Exhibit 10.58
OUTSOURCE INTERNATIONAL, INC.
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FOURTH AMENDMENT
TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This Fourth Amendment (this "Fourth Amendment"), dated as of December
29, 1999, among (a) OUTSOURCE INTERNATIONAL, INC. (the "Borrower"), (b) CAPITAL
STAFFING FUND, INC.; (c) OUTSOURCE FRANCHISING, INC.; (d) SYNADYNE I, INC.; (e)
SYNADYNE II, INC.; (f) SYNADYNE III, INC.; (g) SYNADYNE IV, INC.; (h) SYNADYNE
V, INC.; (i) EMPLOYEES INSURANCE SERVICES, INC.; (j) OUTSOURCE INTERNATIONAL OF
AMERICA, INC.; (k) MASS STAFF, INC.; (l) STAFF ALL, INC.; (m) OUTSOURCE OF
NEVADA, INC.; (n) EMPLOYMENT CONSULTANTS, INC.; (o) X-TRA HELP, INC.; (p)
CO-STAFF, INC.; (q) GUARDIAN EMPLOYER EAST, LLC; (r) GUARDIAN EMPLOYER WEST,
LLC; (s) each of the banks party to the Credit Agreement hereinafter referred to
(collectively, the "Banks") and (t) BANKBOSTON, N.A., as agent for the Banks
(the "Agent"), pursuant to that certain Third Amended and Restated Credit
Agreement (as amended, the "Credit Agreement"), dated as of July 27, 1998, among
the Borrower, the Banks and the Agent. Capitalized terms used herein and which
are not otherwise defined shall have the respective meanings ascribed thereto in
the Credit Agreement.
WHEREAS, (i) the Borrower and (ii) each Subsidiary of the Borrower
party to a Subsidiary Guarantee and whose name appears on the signature page
hereof (a "Guarantor") have requested that the Banks and the Agent agree to
amend the terms of the Credit Agreement in certain respects; and
WHEREAS, the Banks and the Agent are willing to amend the terms of the
Credit Agreement in such respects, upon the terms and subject to the conditions
contained herein; and
NOW, THEREFORE, in consideration of the mutual agreements contained in
the Credit Agreement herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ss.1. Amendment to Definitions. Section 1.1 of the Credit Agreement is
hereby amended by deleting the words "December 31, 1999" appearing in the
definition of "Termination Date", and substituting in lieu thereof the words
"January 31, 2000".
ss.2. Consent to Asset Sale. Each of the Banks hereby consents to the
sale by the Borrower of the real property and improvements located at 0000 Xxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxxxxxx Xxxxx, XX (the "Proposed Sale"), and the Agent
hereby confirms its agreement for the Proposed Sale to be free and clear of the
Agent's mortgage and security interest therein; provided, that (i) the Proposed
Sale is consummated on or prior to December 31, 1999, on substantially the terms
contained in the Sale and Purchase
Agreement for Commercial Improved Land (the "S&P Agreement"), dated December 3,
1999, as amended by an Addendum (the "Addendum") dated December 9, 1999, by and
between the Borrower and Beni Immobili LLC ("BI"), (ii) the proceeds of the
Proposed Sale are paid in cash on the closing date, and such cash proceeds, net
of the amount paid to the holder of the first mortgage on the subject property,
the brokerage commission paid by the Borrower, the cost of state documentary
recording stamps and other closing costs acceptable to the Agent, in each case
as a result of the Proposed Sale (the "Net Cash Proceeds"), are paid to the
Agent with (a) if the BI L/C (as defined below) is issued, a portion, as
described below, to be held by the Agent as cash collateral for the Obligations
and (b) the remainder for immediate application to the Obligations and
automatically permanently reducing the Maximum Commitment by an equal amount
simultaneously with such application to the Obligations and (iii) the Borrower
delivers to the Agent the original letter of credit which it receives pursuant
to Section 2 of the Addendum and takes such other steps related thereto as
reasonably requested by the Agent. The Agent shall, pursuant to the Credit
Agreement, notwithstanding the lack of commitment to issue new Letters of Credit
contained in the Credit Agreement or the restriction on the term thereof, at the
request of the Borrower and as permitted under ss.14 of the S&P Agreement, issue
a Letter of Credit to BI (as amended and in effect from time to time, including
any replacement thereof, the "BI L/C") with an expiration date not later than
October 1, 2002 in a form and amount approved by the Agent and to secure the
Borrower's continuing obligations to the purchaser under the S&P Agreement. So
long as the BI L/C remains outstanding, a portion of the Net Cash Proceeds equal
to 110% of the total amount which may be drawn under the BI L/C shall be
deposited in a cash collateral account to be held by the Agent to secure the
Obligations pursuant to a cash collateral agreement in a form satisfactory to
the Agent. As the Agent determines that the maximum drawing amount of the BI L/C
has been reduced, any amount held in such cash collateral account in excess of
110% of the maximum drawing amount of the BI L/C may be applied by the Agent to
the Obligations and shall automatically permanently reduce the Maximum
Commitment by an equal amount simultaneously with such application to the
Obligations. Upon any draw being made under the BI L/C or termination of the BI
L/C, any amount remaining in such cash collateral account shall be applied first
to any unpaid reimbursement obligations with respect to the BI L/C, and then to
the other Obligations.
