**Exhibit4.5**

 

**SEVENTH AMENDMENT TO SECURITIES PURCHASE AGREEMENTAND WAIVER**

** **

This SEVENTH AMENDMENT TOSECURITIES PURCHASE AGREEMENT AND WAIVER dated as ofNovember  14, 2003 (this “Amendment”), among AlternativeResources Corporation, a Delaware corporation (the “Company”), withheadquarters located at 600 Hart Road, Suite 300, Barrington, Illinois 60010,Wynnchurch Capital Partners, L.P., a Delaware limited partnership andWynnchurch Capital Partners Canada, L.P., an Alberta, Canada limitedpartnership (each a “Purchaser,” and collectively, the “Purchasers”),amends the Securities Purchase Agreement dated as of January 31, 2002, asamended by the First Amendment to Securities Purchase Agreement and Waiverdated August 8, 2002, the Second Amendment to Securities Purchase Agreementdated August 30, 2002, the Third Amendment to Securities Purchase Agreement andWaiver dated as of November 14, 2002, the Fourth Amendment to SecuritiesPurchase Agreement and Consent dated as of December 27, 2002, the Fifth Amendmentto Securities Purchase Agreement and Waiver dated as of April 14, 2003 and theSixth Amendment to Securities Purchase Agreement and Waiver dated as of August14, 2003 (such Securities Purchase Agreement, as so amended, the “SecuritiesPurchase Agreement”), each among the Company and the Purchasers.

 

WHEREAS, the Company andits subsidiaries failed to satisfy (a) the Tangible Capital Base covenant setforth in Section 7.5(h)(i) of the Securities Purchase Agreement for the fiscalquarter ended September 30, 2003 and (b) the Fixed Charge coverage shortfallcovenant set forth in Section 7.5(h)(iii) for the nine month fiscal periodended September 30, 2003, and each such failure constitutes an Event of Defaultunder Section 5.2****of the Notes (the “September 30 Events of Default”);

 

WHEREAS, the Company andFleet Capital Corporation, as Lender pursuant to that certain Credit andSecurity Agreement dated as of January 31, 2002, as amended (the “CreditAgreement”) have requested that the Purchasers waive the September 30Events of Default and any other existing defaults by the Company as providedherein, and amend certain provisions of the Securities Purchase Agreement; and

 

WHEREAS, the Purchasershave agreed to waive the September 30 Events of Default and any other existingdefaults under the Securities Purchase Agreement and to amend certainprovisions of the Securities Purchase Agreement, all subject to the terms,conditions and limitations set forth herein;

 

NOW, THEREFORE, inconsideration of the foregoing and the agreements contained herein, the partieshereby agree as follows:

 

1.             Capitalized Terms.

 

Capitalized terms usedherein which are defined in the Securities Purchase Agreement have the samemeanings herein as therein, except to the extent that such meanings are amendedhereby.  The Securities PurchaseAgreement, together with the Notes, the Warrants, the Subordination Agreementand any other related documents are referred to herein as the “SubordinatedDebt Documents.”

 

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2.             Waiver ofSeptember 30 Events of Default.

 

Subject to thesatisfaction of the terms and conditions set forth in Section 5 hereof, thePurchasers hereby waive the September 30 Events of Default and any otherexisting defaults by the Company pursuant to the Securities Purchase Agreementand the other Subordinated Debt Documents. The parties agree that nothing herein shall be construed as a waiver ofany future Event of Default (including without limitation, any Event of Defaultcaused by reason of the failure of the Company to comply with Section 7.5(h) ofthe Securities Purchase Agreement, as amended hereby, on any other occasion orfor any other period).

 

3.             Amendments.

 

Subject to thesatisfaction of the terms and conditions set forth in Section 5 hereof, theCompany and the Purchasers agree that the Securities Purchase Agreement ishereby amended, effective as of the date hereof, as follows:

 

(a)           Section7.5(h) of the Securities Purchase Agreement is hereby amended and restated inits entirety to read as follows:

 

“(h)         CertainFinancial Covenants.

