Document:

STOCK PURCHASE AGREEMENT

                                      among

                                 TEAMSTAFF, INC.

                                       and

                 THE SHAREHOLDERS OF RS STAFFING SERVICES, INC.

                                       and

                           RS STAFFING SERVICES, INC.

                            Dated as of May 26, 2005

                                TABLE OF CONTENTS
                                                                         Page(s)
                                                                         -------

1.       Definitions..........................................................1
2.       Purchase and Sale of RS Shares.......................................6
3.       Representations and Warranties Concerning the Transaction............9
4.       Representations and Warranties Concerning RS........................13
5.       Pre-Closing Covenants...............................................25
6.       Post-Closing Covenants..............................................26
7.       Conditions to Obligation to Close...................................27
8.       Survival and Indemnification........................................29
9.       Post-Closing Tax Matters; Other Matters; Tag Along Right............32
10.      Termination.........................................................34
11.      Dispute Resolution..................................................35
12.      Miscellaneous.......................................................36

Exhibits
--------

Exhibit A         -Audited Financial Statements of RS for the fiscal years ended
                  December 31, 2004 and 2003

Exhibit B         -Unaudited Balance Sheet and Statement of Income of RS for the
                  four months ended April 30, 2005

Exhibit C         -Form of Seller's Release

Exhibit D         -Sellers Ownership Schedule

Exhibit E         -Form of TeamStaff Note

Exhibit F         -Form of Security Agreement

Exhibit G         -Form of Sellers Counsel Legal Opinion

Exhibit H         -Form of TeamStaff Counsel Legal Opinion

Exhibit I         -Form of Roger Staggs Employment Agreement

Exhibit J         -Form of E. Barry Durham Employment Agreement

Annexes
-------
Annex I: Sellers Disclosure Schedule        Exceptions to the Sellers'
                                            Representations and Warranties

Annex II: TeamStaff Disclosure Schedule     Exceptions to Team Staff's
                                            Representations and Warranties

Annex III: RS Disclosure Schedule           Exceptions to RS' Representations
                                            and Warranties

                            STOCK PURCHASE AGREEMENT

         This Stock Purchase Agreement (this "Agreement") is entered into as of
May 26, 2005, by and among TeamStaff, Inc., a New Jersey corporation with its
address at 300 Atrium Drive, Somerset, New Jersey 08873 ("TeamStaff"), each of
the Sellers (as defined herein), and RS Staffing Services, Inc., a Georgia
corporation with its address at 533 Plaza Drive Road, Monroe, GA 30655 ("RS").
TeamStaff, RS and the Sellers are sometimes referred to herein individually as a
"Party" and collectively as the "Parties."

                                   WITNESSETH

         WHEREAS, the Sellers in the aggregate own all of the outstanding
capital stock of RS.

         WHEREAS, this Agreement contemplates a transaction in which TeamStaff
will purchase from the Sellers, and the Sellers will sell to TeamStaff, all of
the outstanding capital stock of RS in return for the Purchase Price (as such
term is defined herein).

         Now, therefore, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties,
and covenants herein contained, the Parties agree as follows.

     1.  Definitions As used herein, the following terms shall have the
         respective meanings set forth below:

         "Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.

         "Affiliated Group" means any affiliated group within the meaning of
Code ss.1504(a).

         "Association" has the meaning set forth in Section 11(b) below.

         "Breaching Party" has the meaning in Section 10(b) below.

         "Business" means the existing and prospective contract staffing
business of RS and shall include RS' operations, facilities, assets, contractual
rights (including, but not limited to the Government Staffing Contracts),
financial condition, results of operations, finances, products, services,
competitive position, customers, personnel and good will.

         "Closing" has the meaning set forth in Section 2(c) below.

         "Closing Date" has the meaning set forth in Section 2(c) below.

         "Closing Date Financial Statements" has the meaning set forth in
Section 9(f) below.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "COBRA" means the requirements of Part 6 of Subtitle B of Title I of
ERISA and Code ss.4980B.

         "Commission" shall mean the United States Securities and Exchange
Commission.

         "Control Group" has the meaning set forth in Code ss.1563.

         "Current Accounts" means each client of RS who is receiving temporary
staffing services from RS as of the Closing Date.

         "Damages" means any loss, Liability, claim, damage and expense
(including, but not limited to, costs of investigation and defense and
reasonable attorneys', accountants', consultants' and

                                       1

experts' fees and expenses that would not have been expended but for the claimed
breach) whether or not involving a third party claim; provided, however, that
Damages shall be determined net of the sum of any amounts received under
insurance policies and any Tax benefits actually received (or reasonably
expected to be received) with respect to such Damages and, provided, further,
that Damages will not include any incidental or consequential Damages of any
kind.

         "Determining Auditor" means an accounting firm of national stature,
jointly selected by TeamStaff and the Sellers, that is not then employed by
TeamStaff (or any of its Affiliates) and that was not employed by TeamStaff or
RS (or any of their respective Affiliates) during the two-year period
immediately preceding the Closing; provided, however, that if the parties cannot
jointly agree upon the Determining Auditor, the Sellers and TeamStaff shall each
designate one accounting firm (which shall be of national stature but which may
be employed or have been employed by such Party or its Affiliates), and the two
accounting firms so designated shall jointly select a third accounting firm,
meeting the criteria set forth in the first four lines of this sentence, to
serve as the Determining Auditor.

         "Durham Employment Agreement" has the meaning set forth in Section
7(a)(vii) below.

         "Earnout Payment" shall have the meaning set forth in Section 2(e)
below.

         "Earnout Period" shall have the meaning set forth in Section 2(e)(ii)
below.

         "EBITDA" shall have the meaning set forth in Section 2(e)(ii) below.

         "Effective Date" shall have the meaning set forth in Section 2(c)
below.

         "Employee Benefit Plan" means any (a) nonqualified deferred
compensation or retirement plan or arrangement, (b) qualified defined
contribution retirement plan or arrangement which is an Employee Pension Benefit
Plan, (c) qualified defined benefit retirement plan or arrangement which is an
Employee Pension Benefit Plan (including any Multiemployer Plan), or (d)
Employee Welfare Benefit Plan or material fringe benefit or other retirement,
bonus, or incentive plan or program.

         "Employee Pension Benefit Plan" has the meaning set forth in ERISA
ss.3(2).

         "Employee Welfare Benefit Plan" has the meaning set forth in ERISA
ss.3(1).

         "Environmental, Health, and Safety Requirements" shall mean all
federal, state, local and foreign statutes, regulations, ordinances and other
provisions having the force or effect of law, all judicial and administrative
orders and determinations, all contractual obligations and all common law
concerning public health and safety, worker health and safety, and pollution or
protection of the environment, including without limitation all those relating
to the presence, use, production, generation, handling, transportation,
treatment, storage, disposal, distribution, labeling, testing, processing,
discharge, release, threatened release, control, or cleanup of any hazardous
materials, substances or wastes, chemical substances or mixtures, pesticides,
pollutants, contaminants, toxic chemicals, petroleum products or byproducts,
asbestos, polychlorinated biphenyls, noise or radiation, each as amended and as
now or hereafter in effect.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

         "Final Payment Date" means the date on which the TeamStaff Note shall
have been paid in full by TeamStaff and any Earnout Payment shall have been
finally determined and paid in full by TeamStaff.

                                       2

         "Financial Statement" has the meaning set forth in Section 4(g) below.

         "Financing" has the meaning set forth in Section 5(h) below.

         "GAAP" means United States generally accepted accounting principles as
in effect from time to time.

         "Government Staffing Contracts" means contracts whereunder RS provides
staffing services to certain governmental entities.

         "Indemnified Party" has the meaning set forth in Section 8(e) below.

         "Indemnifying Party" has the meaning set forth in Section 8(e) below.

         "Intellectual Property" means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto,
and all patents, patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions, extensions, and
reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
trade names, and corporate names, together with all translations, adaptations,
derivations, and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith, (c) all copyrightable works, all copyrights, and all applications,
registrations, and renewals in connection therewith, (d) all mask works and all
applications, registrations, and renewals in connection therewith, (e) all trade
secrets and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost information, and business and
marketing plans and proposals), (f) all computer software (including data and
related documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium).

         "Knowledge" means (i) with respect to RS or the Sellers, the actual
knowledge of Roger Staggs and E. Barry Durham, in each case after making a
reasonable inquiry as to the matters that are the subject of the statement, and
(ii) with respect to TeamStaff, the actual knowledge of its principal officers
and directors, in each case after making a reasonable inquiry as to the matters
that are the subject of the statement..

         "Liability" means any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.

         "Material Adverse Effect" means: (x) a material adverse effect on the
financial condition, properties, assets, liabilities, business or results of
operations of a Party and its Subsidiaries (as applicable), taken as a whole,
excluding any such effect resulting from or arising in connection with (A)
changes or conditions generally affecting the contract staffing industry or (B)
changes or conditions generally affecting the U.S. economy or financial markets;
or (y) an effect that would prevent, materially delay or materially impair the
ability of the Party to consummate the transactions contemplated by this
Agreement.

         "Most Recent Balance Sheet" means the balance sheet contained within
the Most Recent Financial Statements.

                                       3

         "Most Recent Financial Statements" has the meaning set forth in Section
4(g) below.

         "Most Recent Fiscal Month End" has the meaning set forth in Section
4(g) below.

         "Most Recent Fiscal Year End" has the meaning set forth in Section 4(g)
below.

         "Multiemployer Plan" has the meaning set forth in ERISA ss.3(37).

         "Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).

         "Party" and "Parties" have the meanings set forth in the preface above.

         "PBGC" means the Pension Benefit Guaranty Corporation.

         "Person"" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department, agency, or political
subdivision thereof).

         "Prohibited Transaction" has the meaning set forth in ERISA ss.406 and
Code ss.4975.

         "Purchaser" has the meaning set forth in Section 9(g) below.

         "Purchase Price" has the meaning set forth in Section 2(b) below.

         "Qualifying Event" has the meaning set forth in Section 9(g) below..

         "RS EBITDA Statement" has the meaning set forth in Section 2(e)(iv)(A)
below.

         "RS Common Stock" means the Common Stock of RS, par value $.01 per
share.

         "RS Disclosure Schedule" has the meaning set forth in Section 4 below.

         "RS Lease Amendments" has the meaning in Section 5 (i) below.

         "RS Objection" has the meaning set forth in Section 2(e)(iv)(A) below.

         "RS Preferred Stock" means the Preferred Stock of RS, par value $.01
per share.

         "RS Share" means any share of RS Common Stock or RS Preferred Stock.

         "SEC Documents" has the meaning set forth in Section 3(b)(v) below.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.

         "Security Interest" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest, other than (a) mechanic's, materialmen's,
and similar liens, (b) liens for Taxes not yet due and payable, (c) purchase
money liens and liens securing rental payments under capital lease arrangements,
and (d) other liens arising in the Ordinary Course of Business and not incurred
in connection with the borrowing of money.

         "Seller Release" has the meaning set forth in Section 3(a)(vii) below.

                                       4

         "Sellers" means the legal and beneficial owners of all of the issued
and outstanding RS Shares as set forth on the Sellers Ownership Schedule.

         "Sellers' Auditor" has the meaning set forth in Section 2(e)(iv)(B)
below.

         "Sellers Disclosure Schedule" has the meaning set forth in Section 3(a)
below.

         "Sellers Ownership Schedule" means the Sellers Ownership and Allocation
Schedule which is attached hereto as Exhibit D.

         "Staggs Employment Agreement" has the meaning set forth in Section
7(a)(vi) below.

         "Subsidiary" means any corporation with respect to which a specified
Person (or a Subsidiary thereof) owns a majority of the common stock or has the
power to vote or direct the voting of sufficient securities to elect a majority
of the directors.

         "Tag Along"

         "Tax" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Code ss.59A),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, including any interest, penalty,
or addition thereto, whether disputed or not.

         "Tax Return" means any return, declaration, report, claim for refund,
or information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.

         "TeamStaff" has the meaning set forth in the preamble hereof.

         "TeamStaff Auditor" has the meaning set forth in Section 2(e)(iv)(A)
below.

         "TeamStaff Common Stock" mean the Common Stock of TeamStaff, par value
$.001 per share.

         "TeamStaff Disclosure Schedule" has the meaning set forth in Section
3(b) below.

         "TeamStaff Note" means the promissory note of TeamStaff payable to the
Sellers in the aggregate principal amount of $3,000,000, in the form attached
hereto as Exhibit E. Such TeamStaff Note shall be subordinated to senior debt in
favor of PNC Bank, National Association, obtained by TeamStaff on terms and
conditions reasonably acceptable to the Sellers.

         "TeamStaff Security Agreement" means the security agreement in the form
attached hereto as Exhibit F executed by TeamStaff (A)securing the payment of
the TeamStaff Note to Sellers with (i) a second-priority security interest in
RS's accounts receivables and (ii) providing for an assignment by TeamStaff of
client agreements of the RS Business in an amount proportional, based upon
revenue and/or income generated by the client agreement to the amount of the
TeamStaff Note which remains unpaid and (B) providing for a royalty free use of
the Business Web based system.

         "Third Party Claim" has the meaning set forth in Section 8(e) below.

                                       5

     2.  Purchase and Sale of RS Shares

            (a) Basic Transaction On and subject to the terms and conditions of
this Agreement, TeamStaff agrees to purchase from each of the Sellers, and each
of the Sellers agrees to sell to TeamStaff, all of his or its RS Shares in
exchange for the Purchase Price (as described below). Upon completion of the
transaction provided for herein, TeamStaff shall be the owner of all of the
capital stock of RS in every form, including any convertible securities.

            (b) Purchase Price. In exchange for Seller's RS Shares TeamStaff
agrees to pay to and/or deliver to the Sellers at the Closing the following
consideration (collectively the "Purchase Price"): (i) a wire transfer of
immediately available federal funds in the amount of $3,250,000; (ii) the
TeamStaff Note; and (iii) such number of shares of TeamStaff Common Stock as
shall equal the sum of $1,750,000 divided by the per share price of $1.45 for an
aggregate of 1,206,896 shares of TeamStaff Common Stock. The Purchase Price will
also be deemed to include the Earnout as set forth in Section 2(e). The Purchase
Price shall be allocated among the Sellers as set forth on the Sellers Ownership
Schedule. For purposes of this Agreement, the Purchase Price shall mean the
total aggregate sum of $8,000,000, subject to increase by any Earnout Payment.
Effective as of the Closing, TeamStaff shall own all of the outstanding capital
stock of RS.

            (c) The Closing;Effective Date. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take place by in hand
delivery of documents and/or facsimile or other means of electronic transmission
or at the offices of Goldstein & DiGioia LLP, 45 Broadway - 11th Floor, New
York, New York 10006, or such other location as the Parties may mutually
determine, commencing at 10:00 a.m. local time on June 8, 2005, subject to the
satisfaction or waiver of all conditions to the obligations of the Parties to
consummate the transactions contemplated hereby (other than conditions with
respect to actions the respective Parties will take at the Closing itself) or
such other date as the Parties may mutually determine (the "Closing Date"). The
transactions contemplated hereunder shall be deemed effective for accounting
purposes at 12:00 midnight on June 4, 2005 ("Effective Date").

            (d) Deliveries at the Closing. At the Closing, (i) the Sellers will
deliver to TeamStaff the various certificates, instruments, and documents
referred to in Section 7(a) below, (ii) TeamStaff will deliver to the Sellers
the various certificates, instruments, and documents referred to in Section 7(b)
below, (iii) each of the Sellers will deliver to TeamStaff stock certificates
representing all of his RS Shares, endorsed in blank or accompanied by duly
executed assignment documents, and (iv) TeamStaff will deliver to each of the
Sellers the Purchase Price in accordance with Section 2(b) above.

            (e) Earnout Payment. The Sellers shall be entitled to additional
consideration, payable by TeamStaff in cash to the Sellers in accordance with
the Sellers Ownership Schedule, as follows, which cash payment shall not exceed
the aggregate sum of $2,000,000 (the "Earnout Payment"):

                                       6

                 (i) From and after the Closing Date and until the Final Payment
Date, TeamStaff shall maintain a separate income statement for the Business and
operate the Business as a wholly-owned subsidiary of TeamStaff and shall not
sell its assets or capital stock, merge it with, consolidate its assets with or
otherwise combine it in any way with TeamStaff or any other business, subsidiary
or affiliate of TeamStaff or otherwise;

                 (ii) From the Closing Date until the date that is 12 months
following the Closing Date (the "Earnout Period"), TeamStaff agrees: (A) to
operate the Business in good faith; and (B) that, except upon prior consultation
(but nothing contained herein shall require prior approval) with the Sellers
regarding the proposed action, it shall not take any action or adopt any policy
that the President of RS has reasonably asserted (in advance of or promptly
following such action or adoption), in good faith and in writing, can reasonably
be expected to result (directly or indirectly) in a reduction of the earnings
before interest, taxes and depreciation ("EBITDA") of the Business for any
financial period during the Earnout Period.

