Exhibit 10.2

 

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March 28, 2010

STRICTLY CONFIDENTIAL

Mr. Robert J. Adamson

Chairman & Chief Executive Officer

Medical Staffing Network Holdings Inc.

901 Yamato Road Suite 110

Boca Raton, FL 33431

Dear Mr. Adamson:

Re: Medical Staffing Network Holdings Inc. (the “Company” or “MSN”)

This letter agreement (“Agreement”) confirms that Medical Staffing Network
Holding Inc. and its subsidiaries (eleven directly or indirectly wholly-owned
subsidiaries) have engaged Loughlin Meghji + Company (“LM+Co”) to provide Mohsin
Y. Meghji as Chief Restructuring Officer (“CRO”), effective March 27, 2010, and
to provide the additional services described in more detail below (together, the
“Services”).

LM+Co Services and Responsibilities

Services to be provided

In connection with the responsibilities, the CRO shall:

 

1. Report directly to the Board of Directors (or a Committee of the Board, if
appropriate), and shall perform such other services during the restructuring
process as requested or directed by the Board (or such other Committee).

 

2. Perform a financial review of the Company, including but not limited to a
review and assessment of the financial information that has been, and will be
provided to the Company’s creditors, including without limitation, its short and
long term projected cash flows.

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 2 of 9

 

3. Be responsible for preparing a restructuring proposal, and such other related
information as may be required in connection with negotiations by the Company
(all of the above subject to ultimate Board approval).

 

4. Review, in conjunction with Management and the Company’s other advisors, an
analysis of potential restructuring plans and strategic alternatives to maximize
the enterprise value of MSN. The CRO will be responsible for presenting this to
the Board, and with the Board’s approval, to the Company’s creditor
constituents.

 

5. Serve as the Company’s principal contact with its creditors (and their
financial advisors) with respect to the Company’s financial and operational
matters. In this regard, the CRO will be authorized to regularly meet with the
Company’s lenders (and their business representatives and financial advisors)
and keep them reasonably informed of the Company’s financial performance and any
other significant developments.

 

6. Be responsible, in conjunction with Management, for the “working group” of
professionals retained by the Company or the Board to assist the Company in its
restructuring process or who are/may be working with the Company’s various
stakeholders to ensure that their efforts are coordinated and that their
individual work product is consistent with the Company’s overall restructuring
objectives.

 

7. Review the Company’s already implemented cost reduction programs and
operational improvement initiatives and provide guidance as to whether there are
additional cost reductions or improvement initiatives that should be considered.

 

8. Any other services, as reasonably required by the Board of Directors.

In performing his duties, the CRO shall consult with and obtain input from the
appropriate members of senior management of the Company. The acts of the CRO
shall be subject to the direction, review, and authority of the Board (or any
Committee thereof).

Employment by LM+Co

The CRO and any additional LM+Co personnel will continue to be employed by LM+Co
and while rendering services to the Company will continue to work with other
personnel at LM+Co in connection with other unrelated matters, which will not
unduly interfere with services pursuant to this engagement. With respect to the
Company, however, the CRO and any Additional LM+Co Personnel shall operate under
the direction of the Board and LM+Co shall have no liability to the Company for
any acts or omission of such persons other than caused by their gross negligence
or willful

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 3 of 9

misconduct. LM+Co acknowledges and agrees that its CRO is and will be an officer
of MSN (and its affiliates) and that the CRO and other LM+Co personnel will be a
party to attorney–client privileged information and other strategic information
subject of and protected by the work product protection doctrine of MSN’s
counsel and other advisors. LM+Co further acknowledges and agrees that it may
not disclose any attorney-client privileged information or information subject
of and protected by the work product protection doctrine without express written
authorization from MSN or its counsel.

Deliverables

Materials prepared in connection with our engagement hereunder (“Deliverables”)
may contain factual data, the interpretation of which may change over the
project term as more information or better understanding becomes available. The
parties understand and acknowledge that LM+Co will not have an obligation to
update the Deliverables, after the termination of this Agreement, as part of its
Services hereunder in the event of such a change. LM+Co will consult with
counsel to MSN regarding the dissemination of the Deliverables to third parties
prior to any such dissemination in order to protect all applicable
attorney-client privileges and the work product protection doctrine.

Limitations on Services

LM+Co’s Services are limited to those specifically noted in this Agreement and
do not include accounting, tax-related assistance or advisory services, except
as specifically described herein. LM+Co shall not express any professional
opinions on financial statements or perform attest procedures with respect to
other information in conjunction with this engagement. LM+Co’s Services are not
designed, nor should they be relied upon, to disclose weaknesses in internal
controls, financial statement errors, irregularities or illegal acts. The
accuracy and completeness of such information submitted by the Company to LM+Co
for analysis, on which LM+Co relies and which will form the basis of LM+Co’s
conclusions, are the responsibility of the Company.

