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Exhibit 10.7
AMENDED AND RESTATED SCHEDULE TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
Borrower Address
-------- -------
DIGITAL SOLUTIONS, INC. 000 Xxxxxx Xxxxx,
Xxxxxxxx, XX 00000
DSI CONTRACT STAFFING, INC. 000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
DSI STAFF CONNXIONS NORTHEAST, INC. 000 Xxxxxx Xxxxx,
Xxxxxxxx, XX 00000
DSI STAFF CONNXIONS-SOUTHWEST, INC. 0 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
DSI STAFF Rx, INC. 0 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
THE TEAMSTAFF COMPANIES, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF II, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF III, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF IV, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF V, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF U.S.A., INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF INSURANCE SERVICES, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
TEAMSTAFF HOLDING COMPANY, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
EMPLOYER SUPPORT SERVICES, INC. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000,
Xxxxx, XX 00000
DATE: JANUARY 25, 1999
This Amended and Restated Schedule ("SCHEDULE") forms an integral part of the
Amended and Restated Loan and Security Agreement between the above Borrowers
and FINOVA Capital Corporation dated the above date, and all references herein
and therein to "this Agreement" shall be deemed to refer to said Agreement and
to this Schedule.
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DEFINITIONS (SECTION 1):
"Guarantor(s)" means each subsidiary of DSI that is not a Borrower.
--------------------------------------------------------------------------------
TOTAL FACILITY (SECTION 2.1):
$8,250,000
--------------------------------------------------------------------------------
LOANS (SECTION 2.2):
REVOLVING CREDIT LOANS: A revolving line of credit consisting of loans
against Borrowers' Eligible Receivables (the "REVOLVING CREDIT LOANS") in
an aggregate outstanding principal amount not to exceed the lesser of (a)
or (b) below:
(a) Two Million Five Hundred Thousand Dollars ($2,500,000) (the
"REVOLVING CREDIT LIMIT"), less any Loan Reserves, or
(b) the sum of an amount equal to (i) 85% of the aggregate net amount
of Eligible Receivables of all Borrowers, less (ii) the aggregate
undrawn face amount of all Letters of Credit issued under Section
2.4 of this Agreement; less any Loan Reserves.
TERM LOANS:
1. TERM LOAN A
A term loan ("TERM LOAN A") is an original principal amount of Two
Million Five Hundred Thousand Dollars ($2,500,000); provided, that Term
Loan A shall be on such terms as are set forth on separate promissory
note of Borrowers in the form attached hereto as Exhibit 2.2(A).
2. TERM LOAN B
A term loan ("TERM LOAN B") in an original principal amount of Two
Million Five Hundred Thousand Dollars ($2,500,000); provided, that Term
Loan B shall be on such terms as are set forth on separate promissory
note of Borrowers in the form attached hereto as Exhibit 2.2(B).
3. TERM LOAN C
A term loan ("TERM LOAN C") in an original principal amount of Seven
Hundred Fifty Thousand Dollars ($750,000); provided, that Term Loan C
shall be on such terms as are set forth on separate promissory note of
Borrowers in the form attached hereto as Exhibit 2.2(C).
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(Term Loan A, Term Loan B and Term Loan C shall each be referred
to as a "TERM LOAN" and shall be collectively referred to as
the "TERM LOANS")
_______________________________________________________________________________
LETTERS OF CREDIT (SECTION 2.4):
The aggregate face amount of all outstanding Letters of Credit
from time to time shall not exceed $460,000, and shall be
reserved against the availability of Revolving Credit Loans
pursuant to Section 2.4 hereof. The L/C Fee, which is payable to
FINOVA in addition to all applicable bank charges, shall equal
1.5% per annum of the aggregate face amount of each Letter of
Credit outstanding from time to time during the term of this
Agreement. The L/C Fee shall be deemed to be fully earned upon
the issuance of each Letter of Credit and shall be due and
payable on the first Business Day of each month following a month
during which any Letter of Credit is outstanding.