                 (iii) Within 45 days after the end of the Earnout Period,
TeamStaff shall calculate the EBITDA of the Business as follows:

                    (A) EBITDA will be calculated in accordance with GAAP and
         otherwise in accordance with TeamStaff's accounting policies
         consistently applied;

                    (B) During the Earnout Period, any proposed arrangement
         whereby services will be provided by the Business to TeamStaff or its
         direct or indirect subsidiaries must be made on terms and conditions
         approved by at least one of the Sellers;

                    (C) EBITDA for the Earnout Period will be adjusted as
         follows (with deductions taken or additions made (as the case may be)
         only to the extent not previously taken or made in calculating EBITDA):

                    i. All reasonable charges by TeamStaff for services actually
             and directly provided or expenses actually incurred directly on
             behalf of the Business, including, without limitation, cash
             management, insurance, legal and accounting services, employee
             benefit administration, information technology resources and
             advertising, shall be deducted from EBITDA; provided, however, that
             such deductions will not exceed the amounts RS would have paid for
             such services if such services were obtained directly by RS;

                    ii. Six percent (6%) of any revenue derived by TeamStaff as
             a result of services provided to any third party where the
             establishment of TeamStaff's relationship with such third party was
             a direct or indirect result of

                                       7

             an existing relationship between such third party and RS or the
             Sellers will be added to EBITDA;

                    iii. Appropriate adjustments will be made to insure that
             there is no material or substantial upward or downward adjustment
             of income during any period due to the acceleration or deferral of
             income into a period other than that in which same should normally
             accrue or occur, or due to the acceleration of deferral of any
             losses, costs or expenses into any period other than that in which
             same would normally accrue or occur;

                    iv. the amount of any salary under the Durham Employment
             Agreements will be added to EBITDA, provided Durham does not accept
             or pays back to RS any such amounts paid or to have been paid to
             Durham under his Employment Agreement;

                    v. Any costs or expenses incurred by RS and related to any
             action taken to integrate the operational aspects of the Business,
             including, without limitation, cash management, insurance, legal
             and accounting services, employee benefit administration,
             information technology resources and advertising, with the business
             of Teamstaff will be added to EBITDA.

                    (D) the calculation of EDITDA shall not include any workers
         compensation insurance program refunds which may be obtained pursuant
         to Section 9(e) below.

                 (iv) the EBITDA of the Business shall be finally determined as
follows:

                    (A) The independent auditors of TeamStaff (the "TeamStaff
         Auditor"), at TeamStaff's expense, shall review the calculations of RS'
         EBITDA as provided in clause (iii) above, and shall deliver a written
         letter stating that they have reviewed such calculations and are in
         agreement with such EBITDA calculations (the "RS EBITDA Statement").
         TeamStaff shall provide the RS EBITDA Statement to Sellers as promptly
         as practicable. The Sellers shall have the right to contest the
         accuracy of the RS EBITDA Statement by joint written notice, which
         shall state, in reasonable detail, the Seller's objections and the
         basis or bases therefor (the "RS Objection"). Any such RS Objection
         must be received by TeamStaff no later than thirty (30) days after the
         date that the RS EBITDA Statement was delivered to Sellers.

                    (B) If the Sellers contest the accuracy of the RS EBITDA
         Statement, in accordance with the foregoing, the Sellers shall engage,
         within thirty (30) days after delivery of the RS Objection to
         TeamStaff, a firm of independent certified public accountants (the
         "Sellers' Auditor") to review those items being contested. In such
         review, the Sellers' Auditor shall be entitled to reasonable access to

                                       8

         the TeamStaff Auditor's work papers, and to meet with the TeamStaff
         Auditor to discuss those items in dispute. In addition, TeamStaff will
         cooperate fully in all reasonable requests made by the Sellers' Auditor
         for information or access relating to the determination of EBITDA. The
         Sellers' Auditor shall expeditiously complete its review and provide
         the Sellers and TeamStaff with a written statement of its conclusions
         and the basis or bases therefor in reasonable detail.

                    (C) No later than seventy-five (75) days following delivery
         of the RS Objection to TeamStaff, the Sellers shall advise TeamStaff in
         writing (containing reasonable detail) of their continuing objections
         to the RS EBITDA Statement, if any, and the basis or bases therefor.
         Any items remaining in dispute will be referred to the Determining
         Auditor for a determination, and the determination of the Determining
         Auditor shall be final, binding and conclusive and not subject to
         challenge by the Parties. The fees and expenses of the Determining
         Auditor shall be borne by the Party whose position is farthest, in
         gross dollars, from the amounts finally determined by the Determining
         Auditor with respect to the disputed items.

                 (v) The Earnout Payment shall be calculated as follows: for
every $1.00 of EBITDA of the Business for the Earnout Period over $1,800,000,
the Sellers shall be entitled to $4.00 up to a maximum of $2,000,000. For
example, if EBITDA of the Business is determined to be $2,300,000, the Earnout
Payment would be $2,000,000. The Earnout Payment, if any, shall be made by
TeamStaff by wire transfer of immediately available federal funds on or before
the thirtieth (30th) day following the final determination of EBITDA as provided
above.

     3.  Representations and Warranties Concerning the Transaction.

             (a) Representations and Warranties of the Sellers. Each of the
Sellers represents and warrants to TeamStaff that the statements contained in
this Section 3(a) are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 3(a)) with respect to himself, except as set forth on
Annex I hereto (the "Sellers Disclosure Schedule").

                 (i) Authorization of Transaction. The Seller has full power and
authority to execute and deliver this Agreement and to perform his obligations
hereunder. This Agreement constitutes the valid and legally binding obligation
of the Seller, enforceable in accordance with its terms and conditions, subject
to applicable bankruptcy, insolvency or other similar laws relating to or
affecting the enforcement of creditors' rights generally and to general
principles of equity (regardless of whether enforcement is at equity or at law).
The Seller need not give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency in
order to consummate the transactions contemplated by this Agreement.

                                       9

                 (ii) Noncontravention. Neither the execution and the delivery
of this Agreement, nor the consummation of the transactions contemplated hereby,
will (A) violate or conflict with any applicable law, regulation or order of the
United States or any state or any agency or political subdivision thereof, or
any decree or order of any court or other governmental entity, or (B) result in
a violation or breach of, or constitute a default under, or permit acceleration
of, or give any other party the right to terminate, any material permit or
agreement to which Seller is a party or by which he is bound.

                 (iii) Brokers' Fees. Except as set forth in Section 3(a)(iii)
of the Sellers Disclosure Schedule, the Seller has no Liability or obligation to
pay any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which TeamStaff could become
liable or obligated. All fees and commissions which may be payable to Tucker
Midis & Associates shall be borne by the Sellers and not by RS.

                 (iv) Investment. The Seller (A) understands that the shares of
TeamStaff Common Stock being issued hereunder have not been, and will not be,
registered under the Securities Act, or under any state securities laws, and are
being offered and sold in reliance upon federal and state exemptions for
transactions not involving any public offering, (B) is acquiring the shares of
TeamStaff Common Stock being issued hereunder solely for his or its own account
for investment purposes, and not with a view to the distribution thereof, (C) is
a sophisticated investor with knowledge and experience in business and financial
matters, (D) has received certain information concerning TeamStaff, including
without limitation, the SEC Documents, and has had the opportunity to obtain
additional information as desired in order to evaluate the merits and the risks
inherent in holding shares of TeamStaff Common Stock, (E) is able to bear the
economic risk and lack of liquidity inherent in holding Shares of TeamStaff
Common Stock and (F) understands that the shares of TeamStaff Common Stock
issued hereunder may be sold only in accordance with Rule 144 as promulgated by
the Commission or other exemptions from registration under the Securities Act.

                 (v) RS Shares. The Seller holds of record and owns beneficially
the number of RS Shares set forth next to his name in Section 4(b) of the RS
Disclosure Schedule, free and clear of any restrictions on transfer (other than
any restrictions under the Securities Act and state securities laws), Taxes or
Security Interests. The Seller is not a party to any option, warrant, purchase
right, or other contract or commitment that could require the Seller to sell,
transfer, or otherwise dispose of any capital stock of RS (other than this
Agreement or any agreements or documents executed and/or delivered herewith).
The Seller is not a party to any voting trust, proxy, or other agreement or
understanding with respect to the voting of any capital stock of RS.

                 (vi) Release of Sellers Claims against RS. At Closing, Seller
will provide a full release of RS from any and all claims that it may have,
known or unknown, related to the business of RS and his respective ownership of
RS Shares (other than any claims that may arise under this Agreement) by
delivery to TeamStaff of a release in the form attached hereto as Exhibit C (the
"Seller Release").

                                       10

             (b) Representations and Warranties of TeamStaff. TeamStaff
represents and warrants to the Sellers that the statements contained in this
Section 3(b) are correct and complete as of the date of this Agreement and will
be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 3(b)), except as set forth on Annex II attached hereto
(the "TeamStaff Disclosure Schedule").

                 (i) Organization of TeamStaff. TeamStaff is a corporation duly
organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation.

                 (ii) Authorization of Transaction. TeamStaff has full power and
authority (including full corporate power and authority) to execute and deliver
this Agreement and to perform its obligations hereunder. This Agreement
constitutes the valid and legally binding obligation of TeamStaff, enforceable
in accordance with its terms and conditions. TeamStaff need not give any notice
to, make any filing with, or obtain any authorization, consent, or approval of
any government or governmental agency in order to consummate the transactions
contemplated by this Agreement.

                 (iii) Noncontravention. Neither the execution and the delivery
of this Agreement, nor the consummation of the transactions contemplated hereby,
will (A) violate any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which TeamStaff is subject or any provision of
its charter or bylaws or (B) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice or consent of a
third party under any agreement, contract, lease, license, instrument, or other
arrangement to which TeamStaff is a party or by which it is bound or to which
any of its assets are subject.

                 (iv) Capitalization; Shares Issued. The authorized capital
stock of TeamStaff consists solely of 40,000,000 shares of TeamStaff Common
Stock, of which, as of the date hereof, 18,106,229 shares are issued and
outstanding, and 5,000,000 Shares of preferred stock, none of which are issued
or outstanding. All the issued and outstanding shares of TeamStaff Common Stock
are validly issued, fully paid and nonassesable and have been issued and sold in
full compliance with all applicable federal and state securities laws. The
shares of TeamStaff Common Stock to be issued to Seller pursuant to Section
2(b), when delivered in accordance with this Agreement, shall be duly
authorized, validly issued, fully paid and nonassessable. The issuance of such
shares of TeamStaff Common Stock in connection with this Agreement will be
exempt from registration under the Securities Act of 1933 and applicable state
securities laws and will be otherwise in full compliance with such federal and
state securities laws. The shares of TeamStaff Common Stock to be issued to the
Sellers pursuant to Section 2(b) are restricted securities under Rule 144 of the
Securities Act of 1933 and shall bear an appropriate legend as such. Upon
termination of the two year restricted period under Rule 144 of the Securities
Act of 1933, the holder thereof shall

                                       11

be entitled to receive from Team Staff, at TeamStaff's expense, new certificates
representing such shares, without restrictive legend.

                 (v) SEC Filings and Financial Statements. TeamStaff has filed
or will file with the Commission all required reports, schedules, forms, proxy,
registration and other statements and other documents since October 1, 2000,
(collectively, the "SEC Documents"). The SEC Documents comply, and, as of their
respective filing dates, complied with the requirements of the Securities Act,
or the Securities Exchange Act, as the case may be, and the rules and
regulations of the Commission promulgated thereunder applicable to the SEC
Documents. None of the SEC Documents contain or contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein, in light of the circumstances under which they were made, required to
make such Sec Documents not misleading, except to the extent such statements
have been modified or superseded by a later SEC Document filed and publicly
available prior to the Closing Date, the circumstances or bases for which
modifications or supersessions have not and will not, individually or in the
aggregate, result in any liability or obligation of TeamStaff under the
Securities Act, the Securities Exchange Act or the rules promulgated under the
Securities Act or the Securities Exchange Act. The consolidated financial
statements of TeamStaff and its subsidiaries included in the SEC Documents (as
amended or supplemented by any later filed SEC Document) have been prepared in
accordance with GAAP (except, in the case of unaudited statements, as permitted
by the rules of the Commission) applied on a consistent basis during the periods
involved (except as may be indicated in notes thereto) and fairly present the
financial position, assets and liabilities of TeamStaff and its subsidiaries as
of the dates thereof and the consolidated results of their operations and cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments).

                 (vi) Trading on Nasdaq. TeamStaff Common Stock is authorized
for quotation on the Nasdaq National Market and the trading in TeamStaff Common
Stock on Nasdaq has not been suspended. TeamStaff has received no notice of
de-listing of the TeamStaff Common Stock from the Nasdaq National Market and is
not aware of any facts or circumstances, that could, currently or with the
passage of time, lead to de-listing of TeamStaff Common Stock from the Nasdaq
National Market. TeamStaff is in full compliance with all rules and regulations
governing it by virtue of the quotation of its Common Stock on the Nasdaq
National Market.

                 (vii) Brokers' Fees. TeamStaff has no Liability or obligation
to pay any fees or commissions to any broker, finder, or agent with respect to
the transactions contemplated by this Agreement for which any Seller could
become liable or obligated.

                 (viii) Investment. TeamStaff is not acquiring RS Shares with a
view to or for sale in connection with any distribution thereof within the
meaning of the Securities Act.

                 (ix) No Code ss.338 Election. Neither TeamStaff nor any of its
Affiliates will make any election under Code ss.338 with respect to the
transactions contemplated by this Agreement.

                                       12

                 (x) Disclosure. The representations and warranties contained in
this Section 3(b) do not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements and
information contained in this Section 3(b) not misleading.

     4.  Representations and Warranties Concerning RS . RS and the Sellers
jointly and severally represent and warrant to TeamStaff that the statements
contained in this Section 4 are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 4), except as set forth on Annex III hereto
(the "RS Disclosure Schedule").

             (a) Organization, Qualification, and Corporate Power. RS is a
corporation duly organized, validly existing, and in good standing under the
laws of the jurisdiction of its incorporation. RS is duly authorized to conduct
business and is in good standing under the laws of each jurisdiction where such
qualification is required, except where the failure to so qualify would not have
a Material Adverse Effect upon RS. RS has full corporate power and authority and
all licenses, permits, and authorizations necessary to carry on its Business,
except where the failure to maintain or obtain such license, permit or
authorization will not have a Material Adverse Effect upon RS, and to use the
properties used by it. Section 4(a) of the RS Disclosure Schedule lists the
directors and officers of RS. RS has delivered to TeamStaff correct and complete
copies of the charter and bylaws of RS (as amended to date). The minute books
(containing the records of meetings of the stockholders, the board of directors,
and any committees of the board of directors), the stock certificate books, and
the stock record books of RS are correct and complete in all material respects.
RS is not in default under or in violation of any provision of its charter or
bylaws.

             (b) Capitalization. The entire authorized capital stock of RS
consists of 500 shares of Common Stock, of which 500 shares of Common Stock and
no shares of Preferred Stock are issued and outstanding (collectively referred
to as the "RS Shares") All of the issued and outstanding RS Shares have been
duly authorized, are validly issued, fully paid, and nonassessable, and are held
of record by the respective Sellers as set forth in ss.4(b) of the Disclosure
Schedule. There are no outstanding or authorized options, warrants, purchase
rights, subscription rights, conversion rights, exchange rights, or other
contracts or commitments that could require RS to issue, sell, or otherwise
cause to become outstanding any of its capital stock. There are no outstanding
or authorized stock appreciation, phantom stock, profit participation, or
similar rights with respect to RS. Except as set forth in Section 4(b) of the RS
Disclosure Schedule, there are no voting trusts, proxies, or other agreements or
understandings with respect to the voting of RS Shares.

             (c) Noncontravention. Neither the execution and the delivery of
this Agreement, nor the consummation of the transactions contemplated hereby,
will (A) violate or conflict with (i) any law, regulation or order of the United
States or any state or any agency or political subdivision thereof; (ii) any
term or provision of RS's charter or bylaws; or (iii) any decree or order of any
court or other governmental entity, or (B) result in a violation or breach of,
or

                                       13

constitute a default under, or permit acceleration of, or give any other party
the right to terminate any material permit or cancel an agreement to which RS is
a party or by which it is bound.

             (d) Brokers' Fees. Except as set forth in Section 4(d) of the RS
Disclosure Schedule, RS does not have any Liability or obligation to pay any
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement.

             (e) Title to Assets. RS has good and marketable title to, or a
valid leasehold interest in, the properties and assets used by it in the conduct
of its Business, including the properties and assets shown on the Most Recent
Balance Sheet or acquired after the date thereof, free and clear of all Security
Interests, except for properties and assets disposed of in the Ordinary Course
of Business since the date of the Most Recent Balance Sheet and except for such
imperfections of title and encumbrances, if any, as do not materially detract
from the value or interfere with the use of the properties subject thereto or
affected thereby or otherwise materially impair the Business.