LM+Co’s Services hereunder do not include preparing, auditing or otherwise
attesting in any way (including without limitation, the accuracy, achievability,
reliability, relevance, usefulness or other appropriateness) to the Company’s
financial projections, and the Company has not engaged LM+Co for that purpose.
The parties acknowledge that the Company will remain at all times solely
responsible for its financial projections (including preparation thereof),
developing underlying assumptions and providing any disclosure related thereto.
To the extent that, during the performance of Services hereunder, LM+Co is
required to consider the Company’s financial projections, the parties
acknowledge that LM+Co’s procedures with respect to such projections do not
constitute an examination in accordance with procedures established by the
American Institute of Certified Public Accountants and do not and are not
intended to provide any assurance on any aspect of such projections, including,
without limitation, the reasonableness of the assumptions underlying such
projections, nor do they provide assurance that LM+Co might not become aware of
significant matters

affecting the reasonableness of the projections that might be disclosed by more
extensive procedures. There will usually be differences between projected and
actual results, and those differences may be material. The parties understand
and agree that LM+Co will have no responsibility or liability relating to any
such differences.

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 4 of 9

Fees and Expenses

LM+Co understands that all amounts payable under this Agreement will be paid
directly by the Company.

 

1. Retainer: In connection with the execution of this Agreement, LM+Co is to
receive a $225,000 retainer (the “Retainer”). The Retainer is not intended to
represent an estimate of the total fees and expenses to be paid to LM+Co during
the course of the engagement. Rather, except as set forth below, LM+Co shall
hold the Retainer until the conclusion of the engagement, at which time the
final billing shall be applied against it, with any excess being returned to the
Company.

 

2. Compensation for Restructuring Services:

 

  a. Monthly Fee for Restructuring Services: As compensation for providing the
Services hereunder, LM+Co shall be entitled to non-refundable professional fees
of $150,000 per month (the “Monthly Base Fee”) effective upon execution of the
agreement.

The Monthly Base Fee for Restructuring Service includes time incurred by the
CRO, and one Director from the LM+Co team, who will be based at the Company on a
substantially full time basis.

In addition to the Monthly Base Fee, any time incurred by additional personnel
will be billed at LM+Co’s standard hourly rates (the “Additional Personnel
Hourly Fees”). Additional personnel will be added only with the prior consent of
the Company.

 

Principal

   $ 750

Managing Director

   $ 625

Director

   $ 525

Vice President

   $ 450

Senior Associate

   $ 375

Associate

   $ 325

Analyst

   $ 275

At the end of each month, LM+Co shall furnish to the Company copies of an
invoice for the Monthly Base Fee in respect of that month. The Monthly Base Fee
may be adjusted from time to time by mutual agreement between the Company and
LM+Co. The Monthly Base Fee will be billed and immediately payable monthly on
the last day of each month by check or wire transfer.

The Additional Personnel Hourly Fees shall be billed payable and immediately
payable, by check or wire transfer, on a weekly basis each Friday for the prior
week.

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 5 of 9

 

  b. Additional Fee for Restructuring Services: As further compensation, the
Company also agrees to pay LM+Co an additional fee (the “Additional Fee”) of
$500,000 to be awarded and paid upon the earlier to occur of: (a) an out of
Court debt restructuring or the consummation of a plan of reorganization under
Chapter 11 proceedings; or (b) the consummation of the sale of all or a
substantial portion of the assets of the Company through one transaction or a
series of transactions (and in the event of a series of transactions, the
Additional Fee will be payable as of the consummation of the final transaction
in such series).

 

3. Out-of-Pocket Expenses: Reasonable out-of-pocket expenses (the “Out-of-Pocket
Expenses”) shall be payable, by check or wire transfer, not later than the fifth
business day after LM+Co has furnished to the Company copies of an invoice for
reimbursement thereof. It is our intention to submit invoices for reimbursement
of out-of-pocket expenses monthly.

Invoices for which payment is not received within 3 days of the invoice date
shall be deemed “past due” and shall be set off against the Retainer to satisfy
payment. LM+Co reserves the right to suspend further Services, until payment is
received on past due invoices and/or the Retainer is restored. In the event that
LM+Co so suspends its Services, LM+Co shall not be responsible or liable for any
resulting loss, damage or expense due to such suspension.

