<PAGE>   1
                                                                  EXHIBIT 10.26


================================================================================



                             BUSINESS LOAN AGREEMENT

                                 by and between


                                 REMEDYTEMP, INC

                                       and


                                 BANK OF AMERICA
                     NATIONAL TRUST AND SAVINGS ASSOCIATION





                        Dated as of ____________________




================================================================================



<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                      Page
                                                                      ----
<S>      <C>                                                          <C>
1.       FACILITY NO. 1: LINE OF CREDIT AMOUNT AND TERMS............   1
         1.1      Line of Credit Amount.............................   1
         1.2      Availability Period...............................   1
         1.3      Interest Rate.....................................   1
         1.4      Repayment Terms...................................   3
         1.5      Optional Interest Rates...........................   3
         1.6      Offshore Rate.....................................   3
         1.7      LIBOR Rate........................................   4
         1.8      Letters of Credit.................................   6
                                                                   
                                                                         
2.       FACILITY NO. 2: TERM LOAN FACILITY AMOUNT AND TERMS........   7
         2.1      Amount and Terms..................................   7
         2.2      Interest Rate.....................................   7
         2.3      Repayment Terms...................................   7
         2.4      Mandatory Prepayment; Early Termination...........   8
         2.5      Optional Interest Rates...........................   8
         2.6      Offshore Rate.....................................   8
         2.7      LIBOR Rate........................................   9
                                                                         
3.       DISBURSEMENTS, PAYMENTS AND COST...........................  11
         3.1      Requests for Credit...............................  11
         3.2      Disbursements and Payments........................  11
         3.3      Telephone Authorization...........................  11
         3.4      Direct Debit......................................  12
         3.5      Banking Days......................................  12
         3.6      Taxes.............................................  12
         3.7      Additional Costs..................................  12
         3.8      Interest Calculation..............................  12
         3.9      Interest on Late Payments.........................  12
         3.10     Default Rate......................................  13
                                                                         
4.       CONDITIONS.................................................  13
         4.1      Conditions to First Extension of Credit...........  13
                                                                         
5.       REPRESENTATIONS AND WARRANTIES.............................  13
         5.1      Organization of Borrower..........................  13
         5.2      Authorization.....................................  13
         5.3      Enforceable Agreement.............................  13
         5.4      Good Standing.....................................  13
         5.5      No Conflicts......................................  13
         5.6      Financial Information.............................  13
         5.7      Lawsuits..........................................  14
         5.8      Permits, Franchises...............................  14
         5.9      Other Obligations.................................  14
</TABLE>

                                      (i)



<PAGE>   3

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                         Page
                                                                         ----
<S>      <C>                                                              <C>
         5.10     Income Tax Matters..................................... 14 
         5.11     No Event of Default.................................... 14 
         5.12     ERISA Plans............................................ 14 
         5.13     Location of Borrower................................... 15 
         5.14     Year 2000 Compliance................................... 15 
                                                                             
6.       COVENANTS....................................................... 15 
         6.1      Use of Proceeds........................................ 15 
         6.2      Financial Information.................................. 15 
         6.3      Current Ratio.......................................... 16 
         6.4      Total Liabilities to EBITDA Ratio...................... 16 
         6.5      Fixed Charge Coverage Ratio............................ 17 
         6.6      Other Debts............................................ 17 
         6.7      Other Liens............................................ 17 
         6.8      Debt Reduction Requirement............................. 17 
         6.9      Notices to Bank........................................ 18 
         6.10     Books and Records...................................... 18 
         6.11     Audits................................................. 18 
         6.12     Compliance with Laws................................... 18 
         6.13     Preservation of Rights................................. 18 
         6.14     Maintenance of Properties.............................. 18 
         6.15     Cooperation............................................ 18 
         6.16     General Business Insurance............................. 18 
         6.17     Additional Negative Covenants.......................... 18 
         6.18     ERISA Plans............................................ 21 
         6.19     Bank as Principal Depository........................... 21 
                                                                             
7.       DEFAULT......................................................... 21 
         7.1      Failure to Pay......................................... 21 
         7.2      False Information...................................... 21 
         7.3      Bankruptcy............................................. 21 
         7.4      Receivers.............................................. 21 
         7.5      Judgments.............................................. 21 
         7.6      Government Action...................................... 21 
         7.7      Material Adverse Change................................ 22 
         7.8      Cross-default.......................................... 22 
         7.9      Other Bank Agreements.................................. 22 
         7.10     ERISA Plans............................................ 22 
         7.11     Other Breach Under Agreement........................... 22 
                                                                             
8.       ENFORCING THIS AGREEMENT; MISCELLANEOUS......................... 22 
         8.1      GAAP................................................... 22 
         8.2      California Law......................................... 22 
         8.3      Successors and Assigns................................. 22 
         8.4      Arbitration............................................ 22 
         8.5      Severability; Waivers.................................. 24 
         8.6      Administration Costs................................... 24 

</TABLE>

                                      (ii)


<PAGE>   4
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                       Page
                                                                       ----
<S>      <C>                                                           <C>
         8.7      Attorneys' Fees.....................................  24 
         8.8      One Agreement.......................................  24 
         8.9      Notices.............................................  25 
         8.10     Headings............................................  25 
         8.11     Counterparts........................................  25 
         8.12     Prior Agreement Superseded..........................  25 

</TABLE>



                                     (iii)

<PAGE>   5


                             BUSINESS LOAN AGREEMENT


        This Agreement dated as of ____________, 1999, is between Bank of
America National Trust and Savings Association (the "Bank") and RemedyTemp, Inc.
(the "Borrower").

1. FACILITY NO. 1: LINE OF CREDIT AMOUNT AND TERMS

        1.1 Line of Credit Amount.

                (a) During the availability period described below, the Bank
        will provide a line of credit ("Facility No. 1") to the Borrower.
        Subject to subparagraph (c) below, the amount of the line of credit (the
        "Facility No. 1 Commitment") is Forty Million Dollars ($40,000,000).

                (b) This is a revolving line of credit with a within line
        facility for letters of credit. During the availability period, the
        Borrower may repay principal amounts and reborrow them.

                (c) The Borrower agrees not to permit the outstanding principal
        balance of the line of credit plus the outstanding amounts of any
        letters of credit, including amounts drawn on letters of credit and not
        yet reimbursed, and the outstanding principal balance of the Facility
        No. 2 Commitment (as defined below), to exceed the Facility No. 1
        Commitment.

        1.2 Availability Period. The line of credit is available between the
date of this Agreement and February 28, 2002 (the "Facility No. 1 Expiration
Date") unless the Borrower is in default.

        1.3 Interest Rate.

                (a) Unless the Borrower elects an optional interest rate as
        described below, the interest rate is the Bank's Reference Rate plus the
        Applicable Amount (defined in subparagraph (c) below).

                (b) The Reference Rate is the rate of interest publicly
        announced from time to time by the Bank in San Francisco, California, as
        its Reference Rate. The Reference Rate is set by the Bank based on
        various factors, including the Bank's costs and desired return, general
        economic conditions and other factors, and is used as a reference point
        for pricing some loans. The Bank may price loans to its customers at,
        above, or below the Reference Rate. Any change in the Reference Rate
        shall take effect at the opening of business on the day specified in the
        public announcement of a change in the Bank's Reference Rate.

                (c) "Applicable Amount" means, for any Pricing Period, the per
        annum amounts set forth below under Applicable Amount opposite the
        applicable Pricing Level:



                                       -1-


<PAGE>   6
<TABLE>
<CAPTION>
=============================================================================  
                                                                               
                                     Applicable Amount                         
                                (in basis points per annum)                    
Pricing Level     -----------------------------------------------------------  
                                                                               
                                      Offshore Rate + and    Standby Letters   
                  Reference Rate +       LIBOR Rate +           of Credit      
-----------------------------------------------------------------------------  
<S>              <C>                    <C>                  <C>               
    1                  -25                    100                  90         
-----------------------------------------------------------------------------  
    2                 -12.5                   125                  90         
-----------------------------------------------------------------------------  
    3                   0                     137.5                95         
=============================================================================  
</TABLE>


                        "Pricing Level" means, for each period, the pricing
                level set forth below opposite the Total Liabilities to EBITDA
                ratio, achieved by the Borrower as of the end of the fiscal
                quarter immediately preceding the first day of that Pricing
                Period:


                Pricing Level         Total Liabilities/EBITDA Ratio     
                -------------         -------------------------------    
                      1               less than or equal to 1.75 to 1.00 
                                                                         
                      2               greater than 1.75 to 1.00 but      
                                      less than or equal to 2.50 to 1.00 
                                                                         
                      3               greater than 2.50 to 1.00          

         For purposes of determining the Pricing Level, the Total Liabilities to
         EBITDA ratio shall be calculated for each Pricing Period using (i)
         EBITDA for the fiscal quarter immediately preceding the first day of
         the relevant Pricing Period and each of the three immediately preceding
         fiscal quarters, and (ii) the Total Liabilities as of the end of that
         fiscal quarter.

