FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT

FIRST AMENDMENT, dated as of February 1, 2008, to the Credit Agreement referred
to below (this “Amendment”) by and among BUTLER SERVICE GROUP, INC., a New
Jersey corporation, as the Borrower (the “Borrower”), the other Credit Parties
signatory hereto, GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation
(in its individual capacity, “GE Capital”), for itself, as Lender, and as Agent
for Lenders (in such capacity, the “Agent”), and the other Lenders signatory
hereto.

W I T N E S S E T H:

WHEREAS, the Borrower, the other Credit Parties signatory thereto, Agent, and
Lenders signatory thereto are parties to that certain Third Amended and Restated
Credit Agreement, dated as of August 29, 2007 (including, all annexes, exhibits
and schedules thereto, and as amended, supplemented or otherwise modified from
time to time prior to the date hereof, the “Credit Agreement”); and

WHEREAS, Agent and Lenders have agreed to amend the Credit Agreement in the
manner, and on the terms and conditions provided for herein.

NOW THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt, adequacy and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

1.            Definitions. Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in Annex A of the Credit Agreement.

 

2.

Amendments to Annex A (Definitions) of the Credit Agreement.

(a)           Annex A of the Credit Agreement is hereby amended as of the First
Amendment Effective Date (as defined below) by adding the following definitions
in the appropriate alphabetical order:

““First Amendment Effective Date” means February 1, 2008.

“Daily Reserve” means with respect to the Borrowing Base of the Borrower, a
reserve against the Borrowing Availability of the Borrower in an amount, which
shall accrue on a daily basis in equal installments of $5,000 commencing on the
First Amendment Effective Date through the Commitment Termination Date.”

(b)           Annex A of the Credit Agreement is hereby further amended as of
the First Amendment Effective Date by deleting the language “February 1, 2008”
in clause (a) of the

 

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definition of “Commitment Termination Date” and substituting in lieu thereof the
language “February 29, 2008”.

(c)           Annex A of the Credit Agreement is hereby further amended as of
the First Amendment Effective Date by deleting the definition of “Reserves” in
its entirety and substituting in lieu thereof the following new definition:

““Reserves ” means, with respect to the Borrowing Base of the Borrower (a) a
reserve for the face amount of all Letters of Credit issued hereunder,
(b) reserves established pursuant to Section 5.4(c), (c) the Daily Reserve and
(d) such other reserve against Eligible Accounts, Eligible Pending Accounts
Receivable and Fixed Contract Accounts Receivable or Borrowing Availability of
the Borrower that Agent may, in its reasonable credit judgment, establish from
time to time. Without limiting the generality of the foregoing, Reserves
established to ensure the payment of accrued Interest Expenses or Indebtedness
shall be deemed to be a reasonable exercise of Agent’s credit judgment.”

3.             Amendment to Annex B of the Credit Agreement. Subsection (a) of
Annex B of the Credit Agreement is hereby amended as of the First Amendment
Effective Date by deleting “Nine Million Dollars ($9,000,000.00)” where it
appears in the second sentence of such subsection (a) and substituting in lieu
thereof, “$3,845,844.80”.

4.             Payment of Default Rate. The Borrower and the other Credit
Parties acknowledge and agree that Agent provided notice to the Borrower that,
commencing on January 3, 2008, all outstanding Obligations bore interest at the
Default Rate in accordance with Section 1.5(d) of the Credit Agreement through
the date hereof, all of which interest shall be due and payable in cash on the
Commitment Termination Date; provided, that the Default Rate interest due on the
date hereof shall be waived if the Borrower pays in full in cash on the
Commitment Termination Date all then outstanding Obligations (including, without
limitation, cash collateralizing all outstanding Letters of Credit in accordance
with the terms of Section 1.2 and Annex B, clause (c) of the Credit Agreement),
together with interest, fees, expenses, attorneys fees and any other charges
hereafter accruing through the date of payment, under the Loan Documents;
provided further that to the extent all outstanding Obligations are not paid in
full on or prior to the Commitment Termination Date, all outstanding Obligations
shall continue to bear interest at the Default Rate until such Obligations are
paid in full.

