false 0001499717 0001499717 2025-01-02 2025-01-02 iso4217:USD xbrli:shares iso4217:USD xbrli:shares

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

January 2, 2025

Date of Report (Date of earliest event reported)

 

STAFFING 360 SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware   001-37575   68-0680859

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification Number)

 

757 Third Avenue    
27th Floor    
New York, NY   10017
(Address of principal executive offices)   (Zip Code)

 

(646) 507-5710

(Registrant’s telephone number, including area code)

 

N/A

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common stock   STAF   NASDAQ

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 

 

Item 1.01. Entry into a Material Definitive Agreement.

 

First Amendment to the Agreement and Plan of Merger

 

On January 7, 2025, Staffing 360 Solutions, Inc. a Delaware corporation (the “Company”), Atlantic International Corp., a Delaware corporation (“Atlantic”) and A36 Merger Sub Inc., a Delaware Corporation and a wholly-owned subsidiary of Atlantic (“Merger Sub”), entered into that certain First Amendment (the “Amendment”) to the Agreement and Plan of Merger (as amended, the “Merger Agreement”).

 

Pursuant to the Amendment, upon completion of the merger (the “Merger”), each share Series H Convertible Preferred Stock (“Series H Preferred Stock”) and Series I Preferred Stock (the “Series I Preferred Stock”) immediately prior to the effective time of the Merger, other than certain excluded shares, will be canceled and converted into the right to receive a number of shares of validly issued, fully paid and nonassessable shares of common stock of Atlantic, par value of $0.00001 per share (the “Atlantic Common Stock”), equal to the applicable Exchange Ratio (as defined in the Amendment) for the Series H Preferred Stock and the Series I Preferred Stock, with any resulting fractional shares to be rounded to the nearest whole share.

 

Pursuant to the Amendment, at or prior to the closing of the Merger (the “Closing”), the Company shall enter into a signed settlement agreement (the “Jackson Agreement”) with Jackson Investment Group, LLC (“Jackson”). Pursuant to the Jackson Agreement, (i) all interest accrued and payable to Jackson will be waived or forgiven and (ii) the principal amount of the Loan will be converted into 5,600,000 shares of Series I Preferred Stock. Additionally, pursuant to the Amendment and further agreement between the applicable parties, Jackson shall enter into a lock-up agreement such that the Merger Consideration (as defined in the Merger Agreement) for all of the Series I Preferred Stock are subject to a lock up period for the one year after the Closing, provided, however, that 600,000 shares of Merger Consideration shall be freely tradable following the Closing.

 

Pursuant to the Amendment, at or prior to the Closing, the applicable parties shall enter into signed agreements, pursuant to which any amounts owed in Earned Contingent Cash Payment (as defined in the Merger Agreement) shall be converted into 5,000,000 shares of Series H Preferred Stock and any interest/dividends or other payments due from the Company related to the Series H Preferred Stock shall be waived. Additionally, pursuant to the Amendment, the applicable parties shall enter into lock-up agreements such that the Merger Consideration for all shares of Series H Preferred Stock are (A) subject to a lock up for the 6 months after Closing as follows; (B) 1,750,000 shares of Atlantic Common Stock are subject to a lock-up for the period starting on 6 months after Closing until 9 months after Closing; (C) 875,000 shares of Atlantic Common Stock are subject to a lock-up for the period starting on 9 months after Closing until 12 months after Closing; (D) the lock-up shall terminate 12 months after Closing and (E) the lock-up shall not apply to the extent shares of Atlantic Common Stock must be sold to pay any taxes from such applicable holder.

 

Additionally, pursuant to the Amendment, the Termination Date (as defined in the Merger Agreement) is extended to March 31, 2025.

 

The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, a copy of which is attached hereto as Exhibit 2.1, and incorporated herein by reference.

 

Amendment Nos. 35 and 36 to Credit and Security Agreement with MidCap

 

 

 

 

On January 2, 2025, the Company entered into Amendment No. 35 to Credit and Security Agreement and Limited Waiver (“Amendment No. 35”), effective as of December 27, 2024, by and among the Company, as Parent, Monroe Staffing Services, LLC, a Delaware limited liability company, Faro Recruitment America, Inc., a New York corporation, Lighthouse Placement Services, Inc., a Massachusetts corporation, Key Resources, Inc., a North Carolina Corporation, Headway Workforce Solutions, Inc., a Delaware corporation, Headway Employer Services LLC, a Delaware limited liability company, Headway Payroll Solutions, LLC, a Delaware limited liability company, Headway HR Solutions, Inc., a New York corporation, and NC PEO Holdings, LLC, a Delaware limited liability company, collectively, as borrowers (collectively, the “Borrowers”), and MidCap Funding IV Trust, as agent for the lenders (as successor by assignment to MidCap Funding X Trust, “MidCap”) and the lenders party thereto from time to time (the “Lenders”), which such Amendment No. 35 amends that certain Credit and Security Agreement, dated as of April 8, 2015 (as amended and restated, supplemented, or otherwise modified from time to time, the “Credit and Security Agreement”), by and among the Company, the Borrowers, MidCap and the Lenders. Pursuant to Amendment No. 35, the Commitment Expiry Date (as defined in the Credit and Security Agreement) is extended to January 3, 2025.