                        "Pricing Period" means (a) the period commencing on the
                date of execution of this Agreement and ending on the first
                Pricing Level Change Date to occur thereafter and (b) each
                subsequent period commencing on each Pricing Level Change Date
                and ending the day prior to the next Pricing Level Change Date.

                        "Pricing Level Change Date" means, with respect to any
                change in the Pricing Level which results in a change in the
                Applicable Amount, (5) business days after the date upon which
                the Borrower delivers a compliance certificate to the Bank as
                required under Paragraph 7.2(e) below reflecting such changed
                Pricing Level; provided, however, that if the compliance
                certificate is not delivered by 30 days after the date required
                by Paragraph 7.2(e) for the delivery of a compliance
                certificate, then, subject to the other provisions of this
                Agreement, commencing on the date such compliance certificate
                was required until such compliance certificate is delivered, the
                Applicable Amount shall be based on the next higher level than
                the one previously in effect, and from and after the date such
                compliance certificate is thereafter received, the Applicable
                Amount shall be as determined from such compliance certificate.



                                      -2-


<PAGE>   7

                        "Total Liabilities" means the sum of all liabilities on
                the Borrower's balance sheet.

                        "EBITDA" means the sum of net income before taxes, plus
                interest expense, plus depreciation and amortization, plus funds
                generated from the employee stock purchase plan and any stock
                option activity not to exceed $2,000,000 on an annual basis.

        1.4 Repayment Terms.

                (a) The Borrower will pay interest on April 30, 1999, and then
        monthly thereafter until payment in full of any principal outstandings
        under this line of credit.

                (b) The Borrower will repay in full all principal and any unpaid
        interest or other charges outstanding under this line of credit no later
        than the Facility No. 1 Expiration Date.

                (c) Any amount bearing interest at an optional interest rate (as
        described below) may be repaid at the end of the applicable interest
        period, which shall be no later than the Facility No. 1 Expiration Date.

        1.5 Optional Interest Rates. Instead of the interest rate based on the
Bank's Reference Rate, the Borrower may elect to have all or portions of the
line of credit (during the availability period) bear interest at the rate(s)
described below during an interest period agreed to by the Bank and the
Borrower. Each interest rate is a rate per year. Interest will be paid on the
last day of each interest period, and on the first day of each month during the
interest period. At the end of any interest period, the interest rate will
revert to the rate based on the Reference Rate, unless the Borrower has
designated another interest rate for the portion.

        1.6 Offshore Rate. The Borrower may elect to have all or potions of the
principal balance of the line of credit bear interest at the Offshore Rate plus
the Applicable Amount. Designation of an Offshore Rate portion is subject to the
following requirements:

                (a) The interest period during which the Offshore Rate will be
        in effect will be no shorter than 30 days and no longer than one year.
        The last day of the interest period will be determined by the Bank using
        the practices of the offshore dollar inter-bank market.

                (b) Each Offshore Rate portion will be for an amount not less
        than Five Hundred Thousand Dollars ($500,000).

                (c) The "Offshore Rate" means the interest rate determined by
        the following formula, rounded upward to the nearest 1/100 of one
        percent. (All amounts in the calculation will be determined by the Bank
        as of the first day of the interest period.)


                   Offshore Rate  =        Grand Cayman Rate
                                       ---------------------------
                                       (1.00 - Reserve Percentage)
        Where,

                        (i) "Grand Cayman Rate" means the interest rate (rounded
                upward to the nearest 1/16th of one percent) at which the Bank's
                Grand Cayman Branch, 


                                      -3-


<PAGE>   8

                Grand Cayman, British West Indies, would offer U.S. dollar
                deposits for the applicable interest period to other major banks
                in the offshore dollar inter-bank markets.

                        (ii) "Reserve Percentage" means the total of the maximum
                reserve percentages for determining the reserves to be
                maintained by member banks of the Federal Reserve System for
                Eurocurrency Liabilities, as defined in the Federal Reserve
                Board Regulation D, rounded upward to the nearest 1/100 of one
                percent. The percentage will be expressed as a decimal, and will
                include, but not be limited to, marginal, emergency,
                supplemental, special, and other reserve percentages.

                (d) The Borrower may not elect an Offshore Rate with respect to
        any portion of the principal balance of the line of credit which is
        scheduled to be repaid before the last day of the applicable interest
        period.

                (e) Any portion of the principal balance of the line of credit
        already bearing interest at the Offshore Rate will not be converted to a
        different rate during its interest period.

                (f) Each prepayment of an Offshore Rate Portion, whether
        voluntary, by reason of acceleration or otherwise, will be accompanied
        by the amount of accrued interest on the amount prepaid, and a
        prepayment fee equal to the amount (if any) by which:

                        (i) the additional interest which would have been
                payable on the amount prepaid had it not been paid until the
                last day of the interest period, exceeds

                        (ii) the interest which would have been recoverable by
                the Bank by placing the amount prepaid on deposit in the
                offshore dollar market for a period starting in the date on
                which it was prepaid and ending on the last day of the interest
                period for such portion.

                (g) The Bank will have no obligation to accept an election for
        an Offshore Rate portion if any of the following described events has
        occurred and is continuing:

                        (i) Dollar deposits in the principal amount, and for
                periods equal to the interest period, of an Offshore Rate
                portion are not available in the offshore dollar inter-bank
                market; or

                        (ii) the Offshore Rate does not accurately reflect the
                cost of an Offshore Rate portion.

        1.7 LIBOR Rate. The Borrower may elect to have all or potions of the
principal balance of the line of credit bear interest at the LIBOR Rate plus the
Applicable Amount. Designation of an LIBOR Rate portion is subject to the
following requirements:

                (a) The interest period during which the LIBOR Rate will be in
        effect will be one, two, three, four, six, or twelve months. The first
        day of the interest period must be a day other than a Saturday or a
        Sunday on which the Bank is open for business in California, New York
        and London and dealing in offshore dollars (a "LIBOR Banking 


                                      -4-

<PAGE>   9

        Day"). The last day of the interest period and the actual number of days
        during the interest period will be determined by the Bank using the
        practices of the London inter-bank market.

                (b) Each LIBOR Rate portion will be for an amount not less than
        (i) Five Hundred Thousand Dollars ($500,000) if the interest period is
        one month and (ii) Two Hundred Fifty Thousand Dollars ($250,000) if the
        interest period is two months or longer.

                (c) The "LIBOR Rate" means the interest rate determined by the
        following formula, rounded upward to the nearest 1/100 of one percent.
        (All amounts in the calculation will be determined by the Bank as of the
        first day of the interest period.)

               LIBOR Rate =   London Inter-Bank Offered Rate
                              ------------------------------
                               (1.00 - Reserve Percentage)

        Where,

                        (i) "London Inter-Bank Offered Rate" means the average
                per annum interest rate at which U.S. dollar deposits would be
                offered for the applicable interest period by major banks in the
                London inter-bank market, as shown on the Telerate Page 3750 (or
                such other page as may replace it) at approximately 11:00 a.m.
                London time two (2) London Banking Days before the commencement
                of the interest period. If such rate does not appear on the
                Telerate Page 3750 (or such other page that may replace it), the
                rate for that interest period will be determined by such
                alternate method as reasonably selected by Bank. A "London
                Banking Day" is a day on which the Bank's London Branch is open
                for business and dealing in offshore dollars.

