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EXHIBIT 10.16.1
SEVENTH AMENDMENT TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT AND NOTE
BY AND BETWEEN
SUMMIT BANK, FORMERLY UNITED JERSEY BANK
AND
DIGITAL SOLUTIONS, INC.
AND ITS SUBSIDIARIES
DATED: AS OF OCTOBER 31, 1997
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SEVENTH AMENDMENT TO AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT AND NOTE
THIS SEVENTH AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT AND NOTE (this "Amendment") is made as of October 31, 1997,
BY AND
AMONG SUMMIT BANK, formerly UNITED JERSEY BANK, a New Jersey
banking corporation having a place of business at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ("UJB" or the "Bank"),
AND DIGITAL SOLUTIONS, INC., a New Jersey corporation, having
its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, (together with its successors
and assigns, hereafter referred to as "DIGITAL");
DSI STAFF CONNXIONS OF MISSISSIPPI, INC., a Mississippi
corporation, having its principal place of business at ▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (together
with its successors and assigns, hereafter referred to as
"DSI-MISSISSIPPI");
DSI STAFF CONNXIONS-SOUTHWEST, INC., a Texas corporation,
having its principal place of business at ▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, (together with its
successors and assigns, hereafter referred to as
"DSI-SOUTHWEST");
RAM TECHNICAL SERVICES, INC., a Texas corporation, having
its principal place of business at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, (together with its
successors and assigns, hereafter referred to as "RAM");
MLB MEDICAL STAFFING, INC., a Texas corporation, having its
principal place of business at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, (together with its successors
and assigns, hereafter referred to as "MLB");
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DIGITAL INSURANCE SERVICES, INC., a New Jersey corporation,
having its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, (together with its successors
and assigns, hereafter referred to as "DIGITAL INSURANCE");
STAFF CONNXIONS, INC., a New Jersey corporation, having its
principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, (together with its successors and
assigns, hereafter referred to as "STAFF CONNXIONS");
DSI-CONTRACT STAFFING, INC., a New Jersey corporation,
having its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, (together with its successors
and assigns, hereafter referred to as "DSI-CONTRACT");
DSI STAFF RX, INC., a Texas corporation, having its
principal place of business at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, (together with its successors
and assigns, hereafter referred to as "STAFF RX"); and
DSI STAFF CONNXIONS NORTHEAST, INC., a New Jersey
corporation, having its principal place of business at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, (together with
its successors and assigns, hereafter referred to as "DSI
NORTHEAST");
The corporations listed above (except the Bank) shall hereinafter be
collectively referred to as the "Co-Borrowers".
RECITALS
A. Co-Borrowers and the Bank are parties to a certain Amended and
Restated Loan and Security Agreement, dated as of February 27, 1995 (as amended,
restated or modified up to the date hereof, the "Loan Agreement"). Capitalized
terms used herein and not defined shall have the meanings ascribed to them
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in the Loan Agreement.
B. Pursuant to the terms of the Loan Agreement, the Bank made to the
Co-Borrowers a certain revolving loan in the original principal amount of up to
$3,500,000, as evidenced by a certain letter of credit in the present amount of
$455,301.00 and a note in the present principal amount of $2,657,030.00 (as
modified, increased or extended, the "Loan").
C. To evidence the Loan, Co-Borrowers executed and delivered to the
Bank the Replacement Line of Credit Note, dated as of February 27, 1995, (the
"Note") in the original principal amount of up to $3,500,000.
D. As security for the repayment of the "Obligations" (as that term
is defined in the Loan Agreement), the Co-Borrowers executed and delivered
certain UCC-1 Financing Statements (the "UCC-1's) in favor of the Bank, which
UCC-1's were recorded in the appropriate county and state offices and which
UCC-1's were represented by Co-Borrowers to constitute valid and legally binding
priority security interests in and to the "Collateral" (as that term is defined
in the Loan Agreement).
E. At times and from time to time, the Bank and the Co-Borrowers have
amended the Loan Agreement, and the other documents executed in connection
therewith.
F. Pursuant to the terms of a certain amendment to the Amended and
Restated Loan and Security Agreement, dated as of September 29, 1995, the Bank
and the Co-Borrowers modified the terms of the Loan Agreement to include a
covenant that the Co-Borrowers shall maintain a ratio of total maximum
liabilities less subordinated debt to net worth plus subordinated debt of not
greater than 0.90 to 1.0 and to amend the definition of "Tangible Capital Funds"
(as that term is defined in the Loan Agreement).
G. Pursuant to the terms of a certain second amendment to the Amended
and Restated Loan and Security Agreement, dated as of April 29, 1996, the Bank
and the Co-Borrowers modified the terms of the Loan Agreement to (i) extend the
maturity date of the Loan Agreement and Note; (ii) confirm all security
interests heretofore granted by the Co-Borrowers to the Bank; (iii) add to or
revise certain covenants in the Loan Agreement; (iv) add to or
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revise certain terms and conditions of the Loan; (v) fix the amount of the
existing Letter of Credit at $455,301.00; (vi) reduce the accounts receivables
advance rate of the Loan to seventy-five percent (75%); (vii) require the
payment by Co-Borrowers under the Loan of a principal reduction in the minimum
amount of $1.1 million on or before May 30, 1996; and (viii) waive the
applicability of a certain financial covenant of Co-Borrowers under the Loan
Agreement to maintain minimum "Tangible Capital Funds" (as that term is defined
in the Loan Agreement) of $3,395,000.00 for the Fiscal Quarters commencing
10/1/95 through 3/31/96.
H. To evidence the above, Co-Borrowers executed and delivered to the
Bank the Amended Replacement Line of Credit Note, dated as of April 29, 1996, in
the original principal amount of up to $3,500,000.
