Document:

Exhibit 10.1

Exhibit 10.1

Asset Purchase and Sale

Agreement

By and Between

Global Employment Holdings, Inc.,

Temporary Placement Service, Inc.,

and

Eastern Staffing, LLC,

d.b.a. Select Staffing

March 9, 2009

 

 

 

The parties to this Asset Purchase and Sale Agreement (“Agreement”), effective as of March 9, 2009
(“Effective Date”), are Global Employment Holdings, Inc., a Delaware corporation (“Global”), and
Temporary Placement Service, Inc., a Georgia corporation, a/k/a Michaels & Associates (“TPS” and
together with Global, “Seller”), and Eastern Staffing, LLC, a California limited liability company
(“Buyer”), d.b.a. Select Staffing.

RECITALS

A. Seller is a publicly traded company with offices in New York, New Jersey, Florida, Illinois,
Maryland, Pennsylvania, Texas, the District of Columbia and Georgia.

B. Seller is engaged in the business of staffing and employment services (the “Business”).

C. Seller operates the Business in the State of Georgia (the “Georgia Business”) at the locations
set forth on Schedule 7 (the “Locations”).

D. Subject to the terms and conditions contained in this Agreement, Seller desires to sell to
Buyer and Buyer desires to purchase from Seller certain assets and liabilities related to the
Georgia Business, other than the Excluded Assets, including the Contracts, the Personal Property,
the Intangible Personal Property, and other assets listed in this Agreement.

Now, therefore, in consideration of the mutual covenants, representations, and warranties in
this Agreement, the parties make the following agreement:

ARTICLE 1

PURCHASE AND SALE OF ASSETS

1.1 Purchase and Sale of Assets. Except as set forth in Article 1.2, Seller agrees to sell to
Buyer, and Buyer agrees to purchase from Seller, on the Closing Date, all of Seller’s right,
title, and interest in and to the following assets of Seller used in the operation of the Georgia
Business (the “Assets”):

(a) All customer contracts, agreements, warranties, and other customer rights or agreements,
written or oral, related to the operation of the Georgia Business and all Georgia Business leases
and other agreements listed on Schedule 1 (the “Contracts”);

(b) The tangible personal property listed in Schedule 2 (the “Personal Property”);

(c) The intangible personal property listed in Schedule 3 (the “Intangible Personal
Property”);

(d) all lists (in written or electronic format) of past, present or potential applicants with
Seller in the Georgia Business, including all files, information and computer records related
thereto;

(e) all lists (in written or electronic format) of past, present or potential customers of
Seller in the Georgia Business, including all files, information and computer records related
thereto;

 

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(f) all business development information, databases, price lists and pricing records and
schedules, copies of accounting records, rate records, sales literature, technical literature,
information and know-how, general intangibles of TPS, licenses of TPS (to the extent transferable),
trade association or other memberships of TPS (to the extent transferable), and any other books,
documents, instruments and records, in each case used in the operation of the Georgia Business;

(g) all goodwill associated with the Georgia Business;

(h) all telephone, data line and fax numbers of the Georgia Business, to the extent the same
can be transferred by Seller;

(i) the Georgia Business’s Internet Domain Names;

(j) Seller’s rights in respect of the Unemployment Reserve Account maintained under Georgia
law (subject to Buyer’s duly complying with the provisions thereof regarding transfer) and any
other reserve amounts in Georgia used by Seller in the operation of the Georgia Business;

(k) the prepaid expenses (excluding any prepaid taxes) and deposits of the Georgia Business as
of the Closing Date listed on Schedule 3; and

(l) all rights in favor of Seller under non-competition or non-solicitation agreements
executed in favor of Seller by any of Seller’s current or past employees, if any.

1.2 Excluded Assets. Except for the Assets, Buyer shall not acquire any assets of Seller or
rights therein, including, without limitation, Seller’s accounts receivable, Seller’s unbilled
accounts receivable and the other assets of Seller listed on Schedule 4 (the “Excluded Assets”).

1.3 Permitted Liens. Seller shall convey title to the Assets to Buyer free and clear of all
liens, security interests, and encumbrances of any kind or nature, other than those items listed
on Schedule 5 (the “Permitted Liens”).

1.4 Risk of Loss. Seller assumes all risk of loss or damage to the Assets prior to the Closing
Date. In the event that there is any material loss or damage to all or any material portion of
the Assets prior to the Closing, Buyer may either terminate this Agreement pursuant to Article
12, or negotiate with Seller for a proportionate reduction in the Purchase Price to reflect the
loss or damage. For the purposes of this provision, the term “material loss or damage” shall
mean any loss or damage to the Assets with an aggregate cost of Fifty Thousand Dollars ($50,000).

 

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ARTICLE 2

ASSUMPTION OF LIABILITIES

2.1 Assumption of Liabilities. As of the Closing Date, in addition to any other liabilities
expressly assumed by Buyer under this Agreement, Buyer shall only assume responsibility for
performing and satisfying all of the contractual obligations and other liabilities of Seller listed
on Schedule 6 (the “Assumed Liabilities”).

2.2 Excluded Liabilities. Except as expressly provided in this Agreement, including, without
limitation, with respect to the Assumed Liabilities, Buyer shall not assume or become liable for
any obligations, commitments, or liabilities of Seller, whether known or unknown, absolute,
contingent, or otherwise, and whether or not they are related to the Assets (the “Excluded
Liabilities”).

ARTICLE 3

PURCHASE PRICE

3.1 Purchase Price. Subject to the terms and conditions of this Agreement, the purchase price
for the Assets shall be One Million Nine Hundred Fifty Dollars ($1,950,000.00) (“Purchase
Price”). The Purchase Price shall be paid to Seller as described in Article 3.2(b) , provided
that Buyer has already delivered to Seller a non-refundable deposit in the amount of One Hundred
Thousand Dollars ($100,000.00) (the “Deposit”).

3.2 Purchase Price Allocation and Payment Terms.

(a) The Purchase Price shall be allocated as set forth on Exhibit E and incorporated herein
by reference (the “Allocation”). Buyer and Seller agree that the Allocation shall be used by
them for all purposes including tax, reimbursement and other purposes, and that it will report
the transaction contemplated pursuant to this Agreement in accordance with the Allocation,
including any report made under Section 1060 of the Internal Revenue Code of 1986, as amended
(the “Code”), and that neither party will take a position inconsistent with the Allocation except
with the prior written consent of the other party.

(b) The Purchase Price shall be paid to Seller at the Closing as follows:

(i) Buyer shall deliver to an account designated by Seller the sum of One Million Dollars
($1,000,000.00) less the amount of the Deposit previously paid pursuant to Article 3.1, payable
in immediately available funds (the “Cash Payment”).

