**Exhibit 10.1**

**WAIVERAND AMENDMENT NUMBER ONETO LOAN AND SECURITY AGREEMENT**

This Waiver and AmendmentNumber One to Loan and Security Agreement (“Amendment”) is entered intoas of March 27, 2002, among **US SEARCH.COM, INC.**, a Delaware corporation(“USI”) and **PROFESSIONAL RESOURCE SCREENING, INC**., aDelaware corporation (“PRSI”), formerly known as US SEARCH SCREENINGSERVICES, INC., a Delaware corporation (“Screening”) (each a “Borrower”,and collectively, jointly and severally, the “Borrowers”), on the one hand,and **COMERICABANK — CALIFORNIA**, successor by merger to Imperial Bank (“Bank”),on the other hand, and in light of the following:

A.            USI and Bank havepreviously entered into that certain Loan and Security Agreement, dated as ofSeptember 12, 2001 (as amended from time to time, the “Loan Agreement”).

B.            USI, Screening andBank have previously entered into that certain Forbearance Agreement, dated asof December 24, 2001 (the “Forbearance Agreement”), and that certainJoint and Several Borrower Rider, dated as of December 24, 2001 (the “Rider”),whereby, among other things, Screening became a Borrower under the LoanAgreement.  In connection with the LoanAgreement, the Forbearance Agreement, and the Rider, Borrowers and Bank haveentered into various other agreements (such agreements, together with the LoanAgreement, the Forbearance Agreement, and the Rider, are collectively referredto herein as the “Loan Documents”).

C.            Events of Defaultoccurred under the terms of the Loan Documents as a result of:  (i) Borrowers’ failure to comply withFinancial Statements, Reports, Certificates covenant set forth in Section 6.2of the Loan Agreement for the month ending January 31, 2002, failure to complywith such covenant being an Event of Default under Section 8.2 of the LoanAgreement, and (ii) Borrowers’ failure to comply with the Compliance with VISAMerchant Card Services covenants set forth in Section 6.10(a) and Section6.10(b) of the Loan Agreement for the month ending January 31, 2002, failure tocomply with such covenants being an Event of Default under Section 8.2 of theLoan Agreement (collectively, the “Existing Defaults”).

D.            Screening changedits name to PRSI pursuant to that certain Certificate of Amendment of Articlesof Incorporation, dated as February 25, 2002.

E.             Borrowers and Bankdesire to amend the Loan Agreement and to waive the Existing Defaults inaccordance with the terms and conditions contained herein.

**NOW, THEREFORE**, Borrowers and Bank hereby amend and supplement theLoan Agreement as follows:

1.             **DEFINITIONS**.  All initially capitalized terms used in thisAmendment shall have the meanings given to them in the Loan Agreement unlessspecifically defined herein.

 

2.             **WAIVER.**  Bank hereby waives the Events of Defaultarising out of the Existing

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 Defaults. This waiver applies only to the Existing Defaults and shall not in anyway affect any other obligation, agreement or covenant of Borrowers, or anyright or remedy of Bank, under the Loan Agreement, as amended hereby.

3.             **AMENDMENTS**.

(a)           All references to “US SearchScreening Services, Inc., a Delaware corporation” or “Screening” in the LoanAgreement and all other Loan Documents shall be and mean, and shall be revisedto say, “Professional Resource Screening Services, Inc., a Delaware corporation”.

(b)           Section 2.1 of the Loan Agreement ishereby amended and restated in its entirety to read as follows:

2.1           Credit Extensions.  Borrower promises to pay to Bank, in lawfulmoney of the United States of America, the aggregate unpaid principal amount ofall Credit Extensions made by Bank to Borrower, together with interest on theunpaid principal amount of such Credit Extensions at rates in accordance withthe terms hereof.

(a)           Revolving Advances.

(i)            Amount.  Subject to and upon the terms and conditionsof this Agreement (1) Borrower may request Advances in an aggregate outstandingamount not to exceed the Committed Revolving Line, and (2) amounts borrowedpursuant to this Section 2.1(a) may be repaid and reborrowed at any time priorto the Revolving Maturity Date, at which time all Advances under this Section2.1(a) shall be immediately due and payable. Borrower may prepay any Advances without penalty or premium.