I. Pursuant to the terms of a certain third amendment to the Amended
and Restated Loan and Security Agreement, dated as of August 31, 1996, the Bank
and the Co-Borrowers modified the terms of the Loan Agreement to extend the
maturity date of the Loan Agreement and Note, as amended, to October 31, 1996.
J. To evidence the above, Co-Borrowers executed and delivered to the
Bank the Second Amended Replacement Line of Credit Note, dated as of August 31,
1996, in the original principal amount of up to $3,500,000.
K. Pursuant to the terms of a certain fourth amendment to the Amended
and Restated Loan and Security Agreement, dated as of October 31, 1996, the Bank
and the Co-Borrowers modified the terms of the Loan Agreement to: (i) extend the
maturity date to December 31, 1996; (ii) increase the interest rate of the Loan
from one and one-half (1.5%) percent above the Bank's Floating Base Rate to two
and one-half (2.5%) percent above the Bank's Floating Base Rate; and (iii) alter
certain other provisions of the Loan Documents as more particularly set forth
therein.
L. To evidence the above, Co-Borrowers executed and delivered to the
Bank the Third Amended Replacement Line of Credit Note, dated as of October 31,
1996, in the original principal amount of up to $3,500,000.
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M. Pursuant to the terms of a certain fifth amendment to the Amended
and Restated Loan and Security Agreement, dated as of December 31, 1996, the
Bank and the Co-Borrowers modified the terms of the Loan Agreement to: (i)
extend the maturity dates of the Loan Agreement and Note to April 30, 1997; (ii)
provide for the payment of weekly principal reductions and a term-out of the
Loan; and (iii) alter certain other provisions of the Loan Documents as more
particularly set forth therein.
N. To evidence the above, Co-Borrowers executed and delivered to the
Bank the Fourth Amended Replacement Line of Credit Note, dated as of December
31, 1996, in the original principal amount of up to $3,500,000.
O. Pursuant to the terms of a certain sixth amendment to the Amended
and Restated Loan and Security Agreement, dated as of April 30, 1997, the Bank
and the Co-Borrowers modified the terms of the Loan Agreement to: (i) extend the
maturity dates of the Loan Agreement and Note to October 31, 1997; (ii) provide
for an audit of the Co-Borrowers; (iii) continue weekly principal reductions and
a term-out of the Loan; (iv) increase the interest rate of the Loan from two and
one-half (2.5%) percent above the Bank's Floating Base Rate to three (3.0%)
percent above the Bank's Floating Base Rate; and (v) alter certain other
provisions of the Loan Documents as more particularly set forth therein.
P. To evidence the above, Co-Borrowers executed and delivered to the
Bank the Fifth Amended Replacement Line of Credit Note, dated as of April 30,
1997, in the original principal amount of up to $3,500,000.
Q. The Fifth Amended Note and the Sixth Amended and Restated Loan
Agreement matured on October 31, 1997. The Co-Borrowers agree, admit and
acknowledge that the Fifth Amended Note and the Sixth Amended and Restated Loan
Agreement have matured and that they have no defense, counterclaim, offset or
right of recoupment to the aforesaid maturity. Notwithstanding the above, the
Co-Borrowers are attempting to repay the Loan and otherwise meet their
obligations under the Fifth Amended Note and the Sixth Amended and Restated Loan
Agreement. The Co-Borrowers have asked the Bank to temporarily forbear from the
exercise of any rights and remedies under the Fifth Amended Note and the Sixth
Amended and Restated Loan Agreement and the Bank has agreed
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subject to the terms and conditions of this Agreement.
R. This Amendment is intended to alter certain terms of the Loan
Agreement and Note in order to: (i) extend the maturity dates of the Loan
Agreement and Note to October 31, 1998; (ii) provide for an infusion capital of
$250,000.00 by the Co-Borrowers; (iii) continue weekly principal reductions and
a term-out of the Loan; (iv) continue interest at the rate of three (3.0%)
percent above the Bank's Floating Base Rate; (v) provide for the grant to Bank
of certain warrants to purchase stock of the Co-Borrowers; and (vi) alter
certain other provisions of the Loan Documents as more particularly set forth
herein.
S. The Bank and the Co-Borrowers have agreed to execute this
Amendment and to enter into the transactions, and execute and deliver the
documents provided for herein, all on and subject to the terms hereof.
NOW, THEREFORE, IN CONSIDERATION OF THE LOAN, THE NOTE, THE LOAN
AGREEMENT AND THE OTHER MUTUAL PROMISES SET FORTH HEREIN, THE BANK AND THE
CO-BORROWERS DO HEREBY AGREE AS FOLLOWS:
1. INCORPORATION OF RECITALS: The Recitals set forth above are hereby
incorporated by reference in the Loan Agreement and this Amendment.
2. AMENDMENTS TO LOAN AGREEMENT AND NOTE:
(a) The Bank and the Co-Borrowers hereby agree that as of October 31,
1997, the outstanding principal balance of the Note is Two Million, Six Hundred
Thirty-Seven Thousand, Thirty Dollars and 00/100 Dollars ($2,657,030.00), plus
interest and the outstanding principal balance of the Letter of Credit is Four
Hundred Fifty-Five Thousand, Three Hundred and One Dollars and No Cents
($455,301.00), plus interest, if any, and that the Co-Borrowers admit and
acknowledge that these sums are due and owing to the Bank in full, without
defense, counterclaim, offset and right of recoupment and that Co-Borrowers
hereby irrevocably waive any right to raise such defense, offset, counterclaim
and right of recoupment.
(b) The maturity dates of the Loan Agreement and the Note, as each of
the same have been previously amended and modified and
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are modified hereby, are hereby extended to October 31, 1998. There shall be no
further extensions of the Loan Documents.