(ii) Buyer will execute and deliver to Seller an unsecured, two-year promissory note in
the principal amount of Two Hundred Fifty Thousand Dollars ($250,000.00) bearing interest at the
rate of six percent (6%) per annum, to be paid in quarterly principal payments of Twenty Thousand
Dollars ($20,000.00) plus accrued but unpaid interest on the outstanding principal amount of the
promissory note, in the form attached as Exhibit D-1 and incorporated herein by reference (the
“$250,000 Note”). The $250,000 Note will be personally guaranteed by D. Stephen Sorensen
pursuant to the Guaranty attached as Exhibit H and incorporated herein by reference.

 

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(iii) Buyer will execute and deliver to Seller an unsecured promissory note in the principal
amount of Seven Hundred Thousand Dollars ($700,000.00) which shall be due and payable in full on
March 20, 2009, in the form attached as Exhibit D-2 and incorporated herein by reference (the
“$700,000 Note” and together with the $250,000 Note, the “Notes”). In the event Buyer does not
pay the full amount of the $700,000 Note by March 20, 2009, Seller will have the option of (A)
enforcing the collection of the $700,000 Note (which shall bear interest at the rate of the
lesser of eighteen percent (18%) per annum or the maximum amount permitted by applicable law,
commencing on March 20, 2009 and until the $700,000 Note is paid in full) or (B) unwinding all of
the transactions consummated on the Closing Date pursuant to this Agreement, including,
without limitation, re-taking possession of the Assets and the Assumed Liabilities and
terminating this Agreement and all agreements entered into on the Closing Date pursuant to
Article 12, provided that if Seller elects to unwind the transactions consummated hereby, Seller
will be entitled to retain the full amount of the Cash Payment as a penalty. In order to
preserve Seller’s rights to re-take possession of the Assets and the Assumed Liabilities pursuant
to this Article 3.2(b)(iii), until the $700,000 Note has been paid in full, Buyer covenants and
agrees to (1) retain exclusive ownership of the Assets and the Assumed Liabilities, (2) maintain
and preserve the Assets and the Assumed Liabilities in good condition, (3) not sell, transfer
assign, terminate, mortgage, pledge, hypothecate, lien, encumber or otherwise dispose of or
impair any of the Assets or the Assumed Liabilities and (4) execute any and all documents and
perform any and all acts reasonably necessary, incidental, or appropriate to transfer and vest
title of all ownership rights in the Assets and the Assumed Liabilities in and to Seller if
Seller elects to unwind this transaction. Notwithstanding the foregoing, Buyer may transfer the
Assets to Koosharem Corporation (“Koosharem”) provided that as a condition to such transfer
Koosharem agrees to be bound by the provisions of Article 3.2(b)(iii)(1) — (4) until such time as
the $700,000 Note has been paid in full. The $700,000 Note will be personally guaranteed by D.
Stephen Sorensen pursuant to the Guaranty attached as Exhibit H and incorporated herein by
reference.

ARTICLE 4

CLOSING

4.1 Time and Place of Closing. The Closing for the purchase and sale of the Assets (“Closing” or
“Close”) will take place at Buyer’s corporate headquarters, 3820 State Street, Santa Barbara,
California, 93105, on March 12, 2009, or at such other time and place as the parties may mutually
agree (the “Closing Date”). At the Close, Seller will transfer and convey title to the Assets
and the Assumed Liabilities to Buyer, and Buyer will assume the Assumed Liabilities, as provided
in this Agreement.

4.2 Seller’s Closing Obligations. At the Close, Seller shall execute, acknowledge, and deliver,
as appropriate, each of the following items:

(a) A duly executed bill of sale (the “Bill of Sale”), in substantially the form attached as
Exhibit A and incorporated herein by reference, conveying to Buyer all of Seller’s right, title,
and interest in and to the Personal Property.

(b) A duly executed assignment of all Contracts (the “Assignment of Customer Contracts,
Agreements, and Arrangements”), in substantially the form attached as Exhibit B and incorporated
herein by reference, pursuant to which Seller shall assign to Buyer all of its right, title, and
interest in and to, and Buyer shall accept and assume all of Seller’s obligations in respect of,
the Contracts and the other Assumed Liabilities.

(c) A duly executed assignment of Intangible Personal Property (the “Assignment of
Intangible Personal Property”), in substantially the form attached as Exhibit C and incorporated
herein by reference, assigning to Buyer all of Seller’s right, title, and interest in the
Intangible Personal Property.

(d) A Non-Competition Agreement, duly executed by Global and TPS, in substantially the form
attached as Exhibit G and incorporated herein by reference.

 

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(e) All other deeds, bills of sale, warranty deeds, assignments, endorsements, licenses, and
other good and sufficient instruments and documents of conveyance and transfer as shall be
necessary and effective to transfer, convey, and assign to Buyer at the Closing all of Seller’s
right, title, and interest in and to the Assets, free and clear of any liens or encumbrances,
other than any Permitted Liens.

4.3 Buyer’s Closing Obligations. At the Closing, Buyer shall execute (or cause to be executed),
acknowledge, and deliver, as appropriate, each of the following items:

(a) The Cash Payment provided for in Article 3.2(b)(i).

(b) The Notes executed by a duly authorized representative of Buyer for the benefit of
Seller.

(c) A duly executed Assignment of Customer Contracts, Agreements, and Arrangements, pursuant
to which Seller shall assign to Buyer all of its right, title, and interest in and to, and Buyer
shall accept and assume all of Seller’s obligations in respect of, the Contracts.

(d) A duly executed Assignment of Intangible Property assigning all of Seller’s right,
title, and interest in the Intangible Personal Property to Buyer.

(e) A duly executed Guaranty from D. Stephen Sorensen, in substantially the form attached as
Exhibit H and incorporated herein by reference.

(f) All other instruments and documents necessary to consummate the transactions
contemplated by this Agreement.

4.4 Expenses of Closing. The expenses of Closing shall be paid as follows:

(a) Buyer shall pay sales and use taxes arising out of the transfer of Assets, if any.

(b) Except as otherwise expressly provided in this Agreement, all other Closing fees and
costs, including, but not limited to, legal fees, accounting fees, consulting fees, and other
incidental expenses in connection with the transactions contemplated by this Agreement shall be
borne by the party incurring the expenses.

ARTICLE 5

SELLER’S REPRESENTATIONS AND WARRANTIES

5.1 Seller’s Representations and Warranties. Seller makes the following representations and
warranties to Buyer, each of which is true and correct as of the Effective Date and as of the
Closing Date:

(a) Each of Global and TPS is a corporation in good standing under the laws of the state of
its incorporation and TPS is in good standing and qualified to transact business in the State of
Georgia.