 

On January 8, 2025, the Company, the Borrowers, MidCap, and the Lenders entered into Amendment No. 36 to Credit and Security Agreement (“Amendment No. 36”), effective as of January 3, 2025. Pursuant to Amendment No. 36, (i) the Commitment Expiry Date is extended to January 10, 2025, and (ii) the Additional Reserve Amount (as defined in the Credit and Security Agreement) is amended to be, as of any date of determination, $490,000.

 

Additionally, in consideration for MidCap’s agreement to enter into Amendment No. 36, the Company has agreed to pay to MidCap a modification fee of $150,000, which such fee shall be non-refundable and fully earned as of January 3, 2025.

 

The foregoing descriptions of Amendment No. 35 and Amendment No. 36 do not purport to be complete and are qualified in their entirety by reference to the full text of Amendment No. 35 and Amendment No. 36, copies of which are attached hereto as Exhibit 10.1 and Exhibit 10.2, respectively, and are incorporated herein by reference.

 

Limited Consents to Intercreditor Agreement

 

On January 2, 2025, and January 8, 2025, in connection with Amendment No. 35 and Amendment No. 36, respectively, the Company entered into Limited Consents to the Intercreditor Agreement, dated as of September 15, 2017, as amended, by and between the Company and Jackson, which each such Limited Consent permits the Company’s entry into Amendment No. 35 and Amendment No. 36, respectively.

 

Important Information about the Merger and Where to Find It

 

In connection with the Merger, the Company will file relevant materials with the Securities and Exchange Commission (the “SEC”), including a registration statement on Form S-4, as may be amended, that will include a consent solicitation or proxy statement, as applicable, pertaining to the Company and Atlantic. This Current Report on Form 8-K does not contain all the information that should be considered concerning the Merger and is not a substitute for any other documents that the Company may file with the SEC. It is not intended to form the basis of any investment decision or any other decision in respect to the Merger. Investors and stockholders will be able to obtain free copies of the consent solicitation statement or proxy statement, as applicable. and other documents filed by the Company with the SEC (when they become available) through the website maintained by the SEC at www.sec.gov. In addition, investors and stockholders should note that the Company communicates with investors and the public using its website (www.staffing360solutions.com), where anyone will be able to obtain free copies of the consent solicitation statement or proxy statement and other documents filed by the Company with the SEC and stockholders are urged to read the consent solicitation statement or proxy statement, as applicable, and the other relevant materials when they become available before making any voting or investment decision with respect to the Merger.

 

Participants in the Solicitation

 

The Company and its directors and executive officers may be deemed to be participants in the solicitation of consents in connection with the Merger. Information about the Company’s directors and executive officers is included in the Company’s most recent Annual Report on Form 10-K, including any information incorporated therein by reference, as filed with the SEC. Additional information regarding these persons and their interests in the proposed transaction will be included in the consent solicitation statement or proxy statement, as applicable, relating to the Merger when it is filed with the SEC. These documents can be obtained free of charge from the sources indicated above.

 

 

 

 

Forward-Looking Statements Regarding the Merger

 

This Current Report on Form 8-K, along with the exhibits attached hereto, contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act. All statements other than statements of historical fact contained in this Current Report on Form 8-K, including statements regarding the benefits of the Merger, the anticipated timing of the completion of the Merger, the services offered Atlantic and the markets in which Atlantic plans to operate, the advantages of Atlantic’s services, Atlantic’s competitive landscape and positioning, and Atlantic’s growth plans and strategies, are forward-looking statements. Some of these forward-looking statements can be identified by the use of forward-looking words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “plan,” “targets,” “projects,” “could,” “would,” “continue,” “forecast” or the negatives of these terms or variations of them or similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. All forward-looking statements are based upon estimates, forecasts and assumptions that, while considered reasonable by the Company and its management, and Atlantic and its management, as the case may be, are inherently uncertain and many factors may cause the actual results to differ materially from current expectations which include, but are not limited to:

 

the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger;

 

the outcome of any legal proceedings that may be instituted against Atlantic or the Company related to the Merger;

 

failure of the Company and Atlantic to realize the anticipated benefits of the Merger;

 

the inability to satisfy the initial listing criteria of the Nasdaq Capital Market (“Nasdaq”) or obtain Nasdaq approval of the initial listing of the combined company on Nasdaq;
   
the ability the Company to maintain its listing on Nasdaq;

 

the risk that the price of shares subsequent to the Merger may be volatile due to a variety of factors, including changes in the highly competitive industry in which Atlantic operates, variations in performance across competitors, changes in laws and regulation that may impose additional costs and compliance burdens on Atlantic’s operations, macro-economic and social environments affecting Atlantic’s business and changes in the combined capital structure;

 

the inability to implement business plans, forecasts, and other expectations after the completion of the Merger;

 

the risk that Atlantic may be unable to raise additional capital on acceptable terms to finance its operations and remain a going concern; and

 

the risk that Atlantic’s estimates of market demand may be inaccurate.

