Amendment No. 2 to
Agreement and Plan of Merger
This Amendment No. 2 dated as of April 6, 2001, is entered into by
and among TeamStaff, Inc., a New Jersey corporation with its principal
address at 000 Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 ("TeamStaff"),
TeamSub, Inc. a Georgia corporation and a direct wholly-owned subsidiary of
TeamStaff with its principal address at 000 Xxxxxx Xxxxx, Xxxxxxxx, Xxx
Xxxxxx 00000 ("TeamSub") and XxxxxxXxxx.xxx, Inc. a Georgia corporation with
its principal address at 0000 Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000
("BrightLane", TeamStaff, TeamSub are sometimes referred to herein
collectively as the "Parties").
WITNESSETH
WHEREAS, TeamStaff, TeamSub and BrightLane are parties to that
certain Agreement and Plan of Merger entered into as of March 6, 2001, as
amended by amendment No. 1 dated as of March 26, 2001 ("the Merger
Agreement").
WHEREAS, the Parties have determined it to be in their best
interests to clarify and amend certain terms and conditions contained in the
Agreement.
NOW THEREFORE, in consideration of the foregoing and the mutual
terms and conditions contained herein, and for other good and valuable
consideration, the Parties hereby agree as follows:
1. The Merger Agreement is hereby amended to provide as
follows:
A. The Parties have determined that it is in their mutual interests
that BrightLane purchase from TeamStaff 3,500,000 shares of newly created
Series A Preferred Stock for a purchase price of $3,500,000 pursuant to a
Stock Purchase Agreement being entered into between BrightLane and TeamStaff
on April 6, 2001. The terms of the Series A Preferred Stock created by
TeamStaff are set forth on the Certificate of Designation on Exhibit A
annexed hereto. The proceeds of the purchase shall be used by TeamStaff to
repay Term Loan C under its FINOVA Capital loan facility. As a result of the
Series A Preferred Stock transaction, the following Sections of the Merger
Agreement (and related Disclosure Schedules of the Parties) are hereby
amended to reflect the sale and purchase of the Series A Preferred Shares:
(I) Section 3. TeamStaff Representations and Warranties
Section 3.7 Section 3.11 Section 3.18
(II) Section 4. BrightLane Representations and Warranties
Section 4.2 Section 4.11 Section 4.18
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(III) Section 5.3 Operation of Business
2. Section 10.1 (c) (B) is hereby amended to read as follows:
(B) if the Closing shall not have occurred on or before
September 30, 2001, by reason of the failure of any condition precedent under
Section 8.1 hereof (unless the failure results primarily from TeamStaff
itself breaching any representation, warranty, or covenant contained in this
Agreement) or
3. Section 10.1 (d)(B) is hereby amended to read as follows:
(B) if the Closing shall not have occurred on or before
September 30, 2001, by reason of the failure of any condition precedent under
Section 8.2 hereof (unless the failure results primarily from TeamStaff
itself breaching any representation, warranty, or covenant contained in this
Agreement) or
4. Section 10.(e) is hereby amended to read as follows:
(e) TeamStaff may terminate this Agreement in the event
that it does not obtain approval of its shareholders for the transactions
contemplated herein prior to September 30, 2001; provided, however, TeamStaff
shall use reasonable good faith efforts to obtain such approval prior to such
date.
5. Section 10.(f) is hereby amended to read as follows:
(f) BrightLane may terminate this Agreement in the event
that it does not obtain approval of the holders of each class of BrightLane
Capital Stock for the transactions contemplated herein prior to September 30,
2001; provided, however, BrightLane shall use reasonable good faith efforts
to obtain such approval prior to such date.
6. The Parties confirm that each has completed its due diligence of
the other in accordance with Section 5.8 and that pursuant to Sections 10.1
and Section 5.8 each party waives all right to terminate the Merger Agreement
based upon due diligence related matters.
7. The definition of BrightLane Material Adverse Effect is hereby
amended to read as follows:
"BRIGHTLANE MATERIAL ADVERSE CHANGE" means, (i) as
reflected on the BrightLane Closing Financial Statements accounts payable and
accrued expenses in excess of $600,000; or (ii) BrightLane's cash, restricted
cash and cash equivalents as set forth on the BrightLane Closing Financial
Statements (the "BrightLane Closing Cash Amount") of less than an amount (the
"Target BrightLane Closing Cash Amount") equal to $16,500,000, minus: (A) any
amounts paid as fees or expenses incurred after February 1, 2001 related to
the transactions contemplated herein provided that such fees and expenses do
not exceed the limitations set forth
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in Section 11.11 below, (B) any amounts made as a loan to TeamStaff, (C) any
amounts made as loans to holders of BrightLane options or warrants as
contemplated in Section 2.11 hereof (D) the sum of $3,500,000 representing
the purchase price of the Series A Preferred Stock plus an additional
$425,000 (representing Series A Preferred Stock transaction costs and a
related "success" fee) or (E) for each 30 day period that the Closing does
not occur commencing July 31, 2001, the sum of $425,000 for usual and
ordinary operating costs of BrightLane. The Parties agree that they shall
meet (either in person or by telephone conference call) at least monthly
commencing on the date hereof until the Closing Date, to review all operating
costs of BrightLane for the purpose of containing and/or reducing such
operating costs.
8. Section 2.6(iii) of the Agreement is hereby replaced in its
entirety to read as follows:
(iii) Effective at the Closing, the directors and officers
of TeamStaff (other than the ninth member of the Board of Directors) shall be:
Name Title Class
---- ----- -----
Xxxx Xxxxxxxxx Vice Chairman Class 3
Xxxxxx Xxxxxxx President and Chief Executive Class 3
Officer, Director
Xxxxx Xxxxxxx Director Class 3
Xxxxxx Xxxxx Chief Financial Officer, Vice President
and Secretary
T. Xxxxxxx Xxxxxxx Chairman of the Board Class 2
Xxxxx Xxxxxx Director Class 2
Xxxxxxx Xxxxxx Director Class 2
Xxxxxx Xxxxxxx Director Class 1
First Union 2nd Designee Director Class 1
Xxxxxx XxXxxxx Assistant Secretary
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9. All other terms and conditions of the Agreement shall remain in
full force and effect.
IN WITNESS WHEREOF, the Parties hereto have executed this Amendment
No. 2 as of the date first above written.
TEAMSTAFF, INC.
By:________________________________
Xxxxxx Xxxxx
Vice President and Chief
Financial Officer
TEAMSUB, INC.
By________________________________
Xxxxxx Xxxxx
Vice President and Chief
Financial Officer
XXXXXXXXXX.XXX, INC.
By:________________________________
Xxxx Xxxxxx
Chief Operating Officer
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