_______________________________________________________________________________
INTEREST AND FEES (SECTION 2.6):
Revolving Interest Rate. Borrowers shall pay jointly and
severally FINOVA interest on the daily outstanding balance of
Borrowers' Revolving Credit Loans at a per annum rate of 1.0% in
excess of the rate of interest announced publicly by Citibank,
N.A., (or any successor thereto), from time to time as its "prime
rate" (the "PRIME RATE") which may not be such institution's
lowest rate. The interest rate chargeable hereunder in respect of
the Revolving Credit Loans (herein, the "REVOLVING INTEREST
RATE") shall be increased or decreased, as the case may be,
without notice or demand of any kind, upon the announcement of
any change in the Prime Rate. Each change in the Prime Rate shall
be effective hereunder on the first day following the
announcement of such change. Interest charges and all other fees
and charges herein shall be computed on the basis of a year of
360 days and actual days elapsed and shall be payable to FINOVA
in arrears on the first day of each month.
_______________________________________________________________________________
Term Interest Rate: Borrowers shall pay jointly and severally
FINOVA interest on the daily outstanding balance of each of the
Term Loans at the following per annum rates (each a "TERM
INTEREST RATE"):
(i) Term Loan A and Term Loan B: 3.0% in excess of the
Prime Rate, and
(ii) Term Loan C: 12.0%.
The Term Interest Rate chargeable hereunder in respect of Term
Loan A and Term Loan B shall be increased or decreased, as the
case may be, without notice or demand of any kind, upon the
announcement of
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any change in the Prime Rate. Each change in the Prime Rate shall be effective
hereunder on the first day following the announcement of such change. Interest
charges and all other fees and charges here shall be computed on the basis of a
year of 360 days and actual days elapsed and shall be payable to FINOVA in
arrears on the first day of each month.
Closing Fee. Borrowers shall pay jointly and severally to FINOVA a closing fee
in an amount equal to 1.0% of the Total Facility ("CLOSING FEE"), of which
$63,750.00 has been paid prior to the Amendment Closing Date, and the balance
of $18,750.00 shall be paid on the Amendment Closing Date, and which shall be
deemed fully earned on the date such payment is due.
Unused Line Fee. With respect to each fiscal quarter, or portion thereof during
the term of this Agreement, Borrowers shall unconditionally and jointly and
severally pay to FINOVA a fee equal to one-quarter of one percent (0.25%) per
annum of the difference between the Revolving Credit Limit and the average
daily outstanding balance of the Revolving Credit Loans during such quarter, or
portion thereof ("UNUSED LINE FEE"), which fee shall be calculated and payable
quarterly, in arrears, and shall be due and payable, commencing on the first
Business Day of the Borrower's first fiscal quarter following the Closing Date
and continuing on the first Business Day of each fiscal quarter thereafter.
Success Fee. Borrowers shall jointly and severally pay FINOVA a success fee
("SUCCESS FEE") in the following amounts:
1. TERM LOAN A:
$675,000, which is fully earned as of the Closing Date and shall be payable
in three installments as follows: $200,000 on April 27, 1999; $225,000 on
April 27, 2000; and $250,000 on April 30, 2001. If Borrowers prepay in full
the principal balance of Term Loan A prior to April 30, 2001, then all
unpaid installments of the Success Fee due with respect to Term Loan A
shall be immediately due and payable and shall be paid on the date of such
prepayment.
2. TERM LOAN B:
$675,000, which is fully earned as of the Amendment Closing Date and shall
be payable in three installments as follows: $200,000 on January 24, 2000;
$225,000 on January 24, 2001; and $250,000 on January 24, 2002. If
Borrowers prepay in full the principal balance of Term Loan B prior to the
last Business Day of the Initial Term, then all unpaid installments of the
Success Fee due with respect to
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Term Loan B shall be immediately due and payable and shall be paid on
the date of such prepayment.
3. TERM LOAN C:
$56,250, if Term Loan C is fully repaid within six months after the
Amendment Closing Date, $112,500 if Term Loan C is fully repaid more
than six months after the Amendment Closing Date and within twelve
months after the Amendment Closing Date, or $225,000 if Term Loan C is
fully repaid more than twelve months after the Amendment Closing Date,
in any case which is fully earned as of the Amendment Closing Date,
and shall be payable on the payment or prepayment in full of Term Loan
C.
If the Agreement is terminated for any reason prior to the last Business
Day of the Initial Term, then all unpaid installments of the Success Fee
shall be immediately due and payable and shall be paid on the date of such
termination.