 

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(b) Seller has full legal power and authority to enter into, deliver and perform this
Agreement, and this Agreement constitutes Seller’s valid and binding obligation, enforceable in
accordance with its terms, except to the extent that such enforceability (i) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditors’
rights generally, and (ii) is subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

(c) The execution and delivery of this Agreement does not conflict with, violate, or
constitute a default under the terms, conditions, or provisions of any agreement or instrument to
which Seller is a party, including but not limited to its Credit and Security Agreement dated
April 29, 2008 by and between Global Employment Solutions, Inc., its subsidiaries and Wells Fargo
Bank, National Association (“Wells Fargo”), or any law, judgment, or order of which Seller is
aware, in each case that would materially and adversely affect Seller’s ability to fulfill its
obligations under this Agreement or that would materially impair the value of the Assets taken as
a whole (a “Material Adverse Effect”); provided that Buyer understands and acknowledges that the
transactions contemplated by this Agreement require the consent of (i) certain of Global’s
lenders, including Wells Fargo, (ii) certain of Seller’s preferred stockholders and (iii)
Global’s and TPS’s board of directors (collectively, the “Required Consents”). The execution and
delivery of this Agreement will not result in the creation of any lien, security interest, or
encumbrance on any of the Assets.

(d) There are no actions, suits, proceedings, or claims now pending, or, to the best of
Seller’s knowledge, threatened against Seller or the Assets that would cause a Material Adverse
Effect.

(e) Seller has good and marketable title to the Assets free and clear of all liens, charges,
and encumbrances, other than the Permitted Liens listed on Schedule 5, if any, and any
contractual requirement to obtain the consent of a party to a Contract that is being assigned
hereunder.

(f) To the best of Seller’s knowledge, all of the Contracts are in full force and effect,
have been duly executed by the parties, and neither Seller nor any other party is in material
default under any Contract, nor has Seller knowledge that any party to any of these agreements
intends to cancel or terminate any of these Contracts.

(g) To the best of Seller’s knowledge, each agreement, instrument, or license with respect
to the Intangible Property is in full force and effect, and neither Seller nor any other party is
in material default under any such agreements.

(h) Seller is not a party to, or otherwise bound by, any collective bargaining agreement,
multi-employer pension fund, or other labor union agreement with respect to any person(s)
employed by Seller in connection with its operation of the Georgia Business.

(i) Seller is in material compliance with all federal, state, and local laws and regulations
including without limitation I-9 employment eligibility verification with respect to the
operation of the Georgia Business.

 

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(j) There are no material undisclosed expenses or liabilities (or pre-closing occurrences or
omissions that could reasonably be expected to give rise thereto) being assumed by Buyer with
respect to the Georgia Business.

(k) TPS is a wholly-owned subsidiary of Global Employment Solutions, Inc. Global Employment
Solutions, Inc. is a wholly-owned subsidiary of Global.

ARTICLE 6

BUYER’S REPRESENTATIONS AND WARRANTIES

6.1 Buyer’s Representations and Warranties. Buyer makes the following representations and
warranties to Seller, each of which is true and correct as of the Effective Date and as of the
Closing Date:

(a) Buyer is a limited liability company, duly organized, validly existing, and in good
standing under the laws of the state of its organization, and is qualified to transact business
in the State of California.

(b) Buyer has full legal power and authority to enter into, deliver and perform this Agreement
and the Notes, and this Agreement and the Notes constitute the valid and binding obligations of
Buyer, enforceable in accordance with their terms, except to the extent that such enforceability
(i) may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to creditors’ rights generally, and (ii) is subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in equity or at law).

(c) There is no action, suit, proceeding, or claim pending, or, to the best of Buyer’s
knowledge, threatened, against Buyer that would affect Buyer’s ability to fulfill Buyer’s
obligations under this Agreement or the Notes.

(d) No other action, consent or approval on the part of Buyer is necessary to authorize
Buyer’s due and valid execution, delivery and performance of this Agreement and the Notes.

(e) The execution and delivery of this Agreement and the Notes and the performance by Buyer
of its obligations hereunder and thereunder (i) do not and will not conflict with or violate any
provision of the operating agreement or similar organizational documents of Buyer, and (ii) do
not and will not (a) result in a violation of, or (b) require any authorization, consent,
approval, exemption or other action by or notice to any court or administrative, arbitration or
governmental body or other third party pursuant to, any law, statute, rule, regulation, judgment,
decree, contract, agreement, license or instrument to which Buyer is subject or by which any of
its assets are bound.

 

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ARTICLE 7

SELLER’S PRE-CLOSING OBLIGATIONS

7.1 Maintenance of Property Pending Closing. At all times prior to the Closing Date, Seller shall
continue to maintain the Assets and conduct its operation of the Georgia Business in substantially
the same manner as they have been maintained and operated by Seller prior to the Effective Date.

7.2 Access and Information. On or before the Closing Date, Seller shall promptly provide Buyer
with all information concerning the Georgia Business and the Assets that Buyer may reasonably
request, and Buyer and its accountants and other representatives shall have access during normal
business hours and upon reasonable advance notice to all of the Assets (subject to the
limitations set forth in the Confidentiality Agreement dated as of February 20, 2009 between
Buyer and Seller (the “Confidentiality Agreement”)) and to the books and records of the Georgia
Business.

7.3 Consents. On or before the Closing Date, Seller, at its expense, shall obtain the Required
Consents. In the event that any other consents are required in order to assign Seller’s interest
in any of the Assets to Buyer as contemplated by this Agreement, Seller shall cooperate with
Buyer and use Seller’s reasonable good faith efforts to obtain such consents as soon as
practicable following the Closing Date.

7.4 Corporate Resolution. Seller’s Board of Directors shall have voted in the affirmative for
this transaction on or prior to the Closing Date, in substantially the form attached as Exhibit F
and incorporated herein by reference.

7.5 WARN Act. Seller shall be responsible for providing any notices required under the Worker
Adjustment and Retraining Notification Act”, 29 U.S.C. Section 2102 et seq.

ARTICLE 8

COVENANTS

8.1 Further Assurances Prior to Closing. Seller and Buyer shall, prior to Closing, execute any
and all documents and perform any and all acts reasonably necessary, incidental, or appropriate
to effect the transactions contemplated by this Agreement.

8.2 Notification of Changed Circumstances. At any time after the Effective Date and prior to the
Closing, if either party becomes aware of any fact or circumstance that would change a
representation or warranty made under this Agreement such that it would cause a Material Adverse
Effect, the party with knowledge of those facts shall notify the other in writing as soon as
possible after the discovery of the fact or circumstance.