(c) The definition of "Note" contained in Article I, Section 1.1,
subparagraph 26 of the Loan Agreement shall mean the Sixth Amended
Replacement/Term Line of Credit Note attached hereto as Exhibit "A" and made a
part hereof.
(d) Article I, Section 1.1 of the Loan Agreement is amended to
include as a defined term "Maturity Date." The definition of "Maturity Date"
shall be October 31, 1998.
(e) Article II, Section 2.1, subparagraphs A-H of the Loan Agreement
is amended to reflect the new "Maturity Date" of October 31, 1998 in the place
and stead of October 31, 1997.
(f) Article V of the Loan Agreement is amended to reflect that the
Co-Borrowers are required to pay the amounts due and owing under the Note, as
amended herewith, in full on or before October 31, 1998. It is also be amended
to reflect that commencing on November 1, 1997, and on a weekly basis thereafter
until maturity, Co-Borrowers are required to make principal payments in the
amount of $10,000. Such payments shall be made by way of an automatic charge by
the Bank to the DDA account of Co-Borrowers, number 967703980. Any and all
principal payments shall not be reborrowed by Co-Borrowers. All principal and
accrued interest shall be paid in full on the Maturity Date.
(g) Article VII, Section 7.3 of the Loan Agreement is amended to
reflect that the Co-Borrowers individually, jointly and severally covenant and
agree that, from the date hereof until payment in full of the principal of and
interest on the Sixth Amended Replacement/Term Line of Credit Note, they shall
provide to the Bank:
1. Monthly management prepared financial statements;
2. Quarterly management prepared 10K and 10Q Securities and
Exchange Commission filings, together with all exhibits, addenda and attachments
thereto and materials and information filed therewith;
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3. Monthly Borrowing Base Certificates on the Bank's form.
Moreover, upon written request by the Bank, Co-Borrowers shall provide a
detailed accounts receivable aging report setting forth the amount due and owing
on Receivables for the preceding week, together with a reconciliation report
reasonably satisfactory to the Bank showing all sales, collections, payments and
adjustments to receivables on their respective books as of the last business day
of the preceding week.
(h) On the date of the execution of this Amendment, the Co-Borrowers
shall execute and deliver to the Bank the Sixth Amended Replacement/Term Note in
the form attached hereto as Exhibit "A" and made a part hereof. All sums due and
owing under the Sixth Amended Replacement/Term Note shall be paid in accordance
with the terms of that Note and this Amendment.
(i) The Note shall bear interest at the fluctuating rate of three
percent (3.0%) in excess of the Bank's Floating Base Rate. All accrued and
unpaid interest shall be paid by Co-Borrowers in accordance with the terms of
the Note, i.e., beginning on November 1, 1997 and on the first day of each month
thereafter. All principal and accrued and unpaid interest shall be paid in full
on the earlier of an Event of Default (as defined in the Loan Agreement, as
amended) or on the Maturity Date.
(j) On the date of the execution of this Amendment, the Co-Borrowers
shall execute and deliver to the Bank Warrants to Purchase 500,000 shares of
Digital's stock in the form attached hereto as Exhibit "C" and made a part
hereof. The Exercise Price of the Warrants shall be $2.4375 per share. If
Co-Borrowers' obligations to the Bank hereunder are indefeasibly repaid in full
on or before April 30, 1998 and all commitments and letter of credit obligations
terminated on or before such date, all of the warrants shall expire. If the
Co-Borrowers' obligations hereunder to the Bank are not indefeasibly paid in
full and/or terminated on or before April 30, 1998 and all commitments and
letter of credit obligations terminated on or before such date, then 200,000
warrants shall immediately, and without further action, vest. If, thereafter,
the Co-Borrowers' obligations hereunder to the Bank are indefeasibly paid in
full on or before October 31, 1998 and all commitments and letter of credit
obligations terminated on or before such date, the remaining 300,000 warrants
shall expire. If, however, the Co-Borrowers'
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obligations hereunder are not indefeasibly paid in full and/or terminated on or
before October 31, 1998, the remaining 300,000 warrants shall vest. The warrants
shall be exercisable for a period of three years from May 1, 1998.
(k) On or before December 1, 1997, the Co-Borrowers shall obtain from
their shareholders an investment of equity or subordinated debt in the amount of
$250,000.00.
(l) Article X of the Loan Agreement is amended to reflect that upon
an Event of Default hereunder and/or as defined in the Loan Agreement, in
addition to all of the rights and remedies available to the Bank under the Loan
Agreement, all 500,000 Warrants discussed in subsection (j) above shall be
immediately vested.
(m) Article VII, Section 7.9 ("Financial Covenants"), as amended from
time to time, is deleted in its entirety.
3. REAFFIRMATION AND CONFIRMATION OF TERMS OF THE LOAN AGREEMENT, THE
AMENDED AND RESTATED LOAN AGREEMENT, THE SECOND AMENDED AND RESTATED LOAN
AGREEMENT, THE THIRD AMENDED AND RESTATED LOAN AGREEMENT, THE FOURTH AMENDED AND
RESTATED LOAN AGREEMENT, THE FIFTH AMENDED AND RESTATED LOAN AGREEMENT AND THE
SIXTH AMENDED AND RESTATED LOAN AGREEMENT: The Co-Borrowers hereby confirm and
reaffirm all unaltered by previous amendment or amendment hereof terms,
representations, interests, conditions and warranties contained in the Loan
Agreement, as amended, and the other Loan Documents (as that term is defined in
the Loan Agreement).