5.             Representations and Warranties. To induce Agent and Lenders to
enter into this Amendment, each of the Borrower and Credit Parties make the
following representations and warranties to Agent and Lenders:

(a)           The execution, delivery and performance of this Amendment and the
performance of the Credit Agreement, as amended by this Amendment (the “Amended
Credit Agreement”) by the Borrower and the other Credit Parties: (a) is within
such Person’s organizational power; (b) has been duly authorized by all
necessary or proper corporate and shareholder action; (c) does not contravene
any provision of such Person’s charter or bylaws or equivalent organizational
documents; (d) does not violate any law or regulation, or any order or decree of
any court or Governmental Authority; (e) does not conflict with or result in the
breach or

 

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termination of, constitute a default under or accelerate or permit the
acceleration of any performance required by, any indenture, mortgage, deed of
trust, lease, agreement or other instrument to which such Person is a party or
by which such Person or any of its property is bound; (f) does not result in the
creation or imposition of any Lien upon any of the property of such Person other
than those in favor of Agent pursuant to the Loan Documents; and (g) does not
require the consent or approval of any Governmental Authority or any other
Person.

(b)           This Amendment has been duly executed and delivered by or on
behalf of each of the Borrower and the other Credit Parties.

(c)           Each of this Amendment and the Amended Credit Agreement
constitutes a legal, valid and binding obligation of the Borrower and each of
the other Credit Parties party thereto, enforceable against each in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

(d)           No Default or Event of Default has occurred and is continuing
after giving effect to this Amendment.

(e)           No action, claim, lawsuit, demand, investigation or proceeding is
now pending or, to the knowledge of any Credit Party, threatened against any
Credit Party, at law, in equity or otherwise, before any court, board,
commission, agency or instrumentality of any Governmental Authority, or before
any arbitrator or panel of arbitrators, (a) which challenges the Borrower’s or,
to the extent applicable, any other Credit Party’s right, power, or competence
to enter into this Amendment or perform any of their respective obligations
under this Amendment, the Amended Credit Agreement or any other Loan Document,
or the validity or enforceability of this Amendment, the Amended Credit
Agreement or any other Loan Document or any action taken under this Amendment,
the Amended Credit Agreement or any other Loan Document or (b) which if
determined adversely, is reasonably likely to have or result in a Material
Adverse Effect. To the knowledge of Holdings or the Borrower, there does not
exist a state of facts which is reasonably likely to give rise to such
proceedings.

(f)            The representations and warranties of the Borrower and the other
Credit Parties contained in the Credit Agreement and each other Loan Document
shall be true and correct on and as of the First Amendment Effective Date and
the date hereof with the same effect as if such representations and warranties
had been made on and as of such date, except that any such representation or
warranty which is expressly made only as of a specified date need be true only
as of such date.

6.             No New Letters of Credit. As of the First Amendment Effective
Date, neither the Agent nor the Lenders shall have any obligation to issue,
extend or renew, and the Borrower shall not request the issuance, extension or
renewal of, any Letters of Credit to the Borrower under the Credit Agreement.
Any past issuances of Letters of Credit for the account of the Borrower should
not be considered an agreement, express or implied, on the part of the Lenders
to issue any

 

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additional Letters of Credit or an agreement to waive any terms of the Credit
Agreement in the future, including, without limitation, the satisfaction of
conditions precedent to funding.

7.             No Other Amendments/Waivers. Except as expressly amended herein,
the Credit Agreement and the other Loan Documents shall be unmodified and shall
continue to be in full force and effect in accordance with their terms. In
addition, this Amendment shall not be deemed a waiver of any term or condition
of any Loan Document and shall not be deemed to prejudice any right or rights
which Agent, for itself and Lenders, may now have or may have in the future
under or in connection with any Loan Document or any of the instruments or
agreements referred to therein, as the same may be amended from time to time.