 

(i)            *Tangible Capital Base*.  The Company and its Subsidiaries shall not(x) as of December 31, 2003, have a consolidated Tangible Capital Base of lessthan ($8,925,000) or (y) as of the end of any fiscal quarter commencingwith the fiscal quarter ending March 31, 2004, have a consolidated TangibleCapital Base of less than the sum of (A) ($8,925,000) plus (B) on acumulative basis, 47.5% of positive consolidated net income (without reductionfor losses) for each fiscal quarter ending after December 31, 2003.

 

(ii)           *Fixed Charge Coverage Ratio.*  The Fixed Charge Coverage Ratio of theCompany and its Subsidiaries shall not at any time during any period set forthbelow be less than the ratio set opposite such period:

 
| **Period**                                     |   | **Minimum  Fixed  Charge Coverage  Ratio** |   |
|------------------------------------------------|--------|--------------------------------------------|--------|
|                                           |   |                                       |   |
| July 1, 2004  through September 30, 2004       |   | .95 to 1.00                                |   |
|                                           |   |                                       |   |
| July 1, 2004  through December 31, 2004        |   | .95 to 1.00                                |   |
|                                           |   |                                       |   |
| Thereafter (on a  rolling four quarters basis) |   | .95 to 1.00                                |   |

 

(iii)          *Fixed Charge Coverage Shortfall.*  The amount by which (i) the aggregate FixedCharges of the Company and its Subsidiaries for each fiscal period set forthbelow, exceeds (ii) the total of (w) consolidated EBITDA of the Company and itsSubsidiaries for such period (determined on a consolidated basis withoutduplication in accordance with GAAP) minus (x) the aggregate amount of

 

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all Non-Financed CapitalExpenditures during such period minus (y) the aggregate amount paid, orrequired to be paid (without duplication), in cash in respect of the currentportion of all income taxes for such period minus (z) the aggregate amount ofdividends and distributions permitted to be paid under Section 8.6 of theCredit Agreement and actually paid in cash during such period, shall not begreater than the maximum shortfall amount set forth opposite such fiscalperiod:

 
| **Fiscal Period**                          |   | **Maximum  Shortfall Amount** |            |
|--------------------------------------------|--------|-------------------------------|-----------------|
|                                       |   |                          |            |
| October 1, 2003  through December 31, 2003 |   | $                             | 1,050,000       |   |
|                                       |   |                          |            |
| October 1, 2003  through March 31, 2004    |   | $                             | 1,851,000       |   |
|                                       |   |                          |            |
| October 1, 2003  through June 30, 2004     |   | $                             | 1,917,000” |   |

 

(b)           Section7.6(g) of the Securities Purchase Agreement is hereby amended and restated inits entirety to read as follows:

 

“(g)         *Capital Expenditures. *Company and each of the Subsidiaries shall not make orincur any capital expenditures (including, without limitation, incurring anyCapital Lease Obligations) which, in the aggregate exceed $52,500 at any timeduring any fiscal quarter, commencing with the fiscal quarter ending December 31,2003.”

 

4.             NoDefault; Representations and Warranties, etc.

 

The Company herebyrepresents, warrants and confirms that: (a) the representations and warrantiesof the Company contained in Article 3 of the Securities Purchase Agreement aretrue and correct on and as of the date hereof as if made on such date (exceptto the extent that such representations and warranties expressly relate to anearlier date); (b) after giving effect to this Amendment, the Company is incompliance with all of the terms and provisions set forth in the SecuritiesPurchase Agreement and the other Subordinated Debt Documents; (c) after givingeffect to this Amendment, no Event of Default (as defined in the Notes) hasoccurred and is continuing; and (d) the execution, delivery andperformance by the Company of this Amendment (i) have been duly authorized byall necessary action on the part of the Company, (ii) will not violate anyapplicable law or regulation or the organizational documents of the Company orany of its subsidiaries, (iii) will not violate or result in a default underany indenture, agreement or other instrument binding on the Company or any ofits assets, including without limitation, the Credit Agreement or any otherLoan Document (as defined in the Credit Agreement), and (iv) do not require anyconsent, waiver or approval of or by any person (other than the Purchasers)which has not been obtained.