(ii)           Form of Request.  Whenever Borrower desires an Advance,Borrower will notify Bank by facsimile transmission or telephone no later than3:00 p.m. Pacific time, on the Business Day that the Advance is to bemade.  Each such notification shall bepromptly confirmed by a Payment/Advance Form in substantially the form of Exhibit C.  Bank is authorized to make Advances underthis Agreement, based upon instructions received from a Responsible Officer ora designee of a Responsible Officer, or without instructions if in Bank’sdiscretion such Advances are necessary to meet Obligations which have becomedue and remain unpaid.  Bank shall beentitled to rely on any telephonic notice given by a person who Bank reasonablybelieves to be a Responsible Officer or a designee thereof, and Borrower shallindemnify and hold Bank harmless for any damages or loss suffered by Bank as aresult of such reliance.  Bank willcredit the amount of Advances made under this Section 2.1(a) to Borrower’sdeposit account.

 

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(b)           Borrowing Base Advances.

(i)            Amount.  If no availability exists under theCommitted Revolving Line, then (1) Borrower may request Borrowing Base Advancesin an aggregate outstanding amount not to exceed the lesser of (A) theBorrowing Base Line or (B) the Borrowing Base, and (2) amounts borrowed pursuantto this Section 2.1(b) may be repaid and reborrowed at any time prior to theRevolving Maturity Date, at which time all Borrowing Base Advances under thisSection 2.1(b) shall be immediately due and payable.  Borrower may prepay any Borrowing Base Advances without penaltyor premium.

(ii)           Form of Request.  Whenever Borrower desires a Borrowing BaseAdvance, Borrower will notify Bank by facsimile transmission or telephone nolater than 3:00 p.m. Pacific time, on the Business Day that the Borrowing BaseAdvance is to be made.  Each suchnotification shall be promptly confirmed by a Payment/Advance Form insubstantially the form of Exhibit C. Bank is authorized to make Advances under this Agreement, based uponinstructions received from a Responsible Officer or a designee of a ResponsibleOfficer, or without instructions if in Bank’s discretion such Borrowing BaseAdvances are necessary to meet Obligations which have become due and remainunpaid.  Bank shall be entitled to relyon any telephonic notice given by a person who Bank reasonably believes to be aResponsible Officer or a designee thereof, and Borrower shall indemnify andhold Bank harmless for any damages or loss suffered by Bank as a result of suchreliance.  Bank will credit the amountof Borrowing Base Advances made under this Section 2.1(b) to Borrower’s depositaccount.

(c)           Equipment Advances.

(i)            Subject to and upon the terms andconditions of this Agreement, Bank agrees to make advances (each an “EquipmentAdvance” and, collectively, the “Equipment Advances”) to Borrower at any timefrom the date hereof through the Equipment Advance Availability End Date.  The aggregate outstanding amount ofEquipment Advances shall not exceed the Equipment Line.  And Bank may advance up to 30% of the aggregateamount of outstanding Equipment Advances as Software Equipment Advances; provided,however, that each Software Equipment Advance shall be in a minimumamount of $100,000.  Each EquipmentAdvance shall not exceed 100% of the invoice amount of equipment and softwareapproved by Bank from time to time (which Borrower shall, in any case, havepurchased within 60 days of the date of the corresponding EquipmentAdvance), excluding taxes, shipping, warranty charges, freight discounts,installation expense, and other such soft costs.

(ii)           At the time of eachHardware Advance, the aggregate of the then outstanding principal balance ofthe Hardware Advances, if 

 

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any, shall beadded to the new Hardware Advance and the total aggregate balance of both shallbe payable in equal monthly installments, including all accrued interestthereon, on the last day of each month commencing on the first (1st) fullcalendar month following the initial advance and each such subsequent advancehereunder and continuing on the last day of each succeeding month until theEquipment Maturity Date, at which time all amounts due in connection with theHardware Advances made under this Section 2.1(c) and any other amounts dueunder this Agreement shall be immediately due and payable.

(iii)          Interest on each Software EquipmentAdvance shall begin to accrue on the funding date of the relevant SoftwareEquipment Advance.  Each SoftwareEquipment Advance shall be payable in eighteen (18) equal monthly principalinstallments, plus all accrued interest, beginning on the date that is onemonth after such Software Equipment Advance is funded and continuing on thesame day of each subsequent month thereafter (or on the last day of the monthif the date of funding was on the 31st day of any month) through thedate that is 18 months after such Software Equipment Advance funding date.

(iv)          Equipment Advances may not beprepaid.  Any Equipment Advance orportion thereof, once repaid may not be reborrowed.

(v)           When Borrower desires to obtain anEquipment Advance, Borrower shall notify Bank (which notice shall beirrevocable) by facsimile transmission to be received no later than 3:00 p.m.Pacific time one Business Day before the day on which the Equipment Advance isto be made.  Such notice shall besubstantially in the form of Exhibit C. The notice shall be signed by a Responsible Officer or its designee andinclude a copy of the invoice for any Equipment to be financed.