8.3 Employees.

(a) Seller has provided Buyer with a list of the corporate employees of the Georgia Business
(the “Employees”). Prior to the Closing Date, Buyer will provide Seller with a list of Employees
to which Buyer will extend offers of employment, commencing as of 12:01 a.m. on the Closing Date,
which offers shall be conditioned on Closing. Each Employee who accepts Buyer’s offer of
employment (each, a “Transferred Employee”) shall become an employee of Buyer as of 12:01 a.m. on
the Closing Date. In addition, commencing as of 12:01 a.m. on the Closing Date, Buyer will hire
Ken Michaels and Kevin LeCompte and assume all severance and other employment and benefits
agreements and obligations of Seller with and to such Employees, provided that in the event Mr.
LeCompte’s employment with Buyer is terminated within 12 months
following the Closing Date and Buyer pays Mr. LeCompte cash severance in connection with such
termination, then Seller will pay 50% of the amount of the cash severance paid to Mr. LeCompte by
Buyer up to an aggregate amount of $165,000 paid to Mr. LeCompte (ie, up to $82,500 shall be
payable by Seller) (“Seller’s Severance Payment”). In the event Seller is obligated to pay
Seller’s Severance Payment pursuant to this Article 8.3(a), then such amount shall be first
deducted from the remaining principal amount of the $250,000 Note on such date, with any
deficiency payable to Buyer by Seller in cash. Messrs. Michaels and LeCompte shall be deemed
“Transferred Employees” for purposes of this Agreement. All Transferred Employees (other than
Messrs. Michaels and LeCompte ), shall be compensated and receive benefits consistent with the
payment of compensation and benefits by Buyer to similarly situated Employees in Buyer’s other
offices. In addition, Buyer will cause (i) its benefit plans to recognize all previous service
with Seller for the purpose of determining eligibility and vesting of benefits (but not accrual
of benefits) for Transferred Employees and (ii) to the maximum extent permitted by Buyer’s health
plan, its group health plan to recognize all deductibles and coinsurance payments accrued by the
Transferred Employees prior to Closing, and to waive any preexisting condition limitations
(unless such condition was not covered under a comparable plan of Seller in which such
Transferred Employees participated prior to Closing).

 

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(b) This Article 8.3 shall inure exclusively to the benefit of and be binding upon the
parties hereto and their respective successors, assigns, executors and legal representatives.
Nothing in this Article 8.3, express or implied: (i) is intended to confer on any person other
than the parties hereto or their respective successors and assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement; (ii) shall require Buyer to
maintain any specific employee benefit plan or to guarantee employment of any employee for any
period of time after Closing; and (iii) shall constitute an amendment to any employee benefit
plan. No provision of this Agreement shall create any third party beneficiary rights in any
employee, or any beneficiary or dependents thereof.

(c) Seller shall make COBRA Coverage (as hereinafter defined) available to all qualified
beneficiaries (as such term is defined by Section 4980B(g)(1) of the Code (the “Qualified
Beneficiaries”)) of the Georgia Business who are not Transferred Employees in accordance with the
provisions of COBRA (as hereinafter defined) and, accordingly, Seller shall cause its group
health plan to make COBRA Coverage available to all of the “Qualified Beneficiaries” who are not
Transferred Employees. For purposes of this Article, the term “COBRA Coverage” means the health
and dental insurance coverage required to be offered pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (26 U.S.C. §§ 4980B et seq., and 29 U.S.C. §§ 1162 -1167)
(“COBRA”). Following the Closing Date, COBRA coverage for all Transferred Employees shall be the
sole responsibility and expense of Buyer.

(d) Promptly following the Closing, to the maximum extent permitted by Buyer’s 401(k) plan,
Buyer shall provide for the rollover of 401(k) assets of the Transferred Employees, including
promissory notes representing loans to any Transferred Employees, held in the accounts of the
Transferred Employees under any employee plan sponsored by Seller under Section 401(a) of the
Code into any similar plan sponsored by Buyer for which the Transferred Employees will become
eligible.

8.4 Client Information Database. Buyer will have the right to copy all employee and client
information related to the Georgia Business from Seller’s database.

8.5 Waiver of Compliance with Bulk Sales Law. Buyer waives compliance with the provisions of any
bulk sales law relating to bulk transfers in connection with the transactions contemplated by
this Agreement. Seller agrees to indemnify and hold Buyer harmless from any and all costs arising
as a result of the waiver, including reasonable attorney fees and expenses that may be incurred
by Buyer in any legal proceedings instituted or threatened as a result of the waiver.

 

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ARTICLE 9

CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER

9.1 Buyer’s Conditions. The obligation of Buyer to consummate the transactions contemplated by
this Agreement shall be subject to the satisfaction, on or before the Closing Date, of each of
the following conditions:

(a) The representations and warranties of Seller contained in this Agreement shall be true
and correct in all material respects on and as of the Closing Date with the same force and effect
as though made on and as of the Closing Date.

(b) Seller shall have performed and complied in all material respects with all covenants and
agreements required by this Agreement to be performed or complied with by Seller on or prior to
the Closing Date.

(c) No injunction or restraining order shall be in effect which forbids or enjoins the
consummation of the transactions contemplated by this Agreement, no proceedings for such purpose
shall be pending, and no federal, state, local or foreign statute, rule or regulation shall have
been enacted which prohibits, restricts or delays the consummation of the transactions
contemplated hereby.

(d) The Assets shall be in substantially the same condition on the Closing Date as on the
Effective Date, and there shall be no material loss or damage to the Assets prior to the Closing.

(e) Seller shall have obtained the Required Consents.

(f) All liens, claims, charges, security interests, pledges, assignments, or encumbrances
relating to the Assets that are not Permitted Liens shall be satisfied, terminated, and
discharged by Seller, and evidence reasonably satisfactory to Buyer and its counsel of the
satisfaction, termination, and discharge shall be delivered to Buyer.

(g) Seller shall have delivered the documents required by Article 4.2, each duly executed as
indicated therein, and such other documents as Buyer or its counsel may reasonably request to
evidence the transactions contemplated hereby.

9.2 Failure to Satisfy Buyer’s Conditions. Any of Buyer’s conditions precedent may be waived in
whole or in part by Buyer in writing at any time on or before the Closing Date. In the event all
Buyer’s conditions precedent have not been waived by Buyer or satisfied in full on or before the
Closing Date, Buyer may elect to terminate this Agreement as provided in Article 12.

 

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ARTICLE 10

CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

10.1 Seller’s Conditions. The obligation of Seller to consummate the transactions contemplated by
this Agreement shall be subject to the satisfaction, on or before the Closing Date, of each of
the following conditions:

(a) The representations and warranties of Buyer contained in this Agreement shall be true
and correct in all material respects on and as of the Closing Date with the same force and effect
as though made on and as of the Closing Date.

(b) Buyer shall have performed and complied in all material respects with all covenants and
agreements required by this Agreement to be performed or complied with by Buyer on or prior to
the Closing Date.

(c) No injunction or restraining order shall be in effect which forbids or enjoins the
consummation of the transactions contemplated by this Agreement, no proceedings for such purpose
shall be pending, and no federal, state, local or foreign statute, rule or regulation shall have
been enacted which prohibits, restricts or delays the consummation of the transactions
contemplated hereby.

(d) Buyer shall have delivered (or cause to be delivered) the documents and payments
required by Article 4.3, each duly executed as indicated therein (as appropriate), and such other
documents as Seller or its counsel may reasonably request to evidence the transactions
contemplated hereby.