4. REAFFIRMATION OF NEGATIVE COVENANTS: The Co-Borrowers hereby
reaffirm the Negative Covenants contained in the Loan Agreement (Sections 8.1 -
8.12), as amended, and hereby agree to be bound by and to abide by the terms and
obligations contained therein, particularly that the provision that they shall
obtain Bank approval prior to undertaking any activities identified in Sections
8.1 - 8.12. Bank understands that Co-Borrowers have relocated their business.
Bank consents to the relocation of Co-Borrowers and to an increase in the
capitalized lease provisions of the Loan Documents up to the amount of $400,000.
Co-Borrowers affirm and represent that they will obtain from their Landlord a
subordination agreement as to Landlord's security interests under
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the lease. Co-Borrowers further affirm and represent that any security interest
of Landlord under the lease shall be and is subordinate to the priority security
interest of the Bank.
5. SIXTH AMENDED REPLACEMENT/TERM NOTE: The Loan, as modified and
amended pursuant to the terms of this Amendment, shall be evidenced by the Sixth
Amended Replacement/Term Note. The Sixth Amended Replacement Note replaces,
amends, restates, and continues (but does not constitute a repayment or novation
of) the Note. Amounts due and owing under the Note shall be deemed to be owing
under the Sixth Amended Replacement Note.
6. CONDITIONS PRECEDENT: As conditions precedent to the effectiveness
of this Amendment and the provisions set forth herein, the Bank shall have
received from the Co-Borrowers the following items, in form and substance
acceptable to the Bank and its counsel:
(a) This Amendment, duly executed by all parties hereto,
except for the certificates of good standing for the
companies as set forth in Exhibit "B" attached hereto,
which certificates shall be delivered as soon as is
reasonably practical, but in any event not later than
March 1, 1998;
(b) The Sixth Amended Replacement/Term Note, duly executed by
the Co-Borrowers;
(c) The Warrants to Purchase the Stock of the Co-Borrowers,
duly executed by the Co-Borrowers;
(d) A confirmation from the Co-Borrowers, dated the date of
this Amendment, stating that (i) the representations and
warranties contained in the Loan Agreement and the other
Loan Documents (as that term is defined in the Loan
Agreement) are correct as of the date of this Amendment;
(ii) no Event of Default or an event which with the
passage of time or the giving of notice or both would
constitute an Event of Default, has occurred or is
continuing; and (iii) none of the Co-Borrowers have any
defenses, offsets or claims against the Bank in connection
with the Loan, the Note, the Loan Agreement, the Loan
Documents (as that term is defined
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in the Loan Agreement) and their respective obligations to
the Bank under the Sixth Amended Replacement Note, this
Amendment and any other Loan Documents (as that term is
defined in the Loan Agreement). By executing this
Amendment, the Co-Borrowers hereby confirm the matters
described in this paragraph (c) and certify to the Bank
that the matters contained in this paragraph (c) are true
and correct on the date hereof;
(e) Certified copies of the resolutions of the Boards of
Directors of the Co-Borrowers approving this Amendment,
the Sixth Amended Replacement/Term Note and all documents
evidencing other necessary corporate action and
governmental approvals, if any, with respect to this
Amendment, the Sixth Amended Replacement/Term Note and any
documents incident hereto within three days of the date of
execution of the Amendment;
(f) Certificates of the Secretaries or Assistant Secretaries
of the Co-Borrowers certifying the names and true
signatures of the officers of the Co-Borrowers authorized
to sign this Amendment, the Sixth Amended Replacement/Term
Note and any documents incident hereto within thirty days
of the date of execution of this Amendment.
(g) On the date hereof, Co-Borrowers shall pay an extension
fee of $20,000.00. In addition, Co-Borrowers shall pay any
and all fees and expenses of counsel to the Bank incurred
in connection with the extension of the maturity of the
Loan Documents and any audit fees to date. These fees and
expenses shall be paid from the equity infusion referred
to in Section 2 above. However, the Co-Borrowers agree
that they will attempt to pay at least one half of the
attorney and auditor fees within seven(7) days of the
execution of this Amendment. In addition, during the term
of the extension, Co-Borrowers shall pay any and all costs
and fees incurred by the Bank in connection with the
Indebtedness in the Bank's sole and absolute discretion.
These fees shall include, but not be limited to,
additional attorney and/or auditor fees;
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(h) Receipt on or before December 18, 1997 of a certification
from Co-Borrowers' Chief Financial Officer that all
county, state and/or federal withholding taxes are current
and have been paid in full through the date of the
execution of this Amendment;
(i) Such other approvals, opinions of counsel or documents as
the Bank may reasonably request.
In the event that any of the above items are not received by the Bank
in accordance with time-frames set forth above, such failure shall constitute an
Event of Default as defined in Article X of the Loan Agreement and the Bank
shall have available to it all rights and remedies thereunder.
7. SECURITY INTERESTS: (a) The Co-Borrowers do hereby confirm the
security interests which they have granted to the Bank under the Loan Agreement,
as amended, and do hereby confirm and agree that the same continue to secure the
repayment and performance of all Obligations, including, without limitation,
under the Note, and the Loan Agreement, as amended, and the other Loan Documents
(as that term is defined in the Loan Agreement), as each of the same have been
amended and modified hereby.
(b) In addition to the foregoing, the Co-Borrowers do
hereby grant to the Bank a lien upon and a security interest in and to any and
all of their now owned or hereafter acquired assets (including, without
limitation, all Collateral), to secure the repayment and performance of all
Obligations, including, without limitation, under the Sixth Amended
Replacement/Term Line of Credit Note (the "Sixth Amended Replacement/Term
Note"), attached hereto as Exhibit "A" and made a part hereof, the Loan
Agreement, as amended, this Amendment and the other Loan Documents (as that term
is defined in the Loan Agreement), as each of the same have been amended and
modified hereby. Such lien and security interests shall be deemed to be "Liens"
for all purposes of the Loan Agreement and the other Loan Documents (as that
term is defined in the Loan Agreement).