(d)           Letter of Credit.

(i)            Bank issued for the account ofBorrower a standby letter of credit (ID No. 569842), with a maturity date ofNovember 30, 2002 (“Letter of Credit”). On each and every L/C Commitment Reduction Date, Bank shall reduce theL/C Commitment in such amount and the stated amount of the Letter of Creditshall reduce, per the terms of the Letter of Credit, to an amount not greaterthan the L/C Commitment as reduced and in effect on such date.  Borrower will pay any standard fees that Banknotifies Borrower will be charged for processing the Letter of Credit.

(ii)           Borroweragrees to grant and pledge to Bank a continuing security interest in the SecondTCD to secure prompt repayment of the Letter of Credit.  Such security interest shall constitute avalid, first priority security interest in the Second TCD, and will constitutea valid, first priority security interest in accrued interest or proceedstherefrom.  Notwithstanding any 

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termination, Bank’s Lien on the Second TCD shallremain in effect for so long as the Letter of Credit is outstanding.

 

 

(c)           Section 2.2 of the Loan Agreement ishereby amended and restated in its entirety to read as follows:

2.2           Overadvances.  If the aggregate amount of the outstandingAdvances, Borrowing Base Advances and Equipment Advances exceeds the MaximumCommitment at any time, Borrower shall immediately pay to Bank, in cash, theamount of such excess.

(d)           Section 2.3(a) of the Loan Agreementis hereby amended and restated in its entirety to read as follows:

(a)           Interest Rates.

(i)            Advances, Borrowing BaseAdvances, and Letter of Credit. Except as set forth in Section 2.3(b) the Advances, the Borrowing BaseAdvances, and any drawn but unreimbursed amounts under the Letter of Creditshall bear interest, on the outstanding daily balance thereof, at a rate equalto 2.50% above the Prime Rate.

(ii)           Equipment Advances.  Except as set forth in Section 2.3(b) theEquipment Advances shall bear interest, on the outstanding daily balancethereof, at a rate equal to 2.75% above the Prime Rate.

(e)           Section 2.3(c) of the Loan Agreementis hereby amended and restated in its entirety to read as follows:

(c)           Interest on the Advances shall be dueand payable on the last calendar day of each month during the term hereof.  Any interest not paid when due shall becompounded by becoming a part of the Obligations, and such interest shallthereafter accrue interest at the rate then applicable hereunder.  Bank shall, at its option, charge suchinterest, all Bank Expenses, and all Periodic Payments against any ofBorrower’s deposit accounts, including Account Number 38–059–297(such debits are not a setoff), or against the Committed Revolving Line or, ifno availability exists under the Committed Revolving Line, then against theBorrowing Base Line, in which case those amounts shall thereafter accrueinterest at the rate then applicable hereunder.

(f)            Section 5.3 of the Loan Agreement ishereby amended and restated in its entirety to read as follows:

5.3           Collateral.  Borrower has good title to the Collateral,free and clear of Liens, except for Permitted Liens.  The Eligible Accounts are bona fide existing obligations.  The property giving rise to such EligibleAccounts has been delivered to the account debtor or its agent for immediateshipment to and 

 

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unconditionalacceptance by the account debtor. Borrower has not received notice of actual or imminent InsolvencyProceeding of any account debtor whose accounts are included in any BorrowingBase Certificate as an Eligible Account. All Inventory is in all material respects of good and marketablequality, free from all material defects, except for Inventory for whichadequate reserves have been made.

(g)           Section 6.2 is hereby amended andrestated in its entirety to read as follows:

6.2           Financial Statements, Reports,Certificates.  Borrower shalldeliver to Bank:  (a) as soon asavailable, but in any event within 30 days after the end of each calendarmonth, a company prepared consolidated balance sheet and income statementcovering Borrower’s consolidated operations during such period, in a formacceptable to Bank and certified by a Responsible Officer; (b) as soon asavailable, but in any event within 90 days after the end of Borrower’s fiscalyear commencing December 31, 2001, audited consolidated financial statements ofBorrower prepared in accordance with GAAP, consistently applied, together withan opinion which is unqualified or otherwise consented to in writing by Bank onsuch financial statements of an independent certified public accounting firmreasonably acceptable to Bank; (c) if applicable, copies of all statements,reports and notices sent or made available generally by Borrower to itssecurity holders or to any holders of Subordinated Debt and all reports onForms 10-K and 10-Q filed with the Securities and Exchange Commission; (d)promptly upon receipt of notice thereof, a report of any legal actions pendingor threatened against Borrower or any Subsidiary that could result in damagesor costs to Borrower or any Subsidiary of $100,000 or more; (e) such budgets,sales projections, operating plans or other financial information generallyprepared by Borrower in the ordinary course of business as Bank may reasonably requestfrom time to time, including the minutes from Borrower’s board of directors;and (f) within 30 days of the last day of each fiscal quarter, a report signedby Borrower, in form reasonably acceptable to Bank, listing any applications orregistrations that Borrower has made or filed in respect of any Patents,Copyrights or Trademarks and the status of any outstanding applications orregistrations, as well as any material change in Borrower’s IntellectualProperty Collateral, including but not limited to any subsequent ownershipright of Borrower in or to any Trademark, Patent or Copyright not specified in ExhibitsA, B, and C of the Intellectual Property Security Agreementdelivered to Bank by Borrower in connection with this Agreement.

