CROSSROADS CAPITAL PARTNERS LLC
1600 DOVE STREET, SUITE 300
NEWPORT BEACH, CA 92660
June 30, 1999
PRIVATE AND CONFIDENTIAL
- - ------------------------
Mr. Paul M. Burrell
President, Chief Executive Officer, and Chairman
OutSource International, Inc.
1144 East Newport Center Drive
Deerfield Beach, FL 33442
Re: Finder Services Agreement
Dear Paul:
This letter agreement sets forth the finder services to be provided by
Crossroads Capital Partners LLC ("Crossroads") to OutSource International, Inc.
(the "Company").
1. Engagement of Crossroads. The Company hereby engages Crossroads to act
as a finder for financing transactions involving the Company and
certain lenders or investors (the "Transaction"). These lenders and
investors are set forth on Exhibit A hereto. Crossroads shall act on an
exclusive basis with respect to the lenders and investors set forth on
Exhibit A, as amended from time to time. Crossroads and the Company
agree that Exhibit A may be amended from time to time by mutual
agreement as additional financing sources are identified by Crossroads.
In its capacity as finder, Crossroads agrees to assist the Company in
attempting to secure the necessary financing and investment to complete
a successful Transaction. The Company acknowledges and agrees that
Crossroads is acting solely as a finder and that this engagement does
not constitute an agreement by Crossroads or any of its affiliates to
participate in providing any financing to the Company.
2. Transaction Fees and Expenses. The Company agrees to pay to Crossroads
at closing of any Transaction a transaction fee (a "Transaction Fee")
equal to the sum of (i) One Percent of any senior secured debt
financing amounts (for a Transaction Fee of not less than $150,000),
plus (ii) Four Percent of any subordinated or unsecured debt or equity
investments (for a Transaction Fee of not less than $300,000).
Direct out-of-pocket expenses incurred by Crossroads shall be separate
and apart from the retainer and Transaction Fees and shall be payable
on a monthly basis by the Company upon presentation of properly
documented invoices.
3. Disclosure. In connection with its engagement hereunder, Crossroads
will assist the Company in its collection and dissemination of
necessary documents to be used in connection with the anticipated
Transaction. The Company agrees to furnish Crossroads with all
financial and other information concerning the Company and related
matters (the "Information") which Crossroads may reasonably request or
require for the timely completion of a Transaction. The Company
represents that (i) all Information provided to Crossroads will be
complete and correct in all material respects and will not include an
untrue statement of material fact or omit to state a material fact
necessary in order to make the statement made in the Information not
misleading, (ii) all historical financial data provided to Crossroads
will be prepared and presented in accordance with generally accepted
accounting principals (GAAP) then in effect in the United States and
will fairly present the financial condition and operations of the
Company, and (iii) any projections, financial or otherwise, provided to
Crossroads will be prepared in good faith with a reasonable basis for
assumptions and the conclusions reached therein and on a basis
consistent with the Company's historical financial data. The Company
will promptly notify Crossroads of any material adverse change, or any
development that may lead to any material adverse change, in the
business, operations, financial condition or prospects of the Company,
or concerning any statement contained in the Information or any
historical financial data provided to Crossroads which is not accurate
or which is incomplete or misleading in any material respect. The
Company acknowledges that Crossroads may rely, without independent
verification, upon the accuracy and completeness of the Information and
that Crossroads does not assume any responsibility therefor. The
Company acknowledges and consents that Crossroads may share the
Information with prospective lenders and investors who agree to be
bound by the Confidentiality provisions as described in Section 4,
below.
4. Confidentiality. Crossroads agrees to use all non-public Information
provided to it by or on behalf of the Company solely for the purpose of
locating sources for a Transaction and to treat all such information
confidentially; provided, however, that nothing herein shall prevent
Crossroads from disclosing any Information (i) to financing sources,
who agree to treat it confidentially, (ii) pursuant to the order of any
court or administrative agency or in any pending legal or
administrative proceeding, (iii) upon the request or demand of any
regulatory authority having jurisdiction over Crossroads, (iv) to the
extent that the Information is or becomes publicly available other than
by reason of Crossroads' disclosure, and (v) to Crossroads employees,
officers, directors, independent contractors, legal counsel, or other
agents or affiliates who need to know the Information and are informed
of the confidential nature of such Information. Crossroads shall
promptly advise the Company of any judicial or administrative action
seeking the disclosure of the Information and shall cooperate with the
Company in approving such disclosure or seeking a protective order.
5. Warranties and Indemnification. Crossroads neither expresses nor
implies any warranties of its efforts to complete a Transaction.
Crossroads has not offered any assurances that its efforts to complete
a Transaction can or will be successful.
Crossroads shall not be subject to any liability to the Company for any
act or omission relating to, in connection with or arising out of
services rendered hereunder, unless Crossroads' acts or omissions
constitute malfeasance, gross negligence or the reckless disregard of
Crossroads' obligations or duties hereunder. In furtherance of the
foregoing, the Company agrees and covenants that it will not initiate
any legal or administrative proceedings whatsoever against Crossroads
relating to, in connection with or arising from the services rendered
hereunder seeking more than the amount of the Transaction Fees actually
paid to Crossroads. The Company releases, indemnifies and holds
Crossroads harmless from and against any losses, claims, damages or
liabilities ("Losses") to which Crossroads may become subject and shall
reimburse Crossroads for any legal or other expenses (including the
cost of any investigations and the hiring of any accountant or other
experts) reasonably incurred by Crossroads relating to, in connection
with or arising from the services rendered hereunder (including,
without limitation, any Losses related to the Information provided to
Crossroads by the Company), whether or not resulting in any liability,
unless such Losses resulted in whole or in part from Crossroads'
malfeasance, gross negligence or the reckless disregard of its
obligations or duties hereunder.