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits

 

Exhibit No.   Description
     
2.1+   First Amendment to Agreement and Plan of Merger among Staffing 360 Solutions, Inc, A36 Merger Sub Inc. and Atlantic International Corp., dated January 7, 2025.
10.1   Amendment No. 35 to the Credit and Security Agreement, effective as of December 27, 2024, by and between Staffing 360 Solutions, Inc. and MidCap Funding X Trust.
10.2   Amendment No. 36 to the Credit and Security Agreement, effective as of January 3, 2025, by and between Staffing 360 Solutions, Inc. and MidCap Funding X Trust.
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

+ Certain of the schedules (and similar attachments) to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K under the Securities Act because they do not contain information material to an investment or voting decision and that information is not otherwise disclosed in the exhibit or the disclosure document. The registrant hereby agrees to furnish a copy of all omitted schedules (or similar attachments) to the SEC upon its request.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: January 13, 2025 STAFFING 360 SOLUTIONS, INC.
     
  By: /s/ Brendan Flood
    Brendan Flood
    Chairman and Chief Executive Officer

 

 

 

Exhibit 2.1

 

FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER

 

This First Amendment (this “First Amendment”) to the Merger Agreement (as defined below) is made and entered into as of January 7, 2025, by and Atlantic International Corp a Delaware corporation (“Atlantic”), A36 Merger Sub Inc., a Delaware corporation (“Merger Sub”), and Staffing 360 Solutions, Inc. a Delaware corporation (the “Company”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Merger Agreement (defined below).

 

WHEREAS, Atlantic, Merger Sub, and the Company have entered into that certain Agreement and Plan of Merger, dated as of November 1, 2024 (the “Merger Agreement”)

 

WHEREAS, the Parties desire to amend the terms and conditions of the Merger Agreement to, among other things: (i) clarify the treatment of certain preferred stock of the Company; and (ii) removal of dissenter and appraisal rights consistent with Delaware Law.

 

NOW, THEREFORE, for and in consideration of the mutual covenants contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party hereto, the Parties agree as follows:

 

1.Amendment to Agreement. The Agreement is hereby amended as follows:

 

a.Recital (D) of the Merger Agreement is deleted in its entirety and replaced with the following:

 

“ D. Upon completion of the Merger, each share of the issued and outstanding common stock of the Company (“Company Common Stock”) immediately prior to the Effective Time, other than Excluded Shares, will be canceled and converted into the right to receive the Merger Consideration.

 

b.Section 2.2(a) of the Merger Agreement is deleted in its entirety and replaced with the following:

 

“ (a) Conversion of Shares. Each: (i) share of Company Common Stock; (ii) share of Series H Preferred Shares; and (iii) share of Series I Preferred Shares issued and outstanding immediately prior to the Effective Time (each a “Share” and collectively, the “Shares”), other than any Excluded Shares, shall be cancelled and shall cease to exist and shall be converted automatically into the right to receive the Merger Consideration. “Merger Consideration” means (i) a number of shares of validly issued, fully paid and nonassessable shares of common stock of Atlantic, par value of $.00001 per share (the “Atlantic Common Stock”), equal to their respective Exchange Ratio, with any resulting fractional shares to be rounded to the nearest whole share.”

 

1
 

 

c.Section 2.2(d) of the Merger Agreement is deleted in its entirety and replaced with the following:

 

“(d) Exchange Agent. On or prior to the Closing Date, Atlantic will select a transfer agent or another reputable bank or trust company reasonably acceptable to Company to act as exchange agent in connection with the Merger (the “Exchange Agent”). Promptly after the Effective Time, Atlantic shall cause each person who was, at the Effective Time, a holder of record of Shares entitled to receive the Merger Consideration pursuant hereto instructions for use in effecting the surrender of the non-certificated Company Common Stock represented by book-entry in exchange for the Merger Consideration. The holder of such Share shall be entitled to receive in exchange therefor the Merger Consideration, pursuant to the Exchange Ratio and the terms of this Agreement. Until surrendered as contemplated by this Section 2.2(d), each book-entry share shall be deemed at all times after the Effective Time to represent only the right to receive upon such surrender the Merger Consideration to which holder of such book-entry share is entitled to.”

 

d.Section 2.3 is hereby deleted in its entirety and replaced with the following:

 

“[Reserved]”

 

e.Section 2.4 is hereby deleted in its entirety and replaced with the following:

 

“[Reserved]”

 

f.Section 3.2(f) is hereby deleted in its entirety and replaced with the following:

 

“(f) a signed settlement agreement with the appropriate Jackson Investment (“Jackson”) party converting the Company’s indebtedness with the appropriate Jackson party whereby (i) all interest accrued and payable to appropriate Jackson party will be waived or forgiven; (ii) the principal amount of the Loan will be converted into 5,600,000 shares of Series I Preferred Stock and lock-up agreement such that the Merger Consideration for all of the Series I Preferred Stock are subject to a lock up for the one (1) year after the Closing;”

 

g.Section 3.2(g) is hereby deleted in its entirety and replaced with the following:

 