8. REAFFIRMATION OF JOINT AND SEVERAL LIABILITY: Each of the
Co-Borrowers, jointly and severally, hereby agree and
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reaffirm their agreements to make full and prompt payment when due, and to
fully, promptly and unconditionally perform each and every term and condition of
all Obligations including all indebtedness of any Obligor arising in the future.
The Obligations are a primary obligation of each of the Co-Borrowers, regardless
of whether such Co-Borrowers receive the proceeds of any Loan under the Loan
Agreement, and shall continue without limitation of amount or duration until all
Obligations shall have been paid in full.
9. RELEASE: Effective on the date hereof, each of the Co-Borrowers
(collectively, the "Releasors") do hereby release, acquit, and forever discharge
the Bank and the Bank's subsidiaries, affiliates, officers, directors, agents,
employees, servants, attorneys, and representatives, as well as the respective
heirs, personal representatives, predecessors, successors, and assigns of any
and all of them (hereafter collectively called the "Released Lender Parties")
from any and all claims, demands, debts, actions, causes of action, suits,
contracts, agreements, obligations, accounts, defenses, offsets against all
amounts due and owing to the Bank and liabilities of any kind or character
whatsoever, known or unknown, suspected or unsuspected, in contract or in tort,
at law or in equity, including without implied limitations, such claims and
defenses as fraud, mistake, duress, and usury, which any of the Co-Borrowers
ever had, now has, or might hereafter have against any of the Released Lender
Parties, jointly or severally, for or by reason of any matter, cause, or thing
whatsoever occurring before and up to the date hereof, any including, without
limitation, and all claims, demands, debts, actions, causes of action, suits,
contracts, agreements, obligations, accounts, defenses, offsets including
arising in connection with: (a) the Loan; (b) the Loan Documents; or (c) any
Collateral. In addition, the Releasors agree not to commence, join in,
prosecute, or participate in any suit or other proceeding in a position that is
adverse to any of the Released Lender Parties arising directly or indirectly
from any of the foregoing matters. This Release shall bind the Releasors and
their respective heirs, personal representatives, successors and assigns, and
shall inure to the benefit of the Bank, its successors and assigns. The terms of
this Section 9 shall survive the execution and delivery of this Amendment and
the other Loan Documents (as that term is defined in the Loan Agreement).
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10. PUNITIVE DAMAGES: The Co-Borrowers hereby waive any rights that
they or it may have to claim or recover in any suit, action or proceeding
whatsoever any special, exemplary or punitive damages.
11. REPRESENTATION: The Co-Borrowers and the Bank hereby represent
and warrant to each other that it or he has been represented by counsel of his
or its choice in connection with its or his execution of (as applicable) this
Amendment, the Sixth Amended Replacement Note, and the other documents executed
in connection therewith, and his or its performance hereunder and thereunder.
12. THIRD PARTIES: This Amendment shall not be construed to create
any rights against the Bank in favor of any third parties.
13. MISCELLANEOUS:
(a) INCORPORATION BY REFERENCE. This Amendment is
incorporated by reference into the Loan Agreement, as amended, and the other
Loan Documents (as that term is defined in the Loan Agreement). Except as
otherwise provided herein, all other provisions of the Loan Agreement, as
amended, and the other Loan Documents (as that term is defined in the Loan
Agreement) are hereby affirmed and ratified and shall remain in full force and
effect as of the date of this Amendment.
(b) APPLICABLE LAW. This Amendment, the Loan Agreement, as
amended, and any other loan documents executed in connection herewith shall be
governed by and construed in accordance with the laws of the State of New
Jersey.
(c) JURISDICTION. In any litigation relating to any loan
document, including this Amendment, Co-Borrowers and each Obligor hereby consent
to the personal jurisdiction of the state and federal courts of the State of New
Jersey.
(d) SUCCESSORS AND ASSIGNS. All of the terms and conditions
contained herein, in the Loan Agreement, as amended, and in the other loan
documents executed and delivered in connection herewith, shall be for and shall
inure to the benefit
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16
of and shall bind the respective parties hereto and thereto and their respective
successors and assigns and heirs, personal representatives, administrators and
executors, as the case may be.
(e) SEVERABILITY. In the event any provision of this
Amendment or any other loan document executed and delivered in connection
herewith shall be held invalid or unenforceable by a court of competent
jurisdiction, such holdings shall not invalidate or render unenforceable any
other provision hereof or thereof.
14. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.
15. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO DOES HEREBY
WAIVE ANY RIGHT TO A JURY TRIAL IN CONNECTION WITH THIS AMENDMENT, THE LOAN
AGREEMENT, AS AMENDED, THE THIRD AMENDED REPLACEMENT NOTE, THE OTHER LOAN
DOCUMENTS AND DOES HEREBY ACKNOWLEDGE AND AGREE THAT HE OR IT HAS CONSULTED WITH
COUNSEL OF HIS OR ITS CHOICE IN CONNECTION WITH THE MATTERS DESCRIBED HEREIN AND
SPECIFICALLY AS TO THIS WAIVER OF JURY TRIAL.
IN WITNESS WHEREOF, this Seventh Amendment to the Amended
and Restated Loan and Security Agreement and Note has been executed as of the
date first written above.