(a)           Within 30 days afterthe last day of each month, Borrower shall deliver to Bank with the monthlyfinancial statements a Compliance Certificate signed by a Responsible Officerin substantially the form of Exhibit D hereto.

 

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(b)           Within 20 days after the last day ofeach month, and in addition, in connection with each request of a BorrowingBase Advance, Borrower shall deliver to Bank a Borrowing Base Certificatesigned by a Responsible Officer in substantially the form of Exhibit Ehereto, together with aged listings of accounts receivable and accountspayable.

(c)           Bank shall have a right from time totime hereafter to audit Borrower’s Accounts and appraise Collateral duringnormal business hours at Borrower’s expense.

(d)           Borrower shall immediately provideBank with a detailed schedule of all equipment purchases and associatedexpenses in connection with each Equipment Advance.

(e)           On the fifth (5th) andtwentieth (20th) day of every month, Borrower shall deliver to Bank a cash flowreport, signed by a Responsible Officer, in form reasonably acceptable to Bank,which cash flow report shall include 3 weeks trailing (actual) cash flow and 6weeks forward (projected) cash flow.

(f)            On or before November 30, 2002,Borrower shall deliver the Plan Projections to Bank.

(h)           Section 6.6 of the Loan Agreement ishereby amended and restated in its entirety to read as follows:

6.6           Primary Depository; First TCD andSecond TCD.

(a)           Borrower shall maintain its primarydepository and operating accounts with Bank or Bank’s affiliates.

(b)           Effective March 31, 2002, Borrowershall maintain not less than $1,250,000 of its unrestricted cash and cashequivalents in deposit or investment accounts with Bank or Bank’s Affiliates(subject to control agreements if with Affiliates) at all times.

(c)           Borrower shall maintain the First TCDand Second TCD at Bank, such amount of Second TCD reducing per reduction of theL/C Commitment on the L/C Commitment Reduction Dates.

(i)            Section 6.7 of the Loan Agreement ishereby amended and restated in its entirety to read as follows:

6.7           FinancialCovenants.  Borrower shall maintain,as of the last day of each calendar month unless stated otherwise:

 

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(a)           Operating Performance.      Actual company revenues of no less than75% of the Plan Projections effective March 2002, and continuing monthlythereafter;

(b)           Minimum EBITDA.  Effective August 31, 2002, and monthlythereafter, an EBITDA calculated on a two month trailing average of at least$1.00; and

(c)           Debt/Tangible Net Worth Ratio.  Effective March 31, 2002, a ratio of TotalLiabilities less Subordinated Debt to Tangible Net Worth plus Subordinated Debtof not more than 1.50 to 1.00.

(j)            Section 6.10(b) of the Loan Agreementis hereby amended and restated in its entirety to read as follows:

(b)           Commencing on or before April 30,2002, and continuing up to and including April 30, 2003, Borrower shall causeitself to be removed from VISA’s Merchant Chargeback Monitoring Program (the “Program”).

(k)           Section 8 of the Loan Agreement isfurther amended by adding the following clause (8.10):

8.10         Dissolution of Pequot.         If Pequot Private Equity Fund II, L.P., a Delaware limited partnership(“Pequot”), during the term of this Agreement, unless Bank shallotherwise consent in writing, winds up, dissolves or otherwise terminates itscorporate existence, or consolidates with or merges with or into, or sells,loans or otherwise transfers all or substantially all of its assets to, any entityunless: (a) the entity formed by a consolidation with or into which Pequot ismerged or the entity that acquires all or substantially all of the assets ofPequot, as the case may be, shall be organized and existing under the laws ofthe United States or any state thereof; (b) such entity shall expressly assumethe obligations of Pequot under that certain Limited Guaranty, dated as ofMarch 29, 2002, executed by Guarantor in favor of Bank (the “Guaranty”), in awritten instrument duly authorized, executed and delivered to Bank; and (c)such entity shall have, immediately after the consolidation, merger, transferor loan, a net worth not less than the net worth of Pequot, and a debt to networth ratio not greater than that of Pequot, in each case, as determined inaccordance with generally accepted accounting principles, and measured withrespect to Pequot immediately before the consolidation, merger, transfer orloan.