Examination Fee. Borrowers agree to pay jointly and severally to FINOVA an
examination fee in the amount of $600 per person per day in connection with
each audit or examination of Borrower performed by FINOVA prior to or after
the date hereof, plus all costs and expenses incurred in connection
therewith (the "EXAMINATION FEE"). Without limiting the generality of the
foregoing, Borrowers shall jointly and severally pay to FINOVA an initial
Examination Fee in an amount equal to $600 per person per day, plus all
costs and expenses incurred in connection therewith. Such initial
Examination Fee shall be deemed fully earned at the time of payment and due
and payable upon the closing of this transaction, and shall be deducted
from any good faith deposit paid by Borrower to FINOVA prior to the date of
this Agreement.
--------------------------------------------------------------------------------
CONDITIONS OF CLOSING - INITIAL ADVANCE (SECTION 4.1):
The obligation of FINOVA to make the initial advance hereunder or to issue
or arrange for the issuance of the initial Letter of Credit hereunder is
subject to the fulfillment, to the satisfaction of FINOVA and its counsel,
of each of the following conditions, in addition to the conditions set
forth in Section 4.1 above:
(a) Minimum Excess Availability (Section 4.1(b)). Not less than $300,000.
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(b) Lease and Xxxxxxxx's Consent (Section 4.1(j)). Locations: 000 Xxxxxx
Xxxxx, Xxxxxxxx, Xxx Xxxxxx; 0000 Xxx Xxxxx, Xx Xxxx, Texas; 0 Xxxxxxxxxx
Xxxxx, Xxxxxxx, Xxxxx; and 000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxx.
(c) No Material Adverse Change (Section 4.1(s)). Further, no material
adverse change has occurred in the Borrower's business, operations,
financial condition, or assets or in the respect of repayment of the
Obligations since February 28, 1998.
(d) Support Agreements. Xxxxxx X. Xxxxx shall have delivered a Support
Agreement in favor of FINOVA and in form and substance satisfactory to
FINOVA.
(e) Transaction Costs (Section 4.1(X)). Not to exceed $350,000.
Borrowers shall cause the conditions precedent set forth in Section 4.1 of
this Agreement to be satisfied, and shall provide evidence to FINOVA that
all such conditions precedent have been satisfied, on or before April 28,
1998.
CONDITIONS OF CLOSING - AMENDMENT EFFECTIVENESS (SECTION 4.2):
The effectiveness of the amendments to the Original Agreement effectuated
by this Agreement and the obligation of FINOVA to make Term Loan B and
Term Loan C (as defined in the Schedule) is subject to the fulfillment,
to the satisfaction of FINOVA and its counsel, of each of the following
conditions, in addition to the conditions set forth in Section 4.2 above:
(a) Minimum Excess Availability (Section 4.2(b)). Not less than $500,000.
(b) Lease and Xxxxxxxx's Consent (Section 4.2(i)). Locations: (i) 0000 X.
Xxxxxxxxx Xxxxxxxxx, Xxxxx, Xxxxxxx 00000, and (ii) HQ Deerwood Park,
00000 Xxxxxxxx Xxxx Xxxxxxxxx, Xxxxxx #00, Xxxxxxxxxxxx, Xxxxxxx 00000.
(c) No Material Adverse Change (Section 4.2(o)). Further, no material
adverse change has occurred in the Borrower's business, operations,
financial condition, or assets or in the prospect of repayment of the
Obligations since September 30, 1998.
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(d) Transaction Costs (Section 4.2(s)). Not to exceed $1,200,000
exclusive of any payments made in the form of Borrowers' stock,
of which amount no more than $750,000 will be in reimbursement of
shareholders' expenses under the Merger Documents.
Borrowers shall cause the conditions precedent set forth in
Section 4.2 of this Agreement to be satisfied, and shall provide
evidence to FINOVA that all such conditions precedent have been
satisfied, on or before the Amendment Closing Date.