                        (ii) "Reserve Percentage" means the total of the maximum
                reserve percentages for determining the reserves to be
                maintained by member banks of the Federal Reserve System for
                Eurocurrency Liabilities, as defined in Federal Reserve Board
                Regulation D, rounded upward to the nearest 1/100 of one
                percent. The percentage will be expressed as a decimal, and will
                include, but not be limited to, marginal, emergency,
                supplemental, special, and other reserve percentages.

                (d) The Borrower shall irrevocably request a LIBOR Rate Portion
        no later than 12:00 noon San Francisco time on the LIBOR Banking Day
        preceding the day on which the London Inter-Bank Offered Rate will be
        set, as specified above.

                (e) The Borrower may not elect a LIBOR Rate with respect to any
        principal amount which is scheduled to be repaid before the last day of
        the applicable interest period.

                (f) Any portion of the principal balance already bearing
        interest at the LIBOR Rate will not be converted to a different rate
        during its interest period.

                (g) Each prepayment of a LIBOR Rate Portion, whether voluntary,
        by reason of acceleration or otherwise, will be accompanied by the
        amount of accrued interest on the amount prepaid and a prepayment fee as
        described below. A "prepayment" is a payment of an amount on a date
        earlier than the scheduled payment date for such 


                                      -5-



<PAGE>   10

        amount as required by this Agreement. The prepayment fee shall be equal
        to the amount (if any) by which:

                        (i) the additional interest which would have been
                payable during the interest period on the amount prepaid had it
                not been prepaid, exceeds

                        (ii) the interest which would have been recoverable by
                the Bank by placing the amount prepaid on deposit in the
                domestic certificate of deposit market, the eurodollar deposit
                market, or other appropriate money market selected by the Bank,
                for a period starting on the date on which it was prepaid and
                ending on the last day of the interest period for such portion
                (or the scheduled payment date for the amount prepaid, if
                earlier).

                (h) The Bank will have no obligation to accept an election for a
        LIBOR Rate Portion if any of the following described events has occurred
        and is continuing:

                        (i) Dollar deposits in the principal amount, and for
                periods equal to the interest period, of a LIBOR Rate portion
                are not available in the London inter-bank market; or

                        (ii) the LIBOR Rate does not accurately reflect the cost
                of a LIBOR Rate portion.

        1.8 Letters of Credit. This line of credit may be used for financing:
standby letters of credit with a maximum maturity of no more than one (1) year
from the date of issuance. Each standby letter of credit may include a provision
providing that the maturity date may be automatically extended each year for an
additional year unless the Bank gives written notice of non-renewal within sixty
(60) days of the maturity date. Notwithstanding the foregoing, each letter will
have a final maturity which does not extend beyond the Facility No. 1 Expiration
Date. The amount of the letters of credit outstanding at any one time,
(including amounts drawn on letters of credit and not yet reimbursed) may not
exceed Ten Million Dollars ($10,000,000). The following letters of credit are
outstanding from the Bank for the account of the Borrower:

             Letter of Credit Number            Amount
             -----------------------            ------
                   250089                     $  150,000
                   3007706                    $6,550,000

As of the date of this Agreement, this letter of credit shall be deemed to be
outstanding under this Agreement, and shall be subject to all the terms and
conditions stated in this Agreement.

        The Borrower agrees:

                (a) any sum drawn under a letter of credit may, at the option of
        the Bank, be added to the principal amount outstanding under this
        Agreement. The amount will bear interest and be due as described
        elsewhere in this Agreement.

                (b) if there is a default under this Agreement, to immediately
        prepay and make the Bank whole for any outstanding letters of credit.



                                      -6-


<PAGE>   11

                (c) the issuance of any letter of credit and any amendment to a
        letter of credit is subject to the Bank's written approval and must be
        in form and content satisfactory to the Bank and in favor of a
        beneficiary acceptable to the Bank.

                (d) to sign the Bank's form Application and Agreement for
        Standby Letter of Credit.

                (e) to pay any issuance and/or other fees that the Bank notifies
        the Borrower will be charged for issuing and processing letters of
        credit for the Borrower.

                (f) to allow the Bank to automatically charge its checking
        account for applicable fees, discounts, and other charges.

                (g) to pay the Bank a non-refundable fee equal to the Applicable
        Amount per annum of the outstanding undrawn amount of each standby
        letter of credit, payable quarterly in advance, calculated on the basis
        of the face amount outstanding on the day the fee is calculated. If
        there is a default under this Agreement, at the Bank's option, the
        amount of the fee shall be increased to the Applicable Amount plus two
        (2.0) percent per annum, effective starting on the day the Bank provides
        notice of the increase to the Borrower.

2. FACILITY NO. 2: TERM LOAN FACILITY AMOUNT AND TERMS

        2.1 Amount and Terms.

                (a) During the availability period, the Borrower may request
        Term Loans from the Bank in a total principal amount not to exceed
        Twenty Five Million Dollars ($25,000,000) (the "Facility No. 2
        Commitment").

                (b) The availability period is from the date of this Agreement
        through February 28, 2002 (the "Facility No. 2 Expiration Date"), unless
        the Borrower is in default.

                (c) Each Term Loan made by the Bank under this facility (the
        "Facility No. 2") will reduce the amount of the Facility No. 1
        Commitment available for extensions of credit other than Term Loans.
        "Term Loan" means a term loan under this facility used to finance an
        Acceptable Acquisition (as defined in Paragraph 7.17(c) below).

        2.2 Interest Rate. Unless the Borrower elects an optional interest rate
as described below, the interest rate is the Bank's Reference Rate plus the
Applicable Amount.

        2.3 Repayment Terms.

                (a) The Borrower will pay all accrued but unpaid interest on
        each Term Loan on the first day of the first month after the funding of
        the Term Loan, and then monthly thereafter until payment in full of the
        principal of the Term Loan.

                (b) The Borrower will repay the principal amount of each Term
        Loan in up to 60 successive approximately equal monthly installments
        starting on the first day of the sixth (6th) month after the date on
        which each such loan is made.


                                      -7-


<PAGE>   12

                (c) The Borrower may prepay the loan in full or in part at any
        time. The prepayment will be applied to the most remote payment of
        principal due under this Agreement.

        2.4 Mandatory Prepayment; Early Termination. Anything herein to the
contrary notwithstanding, if Facility No. 1, as now in effect or as hereafter
renewed, amended or restated, terminates for any reason, including, without
limitation, termination at the request of the Borrower, termination resulting
from failure by the Bank to renew Facility No. 1 beyond any availability period
applicable thereto, or termination as otherwise provided or permitted under this
Agreement, the entire principal balance of each Term Loan outstanding under this
Facility No. 2, together with all accrued interest thereon, shall be due and
payable on the effective date of such termination.

        2.5 Optional Interest Rates. Instead of the interest rate based on the
Bank's Reference Rate plus the Applicable Amount, the Borrower may elect to have
all or portions of the Term Loans bear interest at the rate(s) described below
during an interest period agreed to by the Bank and the Borrower. Each interest
rate is a rate per year. Interest will be paid on the last day of each interest
period, and on the first day of each month during the interest period. At the
end of any interest period, the interest rate will revert to the rate based on
the Reference Rate, unless the Borrower has designated another interest rate for
the portion.

        2.6 Offshore Rate. The Borrower may elect to have all or portions of the
principal balance of the Term Loans bear interest at the Offshore Rate plus the
Applicable Amount. Designation of an Offshore Rate portion is subject to the
following requirements:

                (a) The interest period during which the Offshore Rate will be
        in effect will be no shorter than 30 days and no longer than one year.
        The last day of the interest period will be determined by the Bank using
        the practices of the offshore dollar inter-bank market.

                (b) Each Offshore Rate portion will be for an amount not less
        than Five Hundred Thousand Dollars ($500,000).

                (c) The "Offshore Rate" means the interest rate determined by
        the following formula, rounded upward to the nearest 1/100 of one
        percent. (All amounts in the calculation will be determined by the Bank
        as of the first day of the interest period.)

                Offshore Rate  =        Grand Cayman Rate
                                    ---------------------------
                                    (1.00 - Reserve Percentage)
        Where,

                        (i) "Grand Cayman Rate" means the interest rate (rounded
                upward to the nearest 1/16th of one percent) at which the Bank's
                Grand Cayman Branch, Grand Cayman, British West Indies, would
                offer U.S. dollar deposits for the applicable interest period to
                other major banks in the offshore dollar inter-bank markets.

