ADDITION AGREEMENT. The Lender Addition Agreement of
even date herewith between Heller and UJB shall have been duly executed and
delivered to Agent.
(c) FIRST AMENDED TERM NOTES. The First Amended Term Notes of even
date herewith shall have been duly executed and delivered by Borrowers to Agent.
Upon Agent's receipt of such Notes, the Term Note made as of December 8, 1995 in
favor of Heller shall be returned to Borrower Representative with reasonable
promptness.
(d) FIRST AMENDED REVOLVING NOTES. The First Amended Revolving
Notes of even date herewith shall have been duly executed and delivered by
Borrowers to Agent. Upon Agent's receipt of such Notes, the Revolving Notes made
as of December 8, 1995 in favor of Heller shall be returned to Borrower
Representative with reasonable promptness.
(e) NO DEFAULT. No Default or Event of Default under the Loan
Agreement, as amended hereby, shall have occurred and be continuing.
(f) WARRANTIES AND REPRESENTATIONS. The warranties and
representations of Holdings and each Borrower contained in this Amendment, the
Loan Agreement, as amended hereby, and the other Loan Documents shall be true
and correct as of the effective date hereof, with the same effect as though made
on such date, except to the extent that such warranties and representations
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expressly relate to an earlier date, in which case such warranties and
representations shall have been true and correct as of such earlier date.
(g) LEGAL OPINION. A legal opinion of counsel for PSF&S, in
substantially the form delivered by counsel for the original Borrowers on the
Closing Date, shall have been duly executed and delivered to Agent.
(h) SECRETARY'S CERTIFICATE. A Secretary's Certificate of PSF&S
shall have been duly executed and delivered to Agent certifying that (i) there
have been no amendments or other modifications to the certificate of
incorporation or bylaws of PSF&S since the Closing Date, (ii) PFS&S is in good
standing in its state of incorporation, the state in which the principal place
of business of PSF&S is located and all states in which its activities require
it to be qualified and/or licensed to do business, (iii) attached are
resolutions of the PSF&S Board of Directors authorizing and approving the
execution, delivery and performance of the Loan Documents by PSF&S as a Borrower
and (iv) the persons named on such certificate are the duly elected and
qualified officers of PSF&S holding the offices set forth opposite their
respective names, and that the signatures set forth opposite their respective
names are their genuine signatures.
6. MISCELLANEOUS.
(a) CAPTIONS. Section captions used in this Amendment are for
convenience only, and shall not affect the construction of this Amendment.
(b) GOVERNING LAW. THIS AMENDMENT SHALL BE A CONTRACT MADE UNDER
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES. Whenever possible each provision of this Amendment shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Amendment shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Amendment.
(c) COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
(d) SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon,
and shall inure to the sole benefit of, Borrowers, Holdings, Agent and Lenders,
and their respective successors and assigns.
(e) REFERENCES. Any reference to the Loan Agreement contained in
any notice, request, certificate, or other document executed concurrently with
or after the execution and delivery of this Amendment shall be deemed to include
this Amendment unless the context shall otherwise require.
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(f) CONTINUED EFFECTIVENESS. Notwithstanding anything contained
herein, the terms of this Amendment are not intended to and do not serve to
effect a novation as to the Loan Agreement; instead, it is the express intention
of the parties hereto to reaffirm the Indebtedness created under the Loan
Agreement which is evidenced by the Notes and secured by the Collateral. The
Loan Agreement, as amended hereby, and each of the other Loan Documents shall
remain in full force and effect.
(g) COSTS, EXPENSES AND INDEMNITY. Borrowers affirm and
acknowledge that SECTION 10.1 and SECTION 10.2 of the Loan Agreement apply to
this Amendment and the transactions and agreements and documents contemplated
hereunder.
[signature page follows]
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IN WITNESS WHEREOF, this First Amendment to Loan and Security Agreement
has been duly executed and delivered as of the day and year first above written.
COMPUTER CONSULTANTS
FUNDING & SUPPORT, INC.
LABFORCE OF AMERICA, INC.
PRO UNLIMITED, INC.
PROFESSIONAL STAFFING
FUNDING & SUPPORT, INC.
TEMPORARY HELP INDUSTRY
SERVICING COMPANY, INC.
UNIFORCE MIS SERVICES OF GEORGIA,
INC.
UNIFORCE STAFFING SERVICES, INC.
For each of the foregoing:
By: /s/ HARRY MACCARRONE
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Title: Vice President - Finance
BRENTWOOD SERVICE GROUP, INC.
By: /s/ HARRY MACCARRONE
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Title: President
HELLER FINANCIAL, INC.,
as Agent and a Lender
By: /s/ SHYAM AMLADI
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Title: Senior Vice President
UNITED JERSEY BANK,
as a Lender
By: /s/ ROBERT MUNNS
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Title: Vice President