Amendment Agreement No. 1 to Credit Agreement among Spherion Corporation, Borrowing Subsidiaries, and Bank of America, N.A.

Summary

This agreement amends the existing Credit Agreement dated April 2, 2001, between Spherion Corporation, its borrowing subsidiaries, several financial institutions, and Bank of America, N.A. as agent. The amendment updates certain financial definitions, adjusts leverage ratio requirements, and modifies terms related to stock repurchases and financial reporting. The guarantors reaffirm their obligations, and the companies confirm their authority and financial condition. The amendment becomes effective once all parties have signed and necessary corporate approvals are provided.

EX-10.6 5 a2054894zex-10_6.txt AMENDMENT AGREEMENT NO. 1 TO CREDIT AGREEMENT EXHIBIT 10.6 AMENDMENT AGREEMENT NO. 1 TO CREDIT AGREEMENT THIS AMENDMENT AGREEMENT NO. 1 TO CREDIT AGREEMENT (this "Amendment Agreement") is made and entered into as of this 22nd day of June, 2001, by and among SPHERION CORPORATION, a Delaware corporation ("Spherion"), the BORROWING SUBSIDIARIES parties hereto (herein Spherion and each Borrowing Subsidiary are individually referred to as a "Company" and collectively, the "Companies"), the several financial institutions party hereto and BANK OF AMERICA, N.A., a national banking association (the "Agent"), all parties to the Credit Agreement described below. W I T N E S S E T H: WHEREAS, the Companies, the financial institutions party thereto (collectively, the "Banks", individually, a "Bank") and the Agent have entered into a Second Amended and Restated Credit Agreement dated April 2, 2001 (the "Credit Agreement") pursuant to which the Banks have agreed to make available to the Borrowers revolving credit facilities of up to $400,000,000; and WHEREAS, as a condition to the making of loans the Lender has required that certain Subsidiaries of Spherion execute a Guaranty Agreement whereby each of them guarantees payment of the Obligations arising under the Credit Agreement; and WHEREAS, the Companies have requested that the Agent and the Banks, subject to the terms and conditions of this Amendment, amend the Credit Agreement as provided herein; NOW, THEREFORE, in consideration of the mutual covenants, promises and conditions herein set forth, it is hereby agreed as follows: 1. DEFINITIONS. The term "Credit Agreement" as used herein and in the Loan Documents shall mean the Credit Agreement as heretofore and hereby amended and as from time to time further amended or modified. Unless the context otherwise requires, all capitalized terms used herein without definition shall have the respective meanings provided therefor in the Credit Agreement. 2. AMENDMENTS. The Credit Agreement is hereby amended, effective as of the date hereof, as follows: (a) SECTION 1.2 is hereby amended by adding thereto the following two new defined terms in the appropriate alphabetical order: "Consolidated Total Senior Leverage Ratio" means, with respect to Spherion and its Subsidiaries, on a consolidated basis, for any consecutive four quarter period (subject to adjustment as contemplated in SECTION 8.3(iv)), the ratio of (x) Total Senior Indebtedness as at the end of such period to (y) Consolidated EBITDA for such period. "Total Senior Indebtedness" means, at any time (subject to adjustment as contemplated by SECTION 8.3(iv)), all Indebtedness of Spherion and its Subsidiaries, MINUS Subordinated Indebtedness, on a consolidated basis at such time." (b) The definition of "Consolidated Total Leverage Ratio" in SECTION 1.2 is hereby amended in its entirety so that as amended it shall read as follows: "Consolidated Total Leverage Ratio" means, with respect to Spherion and its Subsidiaries, on a consolidated basis, for any consecutive four quarter period (subject to adjustment as contemplated by SECTION 8.3(iv)), the ratio of (x) Total Indebtedness MINUS the sum of all cash and the fair