10.2 Failure to Satisfy Seller’s Conditions. Any of Seller’s conditions precedent may be waived
in whole or in part by Seller in writing at any time on or before the Closing Date. In the event
that all of Seller’s conditions precedent have not been waived by Seller or satisfied in full on
or before the Closing Date, Seller may elect to terminate this Agreement as provided in Article
12.

ARTICLE 11

POST-CLOSING OBLIGATIONS

11.1 Additional Assurances. Each party agrees to do all acts and things and to make, execute, and
deliver such written instruments as shall be reasonably necessary to carry out the terms and
provisions of this Agreement. This covenant of further assurances shall survive the Closing.

11.2 Use of Global’s Name Following Closing. As soon as practicable following the Closing Date,
but in any event within 120 days following the Closing Date, Buyer shall permanently remove and
cease using all signage, labels, stationary, invoices, etc. with the names “Global,” “Global
Employment Solutions,” “Global Employment Holdings,” “GES” or any derivative thereof or any name
confusingly similar therewith. Buyer agrees to treat and protect Seller’s aforementioned trade
names with the same level of care as Buyer’s treats and protects its own trade names.

 

12

 

11.3 Mutual Non-Disparagement. Following the Closing, neither Buyer nor Seller shall, directly
or indirectly, engage in any conduct or make any statement, whether in commercial or
noncommercial speech, disparaging or criticizing in the other party or its affiliates,
subsidiaries, officers, directors, employees or agents or any products or services offered by any
of them, nor shall Buyer or Seller engage in any other conduct or make any other statement that
could be reasonably expected to impair the goodwill of any of them.

11.4 Expenses Straddling the Effective Date to be Pro-Rated. Except as set forth below, all
expenses associated with the operation of the Georgia Business for the month of March 2009 shall
be pro-rated between Seller and Buyer on the basis of 25% (Seller) / 75% (Buyer). This
apportionment of expenses shall not apply to any prepaid expenses or deposits on the Effective
Date, including rent expense of the Georgia Business for the month of March 2009. In the event
one party is required to reimburse the other party pursuant to this Article 11.4, the party
requesting reimbursement shall remit reasonably detailed information with respect to such
expenses to the other party and such other party shall promptly, but in any event within 10 days
of receipt, reimburse the party seeking reimbursement for such expenses. Buyer and Seller agree
to reconcile all March 2009 expenses of the Georgia Business within 45 days following the Closing
Date.

11.5 Accounts Receivable. Buyer covenants and agrees to cooperate with Seller, as reasonably
requested by Seller, in order to assist Seller in collecting its accounts receivable following
the Closing Date (“Seller’s AR”). Further, with respect to Seller’s AR, Buyer will not notify
such customers to change the payment address for payments related to the Seller’s AR in order to
facilitate Seller’s direct collection of its accounts receivable, provided that Buyer’s invoicing
of customers following the Closing Date may contain Buyer’s address for payment of such invoices.
Buyer covenants and agrees not to take any action to change the terms of Seller’s accounts
receivable or offer any inducements to customers of the Georgia Business to pay Buyer’s accounts
receivable ahead of or in priority to Seller’s accounts receivable. In the event Seller or Buyer
receives any payment relating to accounts receivable owned by the other party, such party will
promptly, but in any event within two business days, remit such payment to the other party, duly
endorsed to such party if in the form of a check, draft or other non-cash instrument. Any
collections on accounts receivable that are received by Buyer or Seller following the Closing
Date shall be applied as expressly and explicitly instructed by the customer making such payment.
If no explicit and express instructions are provided by a customer, then the party in receipt of
such payment shall make a reasonable good faith inquiry to the customer as to the intended
application of the payment and apply such payment accordingly. In the event a customer pays a
more recent invoice and skips the payment of an older invoice, then Buyer will cooperate with and
assist Seller in collecting the older invoice as reasonably requested by Seller, including,
without limitation, communicating with and encouraging such customer to pay the older invoice
promptly to avoid incurring additional fees, costs and any interruption of service.

 

13

 

ARTICLE 12

TERMINATION

12.1 Termination. This Agreement may be terminated as follows:

(a) By the mutual consent of Buyer and Seller at any time prior to Closing.

(b) By Buyer at any time prior to the Closing as expressly provided in this Agreement, or if
any condition precedent to Buyer’s obligations set forth in Article 9 has not been satisfied in
full or previously waived by Buyer in writing, at or prior to Closing.

(c) By Seller at any time prior to the Closing as expressly provided in this Agreement, or
if any condition precedent to Seller’s obligations set forth in Article 10 has not been satisfied
in full or previously waived by Seller in writing, at or prior to Closing.

(d) By Seller at any time following March 20, 2009 if the $700,000 Note has not been repaid
in full in accordance with Article 3.2(b)(iii). Any such termination will also apply to all
other agreements entered at the Closing in order to consummate the transactions contemplated by
this Agreement, including, without limitation, the Non-Competition Agreement.

12.2 Effect of Termination. In the event of the termination of this Agreement pursuant to the
provisions of this Article 12 prior to the Closing, this Agreement shall become void and have no
effect, without any liability on the part of any of the parties.

12.3 Remedies Cumulative. The remedies set forth in this Agreement are cumulative and not
exclusive of any other legal or equitable remedy otherwise available to any party.

12.4 Effectiveness of Confidentiality Agreement. In the event of a Termination, the
Confidentiality Agreement in connection with this transaction shall remain in force.

ARTICLE 13

GENERAL PROVISIONS

13.1 Assignment. The respective rights and obligations of the parties to this Agreement may not
be assigned by any party without the prior written consent of the other, which consent may not be
unreasonably withheld or delayed.

13.2 Successors and Assigns. The terms and provisions of this Agreement shall be binding on and
inure to the benefit of the permitted successors and permitted assigns of the parties.

13.3 Entire Agreement. This Agreement (including the Schedules and Exhibits attached hereto) and
the Confidentiality Agreement constitute the entire agreement between the parties with respect to
the subject matter of this Agreement and supersede all prior agreements, oral and written,
between the parties hereto with respect to the subject matter of this Agreement.

13.4 Modification and Waiver. This Agreement may not be amended, modified, or supplemented except
by written agreement signed by the party against which the enforcement of the amendment,
modification, or supplement is sought. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a waiver of any other provision. No waiver shall be binding
unless executed in writing by the party making the waiver.

13.5 Attorney Fees. If any legal action or other proceeding is brought to enforce the provisions
of this Agreement, the prevailing party shall be entitled to recover reasonable attorney fees and
other costs incurred in the action or proceeding, in addition to any other relief to which the
prevailing party may be entitled.

 

14

 

13.6 Fees and Expenses. Except as otherwise specifically provided in this Agreement, Seller and
Buyer shall pay their own fees and expenses in connection with the negotiation and consummation
of the transactions contemplated by this Agreement.