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BORROWER INFORMATION:
Borrowers' States of Incorporation (Section 5.1):
BORROWER STATE
-------- -----
Digital Solutions, Inc. ................................... New Jersey
DSI Contract Staffing, Inc. ............................... New York
DSI Staff ConnXions Northeast, Inc. ....................... New Jersey
DSI Staff ConnXions-Southwest, Inc. ....................... Texas
DSI Staff Rx, Inc. ........................................ Texas
The Teamstaff Companies, Inc. ............................. Florida
Teamstaff Inc. ............................................ Florida
Teamstaff II, Inc. ........................................ Florida
Teamstaff III, Inc. ....................................... Florida
Teamstaff IV, Inc. ........................................ Florida
Teamstaff V, Inc. ......................................... Florida
Teamstaff U.S.A., Inc. .................................... Florida
Teamstaff Insurance Services, Inc. ........................ Florida
Teamstaff Holding Company, Inc. ........................... Florida
Employer Support Services, Inc. ........................... Florida
BORROWER'S COPYRIGHTS, PATENTS TRADEMARKS, AND LICENSES (SECTION 5.5): None
FICTITIOUS NAMES/PRIOR CORPORATE NAMES (SECTION 5.2):
BORROWER FICTITIOUS NAME
-------- ---------------
DSI Staff ConnXions-Southwest, Inc. ............... Turnkey Services, Inc.
DSI Staff ConnXions Northeast, Inc. ............... Temp Staff, Inc.
DSI Contract Staffing, Inc. ....................... X-L Technical, Inc.
DSI Staff Rx, Inc. ................................ Healthmark
BORROWER PRIOR CORPORATE NAMES
-------- --------------------------------
DSI Staff ConnXions-Southwest, Inc. ...... - Turnkey Services, Inc.
- The Alternative Source
- M & B Staff management, Inc.
DSI Staff Rx, Inc. ....................... - MLB Medical Staffing, Inc.
- Physicians Services
- Staff Rx, Inc.
The Teamstaff Companies, Inc. ............ - Teamstaff, Inc.
Teamstaff, Inc. .......................... - TSC Human Resources of
Florida, Inc. f/k/a Tampa Bay
Consulting, Inc.
Teamstaff U.S.A., Inc. ................... - Team Employment Systems, Inc.
Teamstaff Insurance Services, Inc. ....... - Team Staffing, Inc.
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BORROWERS' LOCATIONS (SECTION 5.16)
BORROWER ADDRESS
-------- -------
Digital Solutions, Inc. 000 Xxxxxx Xxxxx, Xxxxxxxx, XX 00000
DSI Contract Staffing, Inc. 000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
DSI Staff ConnXions Northeast, Inc. 000 Xxxxxx Xxxxx, Xxxxxxxx, XX 00000
DSI Staff ConnXions-Southwest, Inc. 0 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
0000 Xxxxxxxx, Xxxxx 000
Xx Xxxx, XX 00000
DSI Staff Rx, Inc. 0 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
The Teamstaff Companies, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff II, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
00000 Xxxxxxxx Xxxx Xxxx.
Building 000, Xxxxx 000
Xxxxxxxxxxxx, XX 00000
Teamstaff III, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff IV, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff V, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff U.S.A., Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff Insurance Services, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Teamstaff Holding Company, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
Employer Support Services, Inc. 0000 X. Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxx, XX 00000
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BORROWERS' FEDERAL TAX IDENTIFICATION NUMBERS (SECTION 5.16):
--------------------------------------------------
BORROWER F.T.I.N.