“(g) signed agreements to be mutually agreed to by the Parties whereby the applicable parties shall: (i) convert any amounts owed in Earned Contingent Cash Payment into five million (5,000,000) Series H Preferred Shares of the Company and waive any interest/dividends or other payments due from the Company related to the Series H Preferred Shares; and (ii) lock-up agreements such that the Merger Consideration for all of the Series H Preferred are; (A) subject to a lock up for the 6 months after Closing as follows; (B) 1,750,000 shares of Atlantic Common Stock are subject to a lock-up for the period starting on 6 months after Closing until 9 months after Closing; (C) 875,000 shares of Atlantic Common Stock are subject to a lock-up for the period starting on 9 months after Closing until 12 months after Closing; and (D) the lock-up shall terminate 12 months after Closing and (E) the lock-up shall not apply to the extent shares of Atlantic Common Stock must be sold to pay any taxes from such applicable holder;”

 

h.Section 3.9(c) is hereby deleted in its entirety and replaced with the following:

 

“[Reserved]”

 

2
 

 

i.Section 5.5(a) of the Merger Agreement is deleted in its entirety and replaced with the following:

 

“(a) The authorized capital stock of Atlantic consists of 300,000,000 shares of Atlantic Common Stock $.00001 par value of which 57,338,135 shares are issued and outstanding as of the date of this First Amendment and 4,903,052 shares are issuable upon the exercise of RSUs, for an aggregate of 62,241,187 shares of common stock. All outstanding shares of Atlantic Common Stock are duly authorized, validly issued, fully paid, and non-assessable and were issued in compliance with all applicable federal and state securities laws;”

 

j.Section 8.1(d) of the Merger Agreement is deleted in its entirety and replaced with the following:

 

“(d) by Atlantic or the Company if the transactions contemplated by this Agreement shall not have been consummated on or prior to March 31, 2025 (the “Termination Date”); provided that (i) the right to terminate this Agreement pursuant to this Section 8.1(d) shall not be available to Atlantic if Atlantic’s breach of any of its covenants or obligations under this Agreement shall have proximately caused the failure to consummate the transactions contemplated by this Agreement on or before the Termination Date, (ii) the right to terminate this Agreement pursuant to this Section 8.1(d) shall not be available to the Company if the Company’s breach of its covenants or obligations under this Agreement shall have proximately caused the failure to consummate the transactions contemplated by this Agreement on or before the Termination Date; and (iii) the right to terminate this Agreement pursuant to this Section 8.1(d) shall not be available to any party if such party’s breach of any of its covenants or obligations under this Agreement shall have proximately caused the failure to consummate the transactions contemplated by this Agreement on or before the Termination Date; or”

 

k.The definition for “Earned Contingent Cash Payment” is hereby added as follows:

 

“ “Earned Contingent Cash Payment” means the Contingent Payment (as defined in that certain Stock Purchase Agreement between the Company, Headway Workforce Solutions, Inc. and Chapel Hill Partners, LP) due from the Company pursuant to the Stock Purchase Agreement between the Company, Headway Workforce Solutions, Inc. and Chapel Hill Partners, LP.”

 

l.The definition for “Exchange Ratio” is hereby deleted in its entirety and replaced with the following:

 

“ “Exchange Ratio” means with respect to the conversion of: (i) Company Common Stock, 1.202; (ii) Series H Preferred Stock, 0.25 and (iii) Series I Preferred Stock, 1.00.”

 

3
 

 

2.No Other Changes. Except as expressly provided in this Amendment, the Agreement shall remain in full force and effect upon its original terms. This Amendment and the Agreement constitute an integrated agreement with respect to the subject matter hereof and thereof. This Amendment may be amended, modified, and supplemented only in accordance with the terms of the Agreement.

 

3.Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Delaware applicable to contracts made and performed in such State, without reference to such State’s or any other state’s or other jurisdiction’s principles of conflict of laws.

 

4.Counterparts. This Amendment may be executed in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

[SIGNATURE PAGE FOLLOWS]

 

4
 

 

IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to be executed as of the date first written above by their respective officers thereunto duly authorized.

 

  COMPANY
  STAFFING 360 SOLUTIONS, INC.
     
  By: /s/ Brendan Flood
  Name: Brendan Flood
  Title: Chief Executive Officer
     
  MERGER SUB
  A36 MERGER SUB INC.
     
  By: /s/ Jeffrey Jagid
  Name: Jeffrey Jagid
  Title: Chief Executive Officer
                                 
  ATLANTIC
  ATLANTIC INTERNATIONAL CORP.
     