13.7 Notices. All notices, requests, demands, and other communications required by this Agreement
shall be in writing and shall be (a) delivered in person, (b) mailed by first class registered or
certified mail, (c) sent by a nationally recognized overnight courier for next business day
delivery or (d) delivered by facsimile transmission, as follows, or to such other address as a
party may designate to the other in writing:

	 	 	 	 	 
	 

	 	(i) If to Seller:
	 	Global Employment Holdings, Inc.

10375 Park Meadows Drive, Suite 375

Lone Tree, CO 80124

Attention: Howard Brill

Facsimile: (303) 216-9594
	 
	 	 	 	 
	 

	 	 	 	with a copy to:
	 
	 	 	 	 
	 

	 	 	 	Brownstein Hyatt Farber Schreck, LLP

410 17th Street, Suite 2200

Denver, CO 80202

Attention: Adam J. Agron

Facsimile: (303) 223-1111
	 
	 	 	 	 
	 

	 	(ii) If to Buyer:
	 	Eastern Staffing, LLC, a California limited liability company, 

dba Select Staffing

3820 State Street

Santa Barbara, CA 93105

Attention: Stephen Biersmith

Facsimile: (877) 547-4466

If delivered personally or by courier, the date on which the notice, request, instruction,
or document is delivered shall be the date on which the delivery is made, and if delivered by
facsimile transmission or mail as aforesaid, the date on which the notice, request, instruction,
or document is received shall be the date of delivery.

13.8 Headings. All Article headings contained in this Agreement are for convenience of reference
only, do not form a part of this Agreement, and shall not in any way affect the meaning or
interpretation of this Agreement.

13.9 Counterparts. This Agreement may be executed in two (2) or more counterparts, all of which
shall be considered one and the same agreement, and shall become effective when one counterpart
has been signed by each party and delivered to the other party hereto.

13.10 Time of Essence. Time shall be of the essence with respect to the obligations of the
parties to this Agreement.

 

15

 

13.11 Governing Law. This Agreement shall be governed by and construed under the laws of the
State of California.

13.12 Severability. In the event that any provision of this Agreement is deemed to be invalid,
illegal, or unenforceable, all other provisions of the Agreement that are not affected by the
invalidity, illegality, or unenforceability will remain in full force and effect.

13.13 Brokerage and Finder’s Fees; Indemnity. Each of the parties hereto represents and warrants
to the other that such parties have not enlisted the services of a broker and have made no
arrangements for the payment of any brokerage commissions, finder’s fees, or advisory fees in
connection with the transactions contemplated by this Agreement and is not otherwise obligated to
pay any such fee or commission. In the event that any claim is asserted by any person claiming a
commission or finder’s fee with respect to this Agreement or the transactions contemplated hereby
arising from any act, representation or promise of any party hereto or its representatives, such
party shall indemnify the other party against and hold them harmless from any cost or expenses
with respect thereto including, without limitation, reasonable attorneys’ fees.

 

16

 

In witness whereof, the duly authorized representatives of the parties hereto
executed this Agreement as of the Effective Date.

Global Employment Holdings, Inc., a Delaware corporation

	 	 	 
	/s/ Dan Hollenbach
	 	 
	 

Dan Hollenbach

Chief Financial Officer

	 	 

Temporary Placement Service, Inc., a Georgia corporation

	 	 	 
	/s/ Dan Hollenbach
	 	 
	 

Dan Hollenbach

Executive Vice President

	 	 

Eastern Staffing, LLC, a California limited liability company

	 	 	 
	D. Stephen Sorensen
	 	 
	 

D. Stephen Sorensen

	 	 
	Manager
	 	 

 

17

 

LIST OF SCHEDULES AND EXHIBITS

Schedule 1 — Georgia Business Leases

Schedule 2 — Personal Property

Schedule 3 — Intangible Personal Property

Schedule 4 — Excluded Assets

Schedule 5 — Permitted Liens

Schedule 6 — Assumed Liabilities

Schedule 7 — Locations

Exhibit A — Bill of Sale

Exhibit B — Assignment of Customer Contracts, Agreements, and Arrangements

Exhibit C — Assignment of Intangible Personal Property

Exhibit D-1 — $250,000 Promissory Note

Exhibit D-2 — $700,000 Promissory Note

Exhibit E — Allocation of Purchase Price

Exhibit F — Corporate Resolutions

Exhibit G — Non-Competition Agreement

Exhibit H —  Guaranty

 

18

 

Exhibit A 

BILL OF SALE

This Bill of Sale is (“Bill of Sale”) is made and entered into by and between Temporary Placement
Service, Inc., a Georgia corporation, a/k/a Michaels & Associates (“TPS”), and Eastern Staffing,
LLC, a California limited liability company, d.b.a. Select Staffing (“Buyer”).

RECITALS

A. TPS and Buyer have entered into an Asset Purchase and Sale Agreement, dated as of March 9,
2009 (the “Agreement”), pursuant to which Seller is selling to Buyer the Assets.

B. Pursuant to the terms of the Agreement, Seller desires to convey, remise, release, and
quitclaim to Buyer, all of Seller’s right, title, and interest in and to the Personal Property.

Now, therefore, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, TPS and Buyer hereby agree as follows:

1. Defined Terms. Unless otherwise defined in this Bill of Sale, all capitalized terms
shall have the meanings given to them in the Agreement.

2. Sale of Personal Property. Seller hereby conveys, remises, releases, and quitclaims
to Buyer, all of Seller’s right, title, and interest in and to the Personal Property (excluding
the Excluded Assets).

3. Successors and Assigns. This Assignment shall inure to the benefit of, and be binding
on, successors and assigns of the parties.

4. Counterparts and Facsimile Signatures. This Assignment may be executed in any number
of counterparts and by facsimile signature, each of which shall be deemed an original. The
counterparts shall together constitute only one agreement.

5. Conflicts. This Assignment is made subject to the terms and conditions of the
Agreement. In the event of a conflict between the provisions of this Assignment and the
provisions of the Agreement, the provisions of the Agreement shall prevail.

[Remainder of Page Intentionally Left Blank]

 

 

 

In witness whereof, the parties have executed this Bill of Sale as of date first set forth
above.

TEMPORARY PLACEMENT SERVICE, INC., a Georgia corporation

	 	 	 
	/s/ Dan Hollenbach
	 	 
	 

Dan Hollenbach

Executive Vice President

	 	 

EASTERN STAFFING, LLC, a California limited liability company

d.b.a. Select Staffing

	 	 	 
	D. Stephen Sorensen
	 	 
	 

D. Stephen Sorensen

	 	 
	Manager
	 	 

 

 

 

Exhibit B 

ASSIGNMENT OF CUSTOMER CONTRACTS, AGREEMENTS, AND ARRANGEMENTS

This Assignment of Customer Contracts, Agreements, and Arrangements (this “Assignment”) is made
and entered into by and between Temporary Placement Service, Inc., a Georgia corporation, a/k/a
Michaels & Associates (“Assignor”), and Eastern Staffing, LLC, a California limited liability
company, d.b.a. Select Staffing (“Assignee”).