--------------------------------------------------
Digital Solutions, Inc. 00-0000000
--------------------------------------------------
DSI Staff ConnXions-Southwest, Inc. 00-0000000
--------------------------------------------------
DSI Staff ConnXions Northeast, Inc. 00-0000000
--------------------------------------------------
DSI Contract Staffing, Inc. 00-0000000
--------------------------------------------------
DSI Staff Rx, Inc. 00-0000000
--------------------------------------------------
The Teamstaff Companies, Inc. 00-0000000
--------------------------------------------------
Teamstaff, Inc. 00-0000000
--------------------------------------------------
Teamstaff II, Inc. 00-0000000
--------------------------------------------------
Teamstaff III, Inc. 00-0000000
--------------------------------------------------
Teamstaff IV, Inc. 00-0000000
--------------------------------------------------
Teamstaff V, Inc. 00-0000000
--------------------------------------------------
Teamstaff U.S.A., Inc. 00-0000000
--------------------------------------------------
Teamstaff Insurance Services, Inc. 00-0000000
--------------------------------------------------
Teamstaff Holding Company, Inc. 00-0000000
--------------------------------------------------
Employer Support Services, Inc. 00-0000000
--------------------------------------------------
PERMITTED ENCUMBRANCES (SECTION 1.1): The following Capital Leases:
DIGITAL SOLUTIONS, INC.:
------------------------
----------------------------------------------------------------------
LESSOR LEASED PROPERTY MATURITY
DATE
----------------------------------------------------------------------
IBM Credit Corporation, Lease #1 Computers & Printers 05/29/2000
----------------------------------------------------------------------
IBM Credit Corporation, Lease #2 Computers & Printers 05/29/2000
----------------------------------------------------------------------
IBM Credit Corporation, Lease #3 Computers & Printers 05/29/2000
----------------------------------------------------------------------
DSI STAFF Rx, INC.:
-------------------
----------------------------------------------------------------------
LESSOR LEASED PROPERTY MATURITY
DATE
----------------------------------------------------------------------
Monex Leasing Phone Equipment 06/01/2000
----------------------------------------------------------------------
Republic Leasing (Clearwater) Furniture 05/01/2001
----------------------------------------------------------------------
THE TEAMSTAFF COMPANIES, INC.:
------------------------------
----------------------------------------------------------------------
LESSOR LEASED PROPERTY MATURITY
DATE
----------------------------------------------------------------------
Key Credit Corp. Computer Equipment 08/15/1999
----------------------------------------------------------------------
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EXISTING INDEBTEDNESS (SECTION 6.2.11): Indebtedness for Borrowed Money
represented by the Capital Leases listed above under Permitted Encumbrances, in
an aggregate principal amount not to exceed at any time $141,000 less scheduled
payments thereon in accordance with the terms thereof as of the Closing Date.
FINANCIAL COVENANTS (SECTION 6.1.13):
Borrowers shall comply with all of the following
covenants. Compliance shall be determined as of the end of
each month, except as otherwise specifically provided
below:
Debt to Net Worth. DSI and its subsidiaries shall maintain at the end of each
month in each period set forth below a ratio of
Indebtedness for Borrowed Money to Net Worth of not greater
than the ratio set forth opposite such period below:
Period Ratio
Closing Date - February 28, 1999 1.5 to 1.0
March 1, 1999 - February 29, 2000 1.0 to 1.0
March 1, 2000 - February 28, 2001 0.75 to 1.0
March 1, 2001 and thereafter 0.5 to 1.0
Net Worth. DSI and its subsidiaries shall maintain as to each date set
forth below Net Worth of not less than the amount set forth
opposite such date below:
Measurement Date Amount
June 30, 1998 $5,500,000
September 30, 1998 $5,650,000
December 31, 1998 $5,800,000
March 31, 1999 $14,000,000
June 30, 1999 $14,500,000
September 30, 1999 $15,000,000
December 31, 1999 $15,500,000
March 31, 2000 $16,000,000
June 30, 2000 $16,500,000
September 30, 2000 $17,000,000
December 31, 2000 $17,500,000
March 31, 2001 $18,000,000
June 30, 2001 $18,500,000
September 30, 2001 $19,000,000
December 31, 2001 $19,500,000
March 31, 2002 $20,000,000
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Debt Service Coverage Ratio As of the last day of each fiscal quarter ending on
--------------------------- each December 31, March 31, June 30, and September
30, the ratio of Operating Cash Flow/Actual for
the consecutive 12-month period ending as of such
last day to Total Contractual Debt Service for such
12-month period must be not less than the ratio set
forth below for such period:
Measurement Date Ratio
---------------- ----------
June 30, 1998 1.3 to 1.0
September 30, 1998 1.3 to 1.0
December 31, 1998 1.3 to 1.0
March 31, 1999 1.3 to 1.0
June 30, 1999 1.3 to 1.0
September 30, 1999 1.3 to 1.0
December 31, 1999 1.3 to 1.0
March 31, 2000 1.4 to 1.0
June 30, 2000 1.4 to 1.0
September 30, 2000 1.4 to 1.0
December 31, 2000 1.4 to 1.0
March 31, 2001 1.5 to 1.0
June 30, 2001 1.5 to 1.0
September 30, 2001 1.5 to 1.0
December 31, 2001 1.5 to 1.0
March 31, 2002 1.5 to 1.0
provided however, that, with respect to the
calculations set forth herein for the period from
the Closing Date through March 31, 1999, Operating
Cash Flow/Actual and Total Contractual Debt Service
shall be determined beginning as of May 1, 1998
(the "START DATE") and be measured as follows: (w)
the time period from the Start Date through June
30, 1998, shall be for such amounts for such
period, (x) the time period from the Start Date
through September 30, 1998, shall be for such
amounts for such period, and (y) the time period
from the Start Date through December 31, 1998,
shall be for such amounts for such period; and (2)
the time period from the Start Date through March
31, 1999 shall be for amounts for such period; and,
provided further, that all such determinations
shall be made on a consolidated basis.