ATTEST/WITNESS: DIGITAL SOLUTIONS, INC.,
a New Jersey Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
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ATTEST/WITNESS DSI STAFF CONNXIONS OF MISSISSIPPI,
INC., a Mississippi Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: DSI STAFF CONNXIONS-SOUTHWEST,
INC., a Texas Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: RAM TECHNICAL SERVICES, INC.,
a Texas Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: MLB MEDICAL STAFFING, INC.
a Texas Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
-17-
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-18-
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ATTEST/WITNESS: DIGITAL INSURANCE SERVICES, INC.,
a New Jersey Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: STAFF CONNXIONS, INC.,
a New Jersey Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: DSI-CONTRACT STAFFING, INC.,
a New Jersey Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST/WITNESS: DSI STAFF RX, INC.,
a Texas Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
-19-
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[SEAL]
-20-
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ATTEST/WITNESS: DSI STAFF CONNXIONS NORTHEAST, INC.,
a New Jersey Corporation
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
SUMMIT BANK, formerly UNITED JERSEY
BANK
a New Jersey Banking Corporation
By:________________________________
Name:______________________________
Title:_____________________________
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STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DIGITAL SOLUTIONS, INC., the corporation named in this
document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
____________________________________
NOTARY PUBLIC
-22-
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STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DIGITAL INSURANCE SERVICES, INC., the corporation
named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
__________________________________
NOTARY PUBLIC
-23-
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STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of STAFF CONNXIONS, INC., the corporation named in this
document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
__________________________________
NOTARY PUBLIC
-24-
25
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of MLB MEDICAL STAFFING, INC., the corporation named in
this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
________________________________
NOTARY PUBLIC
-25-
26
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DSI STAFF CONNXIONS-MISSISSIPPI, the corporation named
in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
____________________________
NOTARY PUBLIC
-26-
27
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DSI STAFF CONNXIONS-SOUTHWEST, the corporation named
in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
___________________________
NOTARY PUBLIC
-27-
28
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of RAM TECHNICAL SERVICES, INC., the corporation named in
this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
________________________________
NOTARY PUBLIC
-28-
29
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DSI-CONTACT STAFFING, INC., the corporation named in
this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
________________________________
NOTARY PUBLIC
-29-
30
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DSI STAFF RX, INC., the corporation named in this
document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-30-
31
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October , 1997, ______________________ personally
came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document as
______________________ of DSI STAFF CONNXIONS NORTHEAST, INC., the corporation
named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as its
voluntary act and deed by virtue of authority from its Board of Directors.
______________________________
NOTARY PUBLIC
-31-
32
EXHIBIT A
Sixth Amended Replacement/Term Note
-32-
33
EXHIBIT B
List of Companies/Good Standing Status
-33-
34
EXHIBIT C
Warrants to Bank for Purchase of Stock
-34-
35
EXHIBIT 10.16.1
SIXTH AMENDED PROMISSORY/TERM GRID NOTE
(THE "SIXTH AMENDED REPLACEMENT/TERM LINE OF CREDIT NOTE")
Up To $3,500,000.00 Dated as of: October 31, 1997
FOR VALUE RECEIVED, DIGITAL SOLUTIONS, INC., a corporation
duly organized and validly existing under the laws of the State of New Jersey,
having its principal office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
(together with its successors and assigns, hereinafter referred to as
"Digital"), DSI STAFF CONNXIONS OF MISSISSIPPI, INC., a corporation duly
organized and validly existing under the laws of the State of Mississippi,
having its principal office at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇ (together with its successors and assigns, hereinafter referred to as
"DSI-Mississippi"), DSI STAFF CONNXIONS-SOUTHWEST INC., a corporation duly
organized and validly existing under the laws of the State of Texas, having its
principal office at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(together with its successors and assigns, hereinafter referred to as
"DSI-Southwest"), RAM TECHNICAL SERVICES, INC., a corporation duly organized and
validly existing under the laws of the State of Texas, having its principal
office at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (together with its
successors and assigns, hereinafter referred to as "RAM"), MLB MEDICAL STAFFING,
INC., a corporation duly organized and validly existing under the laws of the
State of Texas having its principal office at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (together with its successors and assigns, hereinafter
referred to as "MLB"), DIGITAL INSURANCE SERVICES, INC., a corporation duly
organized and validly existing under the laws of the State of New Jersey, having
its principal office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (together
with its successors and assigns, hereinafter referred to as "Digital
Insurance"), STAFF CONNXIONS, INC., a corporation duly organized and validly
existing under the laws of the State of New Jersey, having its principal office
at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (together with its successors
and assigns, hereinafter referred to as "Staff Connxions"), DSI-CONTRACT
STAFFING, INC., a corporation duly organized and validly existing under the laws
of the State of New Jersey, having its principal office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (together
36
with its successors and assigns sometimes hereinafter referred to as
"Staffing"), DSI STAFF RX, INC., a corporation duly organized and validly
existing under the laws of the State of Texas, having its principal office at ▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (together with its successors
and assigns, hereinafter referred to as "Staff RX") and DSI STAFF CONNXIONS
NORTHEAST, INC., a corporation duly organized and validly existing under the
laws of the State of New Jersey, having its principal office at ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (together with its successors and assigns
sometimes hereinafter referred to as "DSI-Northeast") (Digital, DSI-Mississippi,
DSI-Southwest, Staffing, RAM, MLB, Digital Insurance, Staff Connxions, Staff RX
and DSI-Northeast are hereinafter referred to collectively as the
"Co-Borrowers"), hereby individually, jointly, severally and unconditionally
promise to pay to the order of SUMMIT BANK, formerly known as UNITED JERSEY
BANK, a banking corporation duly organized and validly existing under the laws
of the State of New Jersey, having its principal office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (together with its successors and assigns,
hereinafter the "Bank") on the earlier of (i) October 31, 1998, or the date of
an event of default (as such term is defined in the Amended and Restated Loan
and Security Agreement, dated as of February 27, 1995, as amended by the Second
Amendment to the Amended and Restated Loan and Security Agreement, the Third
Amendment to the Amended and Restated Loan and Security Agreement, the Fourth
Amendment to the Amended and Restated Loan and Security Agreement, the Fifth
Amendment to the Amended and Restated Loan and Security Agreement, the Sixth
Amendment to the Amended and Restated Loan and Security Agreement and the
Seventh Amendment to the Amended and Restated Loan and Security Agreement), the
sum of THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000.00), or, if less,
then the aggregate unpaid principal amount of all Advances made by the Bank to
the Co-Borrowers pursuant to Section 2.1 of the Amended and Restated Loan and
Security Agreement, as amended by the Second Amendment to the Amended and
Restated Loan and Security Agreement, the Third Amendment to the Amended and
Restated Loan and Security Agreement, the Fourth Amendment to the Amended and
Restated Loan and Security Agreement, the Fifth Amendment to the Amended and
Restated Loan and Security Agreement, the Sixth Amendment to the Amended and
Restated Loan and Security Agreement and the Seventh Amendment to the Amended
and Restated Loan and Security Agreement, in lawful money of the United States
of America, in
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37
immediately available funds, and to pay interest thereon at a fluctuating rate
equal to the sum of Three Percent (3.0%) in excess of the Bank's Floating Base
Rate.