market value of all Cash Equivalent Investments of Spherion and its Subsidiaries in excess of the sum of $30,000,000 and, until paid, the $122,000,000 of estimated taxes payable as a result of the sale of Michael Page, all as at the end of such period to (y) Consolidated EBITDA for such period." (c) The last sentence of SECTION 2.15(c) is hereby amended in its entirety so that as amended it shall read as follows: "The Applicable Margin shall not be less than .675% and .750% for Revolving Loans and 364 Day Loans, respectively, and the Applicable Fee Percentage shall not be less than .325% and .250% for Revolving Commitments and 364 Day Commitments, respectively, until the Business Day next following the date of receipt by the Agent of the Compliance Certificate and related financial statements of Spherion and its Subsidiaries for the fiscal year ending December 28, 2001." (d) SECTION 8.3(iv) is hereby amended in its entirety so that as amended it shall read as follows: "(iv) In determining Consolidated EBITDA, Consolidated Interest Expense, Consolidated Net Income, Consolidated Net Worth, Total Indebtedness, the Consolidated Interest Coverage Ratio, the Consolidated Total Leverage Ratio, the Consolidated Total Senior Leverage Ratio and Total Senior Indebtedness, all results of operations of Michael Page and its Subsidiaries and all Indebtedness attributed thereto (including, without limitation, all Indebtedness discharged with the proceeds of the Michael Page IPO) shall be excluded." (e) SECTION 8.3 is hereby amended by adding a new clause (v) thereto reading as follows: 2 "(v) The Consolidated Total Senior Leverage Ratio as at the end of any fiscal quarter ending after the Effective Date for the four fiscal quarters then ending to exceed 2.50 to 1.00." (f) SECTION 8.5(c) is hereby amended in its entirety so that as amended it shall read as follows: "(c) Spherion may purchase or redeem or make open market purchases of any class of capital stock in any fiscal year at an aggregate cost not to exceed (i) 7.5% of Consolidated Net Worth during its fiscal year 2001 and (ii) 5% of Consolidated Net Worth as at the end of any fiscal year thereafter; and" 3. GUARANTORS. Each of the Guarantors has joined in the execution of this Amendment Agreement for the purpose of consenting to the amendments contained herein and reaffirming its guaranty of the Obligations. 4. COMPANIES' REPRESENTATIONS AND WARRANTIES. Each Company hereby represents, warrants and certifies that: (a) The representations and warranties made by it in ARTICLE VI of the Credit Agreement are true on and as of the date hereof before and after giving effect to this Amendment Agreement except that (i) the financial statements referred to in SECTION 6.10(a) shall be those most recently furnished to each Bank pursuant to SECTION 7.1(a) AND (b) of the Credit Agreement; (b) The Companies have the power and authority to execute and perform this Amendment Agreement and have taken all action required for the lawful execution, delivery and performance thereof. (c) There has been no material adverse change in the condition, financial or otherwise, of the Companies and their Subsidiaries since the date of the most recent financial reports of the Companies received by the Banks under SECTION 7.1 of the Credit Agreement, other than changes in the ordinary course of business, none of which has been a material adverse change; (d) The business and properties of the Companies and their Subsidiaries are not, and since the date of the most recent financial report of the Companies and their Subsidiaries received by the Lender under SECTION 7.1 of the Credit Agreement have not been, adversely affected in any substantial way as the result of any fire, explosion, earthquake, accident, strike, lockout, combination of workers, flood, embargo, riot, activities of armed forces, war or acts of God or the public enemy, or cancellation or loss of any major