             (f) Subsidiaries. RS has no Subsidiaries, is not part of a Control
Group and has not been part of a Control Group at any time since the date of its
formation.

             (g) Financial Statements. Attached hereto as Exhibits A and B are
the following financial statements (collectively the "Financial Statements"):
(i) the audited balance sheets and statements of income, changes in
stockholders' equity, and cash flow as of and for the fiscal years ended
December 30, 2004 (the "Most Recent Fiscal Year End") and December 31, 2003 for
RS; and (ii) unaudited balance sheet and statement of income, changes in
stockholders' equity, and cash flow (the "Most Recent Financial Statements") as
of and for the four (4) months ended April 30, 2005 (the "Most Recent Fiscal
Month End") for RS. The Financial Statements are accurate and complete in all
material respects and prepared by Sellers in accordance with GAAP consistently
applied from year to year; provided, however, that the Most Recent Financial
Statements are subject to normal year-end adjustments and lack footnotes and
other presentation items.

             (h) Events Subsequent to Most Recent Fiscal Year End. Since the
Most Recent Fiscal Year End, there has been no change in the Business that
would, singly or in the aggregate, constitute or have a Material Adverse Effect
on the Business. Without limiting the generality of the foregoing, since that
date:

                 (i) Other than for the provision of services, RS has not
entered into any agreement, contract, lease, or license (or series of related
agreements, contracts, leases, and licenses) involving more than $50,000.

                 (ii) no party (including RS) has accelerated, terminated,
modified, or cancelled any agreement, contract, lease, or license (or series of
related agreements, contracts, leases, and licenses) involving more than $50,000
to which RS is a party or by which it is bound, other than for services;

                                       14

                 (iii) RS has not imposed any Security Interest upon any of its
assets, tangible or intangible;

                 (iv) RS has not made any capital expenditure (or series of
related capital expenditures) involving more than $50,000;

                 (v) RS has not made any capital investment in, any loan to, or
any acquisition of the securities or assets of, any other Person (or series of
related capital investments, loans, and acquisitions) involving more than
$50,000;

                 (vi) RS has not issued any note, bond, or other debt security
or created, incurred, assumed, or guaranteed any indebtedness for borrowed money
or capitalized lease obligation involving more than $50,000 singly or $100,000
in the aggregate;

                 (vii) RS has not delayed or postponed the payment of accounts
payable and other Liabilities outside the Ordinary Course of Business;

                 (viii) RS has not cancelled, compromised, waived, or released
any right or claim (or series of related rights and claims) involving more than
$25,000;

                 (ix) RS has not granted any license or sublicense of any rights
under or with respect to any Intellectual Property;

                 (x) Other than as set forth in Section 4(h) on the RS
Disclosure Statement, RS has not declared, set aside, or paid any dividend or
made any distribution with respect to its capital stock (whether in cash or in
kind) or redeemed, purchased, or acquired any of its capital stock;

                 (xi) RS has not made any loan or advance to, or entered into
any other similar transaction with, any of its directors, officers, and
employees and has not waived collection of or forgiven any loan or advance;

                 (xii) RS has not entered into any employment contract or
collective bargaining agreement, written or oral, or modified the terms of any
existing such contract or agreement;

                 (xiii) RS has not granted any increase in the base compensation
of any of its directors, officers, and employees;

                 (xiv) RS has not adopted, amended, modified, or terminated any
bonus, profit-sharing, incentive, severance, or other plan, contract, or
commitment for the benefit of any of its directors, officers, and employees (or
taken any such action with respect to any other Employee Benefit Plan); and

                                       15

                 (xv) RS has not committed to any of the foregoing.

             (i) Undisclosed Liabilities. RS has no Liability and has no
Knowledge of any present or future action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand against it giving rise to any
Liability which may exceed $50,000 individually or $100,000 in the aggregate,
except for (i) Liabilities set forth in the Most Recent Balance Sheet and (ii)
Liabilities which have arisen after the Most Recent Fiscal Month End in the
Ordinary Course of Business which do not exceed, or are not expected to exceed,
$50,000 individually or $100,000 in the aggregate.

             (j) Legal Compliance.

                 (i) RS has maintained all permits in connection with the
operation of its Business in such jurisdictions where such permits may be
required, except where the failure to maintain would not have a Material Adverse
Effect on RS. RS has a permit or license in the states set forth in Schedule
4(j) of the RS Disclosure Schedule. RS is in compliance in all material respects
with all federal, state, local and foreign laws, ordinances codes, regulations,
orders, requirements, standards and procedures which are applicable to its
Business including all minimum wage, fair employment, disability benefit, health
and all other employee related laws.

                 (ii) RS has not, since its incorporation, entered into a
Memorandum of Understanding, Consent Decree or similar instrument with any
governmental agency or has been the subject of any investigation or legal
proceeding, which could have a Material Adverse Effect on its Business.

                 (iii) Neither RS nor to RS's Knowledge, any of its respective
officers, directors, employees or agents, has directly or indirectly: (a)
offered or paid any amount to, or made any financial arrangement with, any of
the Current Accounts in order to promote business from such Current Accounts,
other than standard pricing or discount arrangements consistent with proper
business practices; (b) given, or agreed to give, or is aware that there has
been made, or that there is an agreement to make, any gift or gratuitous payment
of any kind, nature or description (whether in money, property or services) to
any Current Account or supplier, source of financing, landlord, sub-tenant,
licensee or anyone else where the giving of such gift or making of such
gratuitous payment would be illegal under the laws of the United States, any
state thereof or any other jurisdiction (foreign or domestic); or (c) made, or
has agreed to make, any payments to any person with the intention or
understanding that any part of such payment was to be used directly or
indirectly for any purpose other than that reflected in the documents supporting
the payments.

             (k) Tax Matters

                 (i) RS has filed all Tax Returns that it was required to file
except in the jurisdictions set forth in Schedule 4(k) where RS has timely filed
an extension of time. All such Tax Returns were correct and complete in all
respects when filed. All Taxes owed by RS (whether or not shown on any Tax
Return) have been paid. No written claim has ever been made by an authority in a
jurisdiction where any of RS does not file Tax Returns that it is or may be
subject to taxation by

                                       16

that jurisdiction. There are no Security Interests on any of the assets of any
of RS that arose in connection with any failure (or alleged failure) to pay any
Tax.

                 (ii) RS has withheld and paid all Taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or other third party, subject to
the withholding instructions of such employee, independent contractor, creditor,
stockholder or other third party.

                 (iii) Neither RS nor any Seller of RS has knowledge that any
authority intends to assess any additional Taxes for any period for which Tax
Returns have been filed. There is no dispute or claim concerning any Tax
Liability of any of RS either (A) claimed or raised by any authority in writing
or (B) as to which any of Sellers of RS has Knowledge based upon personal
contact with any agent of such authority. RS has made available to TeamStaff
copies of all federal, state, local, and foreign income Tax Returns filed with
respect to RS for taxable periods ended on or after January 1, 2002, and
Schedule 4(k) of the RS Disclosure Schedule indicates those Tax Returns that
have been audited, and indicates those Tax Returns that currently are the
subject of audit. RS has delivered to TeamStaff correct and complete copies of
all federal income Tax Returns, examination reports, and statements of
deficiencies assessed against or agreed to by RS since January 1, 2002.

                 (iv) RS has not waived any statute of limitations in respect of
Taxes or agreed to any extension of time with respect to a Tax assessment or
deficiency.

                 (v) RS has not filed a consent under Code ss.341(f) concerning
collapsible corporations. RS has not made any payments, is not obligated to make
any payments, and is not a party to any agreement that under certain
circumstances could obligate it to make any payments that will not be deductible
under Code ss.280G. RS has not been a United States real property holding
corporation within the meaning of Code ss.897(c)(2) during the applicable period
specified in Code ss.897(c)(1)(A)(ii). RS is not a party to any Tax allocation
or sharing agreement. RS (A) is not and has not been, a member of an Affiliated
Group filing a consolidated federal income Tax Return and (B) has no Liability
for the Taxes of any Person under Reg. ss.1.1502-6 (or any similar provision of
state, local, or foreign law), as a transferee or successor, by contract, or
otherwise.

                 (vi) The unpaid Taxes of RS (A) did not, as of the Most Recent
Fiscal Month End, exceed the reserve for Tax Liability (rather than any reserve
for deferred Taxes established to reflect timing differences between book and
Tax income) set forth on the face of the Most Recent Balance Sheet (rather than
in any notes thereto) and (B) do not exceed that reserve as adjusted for the
passage of time through the Closing Date in accordance with the past custom and
practice of RS in filing its Tax Returns.

                                       17

             (l) Real Property

                 (i) Section 4(l)(i) of the RS Disclosure Schedule lists and
describes briefly all real property leaseholds in which RS has an interest. RS
does not own any real property. With respect to each lease or sublease set forth
on Section 4(l)(i) of the RS Disclosure Schedule:

                    (A) assuming due authorization, execution and delivery
         thereof by parties other than RS, the lease or sublease is legal,
         valid, binding, enforceable, and in full force and effect, subject to
         bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
         and similar laws of general applicability relating to or affecting
         creditors' rights and to general equity principles;

                    (B) assuming due authorization, execution and delivery
         thereof by parties other than RS, the lease or sublease will continue
         to be legal, valid, binding, enforceable, and in full force and effect
         on identical terms following the consummation of the transactions
         contemplated hereby, subject to bankruptcy, insolvency, fraudulent
         transfer, reorganization, moratorium and similar laws of general
         applicability relating to or affecting creditors' rights and to general
         equity principles;

                    (C) RS is not in breach or default, and no event has
         occurred which to RS' Knowledge, with notice or lapse of time, would
         constitute a breach or default or permit termination, modification, or
         acceleration thereunder and has paid all amounts required to be paid
         under all leases or subleases;

                    (D) to RS' Knowledge, no other party to such lease or
         sublease is in breach or default, and no event has occurred which to
         RS' Knowledge, with notice or lapse of time, would constitute a breach
         or default;

                    (E) to RS' Knowledge, no party to the lease or sublease has
         repudiated any provision thereof;

                    (F) to RS' Knowledge, there are no disputes, oral
         agreements, or forbearance programs in effect as to the lease or
         sublease;

                    (G) with respect to each sublease, to the Knowledge of RS,
         the representations and warranties set forth in subsections (A) through
         (E) above are true and correct with respect to the underlying lease;
         and

                    (H) RS has not assigned, transferred, conveyed, mortgaged,
         deeded in trust, or encumbered any interest in the leasehold or
         subleasehold.

             (m) Intellectual Property

                                       18

                 (i) RS owns or has the right to use pursuant to license,
sublicense, agreement, or permission all Intellectual Property necessary for the
operation of the Business as presently conducted. Each item of Intellectual
Property owned or used by RS immediately prior to the Closing hereunder will be
owned or available for use by RS on identical terms and conditions immediately
subsequent to the Closing hereunder.

                 (ii) RS has not, to its Knowledge, interfered with, infringed
upon, misappropriated, or otherwise come into conflict with any Intellectual
Property rights of third parties.

                 (iii) Section 4(m)(iii) of the RS Disclosure Schedule
identifies each patent or registration which has been issued to RS with respect
to any of its Intellectual Property, identifies each pending patent application
or application for registration which RS has made with respect to any of its
Intellectual Property, and identifies each license, agreement, or other
permission which RS has granted to any third party with respect to any of its
Intellectual Property (together with any exceptions). RS has delivered to
TeamStaff correct and complete copies of all such patents, registrations,
applications, licenses, agreements, and permissions (as amended to date) and has
made available to TeamStaff correct and complete copies of all other written
documentation evidencing ownership and prosecution (if applicable) of each such
item. Section 4(m)(iii) of the RS Disclosure Schedule also identifies each trade
name or unregistered trademark used by RS in connection with its Business.

                 (iv) Section 4(m)(iv) of the RS Disclosure Schedule identifies
each item of Intellectual Property that any third party owns and that RS uses
pursuant to license, sublicense, agreement, or permission. RS has delivered to
TeamStaff correct and complete copies of all such licenses, sublicenses,
agreements, and permissions (as amended to date). With respect to each material
item of Intellectual Property required to be identified in Section 4(m)(iv) of
the RS Disclosure Schedule:

                    (A) to RS' Knowledge, the license, sublicense, agreement, or
         permission covering the item is legal, valid, binding, enforceable, and
         in full force and effect subject to bankruptcy, insolvency, fraudulent
         transfer, reorganization, moratorium and similar laws of general
         applicability relating to or affecting creditors' rights and to general
         equity principles;

                    (B) the license, sublicense, agreement, or permission will
         continue to be legal, valid, binding, enforceable, and in full force
         and effect on identical terms following the consummation of the
         transactions contemplated hereby subject to bankruptcy, insolvency,
         fraudulent transfer, reorganization, moratorium and similar laws of
         general applicability relating to or affecting creditors' rights and to
         general equity principles;

                    (C) to RS' Knowledge, no party to the license, sublicense,
         agreement, or permission is in breach or default, and no event has
         occurred which with

                                       19

         notice or lapse of time would constitute a breach or default or permit
         termination, modification, or acceleration thereunder;

                    (D) to RS' Knowledge, no party to the license, sublicense,
         agreement, or permission has repudiated any provision thereof;

                    (E) with respect to each sublicense, to RS's Knowledge, the
         representations and warranties set forth in subsections (A) through(D)
         above are true and correct with respect to the underlying license;

             (n) Contracts. Section 4(n) of the Disclosure Schedule lists the
following contracts and other agreements to which RS is a party:

                 (i) any agreement (or group of related agreements) for the
lease of personal property to or from any Person providing for lease payments in
excess of $25,000 per annum;

                 (ii) any agreement (or group of related agreements) for the
furnishing or receipt of services, the performance of which will extend over a
period of more than one year, result in a material loss to RS, or involve
consideration in excess of $25,000;

                 (iii) any agreement concerning a partnership or joint venture;

                 (iv) any agreement (or group of related agreements) under which
it has created, incurred, assumed, or guaranteed any indebtedness for borrowed
money, or any capitalized lease obligation, in excess of $25,000 or under which
it has imposed a Security Interest on any of its assets, tangible or intangible;

                 (v) any agreement concerning confidentiality or noncompetition;

                 (vi) any agreement with any of the Sellers or any Affiliate of
the Sellers;

                 (vii) any profit sharing, stock option, stock purchase, stock
appreciation, deferred compensation, severance, or other material plan or
arrangement for the benefit of its current or former directors, officers, and
employees;

                 (viii) any collective bargaining agreement;

                 (ix) any agreement for the employment of any individual on a
full-time, part-time, consulting, or other basis providing annual compensation
in excess of $50,000 or providing severance benefits;

                                       20

                 (x) any agreement under which it has advanced or loaned any
amount to any of its directors, officers, and employees;

                 (xi) any agreement under which the consequences of a default or
termination could have a Material Adverse Effect on the Business;

                 (xii) all agreements for the provision of services to Current
Accounts and

                 (xiii) any other agreement (or group of related agreements)
other than for services the performance of which involves consideration in
excess of $50,000.

RS has made available to TeamStaff a true and correct copy of all agreements
listed in Section 4(n) of the RS Disclosure Schedule; provided, however, that,
with respect to the Government Staffing Contracts, all work orders related
thereto have been summarized and such summary provided to TeamStaff, which such
summary is true and correct in all material respects. With respect to each such
agreement, assuming due authorization, execution and delivery thereof by parties
to such agreements other than RS: (A) the agreement is legal, valid, binding,
enforceable, and in full force and effect, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles; (B) the agreement will continue to be legal, valid, binding,
enforceable, and in full force and effect on identical terms following the
consummation of the transactions contemplated hereby, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles; (C) RS is not in breach or default, and no event has occurred
which with notice or lapse of time would constitute a breach or default, or
permit termination, modification, or acceleration, under the agreement; (D) to
RS' Knowledge any other party to such agreement is not in breach or default, and
no event has occurred which with notice or lapse of time would constitute a
breach or default; and (E) no party has repudiated any provision of the
agreement. Notwithstanding any representations and warranties contained in this
Section 4(n), the Parties agree and acknowledge that any Government Staffing
Contract may be modified and/or terminated at any time by the governmental
entity party thereto, with or without reason and with or without prior notice,
in accordance with the provisions of such Government Staffing Contract.

             (o) Powers of Attorney There are no outstanding powers of attorney
executed on behalf of RS.