ss.3. Confirmation of Obligations. The Borrower hereby confirms that
the obligations of the Borrower arising under each of the Loan Documents to
which it is a party, including Indebtedness consisting of Revolving Credit
Loans, Swingline Loans and L/C Obligations, are included in the Obligations, are
not subject to any claims or defenses whatsoever, and constitute valid and
binding obligations of the Borrower enforceable against the Borrower in
accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law). Each
Guarantor hereby confirms that the obligations of such Guarantor arising under
each of the Loan Documents to which it is a party are included in the
Obligations, are not subject to any claims or defenses whatsoever, and
constitute valid and binding
obligations of such Guarantor enforceable against such Guarantor in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
ss.4. Release. The Borrower and each Guarantor, on the Borrower's and
each Guarantors own behalf and on behalf of the Borrower's and each Guarantors
successors and assigns, hereby waive, release and discharge the Agent and each
Bank and all of the affiliates of the Agent and each Bank, and all of the
directors, officers, employees, attorneys and agents of the Agent, each Bank and
such affiliates, from any and all claims, demands, actions or causes of action
(known and unknown) arising out of or in any way relating to the Loan Documents
and any documents, agreements, dealings or other matters connected with the
Credit Agreement, in each case to the extent arising (x) on or prior to the date
hereof or (y) out of, or relating to, actions, dealings or matters occurring on
or prior to the date hereof. The waivers, releases, and discharges in this
Section 4 shall be effective regardless of whether the conditions to this Third
Amendment are satisfied and regardless of any other event that may occur or not
occur after the date hereof.
ss.5. Covenants. The Borrower and each Guarantor hereby agrees that:
(a) the Borrower and each Guarantor shall permit the Banks, the Agent
and their advisors to have full and complete access to all information that
Xxxxxxx Xxxxx develops or obtains with respect to the valuation and disposition
of Synadyne and the Borrower and each Guarantor shall authorize Xxxxxxx Xxxxx to
deliver such information to the Banks, the Agent and their advisors, and discuss
the same with them;
(b) the Borrower and each Guarantor shall permit the Banks, the Agent
and their advisors to engage the services of consultants in connection with the
valuation and review of the Borrower's business, and shall permit the Agent
and/or its counsel to continue to retain Nightingale & Associates, LLC
("Nightingale"). Such consultants shall, among other things, make visits to, and
discuss financial and operational matters with, the Borrower and its
Subsidiaries and advise the Agent and the Banks as to the business, operations
and financial condition of the Borrower and its Subsidiaries. Such consultants
shall not be limited in the frequency of visits to the facilities of the
Borrower and its Subsidiaries. The Borrower shall, and shall cause each of its
Subsidiaries to, cooperate with such consultants and provide such consultants
with all information reasonably requested by such consultant in connection with
its engagement by the Agent and/or its counsel. The Borrower shall pay all fees
and expenses of such consultants;
(c) in the event that the Borrower is successful in its efforts to
locate a buyer for Synadyne, the Borrower shall deliver to the Banks, on or
before the Borrower's entering into any agreement to effect such sale, (i)
revised cash flow projections, prepared by CrossRoads Capital Partners, LLC, for
the period prior to and following
completion of such sale to the Termination Date and (ii) a copy of the proposed
purchase and sale agreement; and
(d) the Borrower shall deliver to the Agent, within 3 days after the
end of each calendar week, a report in the form agreed upon by Nightingale and
the Agent, and prepared in a manner consistent with each prior acceptable
report, setting forth the Borrower's actual cash flow as at the end of such week
versus the cash flow forecast as at the end of such week as reported in the Cash
Budget.
ss.6. Representations and Warranties. The Borrower and each of the
Guarantors represent and warrant to the Banks and the Agents as follows: (
a) Representations and Warranties in Credit Agreement. The
representations and warranties of the Borrower and each of the Guarantors
contained in the Credit Agreement, as amended hereby, (a) were true and correct
in all material respects when made, and (b) except (i) as a result of changes in
the ordinary course of business permitted under the Credit Agreement and (ii) to
the extent such representations and warranties by their terms are made solely as
of a prior date, continue to be true and correct in all material respects on the
date hereof.
(b) Authority, Etc. The execution and delivery by the Borrower and each
of the Guarantors of this Third Amendment and the performance by the Borrower
and each of the Guarantors of all of their agreements and obligations under this
Third Amendment and the Credit Agreement as amended hereby (i) are within the
corporate authority of the Borrower and each of the Guarantors, (ii) have been
duly authorized by all necessary corporate or other proceedings or actions, as
the case may be, by the Borrower and each of the Guarantors, (iii) do not
conflict with or result in any breach or contravention of any provision of law,
statute, rule or regulation to which the Borrower or any of the Guarantors is
subject or any judgment, order, writ, injunction, license or permit applicable
to the Borrower or any of the Guarantors, and (iv) do not conflict with any
provision of the corporate charter, by-laws or partnership agreement of, or any
agreement or other instrument binding upon, the Borrower or any of the
Guarantors.