RECITALS

A. Assignor and Assignee have entered into an Asset Purchase and Sale Agreement, dated as of
March 9, 2009 (the “Agreement”), pursuant to which Assignor is selling to Assignee the Assets.

B. Assignor is a party to certain Contracts.

C. Pursuant to the terms of the Agreement, Assignor desires to assign Assignor’s rights, title,
and interest in and to the Contracts to Assignee, and Assignee desires to accept the assignment
and assume all of the obligations associated with the Contracts.

Now, therefore, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Assignor and Assignee hereby agree as follows:

1. Defined Terms. Unless otherwise defined in this Assignment, all capitalized terms
shall have the meanings given to them in the Agreement.

2. Assignment of Contracts. Assignor hereby conveys, contributes, assigns, sets over and
transfers to Assignee all of Assignor’s right, title, and interest in and to the Contracts,
subject to, in the case of any Contract that requires consent to assignment, the receipt of the
required consent.

3. Acceptance of Assignment and Obligations. Assignee hereby assumes and agrees to pay,
perform and discharge if, as and when due in accordance with the terms thereof the Contracts.

4. Successors and Assigns. This Assignment shall inure to the benefit of, and be binding
on, successors and assigns of the parties.

 

 

 

5. Counterparts and Facsimile Signatures. This Assignment may be executed in any number
of counterparts and by facsimile signature, each of which shall be deemed an original. The
counterparts shall together constitute only one agreement.

6. Conflicts. This Assignment is made subject to the terms and conditions of the
Agreement. In the event of a conflict between the provisions of this Assignment and the
provisions of the Agreement, the provisions of the Agreement shall prevail.

7. Governing Law. This Assignment shall be governed by and construed under the laws of
the State of California.

[Remainder of Page Intentionally Left Blank]

 

 

 

In witness whereof, the parties have executed this Assignment as of the date first set forth
above.

TEMPORARY PLACEMENT SERVICE, INC., a Georgia corporation

	 	 	 
	/s/ Dan Hollenbach
	 	 
	 

Dan Hollenbach

Executive Vice President

	 	 

EASTERN STAFFING, LLC, a California limited liability company

d.b.a. Select Staffing

	 	 	 
	/s/ D. Stephen Sorensen
	 	 
	 

D. Stephen Sorensen

	 	 
	Manager
	 	 

 

 

 

Exhibit C 

ASSIGNMENT OF INTANGIBLE PERSONAL PROPERTY

This Assignment of Intangible Personal Property (this “Assignment”) is made and entered into by
and between Temporary Placement Service, Inc., a Georgia corporation, a/k/a Michaels & Associates
(“Assignor”), and Eastern Staffing, LLC, a California limited liability company, d.b.a. Select
Staffing (“Assignee”).

RECITALS

A. Assignor and Assignee have entered into an Asset Purchase and Sale Agreement, dated as of
March 9, 2009 (the “Agreement”), pursuant to which Assignor is selling to Assignee the Assets.

B. Assignor is the owner of certain Intangible Personal Property.

C. Pursuant to the terms of the Agreement, Assignor desires to assign Assignor’s rights, title,
and interest in and to the Intangible Personal Property to Assignee, and Assignee desires to
accept the assignment and assume all of the obligations associated with the Intangible Property.

Now, therefore, in consideration of the payment and delivery to Assignor of all monies and
instruments to be paid and delivered to Assignor by Assignee pursuant to the terms of the
Agreement, the receipt of which Assignor acknowledges, Assignor and Assignee agree as follows:

1. Defined Terms. Unless otherwise defined in this Assignment, capitalized terms shall
have the meanings given to them in the Agreement.

2. Assignment of Intangible Personal Property. Assignor hereby conveys, contributes,
assigns, sets over and transfers to Assignee all of Assignor’s right, title, and interest in and
to the Intangible Personal Property, subject to, in the case of any Intangible Personal Property
that requires consent to assignment, the receipt of the required consent.

3. Acceptance of Assignment and Obligations. Assignee hereby assumes and agrees to pay,
perform and discharge if, as and when due in accordance with the terms thereof the Intangible
Personal Property.

 

 

 

4. Successors and Assigns. This Assignment shall inure to the benefit of, and be binding
on, successors and assigns of the parties.

5. Counterparts and Facsimile Signatures. This Assignment may be executed in any number
of counterparts and by facsimile signature, each of which shall be deemed an original. The
counterparts shall together constitute but one agreement.

6. Conflicts. This Assignment is made subject to the terms and conditions of the
Agreement. In the event of a conflict between the provisions of this Assignment and the
provisions of the Agreement, the provisions of the Agreement shall prevail.

7. Governing Law. This Assignment shall be governed by and construed under the laws of
the State of California.

[Remainder of Page Intentionally Left Blank]

 

 

 

In witness whereof, the parties have executed this Assignment as of the date first set forth
above.

TEMPORARY PLACEMENT SERVICE, INC., a Georgia corporation

	 	 	 
	/s/ Dan Hollenbach
	 	 
	 

Dan Hollenbach

Executive Vice President

	 	 

EASTERN STAFFING, LLC, a California limited liability company

d.b.a. Select Staffing

	 	 	 
	/s/ D. Stephen Sorensen
	 	 
	 

D. Stephen Sorensen

	 	 
	Manager
	 	 

 

 

 

Exhibit D-1 

$250,000 Promissory Note

See Attached

 

 

 

Exhibit D-2 

$700,000 Promissory Note

See Attached

 

 

 

Exhibit E 

Allocation of Purchase Price

The Allocation shall be the Purchase Price less the value of the furniture, fixtures and equipment
acquired and the liabilities assumed.

The remainder shall be allocated as follows:

	 	 	 	 	 
	Employee list
	 	 	1	%
	Customer list
	 	 	16	%
	Goodwill
	 	 	83	%
	 
	 	 	100	%

 

 

 

Exhibit F 

Corporate Resolutions

 

 

 

Exhibit G 

Non-Competition Agreement

See Attached

 

 

 

Exhibit H 

Guaranty

See AttachedExhibit 10.2

Exhibit
10.2

Exhibit D-1

PROMISSORY NOTE

			
	 	 	 
	$250,000.00
	 	March 9, 2009

FOR VALUE RECEIVED, Eastern Staffing, LLC, a California limited liability company
(“Borrower”), hereby promises to pay to the order of Temporary Placement Service, Inc., a Georgia
corporation (“Lender”), in lawful money of the United States at the address of Lender set forth in
the Purchase Agreement (as defined below), the principal amount of $250,000 (the “Principal
Amount”) pursuant to the terms of the Asset Purchase and Sale Agreement dated as of March 9, 2009
by and among Borrower, Lender and Temporary Placement Service, Inc., a Georgia corporation (the
“Purchase Agreement”), together with Interest (as defined in Section 1) thereon. This Promissory
Note (“Note”) has been executed by the Borrower as the date set forth above (the “Effective Date”)
pursuant to the terms of the Purchase Agreement. All capitalized terms used but not defined herein
shall have the meanings assigned to such terms in the Purchase Agreement.