             (p) Insurance

         (i) Section 4(p) of the Disclosure Schedule sets forth all insurance
policies providing property, casualty, general, liability, directors and
officers insurance and workers' compensation coverage and bond and surety
arrangements to which RS is a party, a named insured, or otherwise the
beneficiary of coverage as of the Closing Date. With respect to each such
insurance policy, assuming

                                       21

due authorization, execution and delivery thereof by parties to such policies
other than RS: (A) the policy is legal, valid, binding, enforceable, and in full
force and effect, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles; (B) the policy
will continue to be legal, valid, binding, enforceable, and in full force and
effect on identical terms following the consummation of the transactions
contemplated hereby, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles; (C) RS is not
in breach or default (including with respect to the payment of premiums or the
giving of notices), and no event has occurred which, with notice or the lapse of
time, would constitute such a breach or default, or permit termination,
modification, or acceleration, under the policy; (D) to RS' Knowledge any other
party to such policy is not in breach or default, and no event has occurred
which with notice or lapse of time would constitute a breach or default; and (E)
no insurance carrier has repudiated any provision thereof. Since January 1,
2001, RS has maintained and been covered by insurance in scope and amount
customary and reasonable for its Business, including for workers' compensation.
Schedule 4(p) of the RS Disclosure Schedule describes any self-insurance
arrangements affecting RS.

         (ii) RS has continuously maintained in effect since the commencement of
its business, without lapse or suspension, insurance policies which have
provided its employees with workmen's compensation insurance or similar
occupational accident coverage insurance.

         (iii) To RS's Knowledge, all claims of any kind or nature accrued or
made by RS's employees or others as of the Closing Date which could have a
Material Adverse Effect upon the financial condition or operations of RS are
fully insured under policies of workers' compensation and employee related
insurance (except for applicable deductibles) which have been maintained by RS
as indicated in Section 4(p) of the RS Disclosure Schedule.

         (iv) RS has never maintained any loss sensitive insurance program,
including, without limitation, any retrospectively rated or minimum premium or
self-insured insurance programs.

                                       22

             (q) Litigation. Section 4(q) of the RS Disclosure Schedule sets
forth each instance in which RS (i) is subject to any outstanding injunction,
judgment, order, decree, ruling, or charge or (ii) is a party or, to RS's
Knowledge, is threatened to be made a party to any action, suit, proceeding,
hearing, or investigation of, in, or before any court or quasi-judicial or
administrative agency of any federal, state, local, or foreign jurisdiction or
before any arbitrator. None of the actions, suits, proceedings, hearings, and
investigations set forth in Section 4(q) of the RS Disclosure Schedule could
result in any Material Adverse Effect on the Business. Neither the Sellers nor
RS have any reason to believe that any such action, suit, proceeding, hearing,
or investigation may be brought or threatened against RS.

             (r) Employees. RS is a not a party to or bound by any collective
bargaining agreement, nor has it experienced any strikes, grievances, claims of
unfair labor practices, or other collective bargaining disputes. To RS's
Knowledge, RS has not committed an unfair labor practice which would have a
Material Adverse Effect on RS. Except as disclosed in the Most Recent Financial
Statements, there are no accrued vacation obligations to employees.

             (s) Employee Benefits. (i) Section 4(s) of the RS Disclosure
Schedules lists each Employee Benefit Plan currently maintained or sponsored by
RS. Except as set forth in Section 4(s) of the Disclosure Schedule, neither RS
nor any Affiliate (as defined below for purposes of this Section 4(s) only) has
at any time established, maintained, sponsored or made any contributions to any
Multi-Employer Plan. Each of the Employee Benefit Plans providing health
benefits has at all times been operated in material compliance with the
applicable health care continuation provisions of ERISA, the Code, COBRA and
applicable state health care continuation laws. For purposes of this Section
4(s), the term "Affiliate" shall include all persons under common control with
RS within the meaning of Sections 4001(a)(14) or (b)(1) of ERISA or any
regulation promulgated thereunder, or Sections 414(b), (c) or (m) of the Code,
as amended, or any regulations promulgated thereunder.

             (ii) Neither RS or any member of a Control Group of which is it a
member maintains or contributes to any Employee Benefit Plan other than those
listed on Section 4(s) of the RS Disclosure Schedule. With respect to each
Employee Benefit Plan, no such plan has incurred any "accumulated funding
deficiency," as defined in Section 302(a)(2) of ERISA and Section 412(a) of the
Code, whether or not waived, and RS and each member of the Controlled Group has
met all applicable minimum funding requirements under Section 302 of ERISA in
respect of each Employee Benefit Plan; (ii) each Employee Benefit Plan which is
intended to be a qualified plan under Section 401(a) of the Code as currently in
effect has been determined by the Internal Revenue Service to be qualified under
Section 401(a) of the Code and the trust related thereto is exempt from federal
income tax under Section 501(a) of the Code; (iii) neither RS nor any member of
the Controlled Group has incurred any liability to the PBGC other than for the
payment of premiums, and there are no premium payments which have become due
which are unpaid; (iv) no Employee Benefit Plan has been terminated by the plan
administrator thereof nor by the PBGC, and there is no occurrence which would
cause the PBGC to institute proceedings under Title IV of ERISA to terminate any
Employee Benefit Plan; (v) at this time, the current value of the assets of each
Employee Benefit Plan exceeds the present value of the accrued benefits and
other liabilities of such

                                       23

Employee Benefit Plan and neither RS nor any member of the Controlled Group
knows of any facts or circumstances which would materially change the value of
such assets and accrued benefits and other liabilities; (vi) neither RS nor any
member of the Controlled Group has breached any of the responsibilities,
obligations or duties imposed on it by ERISA with respect to any Employee
Benefit Plan; (vii) neither RS nor any member of a Controlled Group has incurred
any liability for any excise tax arising under Section 4972 or 4980B of the
Code, and no fact exists which could give rise to any such liability; (viii)
neither RS nor or any member of the Controlled Group nor any fiduciary of, nor
any trustee to, any Employee Benefit Plan, has engaged in a "Prohibited
Transaction" nor taken any action which would constitute or result in a
Termination Event with respect to any such Employee Benefit Plan which is
subject to ERISA; (ix) RS has made all contributions due and payable with
respect to each Employee Benefit Plan; (x) there exists no event described in
Section 4043(b) of ERISA, for which the thirty (30) day notice period has not
been waived; (xi) neither RS nor any member of the Controlled Group has any
fiduciary responsibility for investments with respect to any Employee Benefit
Plan existing for the benefit of persons other than employees or former
employees of RS and any member of the Controlled Group; (xii) neither RS nor or
any member of the Controlled Group maintains or contributes to any Employee
Benefit Plan which provides health, accident or life insurance benefits to
former employees, their spouses or dependents, other than in accordance with
Section 4980B of the Code; (xiii) neither RS nor any member of the Controlled
Group has withdrawn, completely or partially, from any Multiemployer Employee
Benefit Plan so as to incur liability under the Multiemployer Pension Plan
Amendments Act of 1980 and there exists no fact which would reasonably be
expected to result in any such liability; and (xiv) no Employee Benefit Plan
fiduciary (as defined in Section 3(221) of ERISA) has any liability for breach
of fiduciary duty or for any failure in connection with the administration or
investment of the assets of a Employee Benefit Plan.

             (t) Guaranties. RS is not a guarantor or otherwise liable for any
Liability or obligation (including indebtedness) of any other Person.

             (u) Environmental, Health, and Safety Matters

         (i) RS has complied, and is in compliance, in all material respects,
with, all applicable Environmental, Health, and Safety Requirements.

         (ii) RS has not received any written or oral notice or report regarding
any actual or alleged violation of Environmental, Health, and Safety
Requirements, or any liabilities or potential liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise), including any investigatory,
remedial or corrective obligations, relating to any of them or its facilities
arising under Environmental, Health, and Safety Requirements.

         (iii) Except as may be implied by the provisions of any applicable
workers' compensation statute or regulation for which RS may be liable as a
"co-employer," to RS' Knowledge RS has not either expressly or by operation of
law, assumed or undertaken any liability, including without limitation any
obligation for corrective or remedial action, of any other Person relating to
Environmental, Health, and Safety Requirements.

                                       24

         (v) Disclosure The representations and warranties contained in this
Section 4 do not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements and
information contained in this Section 4 not misleading.

     5. Pre-Closing Covenants  The Parties agree as follows with respect to the
period between the execution of this Agreement and the Closing.

         (a) General Each of the Parties will use his or its reasonable best
efforts to take all action and to do all things reasonably necessary, proper, or
advisable in order to consummate and make effective the transactions
contemplated by this Agreement (including satisfaction, but not waiver, of the
closing conditions set forth in Section 7 below).

         (b) Notices and Consents The Sellers will cause RS to give any notices
to third parties, and will cause RS to use its best efforts to obtain any third
party consents, that TeamStaff may request in connection with the matters
referred to in Section 4(c) above.

         (c) Operation of Business The Sellers will not cause or permit RS to
engage in any practice, take any action, or enter into any transaction outside
the Ordinary Course of Business. Without limiting the generality of the
foregoing, RS will not (i) other than a dividend payment to be made to the
Sellers prior to Closing, declare, set aside, or pay any dividend or make any
distribution with respect to its capital stock or redeem, purchase, or otherwise
acquire any of its capital stock or (iii) other than bonus payments to be made
to existing employees, make any bonus payments to employees or (iii) otherwise
engage in any practice, take any action, or enter into any transaction of the
sort described in Section 4(h) above or as contemplated as a condition to
Closing as provided in Section 7 below.

         (d) Preservation of Business The Sellers will use commercially
reasonable efforts to keep the Business substantially intact. As of May 25,
2005, the balance due and outstanding on the credit facility of RS with Wachovia
Bank, N.A. ("Wachovia Line") is $2,649,000.

         (e) Full Access RS will permit representatives of TeamStaff to have
full access at all reasonable times and upon reasonable notice, and in a manner
so as not to interfere with the normal business operations of RS, to all
premises, properties, personnel, books, records (including Tax records),
contracts, and documents of or pertaining to RS.

         (f) Notice of Developments Each of the Parties shall give prompt
written notice to the other Parties of (i) the occurrence or non-occurrence of
any event that would be likely to cause any representation or warranty made by
the notifying party contained in this Agreement to be untrue or inaccurate in
any material respect at or prior to the Closing and (ii) any material failure of
the notifying party to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it or him hereunder.

         (g) Exclusivity Neither RS nor any of the Sellers will: (i) knowingly
solicit, initiate, or encourage the submission of any proposal or offer from any
Person relating to the acquisition of any capital stock or other voting
securities, or any substantial portion of the assets, of RS (including any
acquisition structured as a merger, consolidation, or share exchange) or (ii)

                                       25

participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any
other manner any effort or attempt by any Person to do or seek any of the
foregoing or (iii) sell, transfer or pledge any RS Shares owned by the
respective Seller or grant any proxy or enter into any voting agreement with
respect thereto. None of the Sellers will vote their RS Shares in favor of any
such acquisition structured as a merger, consolidation, or share exchange until
this Agreement is terminated in accordance with its terms. RS and the Sellers
will promptly notify TeamStaff if any Person makes any proposal, offer, inquiry,
or contact with respect to any of the foregoing.

         (h) Financing The Parties will cooperate in order to obtain the
necessary financing from PNC Bank, National Association for the benefit of
TeamStaff to fund payments to be made by TeamStaff to Sellers in connection with
the Closing of the transaction and to operate the Business (the "Financing").
The terms of the Financing related to the subordination and payment terms of the
TeamStaff Note and payment of the Purchase Price must be acceptable to the
Sellers.

         (i) RS Lease Amendments. Prior to Closing, RS shall have obtained
written amendments to its existing leases (together the "RS Lease Amendments")
in form and substance acceptable to TeamStaff which shall (i) with respect to
the RS premises located at Decatur, Georgia provide for termination of the lease
on a date which is twelve (12) months after the Closing Date, with the last 6
months of the term at a lease base rent of 50% of the existing lease and (ii)
with respect to the RS premises located at 533 Plaza Drive, Monroe, Georgia
allow for termination, at RS' option, on a date which is two (2) years after the
Closing Date.

     6. Post-Closing Covenants The Parties agree as follows with respect to the
period following the Closing.

         (a) General In case at any time after the Closing any further action is
necessary to carry out the purposes of this Agreement, each of the Parties will
take such further action (including the execution and delivery of such further
instruments and documents) as any other Party may reasonably request, all at the
sole cost and expense of the requesting Party (unless the requesting Party is
entitled to indemnification therefor under Section 8 below). The Sellers
acknowledge and agree that from and after the Closing, TeamStaff will be
entitled to possession of all documents, books, records (including Tax records),
agreements, and financial data of any sort relating to RS; provided, however,
that TeamStaff will allow Sellers to have access to such documents, books,
records, agreements and financial data of RS as such Sellers may reasonably
request in order to comply with applicable law, including tax laws.

         (b) Litigation Support In the event and for so long as any Party
actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection with
(i) any transaction contemplated under this Agreement or (ii) any fact,
situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or prior
to the Closing Date involving RS or its Business, each of the other Parties will
reasonably cooperate with him or it and his or its counsel in the contest or
defense, make available their personnel, and provide such testimony and access
to their books and records as shall be reasonably necessary in connection with

                                       26

the contest or defense, all at the sole cost and expense of the contesting or
defending Party (unless the contesting or defending Party is entitled to
indemnification therefor under Section 8 below).

         (c) Transition None of the Sellers will take any action that is
designed or intended to have the effect of discouraging any lessor, licensor,
customer, supplier, or other business associate of RS from maintaining the same
business relationships with RS after the Closing as it maintained with RS prior
to the Closing.

     7.   Conditions to Obligation to Close

         (a) Conditions to Obligation of TeamStaff. The obligation of TeamStaff
to consummate the transactions to be performed by it in connection with the
Closing is subject to satisfaction of the following conditions:

             (i) the representations and warranties set forth in Section 3(a)
and Section 4 above shall be true and correct in all material respects at and as
of the Closing Date;

             (ii) the Sellers shall have performed and complied with all of
their covenants hereunder in all material respects through the Closing;

             (iii) RS shall have procured all of the third party consents
specified in Section 5(b) above, if any;

             (iv) no action, suit, or proceeding shall be pending or threatened
in writing before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would (A)
prevent the consummation of any of the transactions contemplated by this
Agreement, (B) cause any of the transactions contemplated by this Agreement to
be rescinded following consummation, (C) affect adversely the right of TeamStaff
to own RS Shares and to control RS, or (D) affect adversely the right of RS to
own its assets and to operate the Business (and no such injunction, judgment,
order, decree, ruling, or charge shall be in effect);

             (v) RS shall have delivered to TeamStaff a certificate, in form and
substance satisfactory to TeamStaff, to the effect that each of the conditions
specified above in Sections 7(a)(i)-(iv) is satisfied in all respects;

             (vi) TeamStaff shall have entered into an employment agreement with
Roger Staggs substantially in the form attached hereto as Exhibit I (the "Staggs
Employment Agreement");

             (vii) TeamStaff shall have entered into an employment agreement
with E. Barry Durham substantially in the form attached hereto as Exhibit J (the
"Durham Employment Agreement");

                                       27

             (viii) TeamStaff shall have obtained the Financing, in form and
substance and an amount acceptable to it and to Sellers, as more fully set forth
in Section 5(h) hereof;

             (ix) TeamStaff shall have received from counsel to RS an opinion
substantially in the form attached hereto as Exhibit G;

             (x) TeamStaff shall have received an executed Seller's Release from
each Seller, substantially in the form attached hereto as Exhibit C;

             (xi) TeamStaff shall have received all share certificates
representing Sellers' RS Shares, with duly endorsed stock powers;

             (xii) No Seller shall have exercised any appraisal rights under the
Georgia Business Corporation Law;

             (xiii) TeamStaff shall have received a balance sheet, prepared on a
preliminary basis, of RS dated as of May 28, 2005, reflecting: (a) stockholders'
equity of at least $1,575,000 and (b) no change in the financial condition of RS
since the date of the Most Recent Financial Statements that would have a
Material Adverse Effect upon RS:

             (xiv) TeamStaff shall have received written evidence satisfactory
to it that (i) all outstanding loans from RS to the Sellers or their affiliates
shall have been repaid in full; (ii) the outstanding loans in the principal
amount of approximately $145,000 related to the purchase of vehicles with a
value on the Most Recent Financial Statements of $175,000 shall have been repaid
in full and title transferred for the vehicles to the Sellers;

             (xv) TeamStaff shall have received the RS Lease Amendments; and

             (xvi) TeamStaff shall have received written evidence satisfactory
to it that the outstanding credit facility of RS with Wachovia Bank N.A and all
liens and security interests in favor of Wachovia Bank N.A. shall have been
terminated in full or will be terminated in full at and upon Closing.

TeamStaff may waive any condition specified in this Section 7(a) if it executes
a writing so stating at or prior to the Closing.