NEGATIVE COVENANTS (SECTION 6.2):
Employee Advances: Borrowers shall not make any loans or advances to
------------------ Employees except (i) in the ordinary course of
business and consistent with past practices of
Borrower in an aggregate amount not exceeding at
any time $10,000 and (ii) loans to
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employees to finance the exercise of options to
purchase DSI's common stock issued pursuant to employee
stock option plans, so long as all of the proceeds of
such loans are applied to pay to DSI the exercise price
of such options and the loans are secured by the stock
so purchased.
Capital Expenditures: No Borrower shall make or incur any Capital Expenditure
if, after giving effect thereto, the aggregate amount
of all Capital Expenditures by Borrowers in any fiscal
year (beginning with the 1998 fiscal year) would exceed
$300,000.
Indebtedness: Borrowers shall not create, incur, assume or permit to
exist any Indebtedness for Borrowed Money (including
Indebtedness for Borrowed Money in connection with
Capital Leases) in excess of $250,000 other than the
Indebtedness permitted by Section 6.2.11.
________________________________________________________________________________
REPORTING REQUIREMENTS (SECTION 9.1):
1. DSI shall provide FINOVA with Borrowers' monthly agings
aged by invoice date and reconciliations of Receivables
within ten (10) days after the end of each month.
2. DSI shall provide FINOVA with Borrowers' monthly
accounts payable agings aged by invoice date and
outstanding or held check registers within ten (10) days
after the end of each month.
3. DSI shall provide FINOVA with monthly unaudited
financial statements for DSI and its subsidiaries within
thirty (30) days after the end of each month.
4. DSI shall provide FINOVA with audited consolidated
financial statements of DSI and its subsidiaries within
ninety (90) days after the end of each fiscal year, as
more specifically described in Section 9.1(b) hereof,
and with an opinion issued by a Certified Public
Accountant which is acceptable to FINOVA.
5. DSI shall provide FINOVA with Borrowers' annual
operating budgets (including income statements, balance
sheets and cash flow statements, by month) for the
upcoming fiscal year of Borrowers prior to the end of
each fiscal year of Borrowers.
6. Borrowers' balance sheets for purposes of the definition
of Prepared Financials shall be as of September 30,
1998.
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TERM (SECTION 9.2):
The initial term of this Agreement shall end on January , 2002 (the
"INITIAL TERM" and shall be renewed for successive periods of one (1)
year each (each a "RENEWAL TERM") at the sole discretion of FINOVA,
unless earlier terminated as provided in Section 7 or 9.2 above or
elsewhere in this Agreement.
------------------------------------------------------------------------------
TERMINATION FEE (SECTION 9.2):
(A) Revolving Credit Loans Facility. The Termination Fee applicable to the
Revolving Credit Loans facility provided for in Section 9.2(d) shall be an
amount equal to the following percentage of the Revolving Credit Limit:
(i) three percent (3%), if such early termination occurs during the
period from the Amendment Closing Date through January 25, 2000;
(ii) one percent (1%), if such early termination occurs during the period
from January 25, 2000 through January 24, 2001; and
(iii) zero, if such early termination occurs after January 24, 2001.
(B) Term Loan A. The Termination Fees applicable to any prepayment in
whole or in part of Term Loan A shall be an amount equal to:
(i) three percent (3%) of the amount prepaid if such prepayment is made
during the period from April 28, 1998 through April 27, 1999;
(ii) one percent (1%) of the amount prepaid if such prepayment is made
during the period from April 28, 1999 through April 27, 2000; and
(iii) zero, if such prepayment is made after April 27, 2000; provided,
however, that such Termination Fee shall not be payable in the event of a
prepayment of less than all of Term Loan A which is made with internally
generated cash from operations.