 

5.             Conditionsto Effectiveness.

 

Theeffectiveness of this Amendment shall be subject to the satisfaction of thefollowing conditions precedent:

 

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(a)           The Purchasers shall have receivedcounterparts of this Amendment duly executed by the Company;

 

(b)           The Purchasers shall have received aCertificate of the Secretary of the Company, certifying that this Amendment hasbeen duly authorized by the Board of Directors of the Company;

 

(c)           The Company shall have delivered tothe Purchasers evidence that Lender has executed and delivered to the Company awritten amendment and waiver with respect to the Loan Documents (as defined inthe Credit Agreement), in form and substance reasonably acceptable to thePurchasers;

 

(d)           The Company, ARC Service, Inc., ARCSolutions, Inc., ARC Midholding, Inc., Writers Inc., ARC Technology ManagementLLC, ARC Staffing Management LLC, and ARC Shared Services LLC and Fleet CapitalCorporation shall have executed and delivered to the Purchasers an amendment tothe Guaranty Agreement dated as of April 14, 2003 made by Purchasers for thebenefit of Fleet Capital Corporation (as amended), in form and substancesatisfactory to the Purchasers; and

 

(e)           The Company shall have reimbursed thePurchasers for all reasonable costs and expenses, including reasonable legalfees and disbursements, incurred by the Purchasers in connection with thisAmendment and the transactions contemplated hereby.

 

6.             Miscellaneous.

 

(a)           Except as specifically amendedhereby, all of the terms and provisions of the Securities Purchase Agreement,the other Subordinated Debt Documents and all related documents, shall remainin full force and effect.

 

(b)           This Amendment may be executed in anynumber of counterparts, each of which, when executed and delivered, shall be anoriginal, but all counterparts shall together constitute one instrument.  Delivery of an executed signature pagehereto by facsimile transmission shall be effective as delivery of a manuallyexecuted counterpart hereof.

 

(c)         This Amendment shall be governed by thelaws of the State of Illinois and shall be binding upon and inure to thebenefit of the parties hereto and their respective successors and assigns.

 

[Remainder of Page Left Intentionally Blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this SeventhAmendment to Securities Purchase Agreement and Waiver to be duly executed bytheir respective authorized officers as of the day and year first abovewritten.

 

 
| **COMPANY:**                              |                                                   |
|-------------------------------------------|--------------------------------------------------------|
|                                      |                                                   |
| ALTERNATIVE  RESOURCES CORPORATION        |                                                   |
|                                      |                                                   |
|                                      |                                                   |
| By:                                       | /s/ Steven  Purcell                                    |   |
|                                      | Name:                                                  | Steven Purcell |   |
|                                      | Title:                                                 | CFO |   |
|                                      |
|                                      |
| **PURCHASERS:**                           |
|                                      |
| WYNNCHURCH  CAPITAL PARTNERS, L.P.        |
| By:                                       | Wynnchurch  Partners, L.P., its general partner        |
| By:                                       | Wynnchurch  Management Inc., its general partner       |
|                                      |
|                                      |
| By:                                       | /s/ John  Hatherly                                     |   |
|                                      | Name:                                                  |  John Hatherly |   |
|                                      | Title:                                                 |  President |   |
|                                      |
|                                      |
| WYNNCHURCH  CAPITAL PARTNERS CANADA, L.P. |
| By:                                       | Wynnchurch  Partners Canada, L.P., its general partner |
| By:                                       | Wynnchurch GP  Canada, Inc., its general partner       |
|                                      |
|                                      |
| **By:**                                   | **/s/ John Hatherly**                                  |   |
|                                      | **Name:**                                              |  John Hatherly |   |
|                                      | **Title:**                                             |  President |   |
|                                           |                                                        |  |  |  |

 

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