         (b) Conditions to Obligation of the Sellers. The obligation of the
Sellers to consummate the transactions to be performed by them in connection
with the Closing is subject to satisfaction of the following conditions:

             (i) the representations and warranties set forth in Section 3(b)
above shall be true and correct in all material respects at and as of the
Closing Date;

             (ii) TeamStaff shall have performed and complied with all of its
covenants hereunder in all material respects through the Closing;

             (iii) no action, suit, or proceeding shall be pending or threatened
in writing before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign

                                       28

jurisdiction wherein an unfavorable injunction, judgment, order, decree, ruling,
or charge would (A) prevent consummation of any of the transactions contemplated
by this Agreement or (B) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation (and no such injunction,
judgment, order, decree, ruling, or charge shall be in effect);

             (iv) TeamStaff shall have delivered to the Sellers a certificate,
in form and substance satisfactory to Sellers, to the effect that each of the
conditions specified above in Sections 7(b)(i)-(iii) is satisfied in all
respects;

             (v) Roger Staggs and TeamStaff shall have entered into the Staggs
Employment Agreement;

             (vi) E. Barry Durham and TeamStaff shall have entered into the
Durham Employment Agreement;

             (vii) TeamStaff shall have executed and delivered to Sellers the
TeamStaff Promissory Note and the TeamStaff Security Agreement, substantially in
the forms attached hereto as Exhibits E and F, respectively;

             (viii) TeamStaff shall have delivered certificates to the Sellers
for the TeamStaff Common Stock constituting a portion of the Purchase Price.

             (ix) the Sellers shall have received from counsel to TeamStaff an
opinion in substantially the form attached hereto as Exhibit H; and

             (x) the terms and conditions of the Financing related to the
subordination and payment of the TeamStaff Promissory Note shall be fully
acceptable to Sellers as more fully set forth in Section 5(h) hereof.

The Sellers (evidenced by the written consent of all of the Sellers) may waive
any condition specified in this Section 7(b) if they execute a writing so
stating at or prior to the Closing.

     8.   Survival and Indemnification

         (a) Survival of Warranties and Indemnification Obligations. Except to
the extent set forth herein to the contrary, each and every representation and
warranty and indemnification obligation of any Party hereunder shall survive for
a period of two (2) years after the Closing Date. Any claim ("Claim") for
Damages made by a Party in accordance with this Section 8 within the survival
period shall survive until finally resolved notwithstanding expiration of the
applicable survival period.

         (b) Indemnification by the Sellers. Sellers shall severally but not
jointly, indemnify, defend and hold harmless TeamStaff, and shall reimburse
TeamStaff for any Damages for which a claim is made prior to the expiration of
the survival period, if any, under Section 8(a), arising from or in connection
with (i) any breach of the representations and warranties of the Sellers or RS
made in this Agreement or in any document, agreement, instrument or certificate

                                       29

delivered by any Seller or RS at the Closing pursuant to this Agreement, or (ii)
any failure by RS or a Seller to perform or comply with any agreement or
covenant in this Agreement, or under any document, agreement, instrument or
certificate delivered at the Closing by RS or any Seller pursuant to this
Agreement. Subject to subsection (d) below, with respect to any Claim by
TeamStaff related to any matters set forth on Section 4(q) of the RS Disclosure
Schedule, Sellers explicitly acknowledge that TeamStaff shall have a right to
make a Claim for indemnification hereunder in the event that the amount so
claimed by TeamStaff for indemnification as Damages exceeds the sum of $45,000,
regardless of the scope of the disclosure. Notwithstanding anything contained in
this Section 8(b), the indemnification obligations of any Seller under this
Agreement or based upon a matter for which a claim could be made under this
Agreement, except in the case of fraud or Taxes, will not exceed, in the
aggregate, the sum of $1,500,000 for each of the Sellers; provided however, in
the case of fraud or Claims related to Taxes, the indemnification obligations of
any Seller under this Agreement to TeamStaff shall be up to, in the aggregate,
the sum of $2,375,000 for each of the Sellers. In any case, any indemnification
obligations owed to TeamStaff by either Seller pursuant to this Section 8 will
be limited to setoff, by TeamStaff, of any amounts (principal and/or interest)
owed to the Sellers by TeamStaff under the TeamStaff Promissory Note.
Notwithstanding the foregoing, in the event that the amount of the Claim for
indemnification by TeamStaff hereunder is related to fraud or Taxes and
TeamStaff is entitled to indemnification hereunder, and the amount of such Claim
exceeds the amount of the TeamStaff Promissory Note, then TeamStaff shall have
the right to setoff all Earnout Payments otherwise due to the Sellers up to the
amount of the Claim.

         (c) Indemnification by TeamStaff. TeamStaff shall indemnify, defend and
hold harmless the Sellers and shall reimburse them for any Damages for which a
claim is made prior to the expiration of the survival period, if any, under
Section 8(a), arising from or in connection with (i) any breach of the
representations and warranties of TeamStaff made in this Agreement or in any
document, agreement, instrument or certificate delivered by TeamStaff at the
Closing pursuant to this Agreement, or (ii) any failure by TeamStaff to perform
or comply with any agreement or covenant in this Agreement or under any
document, agreement, instrument, or certificate delivered at the Closing by
TeamStaff pursuant to this Agreement. Notwithstanding anything contained in this
Section 8(c), the indemnification obligations of TeamStaff under this Agreement
or based upon a matter for which a claim could be made under this Agreement,
except in the case of fraud, will not exceed, in the aggregate of $3,000,000;
provided, however, in the case of fraud by TeamStaff hereunder, the
indemnification obligations of TeamStaff under this Agreement to Sellers shall
be, in the aggregate, up to the sum of $4,750,000.

         (d) Limitations on Indemnification Obligations. An indemnified party
shall be entitled to indemnification only if the aggregate and collective
Damages for which it otherwise would be entitled under this Agreement exceed
$125,000, in which event it shall be entitled to indemnification of all such
Damages. Notwithstanding the immediately preceding sentence, however, the
following will not be subject to such minimum indemnification amount: (i)
breaches by any Party of covenants hereunder; (ii) breaches by Sellers or RS of
representations and warranties contained in Sections 3(a)(i), 3(a)(v), 4(a),
4(b) or 4(i) hereof; and (iii) breaches by TeamStaff of representations and
warranties contained in Sections (3)(b)(i)-(ii) and 3(b)(iv)-(vi).

                                       30

         (e) Third-Party Claims. After receipt by a Party of notice of any
matter for which such Party (an "Indemnified Party") is entitled to or is
seeking to assert a right to indemnification under Section 8(b) or 8(c) (a
"Third Party Claim"), the Indemnified Party shall promptly give notice to the
party or parties from whom indemnification will be sought (the "Indemnifying
Party") of the commencement thereof, but the failure so to notify the
Indemnifying Party shall not relieve them of any liability they may have to any
Indemnified Party except to the extent of actual prejudice caused by such
failure. In case any such Third Party Claim shall be brought against an
Indemnified Party and it shall give notice to the Indemnifying Party of the
commencement thereof, the Indemnifying Party will be entitled to participate
therein at its cost and expense or if acceptable to the Indemnified Party,
assume the defense thereof with counsel reasonably satisfactory to such
Indemnified Party; provided, however, that no such participation or assumption
of defense will be, or will be deemed to be, an admission or otherwise indicate
that such Indemnifying Party is required to indemnify the Indemnified Party for
Damages arising from such Third Party Claim. The Indemnifying Party may not
assume the defense if (i) the named parties to any such action (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party and such Indemnified Party shall have been advised in writing by counsel
that there are one or more material legal defenses available to the Indemnified
Party which are not available to the Indemnifying Party, or available to the
Indemnifying Party, but the assertion of which would be adverse to the interest
of the Indemnified Party, or (ii) the Indemnifying Party fails to provide
reasonable assurance to the Indemnified Party of its financial capacity to
defend such Third Party Claim. If the Indemnifying Party is allowed to assume
the defense, the Indemnifying Party shall not be liable to such Indemnified
Party for any fees of other counsel or any other expenses with respect to the
defense of such Third Party Claim, in each case subsequently incurred by such
Indemnified Party in connection with the defense thereof, provided that the
Indemnifying Party may only assume control of the defense of such Third Party
Claim if it acknowledges in writing to the Indemnified Party that any damages,
fines, costs or Liabilities that may be assessed against the Indemnified Party
in connection with the Third Party Claim constitute Damages for which the
Indemnified Party shall be indemnified pursuant to Section 8(b) or 8(c), as the
case may be. If an Indemnifying Party assumes the defense of such Third Party
Claim, no compromise or settlement thereof may be effected by the Indemnifying
Party without the Indemnified Party's prior written consent (which consent will
not unreasonably be withheld or delayed) unless the settlement provides for a
full and unconditional release of the Indemnified Party without payment of any
funds by the Indemnified Party or (A) there is no finding or admission of any
violation of law or any violation of the rights of any person and no effect on
any other claims that may be made against the Indemnified Party and (B) the sole
relief provided is monetary damages that are paid in full by the Indemnifying
Party. If notice is given to the Indemnifying Party of the commencement of any
Third Party Claim and it does not, within ten days after the Indemnified Party's
notice is given, give notice to the Indemnified Party of its election to assume
the defense thereof, the Indemnifying Party shall be bound by any determination
made in such action or any compromise or settlement thereof effected by the
Indemnified Party. Notwithstanding anything to the contrary herein, each of the
Indemnified Party and the Indemnifying Party shall provide, on at least a
quarterly basis, to the other, written summaries of the status of any Third
Party Claims including any litigation, arbitration or mediation proceedings or
settlement discussions related thereto.

                                       31

         (f) Payment. In the event that any Indemnified Party determines that it
is entitled to an indemnity payment pursuant to this Section 8, the Indemnified
Party shall deliver a written notice to the Indemnifying Party. If the
Indemnifying Party disputes all or any portion of the claim, the Indemnifying
Party must provide written notice of its objection (detailing the objection) to
the Indemnified Party within fifteen (15) business days after the receipt of the
claim from the Indemnified Party. Failure by the Indemnifying Party to give such
notice shall be deemed acknowledgment and agreement by the Indemnifying Party
that it is liable for that portion of the claim as to which no objection is
made.

         (g) Construction. The Parties intend that each representation,
warranty, and covenant herein shall have independent significance. If any Party
has breached any representation, warranty, or covenant contained herein in any
respect, the fact that there exists another representation, warranty, or
covenant relating to the same subject matter (regardless of the relative levels
of specificity) which the Party has not breached shall not detract from or
mitigate the fact that the Party is in breach of the first representation,
warranty, or covenant, as the case may be.

     9.   Post-Closing Tax Matters; Other Matters; Tag Along Right.

         (a) Cooperation. TeamStaff, RS and Sellers shall cooperate fully, as
and to the extent reasonably requested by the other party, in connection with
the filing of Tax Returns pursuant to this Section 9 and any audit, litigation
or other proceeding with respect to Taxes. Such cooperation shall include the
retention and (upon the other party's request) the provision of records and
information which are reasonably relevant to any such audit, litigation or other
proceeding and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided
hereunder. RS and Sellers agree (A) to retain all books and records with respect
to Tax matters pertinent to RS relating to any taxable period beginning before
the Closing Date until the expiration of the applicable statute of limitations
of the respective taxable periods, and to abide by all record retention
agreements entered into with any taxing authority, and (B) to give the other
party reasonable written notice prior to transferring, destroying or discarding
any such books and records and, if the other party so requests, such notifying
party shall allow the other party to take possession of such books and records.

         (b) Straddle Period. In the case of any taxable period that includes
(but does not end on) the Closing Date, the amount of any income Taxes for the
period prior to the Closing Date shall be determined based on an interim closing
of the books as of the close of business on the Closing Date. The Sellers shall
prepare or cause to be prepared and be responsible for the signing and filing of
all Tax Returns for the period ending on the Closing Date.

         (c) Responsibility for Filing Tax Returns. TeamStaff shall prepare or
cause to be prepared and filed or cause to be filed all income Tax Returns for
RS which are to be filed for the period commencing on the Closing Date and
thereafter and shall allow the Sellers to review such Tax Returns for a period
of one year following the Closing Date.

                                       32

         (d) Refunds and Tax Benefits. Any income Tax refunds that are received
by TeamStaff or RS, and any amounts credited against income Tax to which
TeamStaff or RS become entitled, that relate to income Tax periods or portions
thereof ending on or before the Closing Date and which are related to the
Business for the period ending on the Closing Date shall be for the account of
the Sellers, and TeamStaff shall pay over to the Sellers any such refund or the
amount of any such credit within fifteen (15) days after receipt thereof or
entitlement thereto.

         (e) Workers' Compensation Insurance Program Refunds. In the event that
RS is entitled to receive any refunds from its workers' compensation insurance
program with respect to its workers' compensation insurance program for the
periods ending in 2003, 2004 and 2005 and payable in 2006, 2007 and 2008
respectively, the Parties hereby agree that the Sellers shall be entitled to the
full amount of any such refund payment. Payment shall be made by Team Staff (or
RS) to Sellers within ten (10) days after receipt of any such refund payment and
shall be considered additional contingent purchase price by Sellers.

         (f) Delivery of Final Closing Financial Statements. Within 30 days
after the Closing Date, the Sellers and RS shall deliver an unaudited balance
sheet and statement of stockholders equity as of June 4, 2005 ("Closing
Financial Statements") certified by the Sellers as true and correct in all
material respects and prepared in accordance with GAAP, reflecting (i) stock
holders' equity of at least $1,575,000 and (ii) no change in the financial
condition of RS since the date of the Most Recent Financial Statements that
would have a Material Adverse Effect upon RS. In the event that the amount of
stockholder's equity is less than or exceeds the sum of $1,575,000, then (A) in
the event of a deficiency, the Seller's shall reimburse TeamStaff for the amount
of such deficiency and (B) in the event that the amount of stockholder's equity
is more than $1,575,000, then TeamStaff shall reimburse the Sellers to the
extent of such excess amount. Such payment shall be made by the Sellers or
TeamStaff, as appropriate, within ten (10) days of receipt of the Closing
Financial Statements required hereunder.

         (g) Tag Along Right. During the period commencing on the Closing Date
and ending on a date which is one (1) year thereafter, TeamStaff agrees that in
the event a person or group (as determined in accordance with Section 13(d) of
the Securities and Exchange Act of 1934, and the rules promulgated thereunder)
(the "Purchaser"), acquires, in a single transaction or a series of transactions
more than 80% of the outstanding shares of Common Stock of TeamStaff
("Qualifying Transaction"), and Kent Smith is no longer the Chief Executive
Officer of TeamStaff (other than termination by the Board of Directors of
TeamStaff for cause in accordance with his employment agreement) following the
Qualifying Transaction, then the Sellers shall have the right, at their option,
to require that the Purchaser purchase from the Sellers the shares of TeamStaff
Common Stock then held by them at a per shares purchase price equal to the price
paid per share by the Purchaser in the Qualifying Transaction. TeamStaff shall
provide written notice ("Tag Along Notice") to the Sellers of the terms of such
Qualifying Transaction at least 20 days prior to the expected closing date of
the Qualifying Transaction. Upon written notice to TeamStaff, given within ten
(10) days after receiving such Tag-Along Notice, Sellers will have the right to
participate in such Qualifying Purchase on the same terms and conditions as
those set forth in the documents governing the Qualifying Purchase and TeamStaff
will allow or cause to be allowed such participation. The rights granted under
this Section 9(g) shall not apply

                                       33

in the event that the Qualifying Transaction is a public tender offer for the
securities of TeamStaff.

     10.  Termination.

         (a) Termination of Agreement. Certain of the Parties may terminate this
Agreement as provided below:

             (i) TeamStaff, RS and the Sellers may terminate this Agreement by
mutual written consent at any time prior to the Closing;

             (ii) TeamStaff may terminate this Agreement by giving written
notice to the Sellers at any time prior to the Closing (A) in the event any of
the Sellers has breached any material representation, warranty, or covenant
contained in this Agreement in any material respect, TeamStaff has notified such
Seller in writing of the breach, and the breach has continued without cure for a
period of ten (10) days after the notice of breach or (B) if the Closing shall
not have occurred on or before June 15, 2005, by reason of the failure of any
condition precedent under Section 7(a) hereof (unless the failure results
primarily from TeamStaff itself breaching any representation, warranty, or
covenant contained in this Agreement); and

             (iii) the Sellers may terminate this Agreement by giving written
notice to TeamStaff at any time prior to the Closing (A) in the event TeamStaff
has breached any material representation, warranty, or covenant contained in
this Agreement in any material respect, any of the Sellers has notified
TeamStaff in writing of the breach, and the breach has continued without cure
for a period of ten (10) days after the notice of breach or (B) if the Closing
shall not have occurred on or before June 15, 2005, by reason of the failure of
any condition precedent under Section 7(b) hereof (unless the failure results
primarily from any of the Sellers themselves breaching any representation,
warranty, or covenant contained in this Agreement).

