**EXHIBIT 10-m**

 

**WAIVER AND SECOND AMENDMENT TO CREDITAGREEMENT**

 

This Waiverand Second Amendment to Credit Agreement (this “Amendment”) is dated as ofApril 7, 2003, and is by and among General Electric Capital Corporation, aDelaware corporation, individually as a Lender and as Agent and SecurityTrustee for the Lenders, Analysts International Corporation, a Minnesotacorporation (“Borrower”), and Medical Concepts Staffing, Inc., a Minnesotacorporation (“Medical Staffing”).

 

W I T N E S S E T H:

 

WHEREAS, pursuantto a certain Credit Agreement dated as of April 11, 2002, by and among GeneralElectric Capital Corporation, a Delaware corporation, individually as a Lenderand as Agent and Security Trustee for the Lenders, the other Credit Partiessignatory from time to time thereto, and Borrower (as amended or otherwisemodified from time to time, the “Credit Agreement”; capitalized terms usedherein and not otherwise defined herein shall have the meaning ascribed to suchterms in the Credit Agreement), Agent and Lenders agreed, subject to the termsand provisions thereof, to provide certain loans and other financialaccommodations to Borrower;

 

WHEREAS,Borrower has recently advised Agent and Lenders that Medical Staffing is awholly-owned Subsidiary of Borrower engaged in the business of temporarystaffing of medical personnel;

 

WHEREAS, thefailure of Borrower to disclose the existence of Medical Staffing as aSubsidiary of Borrower pursuant to Schedule 3.8 to the Credit Agreement hascaused a breach of Section 3.8 of the Credit Agreement and an Event of Defaultpursuant to Section 8.1(f) of the Credit Agreement (“Disclosure Event ofDefault”);

 

WHEREAS,Borrower has recently advised Agent and Lenders of a payment in the aggregateamount of $755,000 to Sarah Spiess (“Spiess”), in full satisfaction ofall deferred compensation obligations of the Credit Parties to Spiess;

 

WHEREAS suchpayment caused a breach of Section 6.22 of the Credit Agreement and an Event ofDefault pursuant to Section 8.1(b) of the Credit Agreement (together with theDisclosure Event of Default, the “Specified Events of Default”); and

 

WHEREAS,Borrower has requested that Agent and Lenders (i) waive the Specified Events ofDefault and (ii) agree to amend the Credit Agreement in certain respects, asset forth below.

 

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

 

# **1.        Joinder and Waiver.  Agent, Lenders, Borrower and MedicalStaffing hereby agree that from and following the date hereof Medical Staffingshall at all times be a Credit Party for purposes of the Credit Agreement andall other Loan Documents.  Subject tothe satisfaction of the conditions precedent set forth in Section 6 of thisAmendment, and in reliance on the representations and warranties set forth inSection 8 of this Amendment, Agent and Lenders hereby waive the SpecifiedEvents of Default.  The foregoing is alimited waiver, and nothing contained herein shall be deemed to constitute awavier of any other Event of Default or any other breach of the CreditAgreement or any other Loan Document that may heretofore or hereafter occur orhave occurred and be continuing or to modify any provision of the CreditAgreement.**

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# **2.        Amendments to Credit Agreement.  Subject to the satisfaction of theconditions precedent set forth in Section 6 of this Amendment, and in relianceon the representations and warranties set forth in Section 8 of this Amendment,the Credit Agreement is hereby amended as follows:**

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## **(a)       Section1.6 of the Credit Agreement is hereby amended to provide that, subject to allReserve limitations, exclusionary criteria and other limitations set forththerein on the same terms as are applicable to the Accounts of Borrower, theAccounts of Medical Staffing may qualify as Eligible Accounts; provided,however, that without limitation of any of the limitations andexclusionary criteria set forth in Section 1.6 of the Credit Agreement, no Accountsof Medical Staffing shall qualify as Eligible Accounts until (i) the aggregateoutstanding amount of such Accounts exceeds $250,000 as of any date ofmeasurement and (ii) Agent shall have completed a field exam of the Accounts ofMedical Staffing, and shall be satisfied, in its sole discretion, with theresults thereof.  Exhibit 4.1(b) to theCredit Agreement (Borrowing Base Certificate) shall be deemed amended to giveeffect to the provisions of this clause (a).**

 

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## **(b)      Clause(a) of Section 6.3 of the Credit Agreement is hereby amended by amending andrestating clause (H) set forth therein in its entirety, as follows:**

 

“(H)    the aggregate balance ofall such intercompany loans owing to Borrower shall not exceed (x) $400,000 atany time, with respect to intercompany loans and/or advances made by Borrowerto all Persons described in this clause (vii) other than Medical Staffing and(y) $1,000,000 at any time, with respect to intercompany loans and/or advancesmade by Borrower to Medical Staffing.”

 

## **(c)       Clause(a) of Section 6.5 of the Credit Agreement is hereby amended and restated inits entirety as follows:**

 

“(a) make anychanges in any of its business objectives, purposes or operations that could inany way adversely affect the repayment of the Loans or any of the otherObligations or could reasonably be expected to have or result in a MaterialAdverse Effect, providedthat Medical Staffing shall be permittedto extend its business to include the provision of temporary staffing ofmedical personnel,”

 

## **(d)      Section6.20 of the Credit Agreement is hereby amended and restated in its entirety asfollows:**

 

“None of theCredit Parties other than Borrower shall engage in any trade or business, orown any assets (other than Stock of their Subsidiaries) or incur anyIndebtedness or Guaranteed Indebtedness (other than the Obligations), providedthat Medical Staffing shall be permitted to engage in its relevantbusiness and own assets.”