(C) Term Loan B. The Termination Fee applicable to any prepayment in whole
or in part of Term Loan B shall be an amount equal to:
(i) three percent (3%) of the amount prepaid if such prepayment is made
during the period from the Amendment Closing Date through January 24,
2000;
(ii) one percent (1%) of the amount prepaid if such prepayment is made
during the period from January 25, 2000 through January 24, 2001; and
(iii) zero, if such prepayment is made after January 24, 2001;
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provided, however, that such Termination Fee shall not be
payable in the event of a prepayment of less than all of Term
Loan B which is made with internally generated cash from
operations.
_______________________________________________________________________________
DISBURSEMENT (SECTION 9.11):
Unless and until a Borrower otherwise directs FINOVA in writing,
all loans shall be wired to Borrowers' following operating
account:
Summit Bank
Somerset, NJ
ABA #: 000000000
For Accounts of Digital Solutions, Inc.
Account No.: 967703980
Notify: Xxxxxx X. Xxxxx
_______________________________________________________________________________
ADDITIONAL PROVISIONS:
1. Excess Cash Flow Prepayments. Within sixty (60) days
following receipt by FINOVA of the annual audited financial
statements of DSI and its subsidiaries, commencing with such
financial statements for the fiscal year ending September 30,
1998, FINOVA may deliver a notice to Borrowers requiring
Borrowers jointly and severally to prepay a Term Loan in an
amount up to the lesser of fifty percent (50%) of Borrower's
Excess Cash Flow for such year or the amount by which the
Borrowers' average daily Excess Availability for the thirty (30)
days preceding the date of XXXXXX's notice exceeded $750,000.
Any prepayments required under this section are strictly at the
sole option of FINOVA, and are payable with thirty (30) days
following the date of demand by FINOVA. All amounts paid
pursuant to this section shall be applied to the principal
installments of the Term Loans pro rata in the inverse order of
maturity. No Termination Fee shall be applied to any payments
made under this Section.
_______________________________________________________________________________
[Signatures Follow]
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BORROWERS:
----------
DIGITAL SOLUTIONS, INC., a New Jersey corporation
Fed. Tax ID #: 00-0000000
By: ______________________________
Name:
Title:
DSI CONTRACT STAFFING, INC., a New York corporation
Fed. Tax ID #: 00-0000000
By: ______________________________
Name:
Title:
DSI STAFF CONNXIONS NORTHEAST, INC., a New Jersey corporation
Fed. Tax ID #: 00-0000000
By: ______________________________
Name:
Title:
DSI STAFF Rx, INC., a Texas corporation
Fed. Tax ID #: 00-0000000
By: ______________________________
Name:
Title:
DSI STAFF CONNXIONS-SOUTHWEST, INC., a Texas corporation
Fed. Tax ID #: 00-0000000
By: ______________________________
Name:
Title:
[Amended and Restated Schedule to Loan Agreement]
17
THE TEAMSTAFF COMPANIES, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By:_____________________________
Name:
Title:
TEAMSTAFF, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By:_____________________________
Name:
Title:
TEAMSTAFF II, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By:_____________________________
Name:
Title:
TEAMSTAFF III, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By:_____________________________
Name:
Title:
TEAMSTAFF IV, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By:_____________________________
Name:
Title:
[AMENDED AND RESTATED SCHEDULE TO LOAN AGREEMENT]
2
18
TEAMSTAFF V, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By: _________________________________
Name:
Title:
TEAMSTAFF U.S.A., INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By: _________________________________
Name:
Title:
TEAMSTAFF INSURANCE SERVICES, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By: _________________________________
Name:
Title:
TEAMSTAFF HOLDING COMPANY, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By: _________________________________
Name:
Title:
EMPLOYER SUPPORT SERVICES, INC., a Florida corporation
Fed. Tax ID #: 00-0000000
By: _________________________________
Name:
Title:
[AMENDED AND RESTATED SCHEDULE TO LOAN AGREEMENT]
3
19
LENDER:
FINOVA CAPITAL CORPORATION
By:
------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
[AMENDED AND RESTATED SCHEDULE TO LOAN AGREEMENT]
4