         (b) Effect of Termination. If this Agreement is terminated as provided
herein, no Party (nor any stockholder, director, officer, employee, agent,
consultant or representative of such Party) shall have any liability to any
other party; provided, however, that if such termination is the result of a
Party (the "Breaching Party") (i) failing to use its reasonable best efforts to
fulfill a condition to the performance of the obligations of another Party, (ii)
failing to perform in all material respects a covenant made by such Breaching
Party herein or other obligation of such Breaching Party herein, (iii)
materially breaching any representation or warranty made by such Breaching Party
herein, or (iv) refusing to close notwithstanding the conditions precedent to
such Party's obligation to close have been fulfilled, then such termination
shall be without prejudice to the rights of any party hereto arising out of such
failure or breach and such Breaching Party will pay all reasonable costs and
expenses (including reasonable attorneys' fees) of the other Parties hereto
incurred by such parties in connection with this Agreement.

                                       34

     11.  Dispute Resolution.

         (a) If any dispute arises under this Agreement, the Parties shall seek
to resolve any such dispute between them, first, by negotiating promptly with
each other in good faith in face-to-face negotiations. If the Parties are unable
to resolve such dispute between them within twenty (20) business days after
notice of such dispute is given by a Party to the other Party or Parties (or
such period as the Parties shall otherwise agree) through these face-to-face
negotiations, then the Parties shall seek to resolve any such dispute between
them through non-binding mediation within twenty (20) business days following
the termination of the Parties' face-to-face negotiations (or such period and
place as the Parties shall otherwise agree). If the Parties are unable to
resolve such dispute through mediation, any such dispute shall be resolved by
private binding arbitration in accordance with Subsection (b) below.

         (b) If the Parties are unable to resolve such dispute through
mediation, any such dispute shall be resolved by private binding arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the "Association") in effect on the date that the demand for
arbitration is given. The arbitration proceeding will take place in Atlanta,
Georgia. If the parties are unable to agree on the identity of a single
arbitrator within ten (10) business days of notice of a demand for arbitration
provided by one party to the other hereunder, then the Association arbitrator
selection rules shall apply; provided, however, that any arbitrator selected
under the selection rules shall also be a member in good standing of the bar in
any of the United States with experience in corporate law and acquisitions. Any
demand for arbitration shall include detail sufficient to establish the nature
of the dispute (including the claims asserted and the material issues with
respect thereto) and shall be delivered to the other Party concurrent with
delivery to the Association. Discovery from the other Party shall be limited to
requests for production of documents and to depositions. No additional formal
discovery from the other Party (e.g., interrogatories or requests for
admissions) shall be permitted except by mutual consent or as approved by the
arbitrator for good cause shown. The arbitrator's decision shall be in writing,
and shall describe in detail the legal reasoning adopted by the arbitrator in
support of the decision. In rendering a decision, the arbitrator shall follow
the law of the United States of America and of the jurisdiction set forth in
Section 12(h) hereof, and shall not use equitable or other principles which
would permit the arbitrator to ignore this Agreement or the law. The
arbitrator's decision shall be final and binding on the parties, provided,
however, that errors of law may be appealed to a court of competent jurisdiction
for review. Any award by the arbitrator shall be subject to all dollar and other
limitations set forth in this Agreement. The arbitrator shall have no authority
to award treble, exemplary, or punitive damages of any type under any
circumstances. Judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. Any Party to this Agreement may bring
an action, including a summary or expedited proceeding, to compel arbitration of
any controversy or claim to which this Agreement applies in any court having
jurisdiction over such action. Nothing in this Section shall limit the right of
any Party to obtain from a court equitable relief, before, during or after the
pendency of any arbitration proceeding brought pursuant to this Agreement, or in
lieu of such proceeding. The reasonable costs, fees and expenses (including
attorneys' fees) of all Parties related to any arbitrated dispute hereunder will
be paid by the Party who is determined by the arbitrator, in his or her sole
discretion, to be the non-prevailing party in such dispute.

                                       35

     12.  Miscellaneous

         (a) Press Releases and Public Announcements. No Party shall issue any
press release or make any public announcement relating to the subject matter of
this Agreement prior to the Closing without the prior written approval of
TeamStaff and the Sellers; provided, however, that any Party may make any public
disclosure it believes in good faith is required by applicable law or any
listing or trading agreement concerning its publicly-traded securities (in which
case the disclosing Party will use its reasonable best efforts to advise the
other Parties prior to making the disclosure).

         (b) No Third-Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their respective
successors and permitted assigns.

         (c) Entire Agreement. This Agreement (including the documents referred
to herein) constitutes the entire agreement among the Parties and supersedes any
prior understandings, agreements, or representations by or among the Parties,
written or oral, to the extent they related in any way to the subject matter
hereof.

         (d) Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No Party may assign either this Agreement or any of his
or its rights, interests, or obligations hereunder without the prior written
approval of TeamStaff and the Sellers; provided, however, that TeamStaff may (i)
assign any or all of its rights and interests hereunder to one or more of its
Affiliates and (ii) designate one or more of its Affiliates to perform its
obligations hereunder (in any or all of which cases TeamStaff nonetheless shall
remain responsible for the performance of all of its obligations hereunder).

         (e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.

         (f) Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.

         (g) Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be sent by (i) registered or certified
mail, return receipt requested, postage prepaid, or (ii) by overnight courier
service, or (iii) by facsimile if followed by delivery is also made by either
(i) or (ii) above, in any case addressed to the recipient as set forth below:

                                       36

         If to RS or Sellers:                    Copy to:

         RS Staffing Services, Inc.              Elizabeth H. Purcell, Esq.
         533 Plaza Drive Road                    Frank X. Moore & Associates
         Monroe, GA  30655                       3343 Peachtree Road, Suite 1100
         Attn:  Roger Staggs                     Atlanta, GA  30326

         E. Barry Durham
         525 High Cashes Valley Road
         Cherry Log, GA 30052

         If to TeamStaff:                         Copy to:

         TeamStaff, Inc.                          Brian C. Daughney, Esq.
         300 Atrium Drive                         Goldstein & DiGioia LLP
         Somerset NJ 08873                        45 Broadway -11th Floor
         Attn: Kent Smith, CEO                    New York, New York 10006

All correspondence sent as above shall be deemed duly given when delivered to
the intended recipient in accordance with the foregoing. Any Party may change
the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Parties notice
in the manner herein set forth.

         (h) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of New York without giving effect
to any choice or conflict of law provision or rule (whether of the State of New
York or any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York.

         (i) Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by
TeamStaff and the requisite Sellers. No waiver by any Party of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.

         (j) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.

         (k) Expenses. Except as set forth herein, each of the Parties will bear
his or its own costs and expenses (including legal fees and expenses) incurred
in connection with this Agreement and the transactions contemplated hereby. The
Sellers shall bear the costs of all legal and accounting services provided to
them in connection with this Agreement and the transactions contemplated herein
and RS shall not have any liability in connection therewith.

                                       37

         (l) Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation.

         (m) Incorporation of Exhibits, Annexes, and Schedules. The Exhibits,
Annexes, and Schedules identified in this Agreement are incorporated herein by
reference and made a part hereof.

         (n) Specific Performance. Each of the Parties acknowledges and agrees
that the other Parties would be damaged irreparably in the event any of the
provisions of this Agreement are not performed in accordance with their specific
terms or otherwise are breached. Accordingly, each of the Parties agrees that
the other Parties shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Agreement and to enforce specifically this
Agreement and the terms and provisions hereof in any action instituted in any
court of the United States or any state thereof having jurisdiction over the
Parties and the matter, in addition to any other remedy to which they may be
entitled, at law or in equity.

     IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
date first above written.

TEAMSTAFF, INC.

By:
      ------------------------
Name:
Title:

RS STAFFING SERVICES, INC.                           THE SELLERS

                                                     -----------------------
                                                     ROGER STAGGS
By:
      ------------------------
Name:
Title:                                               _______________________
                                                     E. BARRY DURHAM

                                       38<PAGE>

                              EMPLOYMENT AGREEMENT

      THIS AGREEMENT by and between ENHERENT CORP., a Delaware corporation (the
"COMPANY"), and PAMELA A. FREDETTE (the "EXECUTIVE") is to be effective as of
the Effective Date (as defined below).

                              W I T N E S S E T H:

      WHEREAS, the Company wishes to provide for the employment by the Company
of the Executive, and the Executive wishes to serve the Company, in the
capacities and on the terms and conditions set forth in this Agreement.

      NOW, THEREFORE, it is hereby agreed as follows:

      1.    TERM.

      (a) The term of this Agreement (the "TERM") shall commence on April 1,
2005 (the "EFFECTIVE DATE") and, unless earlier terminated pursuant to Section 4
below and subject to Section 1(b) below, end at 11:59 PM, March 31, 2008.

      (b) The Term shall automatically be extended on a year-by-year basis,
unless the Company shall give the Executive no less than ninety (90) days'
notice that the Term shall not be so renewed.

      (c) Upon the Executive receiving notice of non-renewal of the Term, the
Executive may resign for Good Reason (as defined in Section 4(c) below).

      2.    POSITION AND DUTIES

      (a) During the Term, the Executive shall serve as the President and Chief
Executive Officer of the Company with such duties and responsibilities as are
customarily assigned to such position.

      (b) As of the Effective Date, the Company shall cause the Executive to be
appointed to the Board of Directors of the Company (the "BOARD") and elected
Chairman of the Board. Thereafter, the Company shall cause the Executive to be
included in the slate of persons nominated to serve as directors on the Board
and shall use its best efforts (including, without limitation, the solicitation
of proxies) to have the Executive elected and reelected to the Board for the
duration of the Term and shall use its best efforts to cause Executive to be
elected the Chairman of the Board. With the written agreement of the Executive,
the obligation of the Company to use its best efforts to cause the Executive to
be elected Chairman of the Board shall be vacated and the election of someone
other than the Executive to the position of Chairman of the Board will not be a
violation of such obligations. Upon any termination of her employment with the
Company, the Executive shall promptly resign from the Board. The Executive shall
report solely to the Board.

      (c) During the Term, the Executive shall devote her full attention and
time during normal business hours to the business and affairs of the Company
and, to the extent necessary to

<PAGE>

discharge the responsibilities assigned to the Executive under this Agreement,
use the Executive's reasonable best efforts to carry out such responsibilities
faithfully and efficiently.

      (d) The Executive shall be based at the Company's principal headquarters
in New York, New York, except for travel reasonably required for the performance
of the Executive's duties hereunder.

      3.    COMPENSATION

      (a) BASE SALARY. During 2005, the Executive shall receive an annualized
base salary ("ANNUAL BASE SALARY") of $325,000 payable in accordance with the
Company's regular payroll practices for its senior executives, as in effect from
time to time. During the Term, the Annual Base Salary shall not be decreased,
except for a proportional decrease applicable to all executives of the Company,
and shall be reviewed by the Board for possible increase at least annually;
provided, however, that the Annual Base Salary shall not be increased prior to
January 1, 2006. Any increase in the Annual Base Salary shall not limit or
reduce any other obligation of the Company under this Agreement. The term
"Annual Base Salary" shall thereafter refer to the Annual Base Salary as
increased from time to time.

      (b) ANNUAL CASH BONUS. For each year of the Term, the Executive shall
participate in an annual cash bonus plan per the terms of Attachment A hereto.
Nothing contained herein shall prevent the Committee from paying an annual bonus
in excess of the amount determined per the terms of the bonus plan.

      (c) EQUITY BASED COMPENSATION.

            (i) The Company will review the Executive's compensation and
incentive opportunities no less than annually to assess the granting of
equity-based awards. If equity-based awards are made to executives of the
Company generally (specifically excluding grants made to individual executives
for recruitment or retention purposes, or special incentive grants made to
executives only in a certain group or department), the Executive will receive a
similar grant at a level commensurate with her position.

            (ii) If the Company files a registration statement under the
Securities Act of 1933 covering the offer and sale by it or any of its equity
holders of equity in the Company for money, the Executive shall be entitled to
piggy-back registration rights for equity she holds at such time and for equity
she will receive in the future due to the exercise of options, the lapse of
restrictions of restricted stock or the acquisition of equity through any other
form of equity-based compensation.

      (d) OTHER BENEFITS. While the Executive is employed during the Term:

            (i) The Executive shall be entitled to participate in all
tax-qualified and nonqualified savings, employee stock ownership and retirement
plans of the Company and shall be entitled to participate in all fringe benefit
and perquisite practices, policies and programs of the Company made available to
the senior executives of the Company.

                                       2
<PAGE>

            (ii) The Executive and/or the Executive's eligible dependents, as
the case may be, shall be eligible for participation in, and shall receive all
benefits under, all welfare benefit plans, practices, policies and programs
provided by the Company, including any medical, prescription, dental,
disability, employee life insurance, group life insurance, accidental death and
travel accident insurance plans and programs, as applicable to the senior
executives of the Company.

            (iii) The Executive shall be entitled to no less than twenty (20)
days paid time off and six (6) personal and sick days per calendar year, to be
administered in accordance with the Company's applicable policies for senior
executives.

            (iv) The Company shall provide Executive with an allowance of no
less than $750 per month for automobile expenses and related insurance expense.

            (v) The Company shall provide the Executive with a life insurance
benefit with a death benefit of no less than $500,000.

            (vi) The Company shall reimburse the Executive for (or pay directly
on the Executive's behalf) reasonable professional fees and related expenses
related to the negotiation and preparation of this Agreement, within fifteen
(15) days following delivery to the Company of an invoice detailing such fees
and expenses.

            (vii) The Company shall promptly reimburse the Executive for all
expenses and disbursements reasonably incurred by the Executive in the
performance of her duties hereunder during the Term.

      4.    TERMINATION OF EMPLOYMENT

      (a) DEATH OR DISABILITY. The Executive's employment shall terminate
automatically upon the Executive's death during the Term. The Company shall be
entitled to terminate the Executive's employment because of the Executive's
Disability during the Term. "DISABILITY" shall be deemed the reason for the
termination by the Company of the Executive's employment, if, as a result of the
Executive's incapacity due to physical or mental illness, the Executive shall
have been absent from the full-time performance of the Executive's duties with
the Company for a period of three (3) consecutive months, the Company shall have
given the Executive a notice of termination for Disability, and, within thirty
(30) days after such notice of termination is given, Executive shall not have
returned to the full-time performance of the Executive's duties (the expiration
of such thirty (30)-day notice period, the "DISABILITY EFFECTIVE DATE").

      (b)   TERMINATION BY THE COMPANY.

            (i) The Company may terminate the Executive's employment during the
Term for Cause (as defined below) or without Cause.

            (ii) A termination of the Executive's employment by the Company for
Cause shall be effectuated by giving the Executive written notice ("NOTICE OF
TERMINATION FOR CAUSE")

                                       3
<PAGE>

of the termination. A termination of the Executive's employment for Cause will
be effective no earlier than the Executive's receipt of the Notice of
Termination for Cause.

            (iii) A termination of the Executive's employment by the Company
without Cause shall be effectuated by giving the Executive written notice
("NOTICE OF TERMINATION WITHOUT CAUSE") of the termination. A termination of the
Executive's employment by the Company without Cause shall be effective no
earlier than fifteen (15) days following the Executive's receipt of the Notice
of Termination without Cause.

            (iv) "CAUSE" for termination by the Company of the Executive's
employment shall mean:

                  (A) the willful and continued failure by the Executive to
      substantially perform her duties with the Company (other than such failure
      resulting from the Executive's incapacity due to physical or mental
      illness or any such actual or anticipated failure after the issuance of a
      Notice of Termination for Good Reason (as defined below) by the Executive)
      that has not been cured within thirty (30) days after a written demand for
      substantial performance is delivered to the Executive by the Board, which
      demand specifically identifies the manner in which the Board believes that
      the Executive has not substantially performed the Executive's duties,

                  (B) the willful engaging by the Executive in conduct which is
      demonstrably and materially injurious to the Company, monetarily or
      otherwise, or

                  (C) the Executive's conviction of or plea of guilty or nolo
      contendre to (x) any felony or (y) a misdemeanor involving dishonesty or
      moral turpitude.

For purposes of clauses (A) and (B) of this definition, no act, or failure to
act, on the Executive's part shall be deemed "willful" unless done, or omitted
to be done, by the Executive not in good faith and without reasonable belief
that the Executive's act, or failure to act, was in the best interest of the
Company.

      (c) TERMINATION BY THE EXECUTIVE.

            (i) The Executive may terminate employment during the Term for Good
Reason (as defined below) or without Good Reason.

            (ii) A termination of employment by the Executive for Good Reason
shall be effectuated by giving the Company written notice ("NOTICE OF
RESIGNATION FOR GOOD REASON") of the termination within ninety (90) days of the
Executive becoming aware of such act or omission that constitutes Good Reason
(such ninety (90)-day requirement does not apply to clause (F) of the Good
Reason definition). A termination of employment by the Executive for Good Reason
shall be effective no earlier than fifteen (15) days following the date when the
Notice of Termination for Good Reason is given.