6. Termination and Survival. The Company or Crossroads may terminate this
letter agreement at any time upon giving 30 days prior written notice
to the other party; provided, however, that the provisions of Sections
2, 4 and 5 of this letter agreement will all survive any termination or
expiration of this letter agreement.
Furthermore, the Company agrees that if within 24 months after
termination of this letter agreement for any reason, it completes any
Transaction with any of the lenders and investors set forth on Exhibit
A (as amended), the Company shall pay to Crossroads an amount equal to
the respective Transaction Fees specified in Section 2.
Notwithstanding anything herein stated to the contrary, it is
understood and agreed that should the Company enter into an agreement
with Robert W. Baird & Co. Incorporated ("Baird") within ninety (90)
days of the date hereof, pursuant to which agreement Baird will assist
the Company in obtaining subordinated debt financing, then (a) this
letter agreement shall thereupon terminate pursuant to Section G, and
(b) the parties will enter into a new arrangement on mutually
acceptable terms.
7. Inspection of Books and Records. The Company agrees that Crossroads and
its agents shall have the right, upon not less than ten business days'
prior written notice, to inspect, audit and copy, at Crossroads' cost,
all of the Company's books and records relative to calculation of the
Transaction Fee. If the inspection shall reveal that the Transaction
Fee was underpaid, then the Company shall forthwith pay the full amount
of the underpayment to Crossroads. If the inspection shall reveal that
the Transaction Fee was overpaid, then Crossroads shall forthwith pay
the full amount of the overpayment to the Company. If the inspection
shall reveal that the Transaction Fee has been underpaid by more than
10%, the Company agrees to pay the full cost of the inspection and
audit of its books and records, together with interest on the amount of
the underpayment from the date the Transaction Fee was due at the prime
or reference rate established by Bank of America, N.A. from time to
time during such period.
8. Amounts Not Paid. All amounts not paid when due will bear interest at
an annual rate of 12% or the maximum rate allowed by law, whichever is
greater.
9. Announcements. The Company agrees that, upon completion of any
financing Transaction contemplated hereby, Crossroads shall have the
right to place advertising notices or announcements in financial and
other newspapers or journals, all at Crossroads' own expense,
describing Crossroads services to the Company. Crossroads will submit a
copy of any such announcement or notice to the Company for its prompt
review and approval prior to placing any such announcement or notices.
10. Governing Law and Jurisdiction. This letter agreement shall be governed
by and construed in accordance with the laws of the State of
California, without giving effect to the conflicts of laws principles
thereof.
11. Agreement to Mediate / Arbitrate. The parties agree to mediate any
dispute or claim arising out of or related to this letter agreement or
any resulting Transaction before resorting to arbitration or court
action. Mediation is a process by which parties attempt to resolve a
dispute or claim by submitting it to an impartial, neutral mediator,
who is authorized to facilitate the resolution of the dispute, but who
is not empowered to impose a settlement on the parties. Mediation fees,
if any, shall be divided equally among the parties involved. Evidence
of anything said, any admission made, and any documents prepared, in
the course of the mediation, shall not be admissible in evidence, or
subject to discovery in any arbitration or court action. If either
party commences an arbitration or court action based on a dispute or
claim to which this paragraph applies without first attempting to
resolve the matter through mediation, then in the discretion of the
arbitrator(s) or judge, that party shall not be entitled to recover
attorneys' fees, even if they would otherwise be available to that
party in any such arbitration or court action. The parties agree that
any dispute or claim in law or equity arising out of or related to this
letter agreement, which is not settled through mediation, shall be
decided by neutral, binding arbitration and not by court action, except
as provided by law for judicial review of arbitration proceedings. The
arbitration shall be conducted in accordance with the rules of the
American Arbitration Association. Judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction
thereof. Each party in any arbitration shall be responsible for its own
attorneys' fees and costs. Notwithstanding any of the above, the
Company may seek injunctive relief in a court of law without first
having to mediate or arbitrate to enforce the confidentiality
provisions of this letter agreement.
12 Entire Agreement. This letter agreement shall constitute the entire
agreement between the parties. This letter agreement may be executed
via facsimile transmission, and may be executed in separate
counterparts, each of which shall be deemed to be an original, all of
which together shall constitute a single instrument. This letter
agreement may not be amended, modified, supplemented or waived, except
in writing. No waiver of any provision of this letter agreement shall
be deemed or shall constitute a waiver of any other provision, nor
shall such waiver constitute a continuing waiver.
If the foregoing correctly sets forth the understanding and agreement
between Crossroads and the Company, please sign in the space indicated
below.
CROSSROADS CAPITAL PARTNERS LLC
By: /S/ Mark D. Barbeau
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Mark D. Barbeau, Principal
AGREED AND ACCEPTED:
OUTSOURCE INTERNATIONAL, INC.
By: /S/ Paul M. Burrell
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Paul M. Burrell, President, Chief Executive
Officer, and Chairman
Date:
Exhibit A
Updated
. Allied Capital
2. Antares Leveraged Capital Corp.
3. DDJ Capital Management
4. IBJ Whitehall
5. Imperial Capital
6. ING Capital
7. Levine Leichtman Capital Partners
8. Mellon Ventures
9. Oaktree Capital Management
10. Pacific Mezzanine Investors
11. Rice Sangales Toole & Wilson
12. TCW/Crescent Mezzanine
13. William Blair Mezzanine Capital Partners
14. PNC Equity Mgmt Group
15. Lincoln Investment
16. Foothill Capital (Paragon)
17. Hampshire Capital
18. Bonderman - Hallifax
Exhibit A is amended to mean the above parties and their investment affiliates.