Capitalized terms in this Sixth Amended Replacement Note
shall have the meanings ascribed to them in that certain amended and restated
loan and security agreement, dated as of February 27, 1995 (the "Loan
Agreement"), as amended by the Second Amendment to the Loan Agreement (the
"Amendment"), dated as of April 29, 1996, the Third Amendment to the Loan
Agreement (the "Second Amendment"), dated as of August 31, 1996, the Fourth
Amendment to the Loan Agreement (the "Third Amendment"), dated as of October 31,
1996, the Fifth Amendment to the Amended and Restated Loan and Security
Agreement (the "Fourth Amendment"), dated as of December 31, 1996, the Sixth
Amendment to the Amended and Restated Loan and Security Agreement (the "Fifth
Amendment"), dated April 30, 1997 and the Seventh Amendment to Loan and Security
Agreement dated even date, by and among the Bank and the Co-Borrowers, which are
hereby incorporated verbatim herein in their entireties and made a part hereof,
unless a different meaning clearly appears from the context hereof. This Sixth
Amended Replacement Note is the "Note" defined in and referred to in the Seventh
Amendment. This Sixth Amended Replacement Note substitutes for and is now the
"Note" dated as of February 27, 1995, as amended (the "Note") in the original
principal amount of up to $3,500,000.00, referred to in the Loan Agreement and
is subject to all its terms and conditions. This Sixth Amended Replacement Note
is not, and shall not be construed to be, a repayment or novation of the Note,
as amended. Any and all amounts due and owing under the Note, as amended, shall
be deemed to be owing hereunder. All accrued and unpaid interest under the Note,
as amended, shall be due and payable in full at the time that the first payment
of interest hereunder is due and payable.
Interest on the unpaid principal, at the rate described
hereinabove, shall accrue from the last date of the last payment of interest
through maturity. Interest only on the aggregate amount of the principal shall
be payable monthly, in arrears, on the first day each calendar month, commencing
November 1, 1997, and continuing thereafter on the first day of each succeeding
calendar month, through and including October 1, 1998. Thereafter, on October
31, 1998, or, if sooner, on the date of an event of default, all unpaid
principal and accrued and unpaid
-3-
38
interest hereon shall be due and payable in full. Interest hereon shall be
computed on the basis of the actual number of days elapsed over a year
consisting of 360 days.
Principal payments hereunder in the amount of $10,000 on a
weekly basis shall be due and payable commencing on November 1, 1997 and
continuing throughout until maturity. The principal payments due hereunder shall
be made by way of an automatic charge to the DDA account of Co-Borrowers,
bearing account number 967703980, located at the Bank. All principal sums repaid
hereunder shall not be reborrowed by Co-Borrowers. Thereafter, all unpaid
principal and accrued interest shall be due and payable in full on October 31,
1998, or, if sooner, on the date of an event of default.
The Co-Borrowers hereby jointly, severally, and irrevocably
authorize and direct the Bank, on the due date of any payment, to charge any
account which shall then be maintained by any of the Co-Borrowers at the Bank,
for the full amount thereof provided, however, that in the event there shall be
insufficient or no funds remaining in any of said accounts on said due date, the
Co-Borrowers shall nevertheless be irrevocably and fully obligated to make
payment to the Bank of such amounts as are then due hereunder in accordance with
the terms hereof.
The Bank shall maintain an account record of the amount of
principal owed by the Co-Borrowers and payments of principal and interest made
by the Co-Borrowers in connection herewith, which account record shall serve as
prima facie evidence of the aggregate amount of outstanding money under the Line
of Credit and accrued and unpaid interest thereon from time to time. The failure
of the Bank to maintain such an account record, however, shall not alter or
impair the rights and remedies of the Bank nor shall the failure of the Bank to
maintain such an account record alter the right of the Co-Borrowers to receive
credit for the payment of principal or interest made in accordance with the
provisions of this Sixth Amended Replacement Note and the Loan Agreement, as
amended.
In the event that any payment required hereunder shall not
be received by the Bank within ten (10) days of the due date thereof, the
Co-Borrowers shall, to the extent permitted by law, pay Bank a late charge of
Five Percent (5%) of the overdue
-4-
39
payment (but in no event to be less than $25.00 nor more than $2,500.00). Any
such late charge shall be immediately due and payable.