            (iii)A termination of the Executive's employment by the Executive
without Good Reason shall be effected by giving the Company written notice
("NOTICE OF RESIGNATION WITHOUT GOOD REASON") of the termination. A termination
of employment by the Executive

                                       4
<PAGE>

without Good Reason shall be effective no earlier than fifteen (15) days
following the date when the Notice of Termination without Good Reason is given.

            (iv) "GOOD REASON" for termination by the Executive of the
Executive's employment shall mean the occurrence (without the Executive's
express written consent) of any one of the following acts by the Company,
failures by the Company to act or, in the case of (F) below, act by the
Executive:

                  (A) the assignment to the Executive of any duties inconsistent
      with the Executive's status as the President and Chief Executive Officer
      of the Company (including by reason of the Company becoming a subsidiary
      of another company) or an adverse alteration in the nature or status of
      the Executive's title or responsibilities, unless such adverse alteration
      is due to a factor beyond the Company's control;

                  (B) a reduction by the Company in the Executive's annual base
      salary or annual bonus opportunity (as either may increase from time to
      time), except for a decrease applicable to executives of the Company
      generally, or a failure by the Company to (x) provide the Executive with
      an opportunity for participation in any stock option plan or other
      equity-based plan on a level commensurate with the Executive's position
      with the Company or (y) meet its obligations per Section 6(c) above;

                  (C) the relocation of the Executive's principle place of
      employment to a location more than fifty (50) miles from the Executive's
      principal place of employment as of the Effective Date, except for
      reasonably required travel on the Company's business;

                  (D) any material breach by the Company of its obligations to
      the Executive under the terms of this Agreement;

                  (E) notice to the Executive that the Company shall not renew
      this Agreement per Section 1, above; or

                  (F) the voluntary termination of the Executive of her
      employment with the Company for any reason during the 6-month period
      commencing on the date of any Change in Control of the Company, provided
      that the Executive has communicated a notice of termination to the Company
      at least 1 month prior to the effectiveness of such voluntary termination.

      (d) DATE OF TERMINATION. The "DATE OF TERMINATION" means, as the case may
be, the date of the Executive's death, the Disability Effective Date or the date
on which the termination of the Executive's employment by the Company for Cause
or without Cause or by the Executive for Good Reason or without Good Reason is
effective, per the applicable written notice.

      5.    OBLIGATIONS OF THE COMPANY UPON TERMINATION

      (a) TERMINATION OTHER THAN FOR CAUSE, DEATH OR DISABILITY; RESIGNATION FOR
GOOD REASON. If the Company terminates the Executive's

                                       5
<PAGE>

employment for any reason other than Cause, death or Disability, or the
Executive terminates her employment for Good Reason, then:

            (i) the Company shall pay to the Executive, not later than thirty
(30) days following the Date of Termination, any unpaid amounts of the
Executive's Annual Base Salary and annual bonus for periods prior to the Date of
Termination (the "ACCRUED AMOUNTS");

            (ii) the Company shall pay to the Executive, not later than thirty
(30) days following the Date of Termination, a lump sum payment equal to the sum
of (i) the Annual Base Salary and (ii) the Executive's most recent annual bonus
payment (or, if prior to the Executive earning a bonus to be paid pursuant to
this Agreement, an amount equal to fifty percent (50%) of the Annual Base
Salary);

            (iii)any then-outstanding option to purchase Company stock granted
to the Executive shall become fully vested and exercisable and remain fully
exercisable for three (3) years following the Date of Termination (but not later
than the applicable expiration date);

            (iv) the restrictions shall lapse on any then-outstanding shares of
restricted stock held by the Executive;

            (v) the Company shall provide to the Executive (and/or the
Executive's eligible dependents, as the case may be), for a period of twelve
(12) months following the Date of Termination, the various welfare benefits to
which she (and/or her eligible dependents, as the case may be) was entitled
immediately before the Date of Termination (on a basis no less favorable than
that in effect immediately before the Date of Termination) and, following the
expiration of such twelve (12)-month period, the rights and benefits to which
she (and/or her eligible dependents, as the case may be) may be entitled under
the provisions of Sections 601-608 of the Employee Retirement Income Security
Act of 1974, as they may be amended from time to time ("COBRA"); and

            (vi) the Company shall provide to the Executive all compensation and
benefits payable to the Executive under the terms of the Company's compensation
and benefit plans, programs or arrangements as in effect immediately prior to
the Date of Termination (the "OTHER BENEFITS").

      (b) DEATH AND DISABILITY. If the Executive's employment is terminated by
reason of the Executive's death or Disability, the Company shall pay to the
Executive or, in the case of the Executive's death, to the Executive's
designated beneficiaries (or, if there is no such beneficiary, to the
Executive's estate or legal representative), the Accrued Amounts (in a lump sum
in cash within thirty (30) days after the Date of Termination) and the Other
Benefits. All outstanding equity-based awards shall be treated according to the
provisions of the applicable plans and award agreements.

      (c) TERMINATION FOR CAUSE; RESIGNATION WITHOUT GOOD REASON. If the
Executive's employment is terminated by the Company for Cause or the Executive
voluntarily terminates her employment without Good Reason, then the Company
shall pay to the Executive the Accrued Amounts (in a lump sum in cash within
thirty (30) days after the Date of

                                       6
<PAGE>

Termination) and the Other Benefits. All outstanding equity-based awards shall
be treated according to the provisions of the applicable plans and award
agreements.

      (d)   CHANGE IN CONTROL.

            (i) Change in Control Severance Pay and Benefits. During the one
(1)-year period following a Change in Control (as defined below), if the Company
terminates the Executive's employment other than for Cause, death or Disability,
or if the Executive resigns for Good Reason (which, per clause (F) of the
definition of Good Reason, includes resignation for any reason during the
6-month period following a Change in Control), the Executive will receive the
same payments and benefits as described in Section 5(a) above per the terms of
such section, except that the payment pursuant to subsection 5(a)(ii) shall be
equal to two (2) times the sum of clause (x) and (y) of that subsection, and the
benefit continuation period pursuant to subsection 5(a)(v) shall be eighteen
(18) months rather than twelve (12) months; subject, however to subsections
5(d)(iii)(A)III and 5(d)(iii)(C)III.b below.

            (ii) Excise Tax Gross-Up. In the event that the aggregate of all
payments or benefits made or provided to, or that may be made or provided to,
the Executive under this Agreement and under all other plans, programs and
arrangements of the Company (with a "payment" including, without limitation, the
vesting of an option or other non-cash benefit or property) (the "AGGREGATE
PAYMENT") is determined to constitute a "parachute payment," as such term is
defined in Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended
(the "CODE"), the Company shall pay to the Executive, prior to the time any
excise tax imposed by Section 4999 of the Code, as amended ("EXCISE TAX") is
payable with respect to such Aggregate Payment, an additional amount which,
after the imposition of all income, payroll and excise taxes thereon, is equal
to the Excise Tax on the Aggregate Payment. The determination of whether the
Aggregate Payment constitutes a parachute payment and, if so, the amount to be
paid to the Executive and the time of payment pursuant to this Section 5(e)
shall be made by an independent auditor (the "AUDITOR") jointly selected by the
Company and the Executive and paid by the Company. The Auditor shall be a
nationally recognized United States public accounting firm which has not, during
the two (2) years preceding the date of its selection, acted in any way on
behalf of the Company or any affiliate thereof. If the Executive and the Company
cannot agree on the firm to serve as the Auditor, then the Executive and the
Company shall each select one accounting firm and those two firms shall jointly
select the accounting firm to serve as the Auditor. Notwithstanding the
foregoing, in the event that the amount of the Executive's Excise Tax liability
is subsequently determined to be greater than the Excise Tax liability with
respect to which an initial payment to the Executive under this Section 5(e) has
been made, the Company shall pay to the Executive an additional amount with
respect to such additional Excise Tax (and any interest and penalties thereon)
at the time and in the amount determined by the Auditor so as to make the
Executive whole, on an after-tax basis, with respect to such Excise Tax (and any
interest and penalties thereon) and such additional amount paid by the Company.
In the event the amount of the Executive's Excise Tax liability is subsequently
determined to be less than the Excise Tax liability with respect to which an
initial payment to the Executive has been made, the Executive shall, as soon as
practical after the determination is made, pay to the Company the amount of the
overpayment by the Company, reduced by the amount of any relevant taxes already
paid by the Executive and not refundable, all as determined by the Auditor. The
Executive and the Company shall cooperate with each other in connection with any
proceeding

                                       7
<PAGE>

or claim relating to the existence or amount of liability for Excise Tax, and
all expenses incurred by the Executive in connection therewith shall be paid by
the Company promptly upon notice of demand from the Executive.

            (iii) A "CHANGE IN CONTROL" shall be deemed to have occurred if:

                  (A) any "person" (as defined in Section 13(d) and 14(d) of the
      Securities Exchange Act of 1934, as amended (the "Exchange Act")),
      excluding for this purpose the Company or any subsidiary of the Company,
      or any employee benefit plan of the Company or any subsidiary of the
      Company, or any person or entity organized, appointed or established by
      the Company for or pursuant to the terms of such plan which acquires
      beneficial ownership of voting securities of the Company, is or becomes
      the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act)
      directly or indirectly of securities of the Company representing thirty
      percent (30%) or more of the combined voting power of the Company's then
      outstanding securities;

                            I. provided, however, that no Change in Control
         shall be deemed to have occurred as the result of an acquisition of
         securities of the Company by the Company which, by reducing the number
         of voting securities outstanding, increases the direct or indirect
         beneficial ownership interest of any person to thirty percent (30%) or
         more of the combined voting power of the Company's then outstanding
         securities, but any subsequent increase in the direct or indirect
         beneficial ownership interest of such a person in the Company shall be
         deemed a Change in Control;

                            II. and provided further, however, that if the Board
         of Directors of the Company determines in good faith that a person who
         has become the beneficial owner directly or indirectly of securities of
         the Company representing thirty percent (30%) or more of the combined
         voting power of the Company's then outstanding securities has
         inadvertently reached that level of ownership interest, and if such
         person divests as promptly as practicable a sufficient amount of
         securities of the Company so that the person no longer has a direct or
         indirect beneficial ownership interest in thirty percent (30%) or more
         of the combined voting power of the Company's then outstanding
         securities, then no Change in Control shall be deemed to have occurred;

                            III. and further provided, however, that if this
         clause (A) is satisfied but (x) the person that has become the
         beneficial owner directly or indirectly of securities of the Company
         representing thirty percent (30%) or more of the combined voting power
         of the Company's then-outstanding securities owns less than forty
         percent (40%) of the combined voting power of the Company's
         then-outstanding securities, (y) such ownership occurred through the
         Company's acquisition of another entity and (z) such acquisition was
         recommended in writing to the Board of Directors by the Executive,
         then, if the Executive resigns per Section 4(c)(iv)(F) above, the
         severance pay and benefits to which the Executive shall be entitled
         will be per the terms of Section 5(a) above without effect given to
         Section 5(d)(i) above; or

                                       8
<PAGE>

                  (B) during any period of two (2) consecutive years (not
      including any period prior to the Effective Date), individuals who at the
      beginning of such two-year period constitute the Board of Directors of the
      Company and any new director (except for a director designated by a person
      who has entered into an agreement with the Company to effect a transaction
      described elsewhere in this definition) whose election by the Board or
      nomination for election by the Company's shareholders was approved by a
      vote of at least two-thirds of the directors then still in office who
      either were directors at the beginning of the period or whose election or
      nomination for election was previously approved, cease for any reason to
      constitute at least a majority thereof; or

                  (C) the shareholders of the Company approve:

                            I. a plan of complete liquidation of the Company,

                            II. an agreement for the sale or disposition of the
         Company or all or substantially all of the Company's assets,

                            III. any plan of merger or consolidation of the
         Company with any other corporation, except that:

                                  a. shareholder approval of a plan of merger or
                      consolidation in which the security owners of the Company
                      immediately prior to the merger or consolidation continue
                      to own at least seventy percent (70%) of the voting
                      securities of the new (or continued) entity immediately
                      after such merger or consolidation shall not be Change in
                      Control; and

                                  b. shareholder approval of a plan of merger or
                      consolidation in which the security owners of the Company
                      immediately prior to the merger or consolidation continue
                      to own at least fifty-one percent (51%) but less than
                      seventy percent (70%) of the voting securities of the new
                      (or continued) entity immediately after such merger or
                      consolidation and such plan of merger or consolidation was
                      recommended in writing to the Board of Directors by the
                      Executive shall be a Change in Control; but, if the
                      definition of Change in Control is satisfied through this
                      clause 5(d)(iii)(C)III.b, then, if the Executive resigns
                      per Section 4(c)(iv)(F) above, the severance pay and
                      benefits to which the Executive shall be entitled will be
                      per the terms of Section 5(a) above without effect given
                      to Section 5(d)(i) above.

      6. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall prevent or
   limit the Executive's continuing or future participation in any plan,
   program, policy or practice provided by the Company or any of its affiliated
   companies for which the Executive may qualify nor shall anything in this
   Agreement limit or otherwise affect such rights as the Executive may have
   under any contract or agreement with the Company or any of its affiliated
   companies. Vested benefits and other amounts that the Executive is otherwise

                                       9
<PAGE>

   entitled to receive under any plan, policy, practice or program of, or any
   contract of agreement with, the Company or any of its affiliated companies on
   or after the Date of Termination shall be payable in accordance with the
   terms of each such plan, policy, practice, program, contract or agreement, as
   the case may be, except as explicitly modified by this Agreement.

      7. NO MITIGATION OR OFFSET. Except as provided herein, the Company's
   obligation to make the payments provided for in, and otherwise to perform its
   obligations under, this Agreement shall not be affected by any set-off,
   counterclaim, recoupment, defense or other claim, right or action that the
   Company may have against the Executive or others. In no event shall the
   Executive be obligated to seek other employment or take any other action by
   way of mitigation of the amounts payable to the Executive under any of the
   provisions of this Agreement and such amounts shall not be reduced,
   regardless of whether the Executive obtains other employment.

      8.    CONFIDENTIAL INFORMATION; COMPETITION; SOLICITATION

      (a) Confidential Information. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies and
their respective businesses that the Executive obtains during the Executive's
employment by the Company or any of its affiliated companies and that is not
public knowledge (other than as a result of the Executive's violation of this
Section 8(a) ("CONFIDENTIAL INFORMATION"). The Executive shall not communicate,
divulge or disseminate Confidential Information at any time during or after the
Executive's employment with the Company, except with the prior written consent
of the Company or as otherwise required by law or legal process and except as
needed to conduct the Executive's duties for the Company.

      (b) Non-Competition; Non-Solicitation. For a period of one (1) year after
the Date of Termination, the Executive shall not, without the written consent of
the Board, directly or indirectly, (i) engage or be interested in (as owner,
partner, stockholder, employee, director, officer, agent, consultant or
otherwise), with or without compensation, any business which is in direct
competition with any line of business actively being conducted on the Date of
Termination by the Company or any of its subsidiaries (provided that the
Executive shall not be prohibited from employment with a division of a direct
competitor if such division is not in direct competition with any line of
business actively being conducted on the Date of Termination by the Company or
any of its subsidiaries); or (ii) solicit any person to leave the employment of
the Company or any of its subsidiaries or affiliates (other than persons
employed in a clerical or other non-professional position). Nothing herein,
however, will prohibit the Executive from acquiring or holding not more than one
percent of any class of publicly traded securities of any such business;
provided that such securities entitle the Executive to no more than one percent
of the total outstanding votes entitled to be cast by security holders of such
business in matters on which such security holders are entitled to vote.

      (c) The Executive agrees that the restrictions set forth in Sections 8(a)
and 8(b) hereof are reasonable and necessary to protect the legal interests of
the Company. The Executive

                                       10
<PAGE>

further agrees that the Company shall be entitled to seek injunctive relief in
the event of any actual or threatened breach of such restrictions.

      9.    PATENTS, COPYRIGHTS AND RELATED MATTERS.

      (a) Disclosure and Assignment. The Executive shall disclose to the Company
any and all improvements and inventions that the Executive may conceive and/or
reduce to practice individually or jointly or commonly with others while she is
employed with the Company with respect to (i) any methods, processes or
apparatus concerned with the development, use or production of any type of
products, goods or services sold or used by the Company, and (ii) any type of
products, goods or services sold or used by the Company. The Executive also
shall assign, transfer and set over to the Company her entire right, title and
interest in and to any and all of such inventions as are specified in this
Section 9(a) and in and to any and all applications for letters patent that may
be filed on such inventions, and in and to any and all letters patent that may
issue, or be issued, upon such applications. In connection therewith and at no
expense to the Executive, the Executive shall sign any and all instruments
deemed necessary by the Company or its subsidiaries or affiliates for:

            (i) the filing and prosecution of any applications for letters
patent of the United States or of any foreign country that the Company or its
subsidiaries or affiliates may desire to file upon such inventions as are
specified in this Section 9(a);

            (ii) the filing and prosecution of any divisional, continuation,
continuation-in-part or reissue applications that the Company or its
subsidiaries or affiliates may desire to file upon such applications for letters
patent; and

            (iii)the reviving, re-examining or renewing of any of such
applications for letters patent.