                        (ii) "Reserve Percentage" means the total of the maximum
                reserve percentages for determining the reserves to be
                maintained by member banks of the Federal Reserve System for
                Eurocurrency Liabilities, as defined in the Federal Reserve
                Board Regulation D, rounded upward to the nearest 1/100 of one
                percent. The percentage will be expressed as a decimal, and will
                include, 


                                      -8-

<PAGE>   13

                but not be limited to, marginal, emergency, supplemental,
                special, and other reserve percentages.

                (d) The Borrower may not elect an Offshore Rate with respect to
        any portion of the principal balance of the line of credit which is
        scheduled to be repaid before the last day of the applicable interest
        period.

                (e) Any portion of the principal balance of the line of credit
        already bearing interest at the Offshore Rate will not be converted to a
        different rate during its interest period.

                (f) Each prepayment of an Offshore Rate Portion, whether
        voluntary, by reason of acceleration or otherwise, will be accompanied
        by the amount of accrued interest on the amount prepaid, and a
        prepayment fee equal to the amount (if any) by which:

                        (i) the additional interest which would have been
                payable on the amount prepaid had it not been paid until the
                last day of the interest period, exceeds

                        (ii) the interest which would have been recoverable by
                the Bank by placing the amount prepaid on deposit in the
                offshore dollar market for a period starting in the date on
                which it was prepaid and ending on the last day of the interest
                period for such portion.

                (g) The Bank will have no obligation to accept an election for
        an Offshore Rate portion if any of the following described events has
        occurred and is continuing:

                        (i) Dollar deposits in the principal amount, and for
                periods equal to the interest period, of an Offshore Rate
                portion are not available in the offshore dollar inter-bank
                market; or

                        (ii) the Offshore Rate does not accurately reflect the
                cost of an Offshore Rate portion.

         2.7 LIBOR Rate. The Borrower may elect to have all or potions of the
principal balance of the Term Loans bear interest at the LIBOR Rate plus the
Applicable Amount. Designation of an LIBOR Rate portion is subject to the
following requirements:

                (a) The interest period during which the LIBOR Rate will be in
        effect will be one, two, three, four, or six months. The first day of
        the interest period must be a day other than a Saturday or a Sunday on
        which the Bank is open for business in California, New York and London
        and dealing in offshore dollars (a "LIBOR Banking Day"). The last day of
        the interest period and the actual number of days during the interest
        period will be determined by the Bank using the practices of the London
        inter-bank market.

                (b) Each LIBOR Rate portion will be for an amount not less than
        (i) Five Hundred Thousand Dollars ($500,000) if the interest period is
        one month and (ii) Two Hundred Fifty Thousand Dollars ($250,000) if the
        interest period is two months or longer.



                                      -9-


<PAGE>   14

                (c) The "LIBOR Rate" means the interest rate determined by the
        following formula, rounded upward to the nearest 1/100 of one percent.
        (All amounts in the calculation will be determined by the Bank as of the
        first day of the interest period.)

                LIBOR Rate =    London Inter-Bank Offered Rate
                                ------------------------------
                                 (1.00 - Reserve Percentage)

        Where,

                        (i) "London Inter-Bank Offered Rate" means the average
                per annum interest rate at which U.S. dollar deposits would be
                offered for the applicable interest period by major banks in the
                London inter-bank market, as shown on the Telerate Page 3750 (or
                such other page as may replace it) at approximately 11:00 a.m.
                London time two (2) London Banking Days before the commencement
                of the interest period. If such rate does not appear on the
                Telerate Page 3750 (or such other page that may replace it), the
                rate for that interest period will be determined by such
                alternate method as reasonably selected by Bank. A "London
                Banking Day" is a day on which the Bank's London Branch is open
                for business and dealing in offshore dollars.

                        (ii) "Reserve Percentage" means the total of the maximum
                reserve percentages for determining the reserves to be
                maintained by member banks of the Federal Reserve System for
                Eurocurrency Liabilities, as defined in Federal Reserve Board
                Regulation D, rounded upward to the nearest 1/100 of one
                percent. The percentage will be expressed as a decimal, and will
                include, but not be limited to, marginal, emergency,
                supplemental, special, and other reserve percentages.

                (d) The Borrower shall irrevocably request a LIBOR Rate Portion
        no later than 12:00 noon San Francisco time on the LIBOR Banking Day
        preceding the day on which the London Inter-Bank Offered Rate will be
        set, as specified above.

                (e) The Borrower may not elect a LIBOR Rate with respect to any
        principal amount which is scheduled to be repaid before the last day of
        the applicable interest period.

                (f) Any portion of the principal balance already bearing
        interest at the LIBOR Rate will not be converted to a different rate
        during its interest period.

                (g) Each prepayment of a LIBOR Rate Portion, whether voluntary,
        by reason of acceleration or otherwise, will be accompanied by the
        amount of accrued interest on the amount prepaid and a prepayment fee as
        described below. A "prepayment" is a payment of an amount on a date
        earlier than the scheduled payment date for such amount as required by
        this Agreement. The prepayment fee shall be equal to the amount (if any)
        by which:

                        (i) the additional interest which would have been
                payable during the interest period on the amount prepaid had it
                not been prepaid, exceeds

                        (ii) the interest which would have been recoverable by
                the Bank by placing the amount prepaid on deposit in the
                domestic certificate of deposit market, the eurodollar deposit
                market, or other appropriate money market 


                                      -10-
<PAGE>   15

                selected by the Bank, for a period starting on the date on which
                it was prepaid and ending on the last day of the interest period
                for such portion (or the scheduled payment date for the amount
                prepaid, if earlier).

                (h) The Bank will have no obligation to accept an election for a
        LIBOR Rate Portion if any of the following described events has occurred
        and is continuing:

                        (i) Dollar deposits in the principal amount, and for
                periods equal to the interest period, of a LIBOR Rate portion
                are not available in the London inter-bank market; or

                        (ii) the LIBOR Rate does not accurately reflect the cost
                of a LIBOR Rate portion.

3. DISBURSEMENTS, PAYMENTS AND COSTS

        3.1 Requests for Credit. Each request for an extension of credit will
be made in writing in a manner acceptable to the Bank, or by another means
acceptable to the Bank.

        3.2 Disbursements and Payments. Each disbursement by the Bank and each
payment by the Borrower will be:

                (a) made at the Bank's branch (or other location) selected by
        the Bank from time to time;

                (b) made for the account of the Bank's branch selected by the
        Bank from time to time;

                (c) made in immediately available funds, or such other type of
        funds selected by the Bank;

                (d) evidenced by records kept by the Bank. In addition, the Bank
        may, at its discretion, require the Borrower to sign one or more
        promissory notes.

        3.3 Telephone Authorization.

                (a) The Bank may honor telephone instructions for advances or
        repayments or for the designation of optional interest rates given by
        any one of the individuals authorized to sign loan agreements on behalf
        of the Borrower, or any other individual designated by any one of such
        authorized signers.

                (b) Advances will be deposited in and repayments will be
        withdrawn from the Borrower's account number 14969-01000, or such other
        of the Borrower's accounts with the Bank as designated in writing by the
        Borrower.

                (c) The Borrower indemnifies and excuses the Bank (including its
        officers, employees, and agents) from all liability, loss, and costs in
        connection with any act resulting from telephone instructions it
        reasonably believes are made by any individual authorized by the
        Borrower to give such instructions. This indemnity and excuse will
        survive this Agreement.



                                      -11-


<PAGE>   16

        3.4 Direct Debit.

                (a) The Borrower agrees that interest and principal payments and
        any fees will be deducted automatically on the due date from checking
        account number 14969-01000, or such other of the Borrower's accounts
        with the Bank as designated in writing by the Borrower.

                (b) The Bank will debit the account on the dates the payments
        become due. If a due date does not fall on a banking day, the Bank will
        debit the account on the first banking day following the due date.

                (c) The Borrower will maintain sufficient funds in the account
        on the dates the Bank enters debits authorized by this Agreement. If
        there are insufficient funds in the account on the date the Bank enters
        any debit authorized by this Agreement, the debit will be reversed.