(l)            Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“Borrowing Base” means an amount equal to 80% of Eligible Accounts, asdetermined by Bank with reference to the most recent Borrowing Base Certificatedelivered by Borrower.

 

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(m)          Exhibit A of the Loan Agreementis hereby amended by adding the following new definition thereto in theappropriate alphabetical order:

“Borrowing Base Advance”or “Borrowing Base Advances” means a cash advance or cash advances under theBorrowing Base Facility.

(n)           Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“Borrowing Base Facility”means the facility under which Borrower may request Bank to issue BorrowingBase Advances, as specified in Section 2.3(b) hereof.

(o)           Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“Borrowing Base Line”means a Credit Extension of up to $1,000,000.

(p)           The definition of “CommittedRevolving Line” in Exhibit A to the Loan Agreement is hereby amended andrestated in its entirety to read as follows:

“Committed RevolvingLine” means a Credit Extension of up to $2,000,000.

(q)           The definition of “Credit Extension”in Exhibit A to the Loan Agreement is hereby amended and restated in itsentirety to read as follows:

“Credit Extension” meanseach Advance, Borrowing Base Advance, Equipment Advance, issuance of the Letterof Credit, or any other extension of credit by Bank for the benefit of Borrowerhereunder.

(r)            Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“Eligible Accounts” meansthose Accounts that arise in the ordinary course of Borrower’s business thatcomply with all of Borrower’s representations and warranties to Bank set forthin Section 5.3; provided, that Bank may change the standards of eligibility bygiving Borrower 30 days prior written notice. Unless otherwise agreed to by Bank, Eligible Accounts shall not includethe following:

(a)           Accounts that the account debtor hasfailed to pay within 90 days of invoice date;

(b)           Accounts withrespect to an account debtor, 25% of whose Accounts the account debtor hasfailed to pay within 90 days of invoice date;

 

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(c)           Accounts with respect to which theaccount debtor is an officer, employee, or agent of Borrower;

(d)           Accounts with respect to which goodsare placed on consignment, guaranteed sale, sale or return, sale on approval,bill and hold, or other terms by reason of which the payment by the accountdebtor may be conditional;

(e)           Accounts with respect to which theaccount debtor is an Affiliate of Borrower;

(f)            Accounts with respect to which theaccount debtor does not have its principal place of business in the UnitedStates;

(g)           Accounts with respect to which theaccount debtor is the United States or any department, agency, or instrumentalityof the United States;

(h)           Accounts with respect to whichBorrower is liable to the account debtor for goods sold or services rendered bythe account debtor to Borrower, but only to the extent of any amounts owing tothe account debtor against amounts owed to Borrower;

(i)            Accounts with respect to an accountdebtor, including Subsidiaries and Affiliates, whose total obligations toBorrower exceed 20% of all Accounts, to the extent such obligations exceed theaforementioned percentage, except as approved in writing by Bank;

(j)            Accounts with respect to anyaccounts receivables derived from any credit card transactions;

(k)           Accounts with respect to which theaccount debtor disputes liability or makes any claim with respect thereto as towhich Bank believes, in its sole discretion, that there may be a basis fordispute (but only to the extent of the amount subject to such dispute orclaim), or is subject to any Insolvency Proceeding, or becomes insolvent, orgoes out of business; and

(l)            Accounts the collection of whichBank reasonably determines after inquiry and consultation with Borrower to bedoubtful.

(s)           Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“First TCD” meansthat certain $550,000 time certificate of deposit account held by Bank, accountnumber 942750000005786, and any replacement or substitution therefor, and theproceeds of any of the foregoing.

 

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(t)            Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“L/C Commitment” meansthe amount set forth in the table below opposite the applicable period:

| **Period**               |   | **L/C Commitment** |
|--------------------------|--------|--------------------|
| 04/01/02 — 04/30/02 |   | $666,668           |
| 05/01/02 — 05/31/02 |   | $583,335           |
| 06/01/02 — 06/30/02 |   | $500,002           |
| 07/01/02 — 07/31/02 |   | $416,669           |
| 08/01/02 — 08/31/02 |   | $333,336           |
| 09/01/02 — 09/30/02 |   | $250,003           |
| 10/01/02 — 10/31/02 |   | $166,670           |
| 11/01/02 — 11/30/02 |   | $83,337            |
| 12/01/02                 |   | $0                 |

(u)           Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“L/C CommitmentReduction Date” means the first day of April, May, June, July, August,September, October, and November, 2002.