1. Interest. The Principal Amount shall bear interest at the rate of 6% per annum
(based on a 360-day year), compounded annually (the “Interest Rate”), from the Effective Date and
continuing until payment in full of the Principal Amount. In the event Borrower fails to make
payment of the Principal Amount or Interest thereon when due, interest shall accrue on the
outstanding Principal Amount and all accrued but unpaid Interest thereon at the rate equal to the
lesser of 18% per annum (based on a 360-day year), compounded annually, or the maximum rate of
interest permitted under applicable law at any time (the “Default Interest Rate”). Interest
compounding under the Interest Rate and the Default Interest Rate, as applicable, shall be known as
“Interest”.

2. Payments of Principal Amount and Interest. On each of the payment dates set forth
below (each, a “Payment Date”), Borrower shall pay to Lender (a) all accrued but unpaid Interest on
the Principal Amount through such Payment Date plus (b) a repayment of the Principal Amount
in an amount equal to $20,000. The Payment Dates are as follows: June 9, 2009, September 9, 2009,
December 9, 2009, March 9, 2010, June 9, 2010, September 9, 2010 and December 9, 2010.

3. Maturity Date. The unpaid Principal Amount, all accrued Interest thereon and all
other sums due hereunder, shall be paid in full on the second anniversary of the Effective Date
(the “Maturity Date”).

4. Guaranteed Indebtedness. The indebtedness represented by this Note is guaranteed
pursuant to the terms of the Guaranty.

 

 

 

5. Application of Payments.

5.1. Except as otherwise expressly provided herein, payments under this Note shall be applied
(a) first to the repayment of any sums incurred by Lender for the payment of any expenses in
enforcing the terms of this Note, (b) then to the payment of Interest accruing under the Default
Interest Rate, (c) then to the payment of Interest accruing under the Interest Rate, and (d) then
to the reduction of the Principal Amount.

5.2. Upon payment in full of the Principal Amount and applicable accrued and unpaid Interest
thereon, this Note shall be marked “Paid in Full” and returned to Borrower.

6. Waiver of Notice. Borrower hereby waives diligence, notice, presentment, protest
and notice of dishonor.

7. Events of Default. The occurrence of any of following events (each, an “Event
of Default”) shall constitute an Event of Default of Borrower:

7.1. Borrower’s default in the payment of any Interest or Principal Amount due under this
Note, provided Lender has given Borrower verbal or written notice of such default and three
business days within which to cure such default;

7.2. Borrower’s default in the performance or observance of any other provision of this Note
or the Purchase Agreement, provided Lender has given Borrower written notice of such default and
five days within which to cure such default to Lender’s reasonable satisfaction, or the Guarantor’s
(as defined in the Guaranty) default in the performance or observance of any provision of the
Guaranty; or

7.3. (a) The application for the appointment of a receiver or custodian for Borrower or the
property of Borrower, (b) the entry of an order for relief or the filing of a petition by or
against Borrower under the provisions of any bankruptcy or insolvency law, (c) any assignment for
the benefit of creditors by or against Borrower, or (d) the insolvency of Borrower.

Upon the occurrence of any Event of Default, Lender may elect, by written notice delivered to
Borrower, to take at any time any or all of the following actions: (i) declare this Note to be
forthwith due and payable, whereupon the entire unpaid Principal Amount, together with all accrued
and unpaid Interest thereon, and all other cash obligations hereunder, shall become forthwith due
and payable, without presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by Borrower, anything contained herein to the contrary notwithstanding, and
(ii) exercise any and all other remedies provided hereunder or available at law or in equity.

Notwithstanding anything to the contrary in this Note, in the event that Lender elects to
unwind the transactions contemplated by the Purchase Agreement pursuant to Article 3.2(b)(iii)(B)
thereof, this Note shall be deemed immediately canceled and all of Lender’s
rights and Borrower’s obligations contained in this Note shall be deemed terminated and of no
further force or effect.

 

2

 

8. Miscellaneous.

8.1. Successors and Assigns. The terms and conditions of this Note shall inure to the
benefit of and be binding upon the respective executors, administrators, heirs, successors and
permitted assigns of the parties. This Note is not assignable by Lender or Borrower without the
prior written consent of the other party, provided that the Lender may assign this Note and all of
Lender’s rights herein to Wells Fargo without the prior written consent of Borrower.

8.2. Loss or Mutilation of Note. Upon receipt by Borrower of evidence satisfactory to
Borrower of the loss, theft, destruction or mutilation of this Note, together with indemnity
reasonably satisfactory to Borrower, in the case of loss, theft or destruction, or the surrender
and cancellation of this Note, in the case of mutilation, Borrower shall execute and deliver to
Lender a new promissory note of like tenor and denomination as this Note.

8.3. Notices. Any notice, demand, offer, request or other communication required or
permitted to be given pursuant to the terms of this Note shall be in given in accordance with the
terms of the Purchase Agreement.

8.4. Governing Law. This Note shall be governed in all respects by the laws of the
State of California as applied to agreements entered into and performed entirely within the State
of California by residents thereof, without regard to any provisions thereof relating to conflicts
of laws among different jurisdictions.

8.5. Waiver and Amendment. Any term of this Note may be amended, waived or modified
only with the written consent of Borrower and Lender.

8.6. Remedies; Costs of Collection; Attorneys’ Fees. No delay or omission by Lender
in exercising any of its rights, remedies, powers or privileges hereunder or at law or in equity
and no course of dealing between Lender and the undersigned or any other person shall be deemed a
waiver by Lender of any such rights, remedies, powers or privileges, even if such delay or omission
is continuous or repeated, nor shall any single or partial exercise of any right, remedy, power or
privilege preclude any other or further exercise thereof by Lender or the exercise of any other
right, remedy, power or privilege by Lender. The rights and remedies of Lender described herein
shall be cumulative and not restrictive of any other rights or remedies available under any other
instrument, at law or in equity. If an Event of Default occurs, Borrower agrees to pay, in
addition to the Principal Amount and Interest payable thereon, reasonable attorneys’ fees and any
other reasonable costs incurred by Lender in connection with its pursuit of its remedies under this
Note.

 

3

 

[Remainder of Page Intentionally Left Blank]

 

4

 

IN WITNESS WHEREOF, Borrower has caused this Note to be dully executed as of the date first
set forth above.

EASTERN STAFFING, LLC, a California limited liability company

d.b.a. Select Staffing

	 	 	 
	/s/ D. Stephen Sorensen
	 	 
	 

D. Stephen Sorensen

	 	 
	Manager

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