        3.5 Banking Days. Unless otherwise provided in this Agreement, a
banking day is a day other than a Saturday or a Sunday on which the Bank is open
for business in California. For amounts bearing interest at an offshore rate (if
any), a banking day is a day other than a Saturday or a Sunday on which the Bank
is open for business in California and dealing in offshore dollars. All payments
and disbursements which would be due on a day which is not a banking day will be
due on the next banking day. All payments received on a day which is not a
banking day will be applied to the credit on the next banking day.

        3.6 Taxes. The Borrower will not deduct any taxes from any payments it
makes to the Bank. If any government authority imposes any taxes on any payments
made by the Borrower, the Borrower will pay the taxes and will also pay to the
Bank, at the time interest is paid, any additional amount which the Bank
specifies as necessary to preserve the after-tax yield the Bank would have
received if such taxes had not been imposed. Upon request by the Bank, the
Borrower will confirm that it has paid the taxes by giving the Bank official tax
receipts (or notarized copies) within 30 days after the due date. However, the
Borrower will not pay the Bank's net income taxes.

        3.7 Additional Costs. The Borrower will pay the Bank, on demand, for
the Bank's costs or losses arising from any statute or regulation, or any
request or requirement of a regulatory agency which is applicable to all
national banks or a class of all national banks. The costs and losses will be
allocated to the loan in a manner determined by the Bank, using any reasonable
method. The costs include the following:

                (a) any reserve or deposit requirements; and

                (b) any capital requirements relating to the Bank's assets and
        commitments for credit.

        3.8 Interest Calculation. Except as otherwise stated in this Agreement,
all interest and fees, if any, will be computed on the basis of a 360-day year
and the actual number of days elapsed. This results in more interest or a higher
fee than if a 365-day year is used.

        3.9 Interest on Late Payments. At the Bank's sole option in each
instance, any amount not paid when due under this Agreement (including interest)
shall bear interest from the due date at the Bank's Reference Rate


                                      -12-


<PAGE>   17

        3.10 Default Rate. Upon the occurrence and during the continuation of
any default under this Agreement, advances under this Agreement will at the
option of the Bank bear interest at a rate per annum which is two (2.00)
percentage points higher than the rate of interest otherwise provided under this
Agreement. This will not constitute a waiver of any default.

4. CONDITIONS

        4.1 Conditions to First Extension of Credit. The Bank must receive the
following items, in form and content acceptable to the Bank, before it is
required to extend any credit to the Borrower under this Agreement:

                (a) Authorizations. Evidence that the execution, delivery and
        performance by the Borrower and any guarantor of this Agreement and any
        instrument or agreement required under this Agreement have been duly
        authorized.

                (b) Any other items that the Bank reasonably requires.

5. REPRESENTATIONS AND WARRANTIES

        When the Borrower signs this Agreement, and until the Bank is repaid in
full, the Borrower makes the following representations and warranties. Each
request for an extension of credit constitutes a renewed representation:

        5.1 Organization of Borrower. The Borrower is a corporation duly formed
and existing under the laws of the state where organized.

        5.2 Authorization. This Agreement, and any instrument or agreement
required hereunder, are within the Borrower's powers, have been duly authorized,
and do not conflict with any of its organizational papers.

        5.3 Enforceable Agreement. This Agreement is a legal, valid and binding
agreement of the Borrower, enforceable against the Borrower in accordance with
its terms, and any instrument or agreement required hereunder, when executed and
delivered, will be similarly legal, valid, binding and enforceable.

        5.4 Good Standing. In each state in which the Borrower does business,
it is properly licensed, in good standing, and, where required, in compliance
with fictitious name statutes.

        5.5 No Conflicts. This Agreement does not conflict with any law,
agreement, or obligation by which the Borrower is bound.

        5.6 Financial Information. All financial and other information that has
been or will be supplied to the Bank:

                (a) sufficiently complete to give the Bank accurate knowledge of
        the Borrower's (and any guarantor's) financial condition.

                (b) in form and content required by the Bank.

                (c) in compliance with all government regulations that apply.


                                      -13-

<PAGE>   18

        5.7 Lawsuits. There is no lawsuit, tax claim or other dispute pending
or threatened against the Borrower which, if lost, would impair the Borrower's
financial condition or ability to repay the loan, except as have been disclosed
in writing to the Bank.

        5.8 Permits, Franchises. The Borrower possesses all permits,
memberships, franchises, contracts and licenses required and all trademark
rights, trade name rights, patent rights and fictitious name rights necessary to
enable it to conduct the business in which it is now engaged.

        5.9 Other Obligations. The Borrower is not in default on any obligation
for borrowed money, any purchase money obligation or any other material lease,
commitment, contract, instrument or obligation.

        5.10 Income Tax Matters. The Borrower has no knowledge of any pending
assessments or adjustments of its income tax for any year.

        5.11 No Event of Default. There is no event which is, or with notice or
lapse of time or both would be, a default under this Agreement.

        5.12 ERISA Plans.

                (a) Each Plan (other than a multiemployer plan) is in compliance
        in all material respects with the applicable provisions of ERISA, the
        Code and other federal or state law. Each Plan has received a favorable
        determination letter from the IRS and to the best knowledge of the
        Borrower, nothing has occurred which would cause the loss of such
        qualification. The Borrower has fulfilled its obligations, if any, under
        the minimum funding standards of ERISA and the Code with respect to each
        Plan, and has not incurred any liability with respect to any Plan under
        Title IV of ERISA.

                (b) There are no claims, lawsuits or actions (including by any
        governmental authority), and there has been no prohibited transaction or
        violation of the fiduciary responsibility rules, with respect to any
        Plan which has resulted or could reasonably be expected to result in a
        material adverse effect.

                (c) With respect to any Plan subject to Title IV of ERISA:

                        (i) No reportable event has occurred under Section
                4043(c) of ERISA for which the PBGC requires 30-day notice.

                        (ii) No action by the Borrower or any ERISA Affiliate to
                terminate or withdraw from any Plan has been taken and no notice
                of intent to terminate a Plan has been filed under Section 4041
                of ERISA.

                        (iii) No termination proceeding has been commenced with
                respect to a Plan under Section 4042 of ERISA, and no event has
                occurred or condition exists which might constitute grounds for
                the commencement of such a proceeding.

                (d) The following terms have the meanings indicated for purposes
        of this Agreement:



                                      -14-



<PAGE>   19

                        (i) "Code" means the Internal Revenue Code of 1986, as
                amended from time to time.

                        (ii) "ERISA" means the Employee Retirement Income
                Security Act of 1974, as amended from time to time.

                        (iii) "ERISA Affiliate" means any trade or business
                (whether or not incorporated) under common control with the
                Borrower within the meaning of Section 414(b) or (c) of the
                Code.

                        (iv) "PBGC" means the Pension Benefit Guaranty
                Corporation.

                        (v) "Plan" means a pension, profit-sharing, or stock
                bonus plan intended to qualify under Section 401(a) of the Code,
                maintained or contributed to by the Borrower or any ERISA
                Affiliate, including any multiemployer plan within the meaning
                of Section 4001(a)(3) of ERISA.

        5.13 Location of Borrower. The Borrower's place of business (or, if the
Borrower has more than one place of business, its chief executive office) is
located at the address listed under the Borrower's signature on this Agreement.

        5.14 Year 2000 Compliance. The Borrower is assessing its systems and
equipment applications and is in the process of making inquiries of the
Borrower's key suppliers, vendors and customers with respect to the "year 2000
problem" (that is, the inability of computers, as well as embedded microchips in
non-computing devices, to properly perform date-sensitive functions with respect
to certain dates prior to and after December 31, 1999). Based on that on-going
assessment and inquiry, the Borrower does not believe the year 2000 problem,
including costs of remediation, will result in a material adverse change in the
Borrower's business condition (financial or otherwise), operations, properties
or prospects, or ability to repay the credit. The Borrower is in the process of
developing adequate contingency plans to provide for uninterrupted and
unimpaired business operation in the event of a failure of its own or a third
party's systems or equipment due to the year 2000 problem, including those of
vendors, customers, and suppliers, as well as a general failure of or
interruption in its communications and delivery infrastructure.