      (b) Section 9(a) shall not apply to any invention for which no equipment,
supplies, facilities, confidential, proprietary or secret knowledge or
information, or other trade secret information of the Company or its
subsidiaries or affiliates was used and that was developed entirely on the
Executive's own time, and (i) that does not relate (A) directly to the business
of the Company or its subsidiaries or affiliates, or (B) to the Company's or its
subsidiaries or affiliates actual or demonstrably anticipated research or
development, or (ii) that does not result from any work performed by the
Executive for the Company or its subsidiaries or affiliates.

      (c) Copyrightable Material. All right, title and interest in all
copyrightable material that the Executive shall, directly or indirectly,
conceive or originate individually or jointly or commonly with others, and that
arise during the term of her employment with the Company and out of the
performance of her duties and responsibilities under this Agreement, shall be
the property of the Company or its subsidiaries or affiliates and are hereby
assigned by the Executive to the Company or its subsidiaries or affiliates,
along with ownership of any and all copyrights in the copyrightable material.
Upon request and at no expense to the Executive, the Executive shall execute any
and all papers and perform all other acts necessary to assist the Company to
obtain and register copyrights on such materials in any and all countries. Where
applicable, works of authorship created by the Executive for the Company or its
subsidiaries or affiliates in

                                       11
<PAGE>

performing her duties and responsibilities hereunder shall be considered "works
made for hire," as defined in the U.S. Copyright Act.

      10. DISPUTE RESOLUTION. Except for the Company's right to seek injunctive
   relief as set forth in Section 8(c), all disputes arising under, related to,
   or in connection with this Agreement shall be settled by expedited
   arbitration conducted before a panel of three arbitrators sitting in New
   York, New York, in accordance with the employment rules of the American
   Arbitration Association then in effect. The decision of the arbitrators in
   that proceeding shall be binding on the Company and the Executive. Judgment
   may be entered on the award of the arbitrators in any court having
   jurisdiction. All fees and expenses of the arbitrators shall be paid by the
   Company. The arbitrators shall have the authority to award attorney's fees
   and costs to the prevailing party.

      11. KEY-PERSON INSURANCE. At any time during the Term, the Company shall
   have the right to insure the life of Executive for the sole benefit of the
   Company, in such amounts, and with such terms, as it may determine. All
   premiums payable thereon shall be the obligation of the Company. The
   Executive shall have no interest in any such policy, but shall cooperate with
   the Company in taking out such insurance by submitting to physical
   examinations, by supplying all information required by the insurance company,
   and by executing all necessary documents, provided that no financial
   obligation is imposed upon the Executive by any such documents.

      12. D&O INSURANCE; COMPANY INDEMNITY.

      (a) The Company shall maintain directors' and officers' liability
insurance for the benefit of the Executive in an amount no less than $5,000,000.

      (b) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "PROCEEDING"), by reason of the
fact that she is or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer, member,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, including service with respect to employee benefit plans,
whether or not the basis of such Proceeding is the Executive's alleged action in
an official capacity while serving as a director, officer, member, employee or
agent, the Executive shall be indemnified and held harmless by the Company to
the fullest extent legally permitted or authorized by the Company's certificate
of incorporation or bylaws or resolutions of the Board or, if greater, by the
laws of the State of Delaware against all cost, expense, liability and loss
(including, without limitation, attorney's fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Executive in connection therewith, and such
indemnification shall continue as to the Executive even if she has ceased to be
a director, member, officer, employee or agent of the Company or other entity
and shall inure to the benefit of the Executive's heirs, executors and
administrators. The Company shall advance to the Executive all reasonable costs
and expenses to be incurred by her in connection with a Proceeding within twenty
(20) days after receipt by the Company of a written request for such advance.
Such request shall include an undertaking by the Executive to repay the amount
of such advance if it shall ultimately be determined that she is not entitled to
be indemnified against

                                       12
<PAGE>

such costs and expenses. The provisions of this Section 12(b) shall not be
deemed exclusive of any other rights of indemnification to which the Executive
may be entitled or which may be granted to her, and it shall be in addition to
any rights of indemnification to which she may be entitled under any policy of
insurance.

      13.   SUCCESSORS

      (a) This Agreement is personal to the Executive and, without the prior
written consent of the Company, shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.

      (b) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.

      (c) The Company shall require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company expressly in writing to assume and
agree to perform this Agreement in the same manner and to the same extent that
the Company would have been required to perform it if no such succession had
taken place. As used in this Agreement, the "Company" shall mean both the
Company as defined above and any such successor that assumes and agrees to
perform this Agreement, by operation of law or otherwise.

      14.   MISCELLANEOUS

      (a) This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York, without reference to principles of conflict
of laws. The captions of this Agreement are not part of the provisions hereof
and shall have no force or effect. This Agreement may not be amended or modified
except by a written agreement executed by the parties hereto or their respective
successors and legal representatives.

      (b) All notices and other communications under this Agreement shall be in
writing and shall be given to the other party (i) by hand delivery; (ii) by
reputable overnight carrier; or (iii) by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:

          If to the Executive:

          Pamela A. Fredette
          enherent Corp.
          192 Lexington Avenue
          New York, New York  10016

          with a copy to:

          Vedder, Price, Kaufman & Kammholz, P.C.
          222 N. LaSalle Street, Suite 2600

                                       13
<PAGE>

          Chicago, Illinois  60601
          Attention:  Kelly A. Starr

          If to the Company:

          enherent Corp.
          192 Lexington Avenue
          New York, New York  10016
          Attention:  General Counsel

          with a copy to:

          Gardner Carton & Douglas LLP
          191 N. Wacker Drive, Suite 3700
          Chicago, Illinois  60606-1698
          Attention:  Stephen A. Tsoris

or to such other address as either party furnishes to the other in writing in
accordance with this subsection (b). Notices and communications shall be
effective when actually received by the addressee.

      (c) The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held invalid or
unenforceable in part, the remaining portion of such provision, together with
all other provisions of this Agreement, shall remain valid and enforceable and
continue in full force and effect to the fullest extent consistent with law.

      (d) Notwithstanding any other provision of this Agreement, the Company may
withhold from amounts payable under this Agreement all federal, state, local and
foreign taxes that are required to be withheld by applicable laws or
regulations.

      (e) The Executive's or the Company's failure to insist upon strict
compliance with any provisions of, or to assert any right under, this Agreement
shall not be deemed to be a waiver of such provision or right or of any other
provision of or right under this Agreement.

      (f) The Executive and the Company acknowledge that this Agreement
constitutes the entire understanding of the parties with respect to the subject
matter hereof and supersede any other prior agreement or other understanding,
whether oral or written, express or implied, between them concerning, related to
or otherwise in connection with, the subject matter hereof and that, following
the date hereof, no such agreement or understanding shall be of any further
force or effect.

      (g) The rights and benefits of the Executive under this Agreement may not
be anticipated, assigned, alienated or subject to attachment, garnishment, levy,
execution or other legal or equitable process except as required by law. Any
attempt by the Executive to anticipate, alienate, assign, sell, transfer,
pledge, encumber or charge the same shall be void. Payments due hereunder shall
not be considered assets of the Executive in the event of insolvency or
bankruptcy.

                                       14
<PAGE>

      (h) To the extent necessary to effectuate the terms of this Agreement,
terms of this Agreement which have effect after the termination of the
Executive's employment or the termination of this Agreement shall survive the
expiration of the Term.

      (i) This Agreement may be executed in several counterparts, each of which
shall be deemed an original, and said counterparts shall constitute but one and
the same instrument. Facsimile signatures on this Agreement shall be the same as
original signatures.

      IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization of its Board, the Company has caused this
Agreement to be executed in its name on its behalf.

                                               ENHERENT CORP.

                                               By: /s/ Thomas E. Minerva
                                                   -----------------------
                                               Name: Thomas E. Minerva
                                               Title: Director

                                               EXECUTIVE

                                               /s/ Pamela A. Fredette
                                               --------------------------
                                               Pamela A. Fredette

                                       15
<PAGE>

                                                                    ATTACHMENT A

                                 ENHERENT CORP.
                 CHIEF EXECUTIVE OFFICER ANNUAL CASH BONUS PLAN

SUMMARY: Annual cash bonus based on EBITDA.

NOTE: MANAGEMENT BONUSES, INCLUDING ANY BONUS PAID TO THE CEO PURSUANT TO THIS
PLAN, ARE EXPENSES FACTORED INTO EBITDA UNDER THIS PLAN.

EBITDA at Tier 1 target levels will result in an annual bonus payment equal to
50% of base salary. EBITDA at 120% or 133% of Tier 1 target level will result in
total annual bonus payment of 75% or 100% of base salary, respectively. EBITDA
at greater than 133% of Tier 1 target level will result in total annual bonus
payment greater than 100% of base salary.

Bonus payments to be made per a combination of quarterly and annual payments, as
described below.

Setting of Tier 1 Targets:

      - 2005: During 2005, Tier 1 EBITDA target levels will be the EBITDA
targets per the Ableco loan agreement, as those EBITDA targets may be amended.

      - 2006 and 2007: For 2006 and 2007, Tier 1 EBITDA target levels will be as
mutually agreed between the CEO and the Company by no less than 30 days prior to
the commencement of the applicable Q1 performance period, or, if such agreement
cannot be reached, then the Tier 1 EBITDA target levels will be the EBITDA
targets per the Ableco loan agreement, as those EBITDA targets may be amended.

      - 2008 and thereafter: Beginning with 2008, Tier 1 EBITDA target levels
will be as mutually agreed between the CEO and the Company, with such agreement
not to be unreasonably withheld, and shall be established no less than 30 days
prior to the commencement of the Q1 performance period.

Tier 1 EBITDA targets will be set for each quarter of the year (Q1, Q2, Q3 and
Q4); only 2005 has EBITDA targets beginning with Q2.

                                       A-1
<PAGE>

TIER 1: Annual target bonus equal to 50% of base salary to be paid in quarterly
installments, based on Tier 1 EBITDA targets. For 2005, Tier 1 EBITDA targets
are as follows:

<TABLE>
<S>                                                                     <C>
Q1                                                                      n/a
Q2                                                                      $210K*
Q3                                                                      $300K
Q4                                                                      $300K
2005 Total:                                                             $810K*
</TABLE>

Q1: If EBITDA target for Q1 achieved, payment equal to 13% of base salary to be
made as soon as practicable after end of Q1, but no later than the last payroll
date in May of the applicable year (this sentence not applicable for 2005).

Q2: If EBITDA target for Q2 achieved, payment equal to 13% (17% for 2005) of
base salary to be made as soon as practicable after end of Q2, but no later than
the last payroll date in August of the applicable year.

Q3: If EBITDA target for Q3 achieved, payment equal to 12% (17% for 2005) of
base salary to be made as soon as practicable after end of Q3, but no later than
the last payroll date in November of the applicable year.

Q4: If EBITDA target for Q4 achieved, payment equal to 12% (16% for 2005) of
base salary to be made as soon as practicable after end of Q4, but no later than
February 15 of the applicable year.

Year End Look-Back:

(a) If a Tier 1 EBITDA target is not achieved in a certain quarter (the
"Shortfall Quarter"), but the Tier 1 EBITDA target is exceeded in another
quarter or quarters (the "Overage Quarter(s)"), then the Tier 1 EBITDA target
will be deemed satisfied in the Shortfall Quarter and the actual EBITDA for the
Overage Quarter with the greatest EBITDA will be deemed reduced by the EBITDA
credited to the Shortfall Quarter to satisfy the Tier 1 EBITDA target for such
quarter. This adjustment will occur for each such Shortfall Quarter, so long as
there exists an Overage Quarter (after each adjustment under this paragraph the
existence of an Overage Quarter and the Overage Quarter with the greatest EBITDA
will re-determined).

(b) Based on the EBITDA adjustments described in paragraph (a) above and subject
to offset as described below, Tier 1 bonus payments not previously made to the
CEO ("Make-Up Tier 1 Bonus Payments") will be paid as soon as practicable after
end of the applicable year, but no later than the immediately following February
15; provided, however, that such Make-Up Tier 1

------------------------
*   Net of "Expense Add-Backs" as defined in Ableco loan agreement.

*   2005 Total EBITDA target is net of "Expense Add-Backs" as defined in Ableco
loan agreement.

                                       A-2
<PAGE>

Bonus Payments will be reduced by the amount of any Tier 2, 3 or 4 bonus
payments received by the CEO which were based on EBITDA deemed credited to any
Shortfall Quarter.]

TIER 2: In addition to the total cash payment equal to 50% of base salary that
may be paid under Tier 1, under Tier 2 eligible for a cash payment of up to 25%
of base salary for exceeding Tier 1 EBITDA targets by 20%.

Q1: Tier 2 payment for Q1 will equal (i) 7% of base salary multiplied by (ii) a
fraction with a numerator equal to the percent by which the actual Q1 EBITDA
exceeded the Tier 1 Q1 EBITDA target and a denominator equal to 20% (if such
fraction results in a number greater than 1, it will be deemed to be the number
1). Tier 2 payment for Q1 performance to be made as soon as practicable after
end of Q1, but no later than the last payroll date in May of the applicable
year. (This paragraph not applicable for 2005.)

Q2: Tier 2 payment for Q2 will equal (i) 6% (9% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which the
actual Q2 EBITDA exceeded the Tier 1 Q2 EBITDA target and a denominator equal to
20% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 2 payment for Q2 performance to be made as soon as
practicable after end of Q2, but no later than the last payroll date in August
of the applicable year.

Q3: Tier 2 payment for Q3 will equal (i) 6% (8% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which the
actual Q3 EBITDA exceeded the Tier 1 Q3 EBITDA target and a denominator equal to
20% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 2 payment for Q3 performance to be made as soon as
practicable after end of Q3, but no later than the last payroll date in November
of the applicable year.

Q4: Tier 2 payment for Q4 will equal (i) 6% (8% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which the
actual Q4 EBITDA exceeded the Tier 1 Q4 EBITDA target and a denominator equal to
20% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 2 payment for Q4 performance to be made as soon as
practicable after end of Q4, but no later than February 15 of the applicable
year.

TIER 3: In addition to the total cash payments equal to 50% of base salary that
may be paid under Tier 1 and 25% of base salary that may be paid under Tier 2,
under Tier 3 eligible for a cash payment of up to 25% of base salary for
exceeding Tier 1 EBITDA targets by 33%.

Q1: Tier 3 payment for Q1 will equal (i) 7% of base salary multiplied by (ii) a
fraction with a numerator equal to the percent by which the actual Q1 EBITDA
exceeded the Tier 1 Q1 EBITDA target and a denominator equal to 33% (if such
fraction results in a number greater than 1, it will be deemed to be the number
1). Tier 3 payment for Q1 performance to be made as soon as practicable after
end of Q1, but no later than the last payroll date in May of the applicable
year. (This paragraph not applicable for 2005.)

                                       A-3
<PAGE>

Q2: Tier 3 payment for Q2 will equal (i) 6% (9% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which
actual Q2 EBITDA exceeded the Tier 1 Q2 EBITDA target and a denominator equal to
33% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 3 payment for Q2 performance to be made as soon as
practicable after end of Q2, but no later than the last payroll date in August
of the applicable year.

Q3: Tier 3 payment for Q3 will equal (i) 6% (8% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which the
actual Q3 EBITDA exceeded the Tier 1 Q3 EBITDA target and a denominator equal to
33% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 3 payment for Q3 performance to be made as soon as
practicable after end of Q3, but no later than the last payroll date in November
of the applicable year.

Q4: Tier 3 payment for Q4 will equal (i) 6% (8% for 2005) of base salary
multiplied by (ii) a fraction with a numerator equal to the percent by which the
actual Q4 EBITDA exceeded the Q4 Tier 1 EBITDA target and a denominator equal to
33% (if such fraction results in a number greater than 1, it will be deemed to
be the number 1). Tier 3 payment for Q4 performance to be made as soon as
practicable after end of Q4, but no later than February 15 of the applicable
year.

TIER 4: If actual annual EBITDA exceeds 133% of Tier 1 target (for 2005, this
means total annual EBITDA would exceed $1.077 million ($810K x 133% ), in
addition to cash payments made under Tiers 1, 2, and 3 (which would equal 100%
of base salary), will receive an additional payment equal to 25% of actual total
annual EBITDA over 133% of the annual Tier 1 EBITDA target. This Tier 4 payment
will be made as soon as practicable after end of the applicable year, but no
later than the immediately following February 15.

                                       A-4

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