contracts; and (e) No event has occurred and no condition exists which, upon the consummation of the transaction contemplated hereby, constitutes a Default or an Event 3 of Default on the part of the Companies under the Credit Agreement either immediately or with the lapse of time or the giving of notice, or both. 5. CONDITIONS TO EFFECTIVENESS. This Amendment Agreement shall become effective upon receipt by the Agent of the following: (a) nineteen (19) counterparts of this Amendment Agreement executed by the Companies, Guarantors, Agent and Required Banks; (b) copies of resolutions of the Boards of Directors of the Companies and each of the Guarantors authorizing the transaction contemplated by this Amendment Agreement certified by the Secretary or Assistant Secretary of each of the Companies and each of the Guarantors; (c) payment to each Bank executing this Amendment Agreement of an amendment fee equal to 10 basis points times such Bank's Commitment; and (d) such other instruments and documents as the Lender may reasonably request. 6. ENTIRE AGREEMENT. This Amendment Agreement sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof and supersedes any prior negotiations and agreements among the parties relative to such subject matter. None of the terms or conditions of this Amendment Agreement may be changed, modified, waived or canceled orally or otherwise, except as provided in the Credit Agreement. 7. FULL FORCE AND EFFECT OF AGREEMENT. Except as hereby specifically amended, modified or supplemented, the Credit Agreement and all of the other Loan Documents are hereby confirmed and ratified in all respects and shall remain in full force and effect according to their respective terms. 8. COUNTERPARTS. This Amendment Agreement may be executed in any number of counterparts and all the counterparts taken together shall be deemed to constitute one and the same instrument. [Remainder of page intentionally left blank.] 4 IN WITNESS WHEREOF, the parties hereto have caused this Amendment Agreement to be duly executed by their duly authorized officers, all as of the day and year first above written. COMPANIES: SPHERION CORPORATION WITNESS: /s/ Rebecca P. Doolittle By: /s/ Roy G. Krause - ---------------------------- ----------------------------- Name: Roy G. Krause /s/ Victoria V. Williams Title: Executive Vice President & CFO - ---------------------------- SPHERION WORLDWIDE HOLDING BV (F/K/A INTERIM SERVICES WORLDWIDE HOLDING BV) BY: SPHERION (EUROPE) INC., DIRECTOR WITNESS: /s/ Rebecca P. Doolittle By: /s/ Roy G. Krause - ---------------------------- ----------------------------- Name: Roy G. Krause /s/ Victoria V. Williams Title: Executive Vice President & CFO - ---------------------------- 5 BANK OF AMERICA, N.A., AS AGENT By: /s/ John E. Williams ---------------------------------------- Name: John E. Williams Title: Managing Director BANK OF AMERICA, N.A., AS A BANK By: /s/ John E. Williams ---------------------------------------- Name: John E. Williams Title: Managing Director 6 ABN AMRO BANK N.V. By: /s/ W.P. Fischer ------------------------------------- Name: W.P. Fischer ------------------------------------- Title: Senior Vice President ------------------------------------- By: /s/ Judith M. Bresner ------------------------------------- Name: Judith M. Bresner ------------------------------------- Title: Group Vice President ------------------------------------- Lending Office: 208 S. LaSalle, Suite 1500 Chicago, Illinois 60604-1003 Attention: Credit Administration Wire Transfer Instructions: ABN AMRO Bank N.V. New York, New York ABA #0260009580 F/O ABN AMRO Bank N.V. Chicago Branch CPU Account #650-001-1789-41 Reference: CPU (#00408972) Spherion Corporation 7 THE CHASE MANHATTAN BANK By: /s/ Tina Ruyter ------------------------------------- Name: Tina Ruyter ------------------------------------- Title: Vice President ------------------------------------- Lending Office: 270 