6. COVENANTS

        The Borrower agrees, so long as credit is available under this Agreement
and until the Bank is repaid in full:

        6.1 Use of Proceeds. To use the proceeds of Facility 1 only for general
business purposes; to use performance and financial standby letters of credit
for general business purposes and to support self-insured workers' compensation
program; and to use the proceeds of Facility No. 2 only to finance Acceptable
Acquisitions subject to the terms and conditions of this Agreement.

        6.2 Financial Information. To provide the following financial
information and statements and such additional information as requested by the
Bank from time to time:

                  (a) Within 120 days of the Borrower's fiscal year end, the
         Borrower's annual report to shareholders, which shall include financial
         statements. These financial 


                                      -15-

<PAGE>   20

        statements must be audited (with an unqualified opinion) by a Certified
        Public Accountant ("CPA") acceptable to the Bank.

                (b) Within 90 days of the Borrower's fiscal year end, the
        Borrower's Form 10-K Annual Report.

                (c) Within 45 days of the period's end, the Borrower's Form 10-Q
        Quarterly Report.

                (d) Within 30 days after filing, any reports filed with the
        Securities and Exchange Commission other than those described in
        subparagraphs (b) through (d) above.

                (e) Concurrently with the delivery of the Borrower's Form 10-K
        Annual Report and Form 10-Q Quarterly Report, a compliance certificate
        of the Borrower signed by the chief financial officer of the Borrower
        setting forth (i) the information and computations (in sufficient
        detail) to establish that the Borrower is in compliance with all
        financial covenants at the end of the period covered by the financial
        statements then being furnished and (ii) whether there existed as of the
        date of such financial statements and whether there exists as of the
        date of the certificate, any default under this Agreement and, if any
        such default exists, specifying the nature thereof and the action the
        Borrower is taking and proposes to take with respect thereto.

                (f) Within 120 days of the Borrower's fiscal year end, the
        Borrower's financial projections or budget by quarter for the following
        fiscal year.

                (g) Within 120 days of the Borrower's fiscal year end, a copy of
        the Borrower's current insurance policy evidencing re-insurance coverage
        of worker's compensation claims in excess of Two Hundred Fifty Thousand
        Dollars ($250,000) per occurrence from an insurance company acceptable
        to the Bank, and with an A.M. Best rating of not less than "A".

                (h) Within 90 days of the Borrower's fiscal year end, a
        company-prepared workers' compensation report stating, on a policy year
        or fiscal year basis, gross wages, claims filed, claims experience, and
        losses as a percentage of temporary employer payroll by policy year.

                (i) Promptly upon request of the Bank, such other statements,
        lists of property and accounts, budgets, forecasts or reports as to the
        Borrower as the Bank may reasonably request.

        6.3 Current Ratio. To maintain a ratio of current assets to current
liabilities, as of the end of each fiscal quarter, at least equal to 1.50:1.00.
For the purposes of this computation, all amounts outstanding under Facility No.
1, but excluding outstanding standby letters of credit and the long-term
portion, shall be considered current liabilities.

        6.4 Total Liabilities to EBITDA Ratio. Not to permit the ratio of the
Borrower's Total Liabilities to EBITDA to exceed 3.00 to1.00. For purposes of
determining compliance with this financial covenant, the Total Liabilities to
EBITDA ratio shall be calculated at the end of each fiscal quarter using (i)
EBITDA for such quarter and each of the three immediately preceding fiscal
quarters, and (ii) Total Liabilities as of the end of such quarter.



                                      -16-



<PAGE>   21

        6.5 Fixed Charge Coverage Ratio. To maintain a Fixed Charge Coverage
Ratio of at least 1.50:1. This ratio will be calculated at the end of each
fiscal quarter, using the results of that quarter and each of the three
immediately preceding fiscal quarters.

        "Fixed Charge Coverage Ratio" means, expressed as a ratio, the sum of
(without duplication) EBITDA, plus collections on loans to franchisees, minus
loans made to franchisees, minus non-financed capital expenditures, minus cash
taxes paid, excluding taxes paid in 1998 and 1999 related to conversion from "S"
to "C" corporation equaling the lesser of the actual amount of taxes paid or
$3,000,000 minus dividends paid, minus purchases of treasury stock, excluding
stock repurchases executed in the fiscal year beginning 1999 not to exceed an
aggregate amount of $5,000,000, minus non-financed Acquisitions, minus
non-financed repurchases of franchises and licenses, divided by the sum of
scheduled mandatory principal repayments of borrowed money, plus scheduled
mandatory payments under capital leases, plus 20% of all amounts outstanding
under Facility No. 1, excluding standby letters of credit, plus interest
expense. For purposes of this calculation, indebtedness outstanding during the
debt reduction period required under Paragraph 6.8 below shall be treated as if
it were being amortized over sixty (60) months.

        6.6 Other Debts. Not to have outstanding or incur any direct debts or
lease obligations (other than those to the Bank), or become liable for the debts
of others, without the Bank's written consent. This does not prohibit:

                (a) Acquiring goods, supplies, or merchandise on normal trade
        credit.

                (b) Endorsing negotiable instruments received in the usual
        course of business.

                (c) Obtaining surety bonds in the usual course of business.

                (d) Obligations under operating leases.

                (e) Additional debts for capitalized leases or purchase money
        obligations which do not exceed Five Million Dollars ($5,000,000) in any
        fiscal year or Ten Million Dollars ($10,000,000) between the date hereof
        to the Facility No. 1 Expiration Date.

        6.7 Other Liens. Not to create, assume, or allow any security interest
or lien (including judicial liens) on property the Borrower now or later owns,
except:

                (a) Deeds of trust and security agreements in favor of the Bank.

                (b) Liens for taxes not yet due.

                (c) Additional liens which secure capitalized leases and
        purchase money obligations permitted under Paragraph 6.6(d) above.

        6.8 Debt Reduction Requirement. To reduce the amount of all advances
outstanding under Facility No. 1 to not more than Five Million Dollars
($5,000,000) for a period of at least 30 consecutive calendar days in each line
year. "Line-year" means the period between the date of this Agreement and
February 28, 2000, and each subsequent one-year period during the availability
period. For the purposes of this paragraph, "advances" does not include undrawn
amounts of outstanding letters of credit. For the purposes of this paragraph,
"advances" includes overdrafts in the Borrower's account.



                                      -17-



<PAGE>   22

        6.9      Notices to Bank.  To promptly notify the Bank in writing of:

                (a) any lawsuit over Five Hundred Thousand Dollars ($500,000)
        against the Borrower (or any guarantor).

                (b) any substantial dispute between the Borrower (or any
        guarantor) and any government authority.

                (c) any failure to comply with this Agreement.

                (d) any material adverse change in the Borrower's (or any
        guarantor's) financial condition or operations.

                (e) any change in the Borrower's name, legal structure, place of
        business, or chief executive office if the Borrower has more than one
        place of business.

        6.10 Books and Records. To maintain adequate books and records.

        6.11 Audits. To allow the Bank and its agents to inspect the Borrower's
properties and examine, audit, and make copies of books and records at any
reasonable time. If any of the Borrower's properties, books or records are in
the possession of a third party, the Borrower authorizes that third party to
permit the Bank or its agents to have access to perform inspections or audits
and to respond to the Bank's requests for information concerning such
properties, books and records.

        6.12 Compliance with Laws. To comply with the laws (including any
fictitious name statute), regulations, and orders of any government body with
authority over the Borrower's business.

        6.13 Preservation of Rights. To maintain and preserve all rights,
privileges, and franchises the Borrower now has.

        6.14 Maintenance of Properties. To make any repairs, renewals, or
replacements to keep the Borrower's properties in good working condition.

        6.15 Cooperation. To take any action reasonably requested by the Bank
to carry out the intent of this Agreement.

        6.16 General Business Insurance. To maintain and keep in force
insurance of the type usual for the business it is in and deliver to the Bank
upon the Bank's request a copy of each insurance policy, or, if permitted by the
Bank, a certificate of insurance listing all insurance in force.

        6.17 Additional Negative Covenants. Not to, without the Bank's written
consent:

                (a) engage in any business activities substantially different
        from the Borrower's present business.

                (b) liquidate or dissolve the Borrower's business.




                                      -18-

<PAGE>   23

                (c) lease, or dispose of all or a substantial part of the
        Borrower's business or the Borrower's assets.