Conflicts

LM+Co has performed an internal search for any potential conflicts of interest
based on its understanding of the various parties involved in this matter, and
such search has not revealed any relationships that it believes would conflict
with its engagement hereunder. The Company, however, is aware of LM+Co’s
business relationships with MSN’s lenders on matters unrelated to the Company,
and the Company acknowledges that such current relationships do not pose a
conflict in relation to LM+Co’s retention for this matter.

Should any potential conflict pertaining to LM+Co’s engagement hereunder come to
the attention of any party hereto, such party shall immediately advise the
others. Nothing contained herein should be construed to be a waiver of any
potential conflict pertaining to LM+Co that may come to the attention of any
party hereto. LM+Co reserves the right to terminate this engagement at any time,
if a conflict of interest arises or becomes known to it that, in its judgment,
would impair its ability to perform the Services objectively.

Without the express prior written consent of the Company, LM+Co agrees that it
shall not undertake nor perform any services for any third party (including
lenders or their advisors) in connection with any
transaction/discussion/negotiation related to the Company.

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 6 of 9

Confidentiality

LM+Co agrees to keep confidential all information obtained from the Company,
pursuant to the terms of the confidentiality agreement dated March 26, 2010
between LM+Co and the Company (the “Confidentiality Agreement”).

The Company acknowledges that all Information (written or oral) generated by
LM+Co in connection with their engagement is intended solely for the benefit and
use of the Company (limited to its Board and other management) in considering
the transactions to which it relates. The Company agrees that no such
information shall be used for any other purpose or reproduced, disseminated,
quoted or referred to with attribution to LM+Co at any time in any manner or for
any purpose other than accomplishing the Services referred to herein, without
LM+Co’s prior approval (which shall not be unreasonably withheld), except as
required by law.

Termination of Engagement

Both the Company and LM+Co shall have the right to terminate LM+Co’s Services
upon ten (10) days’ prior written notice to the other. Upon such termination,
the Company shall remain obligated to pay LM+Co: (i) any unpaid Monthly Base Fee
and Additional Personnel Hourly Fee due as of the termination, (ii) any current
Monthly Base Fee and Additional Personnel Hourly Fee pro-rated to the effective
date of the termination, and (iii) all Out-of-Pocket expenses hereunder incurred
on or before the effective date of such termination. In addition, the
Indemnification and Statement of Limitation provisions contained in Annex A
hereto as well as the Confidentiality Agreement, shall survive any such
termination and are incorporated herein by reference and made a part of this
Agreement.

If the Company terminates this engagement without Cause or if LM+Co terminates
this engagement for Good Reason, LM+Co shall be entitled to receive the
Additional Fee for Restructuring Services provided one of the qualifying
conditions has occurred within 12 months of LM+Co’s termination.

Miscellaneous

LM+Co acknowledges that MSN and its subsidiaries may be seeking relief under
U.S. bankruptcy laws. Should the Company and/or its subsidiaries become a debtor
under any applicable provision of the Code, then the Company and/or its
subsidiaries has an affirmative duty to promptly seek to have LM+Co’s retention
approved pursuant to U.S.C. Section 363. Under the terms of this Agreement to
the extent permitted by applicable law, rule or regulation, LM+Co shall have no
obligation to provide any services under this Agreement in the event that the
Company and/or its subsidiaries should become a debtor under any applicable
reorganization law unless LM+Co’s retention under the terms of this Agreement is
approved on terms and conditions satisfactory to LM+Co by a final order of the
appropriate court and an acceptable carve out for the payment of the Success Fee
from the Company’s secured creditors.

 

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 7 of 9

Complete Agreement; Amendments; Governing Law; Sole Benefit

This Agreement (including the Annex) and the Confidentiality Agreement between
the parties hereto dated effective as of March 26, 2010: (a) constitutes the
entire agreement of the parties with respect to the subject matter hereof and
supersedes any other communications, understandings or agreements (both written
and oral) among the parties with respect to the subject matter hereof, and
(b) may be modified, amended or supplemented only by written agreement among all
the parties hereto.

This Agreement and all controversies arising from or related to performance
hereunder shall be governed by and construed in accordance with the laws of the
State of Florida applicable to contracts to be executed and performed within
such state. The parties hereby submit to the jurisdiction of and venue in the
federal and state courts located in Palm Beach County, Florida and waive any
right to trial by jury in connection with any dispute related to this Agreement.
This Agreement shall be binding upon the parties and their respective successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement.

Please confirm the foregoing is in accordance with your understanding by signing
and returning a copy of this Agreement, whereupon it shall become binding and
enforceable in accordance with its terms.