Park Avenue New York, New York 10017 Wire Transfer Instructions: The Chase Manhattan Bank New York, New York ABA #021000021 Commercial Loans #9420 Reference: Spherion Corporation Attention: __________________ 8 CITIBANK, N.A. By: /s/ David L. Harris ------------------------------------- Name: David L. Harris ------------------------------------- Title: Vice President ------------------------------------- Lending Office: 399 Park Avenue, 11th Floor, Zone 16 New York, New York 10043 Wire Transfer Instructions: Citibank, N.A. New York, New York ABA #021000089 Account #40580628 Atlanta Receipts Reference: Spherion Corporation 9 FIRST UNION NATIONAL BANK By: /s/ Nicholas A.J. Hahn ------------------------------------- Name: Nicholas A.J. Hahn ------------------------------------- Title: AVP ------------------------------------- Lending Office: 301 South College Street, DC-5 Charlotte, North Carolina 28288 Wire Transfer Instructions: First Union National Bank Miami, Florida ABA #063000021 Account #GL ###-###-#### Account Name: Commercial Loan Services Attention: Cindy Petry Reference: Spherion Corporation 10 FLEET NATIONAL BANK By: /s/ Deborah Lawrence ------------------------------------- Name: Deborah Lawrence ------------------------------------- Title: Senior Vice President ------------------------------------- Lending Office: 100 Federal Street, 7th Floor Mail Stop: MA DE 1000 7F Boston, Massachusetts 02210 Wire Transfer Instructions: Fleet National Bank Boston, Massachusetts ABA # 011-000-138 Account # 151035166156 Attention: Commercial Loan Services/C&I Reference: Spherion Corporation 11 SUNTRUST BANK, N.A. By: /s/ Daniel S. Komitor ------------------------------------- Name: Daniel S. Komitor ------------------------------------- Title: Director ------------------------------------- Lending Office: 303 Peachtree Street, 2nd Floor, MC 1921 Atlanta, Georgia 30308 Wire Transfer Instructions: SunTrust Bank, N.A. ABA #061-000-104 Account #9088000112/Wire Clearing Attention: Tom Presley Reference: Spherion Corporation 12 WACHOVIA BANK, N.A. By: /s/ KARIN E. REEL ------------------------------------- Name: KARIN E. REEL ------------------------------------- Title: VICE PRESIDENT ------------------------------------- Lending Office: 191 Peachtree Street, 29th Floor Atlanta, Georgia 30303 Wire Transfer Instructions: Wachovia Bank, N.A. Atlanta, Georgia ABA #061000010 Account #18-171 498 Attention: Adrienne Durham Reference: Spherion Corporation 13 ING BANK N.V. By: /s/ J. Schmidt ------------------------------------- Name: J. Schmidt ------------------------------------- Title: Sr. Relationship Manager ------------------------------------- By: /s/ M. Balmessen ------------------------------------- Name: M. Balmessen ------------------------------------- Title: Sr. Relationship Manager ------------------------------------- Lending Office: P.O. Box 1800 1000 BV Amsterdam The Netherlands Wire Transfer Instructions: Northern Trust Int. Banking Corp. Account #100628-20230, SWIFT CNORUS 33 In Favor of: ING Utrecht For Further Credit to: Account #02.00.37.449 (ING) Reference: Spherion Corporation 14 THE INDUSTRIAL BANK OF JAPAN, LIMITED By: /s/ James W. Masters ------------------------------------- Name: James W. Masters ------------------------------------- Title: Senior Vice President and Manager ------------------------------------- Lending Office: 191 Peachtree Street, N.E. Suite 3825 Atlanta, Georgia 30303-1757 Wire Transfer Instructions: The Industrial Bank of Japan, Limited New York Branch New York, New York ABA #026008345 For further credit to: IBJ Atlanta Agency Account #2601-21014 Reference: Spherion Corporation 15 THE BANK OF NEW YORK By: /s/ David C. Siegel ------------------------------------- Name: David C. Siegel ------------------------------------- Title: Vice President ------------------------------------- Lending Office: One Wall Street, 22nd Floor New York, New York 10286 