  By: /s/ Jeffrey Jagid
  Name: Jeffrey Jagid
  Title: Chief Executive Officer

 

5

 

 

Exhibit 10.1

 

AMENDMENT NO. 35 TO

CREDIT AND SECURITY AGREEMENT

 

THIS AMENDMENT NO. 35 TO CREDIT AND SECURITY AGREEMENT (this “Amendment”) is made as of the 2nd day of January, 2025, and effective nunc pro tunc as of December 27, 2024, by and among MONROE STAFFING SERVICES, LLC, a Delaware limited liability company, FARO RECRUITMENT AMERICA, INC., a New York corporation, LIGHTHOUSE PLACEMENT SERVICES, INC., a Massachusetts corporation, KEY RESOURCES, INC., a North Carolina corporation, HEADWAY WORKFORCE SOLUTIONS, INC., a Delaware corporation, HEADWAY EMPLOYER SERVICES LLC, a Delaware limited liability company, HEADWAY PAYROLL SOLUTIONS, LLC, a Delaware limited liability company, HEADWAY HR SOLUTIONS, INC., a New York corporation, and NC PEO HOLDINGS, LLC, a Delaware limited liability company (each of the foregoing Persons being referred to herein individually as a “Borrower”, and collectively as “Borrowers”), STAFFING 360 SOLUTIONS, INC., a Delaware corporation (as “Parent”), and MIDCAP FUNDING IV TRUST, a Delaware statutory trust, as successor-by-assignment to MidCap Funding X Trust (as Agent for Lenders, “Agent”, and individually, as a Lender), and the other financial institutions or other entities from time to time parties to the Credit Agreement referenced below, each as a Lender.

 

RECITALS

 

A. Borrowers, Agent and Lenders are party to that certain Credit and Security Agreement dated as of April 8, 2015 (as amended by that certain Amendment No. 1 and Joinder Agreement to Credit and Security Agreement dated as of July 13, 2015, by that certain Amendment No. 2 to Credit and Security Agreement dated as of August 31, 2015, by that certain Overadvance Letter dated October 9, 2015, by that certain Overadvance Letter dated as of November 20, 2015, by that certain Overadvance Letter dated as of February 8, 2016, by that certain Amendment No. 3 to Credit and Security Agreement and Limited Waiver dated as of February 8, 2016, by that certain Amendment No. 4 and Joinder Agreement to Credit and Security Agreement dated as of July 11, 2016, by that certain Amendment No. 5 to Credit and Security Agreement dated as of September 26, 2016, by that certain Amendment No. 6 to Credit and Security Agreement and Limited Consent dated as of January 26, 2017, by that certain Amendment No. 7 to Credit and Security Agreement and Limited Consent dated as of June 5, 2017, by that certain Amendment No. 8 and Joinder Agreement to Credit and Security Agreement and Limited Consent dated as of September 15, 2017, by that certain Amendment No. 9 to Credit and Security Agreement and Limited Consent dated as of June 6, 2018, by that certain Amendment No. 10 and Joinder Agreement to Credit and Security Agreement and Limited Consent dated as of August 27, 2018, by that certain Overadvance Letter dated as of January 3, 2019, by that certain Amendment No. 11 to Credit and Security Agreement dated as of February 7, 2019, by that certain Overadvance Letter dated as of April 1, 2019, by that certain Amendment No. 12 to Credit and Security Agreement dated as of April 1, 2019, by that certain Overadvance Letter dated as of July 15, 2019, by that certain Amendment No. 13 to Credit and Security Agreement dated as of August 2, 2019, by that certain Amendment No. 14 dated as of August 8, 2020, by that certain Amendment No. 15 dated as of September 7, 2020, by that certain Amendment No. 16 dated as of October 7, 2020, by that certain Amendment No. 18 to Credit and Security Agreement dated as of February 8, 2021, by that certain Amendment No. 19 to Credit and Security Agreement dated as of December 23, 2021, by that certain Amendment No. 20 to Credit and Security Agreement and Limited Consent dated as of April 18, 2022, by that certain Amendment No. 21 to Credit and Security Agreement and Limited Consent dated as of August 30, 2022, by that certain Amendment No. 22 to Credit and Security Agreement dated as of September 15, 2022, by that certain Amendment No. 23 to Credit and Security Agreement dated as of September 26, 2022, by that certain Amendment No. 24 to Credit and Security Agreement dated as of September 29, 2022, by that certain Amendment No. 25 to Credit and Security Agreement dated as of October 13, 2022, by that certain Amendment No. 26 to Credit and Security Agreement dated as of October 20, 2022, by that certain Amendment No. 27 and Joinder Agreement to Credit and Security Agreement dated as of October 27, 2022, by that certain Amendment No. 28 to Credit and Security Agreement and Limited Waiver dated as of August 30, 2023, by that certain Amendment No. 29 to Credit and Security Agreement dated as of July 18, 2024, by that certain Amendment No. 30 to Credit and Security Agreement dated as of September 11, 2024, by that certain Amendment No. 31 to Credit and Security Agreement dated as of October 9, 2024, by that certain Amendment No. 32 to Credit and Security Agreement dated as of December 9, 2024, by that certain Amendment No. 33 to Credit and Security Agreement dated as of December 13, 2024, and by that certain Amendment No. 34 to Credit and Security Agreement dated as of December 24, 2024 (as so amended, the “Existing Credit Agreement”, and as amended hereby and as it may be further amended, modified, supplemented and/or restated from time to time, the “Credit Agreement”)). Capitalized terms used but not otherwise defined in this Amendment shall have the meanings set forth in the Credit Agreement.

 

 
 

 

B. Borrowers have requested that the Agent and the Lenders have agreed to amend the Existing Credit Agreement to extend the Commitment Expiry Date.