Very truly yours,

Loughlin Meghji + Company

 

By   /s/ Patrick J. Fodale, Managing Director, For Mohsin Y. Meghji     Date    
March 31, 2010   Mohsin Y. Meghji         Accepted and agreed to as of the date
first above written: Medical Staffing Network Holdings Inc. and its
subsidiaries. By   /s/ Robert J. Adamson     Date     March 31, 2010  

Robert J. Adamson

Chairman & Chief Executive Officer

       

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 8 of 9

ANNEX A

INDEMNIFICATION and STATEMENT OF LIMITATIONS

As LM+Co is performing the Services for the benefit of the Company, the Company
shall indemnify the Chief Restructuring Officer, LM+Co and its affiliates
(including past, present or future partners, principals and personnel of each of
them) (collectively called the “Indemnified Persons”) against all costs, fees,
expenses, damages, and liabilities (including defense costs) associated with any
third party claim relating to or arising as a result of the Services (“Losses”),
the Company’s use or disclosure of the Deliverables, or this Agreement. This
provision is intended to apply regardless of the nature of any claim (including
contract, statute, any form of negligence, whether of the Company, LM+Co, or
others, tort, strict liability or otherwise), except to the extent such Losses
are determined to be the result of LM+Co’s bad faith, gross negligence or
willful misconduct.

The Company shall not, without LM+Co’s prior written consent (which will not be
unreasonably withheld), settle, compromise, or consent to the entry of any
judgment in any pending or threatened claim, action, or proceeding in respect of
which indemnification could reasonably be sought hereunder (whether or not LM+Co
or any other Indemnified Person is an actual or potential party to such claim,
action, or proceeding), if such settlement, compromise, or consent does not
include an unconditional release of each Indemnified Person from all liability
arising out of such claim, action, or proceeding. The Company shall not be
liable hereunder to any Indemnified Person for any amount paid or payable in the
settlement of any action, proceeding or investigation entered into without its
written consent.

Upon receipt by an Indemnified Person of actual notice of a proceeding against
such Indemnified Person in respect of which indemnity may be sought hereunder,
such Indemnified Person shall promptly notify the Company with respect thereto.
In addition, an Indemnified Person shall promptly notify the Company after any
action is commenced (by way of service with a summons or other legal process
giving information as to the nature and basis of the claim) against such
Indemnified Person in respect of which indemnity may be sought hereunder. In any
event, failure to notify the Company shall not relieve the Company from any
liability which the Company may have on account of this indemnity or otherwise,
except to the extent the Company shall have been materially prejudiced by such
failure.

To the extent it wishes, the Company shall be entitled to participate, as well
as assume, the defense of any action that is the subject of the proceeding in
respect of which indemnity may be sought with counsel reasonably satisfactory to
the Indemnified Person, and, if it elects to do so, the Company shall be
thereafter relieved of any further obligation for the payment of the fees and
expenses of the Indemnified Person’s counsel, provided, however, that the
Indemnified Person shall be entitled to continued separate counsel at such
Indemnified Person’s own expense.

In the event that any LM+Co personnel are requested or required to appear as a
witness in connection with any action, claim or proceeding for which
indemnification is available hereunder, to the extent

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Mr. Robert J. Adamson

Medical Staffing Network Holdings Inc.

March 28, 2010

Page 9 of 9

permitted by law, the Company shall reimburse LM+Co for all reasonable
out-of-pocket expenses incurred by it in connection with such personnel
appearing and preparing to appear as a witness, including, without limitation,
the reasonable fees and disbursements of its legal counsel, and to compensate
LM+Co in an amount to be mutually agreed upon per person per day for each day
that such personnel is involved in preparation, discovery proceedings or
testimony pertaining to such action, claim or proceeding.

LM+Co’s total aggregate liability to the Company relating to this Agreement
shall in no event exceed the fees LM+Co receives hereunder for the portion of
the work giving rise to liability, except for liability for bad faith, gross
negligence or willful misconduct, which will not be so limited. In no event
shall LM+Co have any responsibility for any special, consequential, incidental
or exemplary damages or loss (nor any lost profits, savings or business
opportunity). This paragraph shall apply regardless of the nature of any
claim(s) (including contract, statute, any form of negligence, tort, strict
liability or otherwise), regardless of any failure of the essential purpose of
any remedy and whether or not LM+Co was advised of the possibility of the damage
or loss asserted, but shall not apply to the extent finally determined to be
prohibited by applicable law.

The Indemnification and Limitation of Liability provisions contained in this
Annex A shall survive the termination or expiration of this Agreement for any
reason.

Accepted and agreed to as of the date first above written:

Medical Staffing Network Holdings Inc. and its subsidiaries.

 

By   /s/ Robert J. Adamson     Date     March 31, 2010  

Robert J. Adamson

Chairman & Chief Executive Officer