(v)           The definition of “Letter of CreditSublimit” in Exhibit A to the Loan Agreement is hereby deleted in itsentirety and replaced with the following:

[Intentionally Deleted.]

(w)          Exhibit A of the Loan Agreementis hereby amended by adding the following new definition thereto in theappropriate alphabetical order:

“Maximum Commitment”means a Credit Extension of up to $3,000,000.

(x)            Thedefinition of “Plan Projections” in Exhibit A to the Loan Agreement ishereby amended and restated in its entirety to read as follows:

 

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“Plan Projections” meansthose certain  projections for theperiod commencing January 1, 2003 through and including April 30, 2003 setforth in a business plan delivered to Bank.

(y)           The definition of “Revolving MaturityDate” in Exhibit A to the Loan Agreement is hereby amended and restatedin its entirety to read as follows:

“Revolving Maturity Date”means March 26, 2003.

(z)            Exhibit A of the LoanAgreement is hereby amended by adding the following new definition thereto inthe appropriate alphabetical order:

“Tangible Net Worth”means, on any date, the consolidated total assets of Borrower and itsSubsidiaries plus Subordinated Debt minus, (i) any amountsattributable to (a) goodwill, (b) intangible items such as unamortized debtdiscount and expense, Patents, trade and service marks and names, Copyrightsand research and development expenses except prepaid expenses, and (c) reservesnot already deducted from assets, and (ii) Total Liabilities.

(aa)         Exhibit A of the Loan Agreementis hereby amended by adding the following new definition thereto in theappropriate alphabetical order:

“Second TCD” means that certain $750,000 timecertificate of deposit account held by Bank, account number 942750000006008,and any replacement or substitution therefor, and the proceeds of any of theforegoing.  The Second TCD shall bereduced per reduction of the L/C Commitment on the L/C Commitment ReductionDates.

(bb)         Exhibit A of the Loan Agreementis hereby amended by adding the following new definition thereto in theappropriate alphabetical order:

“Total Liabilities” is onany day, obligations that should, under GAAP, be classified as liabilities onBorrower’s consolidated balance sheet, including all Indebtedness, and currentportion Subordinated Debt allowed to be paid, but excluding all otherSubordinated Debt.

(cc)         Exhibit D of the Loan Agreementis hereby amended and restated in its entirety to read as attached hereto andincorporated by this reference into the Amendment.

(dd)         A new Exhibit E is hereby addedto the Loan Agreement to read as attached hereto and incorporated by thisreference into the Amendment.

4.             **REPRESENTATIONSAND WARRANTIES**. Borrowers hereby affirm to Bank that all of Borrowers’ representationsand warranties set forth in the Loan Agreement are true, complete and accuratein all respects as of the date hereof.

 

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5.             **NO DEFAULTS**.  Borrowers hereby affirm to Bank that, otherthan the Existing Defaults, no Event of Default has occurred and is continuingas of the date hereof.

6.             **CONDITIONS PRECEDENT**.  The effectiveness of this Amendment(including the waiver of the Existing Defaults under Section 2 hereof) isexpressly conditioned upon the following:

(a)           Receipt by Bank of a fully earned,non-refundable Amendment Fee of $10,000;

(b)           Receipt by Bank of a warrant topurchase 51,086 shares of USI’s Common Stock at an exercise price per shareequal to $0.783 per share, on Bank’s form, with a 7-year maturity, inclusive ofcertain provisions to include but not be limited to assignability to Bank’saffiliates, antidilution protection and a net exercise provision, and on thesame terms as provided to Pequot Private Equity Fund II, L.P., a Delawarelimited partnership (“Pequot”) in the last equity round, except thatBank shall have piggyback and S-3 registration rights, duly executed anddelivered by USI and Pequot to Bank;

(c)           Receipt by Bank of a limitedcontinuing guaranty of the Obligations of Borrowers to Bank, in a formacceptable to Bank in its sole discretion, duly executed and delivered byPequot to Bank (the “Guaranty”);

(d)           Receipt by Bank of that certainCertified Certificate of Amendment of Articles of Incorporation, dated as ofFebruary 25, 2002, evidencing that Screening changed its name to PRSI;

(e)           Filing of amendments to financingstatements as a result of Screening changing its name to PRSI; and

(f)            Receipt by Bank of an executed copyof this Amendment.