 

C. Borrowers, Agent and Lenders have agreed to amend the Credit Agreement as set forth herein.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set forth in this Amendment, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Agent, Lenders, Parent and Borrowers hereby agree as follows:

 

1. Recitals. This Amendment shall constitute a Financing Document and the Recitals set forth above shall be construed as part of this Amendment as if set forth fully in the body of this Amendment.

 

2. Amendments to Existing Credit Agreement.

 

(a) Section 1.1 (Defined Terms). The definition of “Commitment Expiry Date” in Section 1.1 of the Credit Agreement is hereby amended and restated to read as follows:

 

“Commitment Expiry Date” means January 3, 2025.

 

2
 

 

3. Confirmation of Representations and Warranties; Reaffirmation of Security Interest.

 

(a) Each Borrower hereby confirms that all of the representations and warranties set forth in Article 3 of the Credit Agreement are true and correct in all material respects with respect to such Borrower as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, and covenants to perform its respective obligations under the Credit Agreement. To induce Agent and Lender to enter into this Agreement, Borrowers and Parent further represent and warrant that:

 

(i) no Default or Event of Default has occurred or is continuing as of the date hereof (excluding those certain Events of Default set forth in the Reservation of Rights Letters (as defined below)), which has not been waived in writing by the Agent;

 

(ii) as of the date hereof and, immediately after giving effect to this Amendment and the transactions contemplated hereby, the representations and warranties of Borrowers contained in the Financing Documents are true and correct in all material respects (or if any representation or warranty is qualified with respect to materiality, in all respects) on and as of the date hereof to the same extent as though made on and as of such date except to the extent such representations and warranties specifically relate to an earlier date; and

 

(iii) the execution, delivery and performance by Borrowers and Parent of this Amendment are within each of its corporate powers and have been duly authorized by all necessary corporate action, and this Amendment is the legal, valid and binding obligation of Borrowers and Parent enforceable against Borrowers and Parent in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by equitable principles, and neither the execution, delivery or performance by Borrowers and Parent of this Agreement (A) violates any Law, or any other rule or decree of any Governmental Authority, (B) conflicts with or results in the breach or termination of, constitutes a default under or accelerates any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which Borrowers or Parent is a party or by which Borrowers or Parent or any of its property is bound, except for such conflicts, breaches, terminations, defaults or accelerations that would not reasonably be expected to have a Material Adverse Effect, (C) results in the creation or imposition of any Lien upon any of the Collateral, (D) violates or conflicts with the by-laws or other organizational documents of Borrowers and Parent, or (E) requires the consent, approval or authorization of, or declaration or filing with, any other Person, except for those already duly obtained.

 

(b) Each Borrower and Parent confirms and agrees that all security interests and Liens granted to Agent continue in full force and effect, and all Collateral remains free and clear of any Liens, other than those granted to Agent and Permitted Liens. Nothing herein is intended to impair or limit the validity, priority or extent of Agent’s security interests in and Liens on the Collateral. For the avoidance of any doubt, the Collateral secures repayment of the Obligations and the Affiliated Obligations, and in furtherance thereof, Borrowers and Parent hereby reaffirm the grant to Agent, for the benefit of itself and Lenders, of a continuing first priority Lien (subject to Permitted Liens) on and security interest in all of the Collateral as security for the payment and performance of the Obligations, and for the payment and performance of all obligations under the Affiliated Financing Documents.

 

3
 

 

4. Enforceability. This Amendment constitutes the legal, valid and binding obligation of each Borrower and Parent, and is enforceable against each Borrower and Parent in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by general equitable principles.

 

5. Costs and Fees. Borrowers shall be responsible for the payment of all reasonable costs and fees of Agent’s counsel incurred in connection with the preparation of this Amendment and any related documents. If Agent or any Lender uses in-house counsel for any of these purposes, Borrowers further agree that the Obligations include reasonable charges for such work commensurate with the fees that would otherwise be charged by outside legal counsel selected by Agent or such Lender for the work performed. Borrowers hereby authorize Agent to deduct all of such fees set forth in this Section 5 from the proceeds of one or more Revolving Loans made under the Credit Agreement.

 

6. Reaffirmation of Security Interest. Each of the Borrowers and Parent confirms and agrees that: (i) all security interests and liens granted to Agent continue in full force and effect, and (ii) all Collateral remains free and clear of any liens other than liens in favor of Agent and Permitted Encumbrances. Nothing herein contained is intended to impair or limit the validity, priority and extent of Agent’s security interest in and liens upon the Collateral.

 

7. Conditions to Effectiveness. This Amendment shall become effective nunc pro tunc as of December 27, 2024 upon the satisfaction of each of the following conditions (the “Effective Date”):

 

(a) Amendment. Borrowers and Parent shall have delivered to Agent this Amendment, duly executed by an authorized officer of each Credit Party;

 

(b) Representations and Warranties. All representations and warranties of Borrowers contained herein shall be true and correct in all material respects as of the date hereof except to the extent such representations and warranties specifically relate to an earlier date (and such parties’ delivery of their respective signatures hereto shall be deemed to be their certification thereof);

 

(c) JIG Consent. Agent shall have received a duly executed copy of the Limited Consent to Intercreditor Agreement by JIG; and

 

4
 

 

(d) Fees and Expenses. Agent shall have received from Borrowers of all of the fees owing pursuant to this Amendment and Agent’s reasonable out-of-pocket legal fees and expenses.