                (d) sell or otherwise dispose of any assets for less than fair
        market value, or enter into any sale and leaseback agreement covering
        any of its fixed or capital assets.

                (e) make any Acquisition; provided, however, that the Borrower
        may make any Acceptable Acquisition.

        "Acquisition" means any transaction or series of related transactions
        for the purpose of or resulting, directly or indirectly, in (i) the
        acquisition by the Borrower of all or substantially all of the assets of
        a person or entity or of any business or division of a person or entity,
        (ii) the acquisition by the Borrower of in excess of fifty percent (50%)
        of the capital stock, partnership interests, membership interests or
        equity of any person or entity, or otherwise causing any entity to
        become a subsidiary of the borrower, or (iii) a merger or consolidation
        or any other combination by the Borrower with another person or entity
        (other than an entity that is a subsidiary of the Borrower) provided
        that the Borrower or its subsidiary is the surviving entity. "Acceptable
        Acquisition" means an Acquisition:

                        (i) If the total value of the consideration paid for all
                Acquisitions made after the date of this Agreement will not
                exceed Ten Million Dollars ($10,000,000), including the proposed
                Acquisition:

                                (A) where the business being acquired is
                        substantially the same as the Borrower's present
                        business;

                                (B) which is undertaken in accordance with all
                        applicable requirements of law;

                                (C) where prior, effective written consent or
                        approval of such Acquisition has been given by the board
                        of directors or equivalent governing body of the
                        acquiree;

                                (D) a statement showing that, on a pro forma
                        consolidated basis immediately after the Acquisition,
                        the Borrower will be in full compliance with Paragraphs
                        6.6 and 6.7 of this Agreement (including a break-out of
                        the acquiree's funded and contingent debts assumed by
                        the Borrower in connection with any Acquisition);

                                (E) within 30 days after the closing of the
                        Acquisition, the Borrower has delivered to the Bank a
                        statement of sources and uses of funds;

                        (ii) If the total value of the consideration for the
                Acquisition paid for all Acquisitions made after the date of
                this Agreement, including the proposed Acquisition, equals or
                exceeds Ten Million Dollars ($10,000,000):

                                (A) where the Borrower has complied with the
                        requirements of Subparagraphs (i) (A) through (i) (D)
                        above;



                                      -19-


<PAGE>   24

                                (B) where the total value of the consideration
                        paid for all Acquisitions made after the date of this
                        Agreement, including the proposed Acquisition, does not
                        exceed Twenty Five Million Dollars ($25,000,000);

                                (C) where the Borrower has delivered to the Bank
                        at least 15 days prior to the Acquisition:

                                            (1) a compliance certificate
                                    showing, on a pro forma consolidated basis
                                    for the Borrower and the acquiree,
                                    compliance with Paragraphs 6.3, 6.4, and 6.5
                                    of this Agreement for the most recently
                                    ended fiscal quarter of the Borrower and the
                                    underlying calculations showing such
                                    compliance, including a break-out of the
                                    acquiree's figures.

                                            (2) financial statements of the
                                    entity to be acquired, prepared by a
                                    certified public accountant, for such
                                    entity's last three fiscal years and the
                                    latest interim fiscal period, all in form
                                    and content acceptable to the Bank;

                                            (3) evidence that, on a pro-forma
                                    basis for the acquiree, the sum of the
                                    EBITDA over the immediately preceding four
                                    fiscal quarters of the acquiree plus any
                                    non-recurring compensation of the owner(s)
                                    of the acquiree is positive, validated by a
                                    certified public accountant;

                                            (4) a statement of sources and uses
                                    of funds for such Acquisition;

                                            (5) evidence that the Borrower will
                                    have, on a one time basis, a Fixed Charge
                                    Coverage Ratio not less than 1.50:1.00 on a
                                    pro-forma consolidated basis after the
                                    Acquisition, including any new debt service
                                    and any loss (without adding profit)
                                    incurred by the acquiree in its most
                                    recently ended fiscal year or in its latest
                                    four (4) fiscal quarters;

                                            (6) evidence that any indebtedness
                                    the of acquiree to be assumed by the
                                    Borrower will be unsecured, except for
                                    purchase money indebtedness secured by the
                                    property purchased.

                                            (7) if the Acquisition is in the
                                    form of a stock purchase, at least 10 days
                                    prior to the projected closing date of the
                                    Acquisition, an opinion of the Borrower's
                                    counsel, in form and content acceptable to
                                    the Bank and covering such matters as the
                                    Bank may request, including any trailing
                                    liability issues.

                                            (8) a statement disclosing the terms
                                    and conditions of any contingent or other
                                    off balance sheet obligations assumed in
                                    connection with the Acquisition, including
                                    any indemnities.

                For purposes of this subparagraph (e), "consideration" paid for
        an Acquisition means all value given, including cash, stock of the
        Borrower, and all liabilities of the 


                                      -20-



<PAGE>   25

        acquiree which are to be assumed by the Borrower, including all funded
        debt and contingent liabilities but excluding normal trade debt and
        accruals; provided, however, that "consideration" shall exclude
        contractual "earn out" obligations based on future financial performance
        benchmarks of the acquiree.

        6.18 ERISA Plans. To give prompt written notice to the Bank of:

                (a) The occurrence of any reportable event under Section 4043(c)
        of ERISA for which the PBGC requires 30-day notice.

                (b) Any action by the Borrower to terminate or withdraw from a
        Plan or the filing of any notice of intent to terminate under Section
        4041 of ERISA.

                (c) Any notice of non-compliance made with respect to a Plan
        under Section 4041(b) of ERISA.

                (d) The commencement of any proceeding with respect to a Plan
        under Section 4042 of ERISA.

        6.19 Bank as Principal Depository. To maintain the Bank as its
principal depository bank, including for the maintenance of business, cash
management, operating and administrative deposit accounts.

7. DEFAULT

        If any of the following events occurs, the Bank may do one or more of
the following: declare the Borrower in default, stop making any additional
credit available to the Borrower, and require the Borrower to repay its entire
debt immediately and without prior notice. If an event of default occurs under
the paragraph entitled "Bankruptcy," below, with respect to the Borrower, then
the entire debt outstanding under this Agreement will automatically be due
immediately.

        7.1 Failure to Pay. The Borrower fails to make a payment under this
Agreement when due.

        7.2 False Information. The Borrower has given the Bank false or
misleading information or representations.

        7.3 Bankruptcy. The Borrower (or any guarantor) files a bankruptcy
petition, a bankruptcy petition is filed against the Borrower (or any guarantor)
or the Borrower (or any guarantor) makes a general assignment for the benefit of
creditors.

        7.4 Receivers. A receiver or similar official is appointed for the
Borrower's (or any guarantor's) business, or the business is terminated.

        7.5 Judgments. Any judgments or arbitration awards are entered against
the Borrower (or any guarantor), or the Borrower (or any guarantor) enters into
any settlement agreements with respect to any litigation or arbitration, in an
aggregate amount of Five Hundred Dollars ($500,000) or more in excess of any
insurance coverage.

        7.6 Government Action. Any government authority takes action that the
Bank believes materially adversely affects the Borrower's (or any guarantor's)
financial condition or ability to repay.



                                      -21-


<PAGE>   26

        7.7 Material Adverse Change. A material adverse change occurs in the
Borrower's (or any guarantor's) financial condition, properties or prospects, or
ability to repay the credit.

        7.8 Cross-default. Any default occurs under any agreement in connection
with any credit the Borrower (or any guarantor) has obtained from anyone else or
which the Borrower (or any guarantor) has guaranteed.

        7.9 Other Bank Agreements. The Borrower (or any guarantor) fails to meet
the conditions of, or fails to perform any obligation under any other agreement
the Borrower (or any guarantor) has with the Bank or any affiliate of the Bank.

        7.10 ERISA Plans. Any one or more of the following events occurs with
respect to a Plan of the Borrower subject to Title IV of ERISA, provided such
event or events could reasonably be expected, in the judgment of the Bank, to
subject the Borrower to any tax, penalty or liability (or any combination of the
foregoing) which, in the aggregate, could have a material adverse effect on the
financial condition of the Borrower:

                (a) A reportable event shall occur under Section 4043(c) of
        ERISA with respect to a Plan.