 

# **3.        Annex A to the Credit Agreement ishereby amended by inserting the following definition in appropriatealphabetical order:**

 

“MedicalStaffing” means Medical Concepts Staffing, Inc., a Minnesota corporationand a wholly-owned Subsidiary of Borrower.

 

4.        The definition of“Borrowing Base”, set forth in Annex A to the Credit Agreement, is herebyamended by inserting the words “and Medical Staffing’s” after each reference to“Borrower’s” set forth therein.

 

5.        Collection Reserve.  Borrower and Medical Staffing herebyacknowledge and agree that, without otherwise limiting Agent’s right toestablish and adjust Reserves, the Collection Reserve (as identified on theBorrowing Base Certificate) is $3,200,000 as of the date hereof, as the samemay be adjusted from time to time in Agent’s reasonable credit judgment.

 

6.        Conditions Precedent.  The effectiveness of the waivers andamendments contemplated hereby is subject to the prior receipt by Agent of eachof the following documents and agreements, each in form and substanceacceptable to Agent in its sole discretion:

 

(a)       A Guaranty executed byMedical Staffing;

 

(b)      A Pledge Agreementexecuted by Borrower with respect to all of the outstanding Stock of MedicalStaffing, together with the share certificates evidencing all such Stock and astock power executed in blank;

 

## **(c)       aSecurity Agreement executed by Medical Staffing in favor of Agent;**

 

## **(d)      aTrademark Security Agreement executed by Medical Staffing in favor of Agent;**

 

## **(e)       anIntercompany Note executed by Medical Staffing in favor of Borrower,accompanied by an allonge executed in blank by Borrower;**

 

## **(f)       aSecretary’s Certificate of Medical Staffing, with respect to Articles ofIncorporation, By-Laws, authorizing resolutions and incumbency  signatures; and**

 

## **(g)      anopinion or opinions of counsel to Medical Staffing with respect to thedocuments, agreements and transactions described herein.**

 

# **7.        References; Effectiveness.  Agent and Borrower hereby agree that allreferences to the Credit Agreement which are contained in any of the other LoanDocuments shall refer to the Credit Agreement as amended by this Amendment.**

 

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# **8.        Representations and Warranties.  To induce Agent to enter into thisAmendment, each of Borrower and Medical Staffing hereby jointly and severallyrepresents and warrants to Agent that:**

 

## **(a)       Theexecution, delivery and performance by Borrower and Medical Staffing of thisAmendment and each other agreement and document contemplated hereby are withinits corporate power, have been duly authorized by all necessary corporateaction, have received all necessary governmental approval (if any shall berequired), and do not and will not contravene or conflict with any provision oflaw applicable to Borrower or Medical Staffing, the articles of incorporationand by-laws of Borrower or Medical Staffing, any order, judgment or decree ofany court or governmental agency, or any agreement, instrument or documentbinding upon Borrower or Medical Staffing or any of their respectiveproperties;**

 

## **(b)      Eachof the Credit Agreement, the other Loan Documents, as amended by thisAmendment, and each other agreement and document contemplated hereby is thelegal, valid and binding obligation of Borrower and/or Medical Staffing (asapplicable), enforceable against Borrower and/or Medical Staffing (asapplicable) in accordance with their terms, except as such enforceability maybe limited by applicable bankruptcy, reorganization, moratorium, fraudulenttransfer or other similar laws affecting creditors’ rights generally or byprinciples governing the availability of equitable remedies;**

 

## **(c)       Aftergiving effect to the amendments set forth herein, the representations andwarranties contained in the Credit Agreement and the other Loan Documents aretrue and accurate as of the date hereof with the same force and effect as ifsuch had been made on and as of the date hereof;**

 

## **(d)      Aftergiving effect to the amendments set forth herein, Borrower has performed all ofits obligations under the Credit Agreement and the Loan Documents to beperformed by it on or before the date hereof and as of the date hereof,Borrower is in compliance with all applicable terms and provisions of theCredit Agreement and each of the Loan Documents to be observed and performed byit and, except to the extent otherwise waived by the provisions hereof, noEvent of Default or other event which, upon notice or lapse of time or both,would constitute an Event of Default, has occurred.**

 

# **9.        Counterparts.  This Amendment may be executed in any numberof counterparts and by the different parties on separate counterparts, and eachsuch counterpart shall be deemed to be an original, but all such counterpartsshall together constitute but one and the same Amendment.**

 

# **10.      Continued Effectiveness.  Except as amended hereby, the CreditAgreement and each of the Loan Documents shall continue in full force andeffect according to its terms.**

 

# **11.      Costs and Expenses. Borrower herebyagrees that all expenses incurred by Agent in connection with the preparation,negotiation and closing of the transactions contemplated hereby, including,without limitation, reasonable attorneys’ fees and expenses, shall be part ofthe Obligations.**

 

IN WITNESSWHEREOF, this Amendment has been executed as of the day and year first writtenabove.

 

 
|   |   | ANALYSTS  INTERNATIONAL CORPORATION                                           |
|--------|--------|-------------------------------------------------------------------------------|
|   |   |                                                                          |
|   |   |                                                                          |
|   |   | By                                                                            |   |   |
|   |   | Its                                                                           |   |   |
|   |   |                                                                          |
|   |   | MEDICAL  CONCEPTS STAFFING, INC.                                              |
|   |   |                                                                          |
|   |   |                                                                          |
|   |   | By                                                                            |   |   |
|   |   | Its                                                                           |   |   |
|   |   |                                                                          |   |
|   |   | GENERAL  ELECTRIC CAPITAL CORPORATION,  as Agent, Security Trustee and Lender |
|   |   |                                                                          |
|   |   |                                                                          |
|   |   | By                                                                            |   |   |
|   |   | Its                                                                           |   |   |

 

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