 

8. Release. Each Borrower, voluntarily, knowingly, unconditionally and irrevocably, with specific and express intent, for and on behalf of itself and all of its respective parents, subsidiaries, affiliates, members, managers, predecessors, successors, and assigns, and each of their respective current and former directors, officers, shareholders, agents, and employees (collectively, “Releasing Parties”), does hereby fully and completely release, acquit and forever discharge each Indemnitee (as defined in the Credit Agreement) of and from any and all actions, causes of action, suits, debts, disputes, damages, claims, obligations, liabilities, costs, expenses and demands of any kind whatsoever, at law or in equity, whether matured or unmatured, liquidated or unliquidated, vested or contingent, choate or inchoate, known or unknown that the Releasing Parties (or any of them) has against the Indemnitees (or any of them), that directly or indirectly arise out of, are based upon or are in any manner connected with any Prior Related Event. “Prior Related Event” means any transaction, event, circumstance, action, failure to act, occurrence of any type or sort, whether known or unknown, which occurred, existed, was taken, was permitted or begun in accordance with, pursuant to or by virtue of (a) any of the terms of this Amendment or any other Financing Document, (b) any actions, transactions, matters or circumstances related hereto or thereto, (c) the conduct of the relationship between any Indemnitee and any Borrower, or (d) any other actions or inactions by any Indemnitee, all on or prior to the date hereof. Each Borrower acknowledges that the foregoing release is a material inducement to Agent’s and Lender’s decision to enter into this Amendment and to agree to the modifications contemplated hereunder.

 

9. No Waiver or Novation. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Agent, nor constitute a waiver of any provision of the Credit Agreement, the Financing Documents or any other documents, instruments and agreements executed or delivered in connection with any of the foregoing. Nothing herein is intended or shall be construed as a waiver of any existing Defaults or Events of Default under the Credit Agreement or other Financing Documents or any of Agent’s rights and remedies in respect of such Defaults or Events of Default. This Amendment (together with any other document executed in connection herewith) is not intended to be, nor shall it be construed as, a novation of the Credit Agreement. For the avoidance of doubt, nothing herein shall operate as a waiver of any right, power or remedy of Agent or any Lender (including, without limitation, the right to implement additional reserves and/or adjustments, and/or increase existing reserves and/or adjustments to the Borrowing Base), nor constitute a waiver or other modification of any provision set forth in the Reservation of Rights Letter, dated April 12, 2024, the Post-Default Advance Letter, dated April 16, 2024, or the Reservation of Rights Letter, dated October 18, 2024, each of which shall remain in full force and effect (collectively, the “Reservation of Rights Letters”).

 

10. Affirmation. Except as specifically amended pursuant to the terms hereof, the Credit Agreement and all other Financing Documents (and all covenants, terms, conditions and agreements therein) shall remain in full force and effect, and are hereby ratified and confirmed in all respects by Borrowers. Each Borrower covenants and agrees to comply with all of the terms, covenants and conditions of the Credit Agreement (as amended hereby) and the Financing Documents, notwithstanding any prior course of conduct, waivers, releases or other actions or inactions on Agent’s or any Lender’s part which might otherwise constitute or be construed as a waiver of or amendment to such terms, covenants and conditions.

 

5
 

 

11. Miscellaneous.

 

(a) Reference to the Effect on the Credit Agreement. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of similar import shall mean and be a reference to the Credit Agreement, as amended by this Amendment. Except as specifically amended above, the Credit Agreement, and all other Financing Documents (and all covenants, terms, conditions and agreements therein), shall remain in full force and effect, and are hereby ratified and confirmed in all respects by Borrowers.

 

(b) Incorporation of Credit Agreement Provisions. The provisions contained in Section 11.6 (Indemnification), Section 12.8 (Governing Law; Submission to Jurisdiction) and Section 12.9 (Waiver of Jury Trial) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in their entirety.

 

(c) Headings. Section headings in this Amendment are included for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

 

(d) Counterparts. This Amendment may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Signatures by facsimile or by electronic mail delivery of an electronic version (e.g., .pdf or .tif file) of an executed signature page shall be treated as delivery of an original and shall bind the parties hereto. This Amendment constitutes the entire agreement and understanding among the parties hereto and supersede any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.

 

[SIGNATURES APPEAR ON FOLLOWING PAGES]

 

6
 

 

IN WITNESS WHEREOF, intending to be legally bound, and intending that this document constitute an agreement executed under seal, the undersigned have executed this Amendment under seal as of the day and year first hereinabove set forth.