7.             **COSTS AND EXPENSES**.  Borrower shall pay to Bank all of Bank’sout-of-pocket costs and expenses (including, without limitation, the fees andexpenses of its counsel, which counsel may include any local counsel deemednecessary, search fees, filing and recording fees, documentation fees,appraisal fees, travel expenses, and other fees) arising in connection with thepreparation, execution, and delivery of this Amendment, the Guaranty, and allrelated documents.

8.             **LIMITED EFFECT**.  In the event of a conflict between the termsand provisions of this Amendment and the terms and provisions of the LoanAgreement, the terms and provisions of this Amendment shall govern.  In all other respects, the Loan Agreement,as amended and supplemented hereby, shall remain in full force and effect.

9.             **COUNTERPARTS; EFFECTIVENESS**.  This Amendment may be executed in any numberof counterparts and by different parties on separate counterparts, each ofwhich when so executed and delivered shall be deemed to be an original.  All such counterparts, taken 

 

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together, shallconstitute but one and the same Amendment. This Amendment shall become effective upon the execution of acounterpart of this Amendment by each of the parties hereto.

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IN WITNESS WHEREOF, theparties hereto have executed this Amendment as of the date first set forthabove.
| **COMERICA  BANK****—  CALIFORNIA,**                                                         |
|---------------------------------------------------------------------------------------------------|
| successor  by merger to Imperial Bank                                                             |
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| By:                                                                                               |   |
| Title:                                                                                            |   |
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| **US  SEARCH.COM, INC.**,                                                                         |
| a  Delaware corporation                                                                           |
|                                                                                              |   |
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| By:                                                                                               |   |
| Title:                                                                                            |   |
|                                                                                              |   |
|                                                                                              |   |
| **PROFESSIONAL RESOURCE SCREENING,  INC., formerly known as US SEARCH SCREENING SERVICES, INC.,** |
| a Delaware  corporation                                                                           |
|                                                                                              |   |
|                                                                                              |   |
| By:                                                                                               |   |
| Title:                                                                                            |   |

 

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EXHIBIT DCOMPLIANCE CERTIFICATE

TO:                                                                            COMERICABANK - CALIFORNIA

FROM:                                                         USSEARCH.COM, INC.

The undersignedauthorized officer of US SEARCH.COM, INC. hereby certifies that in accordancewith the terms and conditions of the Loan and Security Agreement betweenBorrower and Bank (the “Agreement”), (i) Borrower is in complete compliance forthe period ending                                    with all required covenants, including without limitation the ongoingregistration of intellectual property rights in accordance with Section 6.8,except as noted below and (ii) all representations and warranties of Borrowerstated in the Agreement are true and correct in all material respects as of thedate hereof.  Attached herewith are therequired documents supporting the above certification.  The Officer further certifies that these areprepared in accordance with Generally Accepted Accounting Principles (GAAP) andare consistently applied from one period to the next except as explained in anaccompanying letter or footnotes.

**Pleaseindicate compliance status by circling Yes/No under “Complies” column.**
| **Reporting  Covenant**                                 |   |                             | **Required** |   |       | **Complies** |
|---------------------------------------------------------|--------|----------------------------------|--------------|--------|------------|--------------|
|                                                    |   |                             |         |   |       |         |
| Monthly financial statements*                           |   | Monthly within 30 days           |         | Yes    |       | No           |
| Annual (CPA Audited)                                    |   | FYE within 120 days              |         | Yes    |       | No           |
| 10K and 10Q                                             |   | (as applicable)                  |         | Yes    |       | No           |
| A/R & A/P Agings, Borrowing Base Cert               |   | With each Borrowing Base Advance |         | Yes    |       | No           |
| A/R Audit                                               |   | Initial and Semi-annual          |         | Yes    |       | No           |
| IP Report                                               |   | Quarterly within 30 days         |         | Yes    |       | No           |
|                                                    |   |                             |         |   |       |         |   |   |
| **Financial  Covenant**                                 |   |                             | **Required** |   | **Actual** |         | **Complies** |
|                                                    |   |                             |         |   |       |         |   |   |
| Maintain on a Monthly  Basis:                      |   |                             |         |   |       |         |   |   |
| 1.Minimum Liquidity                                     |   |                             |         |   |       |         |   | Yes |   | No |
| 2.EBITDA Negative Variance                              |   |                             |         |   |       |         |   | Yes |   | No |
| 3.Monthly Cash Burn                                     |   |                             |         |   |       |         |   | Yes |   | No |
| 4.Operating Performance                                 |   |                             |         |   |       |         |   | Yes |   | No |
| 5.Minimum EBITDA                                        |   |                             |         |   |       |         |   | Yes |   | No |
| 6.Debt/Tangible Net Worth Ratio                         |   |                             |         |   |       |         |   | Yes |   | No |
|                                                    |   |                             |         |   |       |         |   |   |
| **Comments  Regarding Exceptions:**  See Attached. |   | **BANK  USE ONLY**               |         |   |       |         |   |   |
|                                                    |   |                             |         |   |       |         |   |   |
|                                                    |   | Received by:                     |         |
| Sincerely,                                              |   | AUTHORIZED SIGNER                |
|                                                    |   |                             |         |   |       |         |   |   |
|                                                    |   | Date:                            |         |
|                                                    |   |                             |         |   |       |         |   |   |
|                                                    |   | Verified:                        |         |
| SIGNATURE                                               |   | AUTHORIZED SIGNER                |
|                                                    |   |                             |         |   |       |         |   |   |
|                                                    |   | Date:                            |         |
| TITLE                                                   |   |                             |         |   |       |         |   |   |
|                                                    |   | Compliance Status                |         |   |       | Yes          |   | No |
|                                                    |   |                             |         |   |       |         |   |   |
| DATE                                                    |   |                             |         |   |       |         |   |   |
|                                                         |        |                                  |              |        |            |              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