Payment of the principal of and accrued interest on this
Sixth Amended Replacement Note is secured by a first priority security interest
in the lien upon certain of the Collateral granted by the Co-Borrowers to the
Bank pursuant to the Amended and Restated Loan and Security Agreement, as
amended. Reference is hereby made to the Amended and Restated Loan and Security
Agreement, as amended, for a more complete description of the security for the
Obligations of the Co-Borrowers including, without limitation, repayment of
principal and interest on this Note, the rights and Obligations of the
Co-Borrowers in connection therewith and other matters affecting the
Indebtedness evidenced by this Note.
Upon the occurrence of an event of default, as defined in
the Amended and Restated Loan and Security Agreement, in addition to any and all
other remedies available hereunder, under any of the Loan Documents or by
statute, at law, in equity or otherwise, the principal amount hereof, together
with accrued interest thereon, may become, or may be declared to be, immediately
due and payable in the manner, upon the conditions and with the effect provided
herein and/or the Amended and Restated Loan and Security Agreement, as amended.
Each Co-Borrower acknowledges that the Bank does not intend
for the aggregate principal amount of the Outstanding Advances under Section 2.1
of the Amended and Restated Loan and Security Agreement, as amended by the
Second, Third, Fourth, Fifth, Sixth and Seventh Amendments to the Loan
Agreement, to exceed, at any time, the Advances Limit (including the Letter of
Credit Sublimit), which is specifically defined in Section 2.1(A) of the Amended
and Restated Loan and Security Agreement, as amended by the Second, Third,
Fourth, Fifth, Sixth and Seventh Amendments to the Loan Agreement.
This Sixth Amended Replacement Note shall be governed by
and construed in accordance with the laws of the State of New Jersey.
Upon the occurrence of an Event of Default, with
-5-
40
respect to the payment of any installment of principal, interest or principal
and interest hereunder and until such Event of Default shall be cured, the Bank
shall be entitled to collect interest on the then outstanding principal amount
of the Loan, at a rate equal to Five Percent (5%) above the then applicable rate
set forth in this Note; provided, however, that such rate of interest shall
never exceed the maximum rate of interest permissible under the laws of the
State of New Jersey.
Each of the Co-Borrowers and all guarantors and/or
endorsers of this Note hereby waive presentment, demand for payment, protest and
notice of protest and all other demands and notices in connection with the
payment and enforcement of this Note and consent to extensions of time in the
payment of any moneys payable under this Note, or forbearance of their
indulgence, without notice.
WAIVER OF JURY TRIAL. EACH CO-BORROWER WAIVES TRIAL BY JURY
AND CONSENTS TO AND CONFERS PERSONAL JURISDICTION ON COURTS OF THE STATE OF NEW
JERSEY OR OF THE FEDERAL GOVERNMENT, AND EXPRESSLY WAIVES ANY OBJECTIONS AS TO
VENUE IN ANY OF SUCH COURTS AND AGREES THAT SERVICE OF PROCESS MAY BE MADE UPON
IT BY MAILING A COPY OF THE SUMMONS BY UNITED STATES CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO ITS ADDRESS. THE BANK LIKEWISE WAIVES TRIAL BY JURY.
IN WITNESS WHEREOF, each of the undersigned have caused
this Note to be duly executed on the day and year first above written.
ATTEST: DIGITAL SOLUTIONS, INC.
A New Jersey Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
-6-
41
ATTEST: DIGITAL INSURANCE SERVICES, INC.
A New Jersey Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: STAFF CONNXIONS, INC.
A New Jersey Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: MLB MEDICAL STAFFING, INC.
A Texas Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: DSI STAFF CONNXIONS-MISSISSIPPI
A Mississippi Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
-7-
42
[SEAL]
ATTEST: DSI STAFF CONNXIONS-SOUTHWEST
A Texas Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: RAM TECHNICAL SERVICES, INC.
A Texas Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: DSI-CONTACT STAFFING, INC.
A Texas Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: DSI STAFF RX, INC.
A Texas Corporation
-8-
43
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
ATTEST: DSI STAFF CONNXIONS NORTHEAST, INC.
A New Jersey Corporation
Co-Borrower
__________________________ By:________________________________
Name:_____________________ Name:______________________________
Title:____________________ Title:_____________________________
[SEAL]
-9-
44
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, ____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DIGITAL SOLUTIONS, INC., the corporation named in
this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
________________________
NOTARY PUBLIC
-10-
45
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DIGITAL INSURANCE SERVICES, INC., the corporation
named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_______________________
NOTARY PUBLIC
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46
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of STAFF CONNXIONS, INC., the corporation named in
this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-12-
47
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of MLB MEDICAL STAFFING, INC., the corporation named
in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-13-
48
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DSI STAFF CONNXIONS-MISSISSIPPI, the corporation
named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
__________________________
NOTARY PUBLIC
-14-
49
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DSI STAFF CONNXIONS-SOUTHWEST, the corporation
named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-15-
50
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of RAM TECHNICAL SERVICES, INC., the corporation named
in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-16-
51
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DSI-CONTACT STAFFING, INC., the corporation named
in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_______________________
NOTARY PUBLIC
-17-
52
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DSI STAFF RX, INC., the corporation named in this
document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_________________________
NOTARY PUBLIC
-18-
53
STATE OF ___________)
) SS.:
COUNTY OF __________)
I CERTIFY that on October __, 1997, _____________________
personally came before me and acknowledged under oath, to my satisfaction that:
(a) he signed, sealed and delivered the attached document
as ______________________ of DSI STAFF CONNXIONS NORTHEAST, INC., the
corporation named in this document;
(b) the proper corporate seal was affixed; and
(c) this document was signed and made by the corporation as
its voluntary act and deed by virtue of authority from its Board of Directors.
_______________________
NOTARY PUBLIC
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54
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