Wire Transfer Instructions: The Bank of New York New York, New York ABA #021000018 Commercial Loan Servicing Department Reference: Spherion Corporation 16 COMERICA BANK By: /s/ Danielle N. Butler ------------------------------------- Name: Danielle N. Butler ------------------------------------- Title: AVP ------------------------------------- Lending Office: 500 Woodward Avenue, 9th Floor MC 3280 Detroit, Michigan ###-###-#### Wire Transfer Instructions: Comerica Bank ABA #072000096 Account Name: Commercial Loan Servicing Account #02-21585-90010 Reference: Spherion Corporation 17 CREDIT SUISSE FIRST BOSTON By: /s/ Robert N. Finney ------------------------------------- Name: Robert N. Finney ------------------------------------- Title: Managing Director ------------------------------------- By: /s/ Vitaly G. Butenko ------------------------------------- Name: Vitaly G. Butenko ------------------------------------- Title: Assistant Vice President ------------------------------------- Lending Office: 11 Madison Avenue New York, New York 10010-3629 Wire Transfer Instructions: The Bank of New York New York, New York ABA # 021000018 Name of Account: CSFB NY Trade Services Account #890-0329-254 Reference: Spherion Corporation 18 HSBC BANK USA By: /s/ Alan F. Vitulich ------------------------------------- Name: Alan F. Vitulich ------------------------------------- Title: Vice President ------------------------------------- Lending Office: 452 Fifth Avenue New York, New York 10018 Wire Transfer Instructions: HSBC Bank USA ABA #021-001-088 Account #001-940-503 Attention: Asset Syndications Reference: Spherion Corporation 19 KBC BANK N.V. By: /s/ Robert Snauffer ------------------------------------- Name: Robert Snauffer ------------------------------------- Title: First Vice President ------------------------------------- By: /s/ Eric Haskin ------------------------------------- Name: Eric Haskin ------------------------------------- Title: Assistant Vice President ------------------------------------- Lending Office: New York Branch 125 West 55th Street New York, New York 10019 Wire Transfer Instructions: KBC Bank N.V. ABA #026-008-248 Reference: Spherion Corporation 20 THE NORTHERN TRUST COMPANY By: /s/ Roger McDugal ------------------------------------- Name: Roger McDugal ------------------------------------- Title: Second Vice President ------------------------------------- Lending Office: 50 S. LaSalle Street, 11th Floor Chicago, Illinois 60675 Wire Transfer Instructions: The Northern Trust Company ABA #071000152 Commercial Loan Account #5186401000 Credit to: Commercial Loan Dept. Reference: Spherion Corporation 21 GUARANTORS: ATRIUM (U.S.-B) INC. ATRIUM (U.S.-B) LLC SPHERION ACQUISITION CORPORATION (F/K/A INTERIM ACQUISITION CORPORATION) SPHERION ASSESSMENT INC. (F/K/A INTERIM ASSESSMENT SERVICES, INC.) SPHERION FINANCIAL CORPORATION (F/K/A INTERIM FINANCIAL CORPORATION) SPHERION REAL ESTATE SOLUTIONS INC. (F/K/A INTERIM REAL ESTATE SOLUTIONS INC.) ATRIUM (NL-A) INC. NORRELL CORPORATION (F/K/A INTERIM MERGER CORPORATION) SPHERION U.S. INC. (F/K/A INTERIM U.S. INC.) RICH FIELD AGENCY, INC. SARATOGA INSTITUTE, INC. SPHERION (EUROPE) INC. (F/K/A INTERIM SERVICES (EUROPE) INC.) ANATEC ASSET MANAGEMENT COMPANY ATR ASSET MANAGEMENT COMPANY COMTEX ASSET MANAGEMENT COMPANY COMTEX INFORMATION SYSTEMS, INC. NC HOLDING CORPORATION NORCROSS TELESERVICES INC. NORRELL ASSET MANAGEMENT COMPANY ACCOUNTING RESOURCES OF MASSACHUSETTS, INC. NORRELL RESOURCES CORPORATION NORRELL LICENSING COMPANY NORRELL INTERNATIONAL LTD. NORRELL TEMPORARY SERVICES, INC. NORRELL ACQUISITION CORP. SPHERION PACIFIC ENTERPRISES LLC SPHERION ATLANTIC ENTERPRISES LLC SPHERION PACIFIC OPERATIONS LLC SPHERION HOLDINGS LLC SPHERION ATLANTIC OPERATIONS LLC By: /s/ James W. Williamson ------------------------------------- Name: James W. Williamson Title: Vice President (Risk Management) of each of the foregoing Guarantors 22