                (b) Any Plan termination (or commencement of proceedings to
        terminate a Plan) or the full or partial withdrawal from a Plan by the
        Borrower or any ERISA Affiliate.

        7.11 Other Breach Under Agreement. The Borrower fails to meet the
conditions of, or fails to perform any obligation under, any term of this
Agreement not specifically referred to in this Article.

8. ENFORCING THIS AGREEMENT; MISCELLANEOUS

        8.1 GAAP. Except as otherwise stated in this Agreement, all financial
information provided to the Bank and all financial covenants will be made under
generally accepted accounting principles, consistently applied.

        8.2 California Law. This Agreement is governed by California law.

        8.3 Successors and Assigns. This Agreement is binding on the Borrower's
and the Bank's successors and assignees. The Borrower agrees that it may not
assign this Agreement without the Bank's prior consent. The Bank may sell
participations in or assign this loan, and may exchange financial information
about the Borrower with actual or potential participants or assignees. If a
participation is sold or the loan is assigned, the purchaser will have the right
of set-off against the Borrower.

        8.4 Arbitration.

                 (a) This paragraph concerns the resolution of any
        controversies or claims between the Borrower and the Bank, including
        but not limited to those that arise from:

                        (i) This Agreement (including any renewals, extensions
                or modifications of this Agreement);



                                      -22-


<PAGE>   27

                        (ii) Any document, agreement or procedure related to or
                delivered in connection with this Agreement;

                        (iii) Any violation of this Agreement; or

                        (iv) Any claims for damages resulting from any business
                conducted between the Borrower and the Bank, including claims
                for injury to persons, property or business interests (torts).

                (b) At the request of the Borrower or the Bank, any such
        controversies or claims will be settled by arbitration in accordance
        with the United States Arbitration Act. The United States Arbitration
        Act will apply even though this Agreement provides that it is governed
        by California law.

                (c) Arbitration proceedings will be administered by the American
        Arbitration Association and will be subject to its commercial rules of
        arbitration.

                (d) For purposes of the application of the statute of
        limitations, the filing of an arbitration pursuant to this paragraph is
        the equivalent of the filing of a lawsuit, and any claim or controversy
        which may be arbitrated under this paragraph is subject to any
        applicable statute of limitations. The arbitrators will have the
        authority to decide whether any such claim or controversy is barred by
        the statute of limitations and, if so, to dismiss the arbitration on
        that basis.

                (e) If there is a dispute as to whether an issue is arbitrable,
        the arbitrators will have the authority to resolve any such dispute.

                (f) The decision that results from an arbitration proceeding may
        be submitted to any authorized court of law to be confirmed and
        enforced.

                (g) The procedure described above will not apply if the
        controversy or claim, at the time of the proposed submission to
        arbitration, arises from or relates to an obligation to the Bank secured
        by real property located in California. In this case, both the Borrower
        and the Bank must consent to submission of the claim or controversy to
        arbitration. If both parties do not consent to arbitration, the
        controversy or claim will be settled as follows:

                        (i) The Borrower and the Bank will designate a referee
                (or a panel of referees) selected under the auspices of the
                American Arbitration Association in the same manner as
                arbitrators are selected in Association-sponsored proceedings;

                        (ii) The designated referee (or the panel of referees)
                will be appointed by a court as provided in California Code of
                Civil Procedure Section 638 and the following related sections;

                        (iii) The referee (or the presiding referee of the
                panel) will be an active attorney or a retired judge; and

                        (iv) The award that results from the decision of the
                referee (or the panel) will be entered as a judgment in the
                court that appointed the referee, in 


                                      -23-


<PAGE>   28

                accordance with the provisions of California Code of Civil
                Procedure Sections 644 and 645.

                (h) This provision does not limit the right of the Borrower or
        the Bank to:

                        (i) exercise self-help remedies such as setoff;

                        (ii) foreclose against or sell any real or personal
                property collateral; or

                        (iii) act in a court of law, before, during or after the
                arbitration proceeding to obtain:

                              (A) an interim remedy; and/or            
                                                                       
                              (B) additional or supplementary remedies.

                (i) The pursuit of or a successful action for interim,
        additional or supplementary remedies, or the filing of a court action,
        does not constitute a waiver of the right of the Borrower or the Bank,
        including the suing party, to submit the controversy or claim to
        arbitration if the other party contests the lawsuit. However, if the
        controversy or claim arises from or relates to an obligation to the Bank
        which is secured by real property located in California at the time of
        the proposed submission to arbitration, this right is limited according
        to the provision above requiring the consent of both the Borrower and
        the Bank to seek resolution through arbitration.

                (j) If the Bank forecloses against any real property securing
        this Agreement, the Bank has the option to exercise the power of sale
        under the deed of trust or mortgage, or to proceed by judicial
        foreclosure.

        8.5 Severability; Waivers. If any part of this Agreement is not
enforceable, the rest of the Agreement may be enforced. The Bank retains all
rights, even if it makes a loan after default. If the Bank waives a default, it
may enforce a later default. Any consent or waiver under this Agreement must be
in writing.

        8.6 Administration Costs. The Borrower shall pay the Bank for all
reasonable costs incurred by the Bank in connection with administering this
Agreement.

        8.7 Attorneys' Fees. The Borrower shall reimburse the Bank for any
reasonable costs and attorneys' fees incurred by the Bank in connection with the
enforcement or preservation of any rights or remedies under this Agreement and
any other documents executed in connection with this Agreement, and in
connection with any amendment, waiver, "workout" or restructuring under this
Agreement. In the event of a lawsuit or arbitration proceeding, the prevailing
party is entitled to recover costs and reasonable attorneys' fees incurred in
connection with the lawsuit or arbitration proceeding, as determined by the
court or arbitrator. In the event that any case is commenced by or against the
Borrower under the Bankruptcy Code (Title 11, United States Code) or any similar
or successor statute, the Bank is entitled to recover costs and reasonable
attorneys' fees incurred by the Bank related to the preservation, protection, or
enforcement of any rights of the Bank in such a case. As used in this paragraph,
"attorneys' fees" includes the allocated costs of the Bank's in-house counsel.

        8.8 One Agreement. This Agreement and any related security or other
agreements required by this Agreement, collectively:



                                      -24-


<PAGE>   29

                (a) represent the sum of the understandings and agreements
        between the Bank and the Borrower concerning this credit;

                (b) replace any prior oral or written agreements between the
        Bank and the Borrower concerning this credit; and

                (c) are intended by the Bank and the Borrower as the final,
        complete and exclusive statement of the terms agreed to by them.

In the event of any conflict between this Agreement and any other agreements
required by this Agreement, this Agreement will prevail.

        8.9 Notices. All notices required under this Agreement shall be
personally delivered or sent by first class mail, postage prepaid, to the
addresses on the signature page of this Agreement, or to such other addresses as
the Bank and the Borrower may specify from time to time in writing.

        8.10 Headings. Article and paragraph headings are for reference only
and shall not affect the interpretation or meaning of any provisions of this
Agreement.

        8.11 Counterparts. This Agreement may be executed in as many
counterparts as necessary or convenient, and by the different parties on
separate counterparts each of which, when so executed, shall be deemed an
original but all such counterparts shall constitute but one and the same
agreement.

        8.12 Prior Agreement Superseded. This Agreement supersedes the Business
Loan Agreement entered into as of August 25, 1997, between the Bank and the
Borrower, and any credit outstanding thereunder shall be deemed to be
outstanding under this Agreement.





                                      -25-

<PAGE>   30

         This Agreement is executed as of the date stated at the top of the
first page.

Bank of America National                           RemedyTemp, Inc.
Trust and Savings Association

/s/ T.A. Miles                                     /s/ Alan M. Purdy
------------------------------                     ---------------------------
By:     T.A. Miles                                 By:    Alan M. Purdy
Title:  Vice President                             Title: Senior Vice President 
                                                          and Chief Financial 
                                                          Officer

Address where notices to                           Address where notices to
the Bank are to be sent:                           the Borrower are to be sent:

Inland Empire Regional Commercial                  101 Enterprise
  Banking Office #1496                             Aliso Viejo, CA  92656
3650 14th Street, Second floor
Riverside, CA  92501


                                      -26-