8.             Outstanding Indebtedness; Waiver of Claims. Each of the Borrower
and the other Credit Parties hereby acknowledges and agrees that as of February
1, 2008, the aggregate outstanding principal amount of the Revolving Loan is
$33,702,945 and the aggregate outstanding Letters of Credit Obligations is
$3,845,844.80, and that such principal amounts are payable pursuant to the
Credit Agreement without defense, offset, withholding, counterclaim or deduction
of any kind. The Borrower and each other Credit Party hereby waives, releases,
remises and forever discharges Agent, Lenders and each other Indemnified Person
from any and all claims, suits, actions, investigations, proceedings or demands
arising out of or in connection with the Credit Agreement (collectively,
“Claims”), whether based in contract, tort, implied or express warranty, strict
liability, criminal or civil statute or common law of any kind or character,
known or unknown, which the Borrower or any other Credit Party ever had, now has
or might hereafter have against Agent or Lenders which relates, directly or
indirectly, to any acts or omissions of Agent, Lenders or any other Indemnified
Person on or prior to the date hereof; provided, that neither the Borrower nor
any other Credit Party waives any Claim solely to the extent such Claim relates
to the Agent’s or any Lender’s gross negligence or willful misconduct.

9.             Amendment Fee. The Borrower and the other Credit Parties hereby,
jointly and severally agree to pay to the Agent, for the ratable benefit of the
Lenders, an amendment fee in the aggregate amount equal to $300,000, which shall
be fully earned, due and payable in immediately available funds on the First
Amendment Effective Date (the “Amendment Fee”); provided, that a portion of the
Amendment equal to $100,000 shall be refunded to the Borrower on the Commitment
Termination Date if the Borrower pays in full in cash on the Commitment
Termination Date all then outstanding Obligations (including, without
limitation, cash collateralizing all outstanding Letters of Credit in accordance
with the terms of Section 1.2 and Annex B, clause (c) of the Credit Agreement),
together with interest, fees, expenses, attorneys fees and any other charges
hereafter accruing through the date of payment, under the Loan Documents.

10.           Expenses. The Borrower and the other Credit Parties hereby
reconfirm their respective obligations pursuant to Sections 1.9 and 11.3 of the
Credit Agreement to pay and reimburse Agent, for itself and Lenders, for all
reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) incurred in connection with the negotiation, preparation, execution and
delivery of this Amendment and all other documents and instruments delivered in
connection herewith.

 

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11.           Effectiveness. This Amendment shall be deemed effective as of the
date hereof (the “First Amendment Effective Date”) only upon satisfaction in
full in the judgment of Agent of each of the following conditions:

(a)           Amendment. Agent shall have received five (5) original copies of
this Amendment duly executed and delivered by Agent, the Requisite Lenders, the
Borrower and the other Credit Parties.

(b)           Amendment Fee. Agent shall have received payment of the Amendment
Fee.

(c)           Payment of Letter Agreement Fee. Agent shall have received payment
of the fee referred to in that certain Letter Agreement, dated January 9, 2008,
among the Borrower, the other Credit Parties thereto, Agent and the Lenders
signatory thereto, in an aggregate amount equal to $50,000.

(d)           Payment of Fees and Expenses. The Borrower shall have paid to
Agent all documented costs, fees and expenses owing to Agent in connection with
this Amendment and the other Loan Documents (including, without limitation,
reasonable legal fees and expenses).

(e)           Representations and Warranties. The representations and warranties
of or on behalf of the Borrower and the Credit Parties in this Amendment shall
be true and correct on and as of the First Amendment Effective Date and the date
hereof, except that any such representation or warranty which is expressly made
only as of a specified date need be true only as of such date.

12.          GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

13.          Counterparts. This Amendment may be executed by the parties hereto
on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the day and year first above written.

 

 

 

BUTLER SERVICE GROUP, INC., as Borrower

 

 

 

 

 

 

 

 

By:

/s/ Mark Koscinski

 

 

 

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Name:

Mark Koscinski

 

 

 

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Title:

SVP Controller

 

 

 

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GENERAL ELECTRIC CAPITAL

 

 

CORPORATION, as Agent and Lender

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ James H. Kaufman

 

 

 

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Name:

James H. Kaufman

 

 

 

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Title:

Duly Authorized Signatory

 

 

 

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The following Persons are signatories to this Amendment in their capacity as
Credit Parties and not as the Borrower.

 

BUTLER INTERNATIONAL, INC.

BUTLER SERVICES INTERNATIONAL, INC.

BUTLER TELECOM, INC.

BLUESTORM, INC.

BUTLER SERVCICES, INC.

BUTLER UTILITY SERVICE, INC.

 

 

 

 

By:

/s/ Mark Koscinski

 

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Name:

Mark Koscinski