*Until Borrower implements CVV-2, Borrower shall include within itsmonthly financial reporting to Bank, Pequot Capital’s written certificationthat Borrower is observing a “No Questions Asked” refund policy for billingdisputes involving either fraud or customer dissatisfaction.

 

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EXHIBIT E

BORROWING BASECERTIFICATE

Borrowers:  US SEARCH.COM, INC., and PROFESSIONALRESOURCE SCREENING, INC.

Lender:  Comerica Bank — California

Commitment Amount:  $1,000,000

 
| ACCOUNTS RECEIVABLE                                                                                |   |   |   |      |
|----------------------------------------------------------------------------------------------------|--------|--------|--------|-----------|
| 1.  Accounts  Receivable Book Value as of                                                          |   |   | $      |      |
| 2.  Additions  (please explain on reverse)                                                         |   |   | $      |      |
| 3.  TOTAL  ACCOUNTS RECEIVABLE                                                                     |   |   | $      |      |
|                                                                                               |   |   |   |      |
| ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)                                               |   |   |   |      |
| 4.  Amounts  over 90 days from invoice date                                                        | $      |   |   |      |
| 5.  Balance of  25% over 90 day accounts                                                           | $      |   |   |      |
| 6.  Concentration  Limits                                                                          |   |   |   |      |
| 7.  Foreign  Accounts                                                                              | $      |   |   |      |
| 8.  Governmental  Accounts                                                                         | $      |   |   |      |
| 9.  Contra  Accounts                                                                               | $      |   |   |      |
| 10.       Demo  Accounts                                             | $      |   |   |      |
| 11.       Intercompany/Employee  Accounts                            | $      |   |   |      |
| 12.       Other  (please explain on reverse)                         | $      |   |   |      |
| 13.       TOTAL  ACCOUNTS RECEIVABLE DEDUCTIONS                      |   |   | $      |      |
| 14.       Eligible  Accounts (#3 minus #13)                          |   |   | $      |      |
| 15.       LOAN  VALUE OF ACCOUNTS (    % of #14) |   |   | $      |      |
|                                                                                               |   |   |   |      |
| BALANCES                                                                                           |   |   |   |      |
| 16.       Maximum  Loan Amount                                       |   |   | $      | 1,000,000 |
| 17.       Total  Funds Available [Lesser of #16 or #15]              |   |   | $      |      |
| 18.       Present  balance owing on Borrowing Base Line              |   |   | $      |      |
| 19.       RESERVE  POSITION (#17 minus #18 and #19)                  |   |   | $      |      |

* *

*Theundersigned represents and warrants that the foregoing is true, complete andcorrect, and that the information reflected in this Borrowing Base Certificatecomplies with the representations and warranties set forth in the Loan and SecurityAgreement between the undersigned and Comerica Bank - California.*
| US  SEARCH.COM, INC. |               | PROFESSIONAL  RESOURCE |
|----------------------|--------------------|------------------------|
|                 |               | SCREENING,  INC.       |
|                 |               |                   |
|                 |               |                   |
|                 |               |                   |
| By:                  |               |                   | By: |   |
|                 | Authorized  Signer |                   |   | Authorized  Signer |

 

 

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