(c) Enforceability of Obligations. This Third Amendment, and the Credit
Agreement as amended hereby, and the other Loan Documents constitute the legal,
valid and binding obligations of the Borrower and each of the Guarantors
enforceable against each such Person in accordance with their respective terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law). After giving effect
to this Fourth Amendment, no Default or Event of Default exists under the Credit
Agreement.
ss.7. Conditions to Effectiveness. This Fourth Amendment shall be
effective as of the date hereof (the "Effective Date") upon the satisfaction of
the following conditions precedent:
(a) receipt by the Agent of an original counterpart signature to this
Fourth Amendment, duly executed and delivered by the Borrower, each of the
Guarantors, each of the Banks and the Agent;
(b) receipt by the Agent of evidence satisfactory to the Agent that the
Outsource Funding Credit Agreement date has been extended until January 31, 2000
from its current December 31, 1999 maturity date;
(c) receipt by the Agent of appropriate corporate authority
documentation for the Borrower and each of the Guarantors, including copies (to
the extent not already furnished to the Agent) for each such Person's
organizational documents, bylaws and resolutions authorizing the transactions
contemplated by this Fourth Amendment;
(d) payment by the Borrower of the legal, appraisal, consultant and
out-of-pocket fees and expenses of the Agent, in each case, to the extent that
invoices for the same have been presented to the Borrower;
(e) payment by the Borrower of all fees and expenses of Nightingale and
any other consultant retained by the Agent and/or the Banks in connection with
consulting services, to the extent that invoices for the same have been
presented to the Borrower (in addition to any amount previously paid as a
retainer); and
(f) receipt by the Agent of an amendment fee of $35,000 paid by the
Borrower for the pro rata account of each Bank based on such Bank's Commitment
Percentage.
ss.8. Miscellaneous Provisions. (a) Except as otherwise expressly
provided by this Third Amendment, all of the terms, conditions and provisions of
the Credit Agreement shall remain the same. It is declared and agreed by each of
the parties hereto that the Credit Agreement, as amended hereby, shall continue
in full force and effect, and that this Third Amendment and the Credit Agreement
shall be read and construed as one instrument.
(b) THIS FOURTH AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED ACCORDING
TO, THE LAWS OF THE STATE OF CONNECTICUT (EXCLUDING THE LAWS APPLICABLE TO
CONFLICTS OR CHOICE OF LAW).
(c) This Fourth Amendment may be executed in any number of
counterparts, but all such counterparts shall together constitute but one
instrument. In making proof of this Fourth Amendment it shall not be necessary
to produce or account for more than one counterpart signed by each party hereto
by and against which enforcement hereof is sought.
(d) Headings or captions used in this Fourth Amendment are for
convenience of reference only and shall not define or limit the provisions
hereof.
(e) The Borrower hereby agrees to pay to the Agent, on demand by the
Agent, all reasonable out-of-pocket costs and expenses incurred or sustained by
the Agent in connection with the preparation of this Fourth Amendment (including
without limitation, recording and filing fees, notarization fees, stamp taxes,
any other tax imposed by reason of the execution and delivery of the Loan
Documents, the reasonable fees and expenses of counsel to the Agent and the
reasonable fees and expenses of the Agent's commercial finance examiners and
commercial auditors).
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Fourth Amendment as of the date first set forth above.
OUTSOURCE INTERNATIONAL, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President & CEO
CAPITAL STAFFING FUND, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
OUTSOURCE FRANCHISING, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
SYNADYNE I, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
SYNADYNE II, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
SYNADYNE III, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
SYNADYNE IV, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
SYNADYNE V, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Vice President
EMPLOYEES INSURANCE SERVICES, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
OUTSOURCE INTERNATIONAL OF AMERICA, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
MASS STAFF, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
STAFF ALL, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
OUTSOURCE OF NEVADA, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
EMPLOYMENT CONSULTANTS, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
X-TRA HELP, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
CO-STAFF, INC.
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: President
GUARDIAN EMPLOYER EAST, LLC
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Manager
GUARDIAN EMPLOYER WEST, LLC
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
Title: Manager
BANKBOSTON, N.A., individually and as Agent
By: /s/ C. Xxxxxxxxxxx Xxxxx
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Name: C. Xxxxxxxxxxx Xxxxx
Title: Vice President
COMERICA BANK
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. XxXxxxx
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Name: Xxxx X. XxXxxxx
Title: First Vice President
SUNTRUST BANK, SOUTH FLORIDA,
NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
FLEET NATIONAL BANK
By: /s/ C. Xxxxxxxxxxx Xxxxx
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Name: C. Xxxxxxxxxxx Xxxxx
Title: Banking Officer