 

AGENT:     MIDCAP FUNDING IV TRUST
         
      By: Apollo Capital Management, L.P.,
        its investment manager
         
      By: Apollo Capital Management GP, LLC,
        its general partner
         
      By: /s/ Maurice Amsellem          (SEAL)
      Name: Maurice Amsellem
      Title: Authorized Signatory
         
LENDER:     MIDCAP FUNDING IV TRUST
         
      By: Apollo Capital Management, L.P.,
        its investment manager
         
      By: Apollo Capital Management GP, LLC,
        its general partner
         
      By: /s/ Maurice Amsellem          (SEAL)
      Name: Maurice Amsellem
      Title: Authorized Signatory

 

Signature Page to

Amendment No. 35 to Credit and Security Agreement

 

 
 

 

BORROWERS:     MONROE STAFFING SERVICES, LLC,
a Delaware limited liability company
         
      By: /s/ Brendan Flood            (Seal)
      Name: Brendan Flood
      Title: Chairman and Chief Executive Officer
         

LIGHTHOUSE PLACEMENT SERVICES, INC.,

a Massachusetts corporation

  FARO RECRUITMENT AMERICA, INC.,
a New York corporation

     
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
HEADWAY WORKFORCE SOLUTIONS, INC., a Delaware corporation


 

KEY RESOURCES, INC.,

a North Carolina corporation


         
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
HEADWAY PAYROLL SOLUTIONS, LLC, a Delaware limited liability company


 

HEADWAY EMPLOYER SERVICES

LLC, a Delaware limited liability company


 
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         

HEADWAY HR SOLUTIONS, INC., a

New York corporation


 

NC PEO HOLDINGS, LLC, a Delaware

limited liability company


         
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
PARENT:    

STAFFING 360 SOLUTIONS, INC.,

a Delaware corporation

     
      By: /s/ Brendan Flood            (Seal)
      Name: Brendan Flood
      Title: Chief Executive Officer

 

Signature Page to

Amendment No. 35 to Credit and Security Agreement

 

 

 

 

Exhibit 10.2

 

Execution Version

 

AMENDMENT NO. 36 TO

CREDIT AND SECURITY AGREEMENT

 

THIS AMENDMENT NO. 36 TO CREDIT AND SECURITY AGREEMENT (this “Amendment”) is made as of the 8th day of January, 2025, and effective nunc pro tunc as of January 3, 2025, by and among MONROE STAFFING SERVICES, LLC, a Delaware limited liability company, FARO RECRUITMENT AMERICA, INC., a New York corporation, LIGHTHOUSE PLACEMENT SERVICES, INC., a Massachusetts corporation, KEY RESOURCES, INC., a North Carolina corporation, HEADWAY WORKFORCE SOLUTIONS, INC., a Delaware corporation, HEADWAY EMPLOYER SERVICES LLC, a Delaware limited liability company, HEADWAY PAYROLL SOLUTIONS, LLC, a Delaware limited liability company, HEADWAY HR SOLUTIONS, INC., a New York corporation, and NC PEO HOLDINGS, LLC, a Delaware limited liability company (each of the foregoing Persons being referred to herein individually as a “Borrower”, and collectively as “Borrowers”), STAFFING 360 SOLUTIONS, INC., a Delaware corporation (as “Parent”), and MIDCAP FUNDING IV TRUST, a Delaware statutory trust, as successor-by-assignment to MidCap Funding X Trust (as Agent for Lenders, “Agent”, and individually, as a Lender), and the other financial institutions or other entities from time to time parties to the Credit Agreement referenced below, each as a Lender.

 

RECITALS

 

A. Borrowers, Agent and Lenders are party to that certain Credit and Security Agreement dated as of April 8, 2015 (as amended by that certain Amendment No. 1 and Joinder Agreement to Credit and Security Agreement dated as of July 13, 2015, by that certain Amendment No. 2 to Credit and Security Agreement dated as of August 31, 2015, by that certain Overadvance Letter dated October 9, 2015, by that certain Overadvance Letter dated as of November 20, 2015, by that certain Overadvance Letter dated as of February 8, 2016, by that certain Amendment No. 3 to Credit and Security Agreement and Limited Waiver dated as of February 8, 2016, by that certain Amendment No. 4 and Joinder Agreement to Credit and Security Agreement dated as of July 11, 2016, by that certain Amendment No. 5 to Credit and Security Agreement dated as of September 26, 2016, by that certain Amendment No. 6 to Credit and Security Agreement and Limited Consent dated as of January 26, 2017, by that certain Amendment No. 7 to Credit and Security Agreement and Limited Consent dated as of June 5, 2017, by that certain Amendment No. 8 and Joinder Agreement to Credit and Security Agreement and Limited Consent dated as of September 15, 2017, by that certain Amendment No. 9 to Credit and Security Agreement and Limited Consent dated as of June 6, 2018, by that certain Amendment No. 10 and Joinder Agreement to Credit and Security Agreement and Limited Consent dated as of August 27, 2018, by that certain Overadvance Letter dated as of January 3, 2019, by that certain Amendment No. 11 to Credit and Security Agreement dated as of February 7, 2019, by that certain Overadvance Letter dated as of April 1, 2019, by that certain Amendment No. 12 to Credit and Security Agreement dated as of April 1, 2019, by that certain Overadvance Letter dated as of July 15, 2019, by that certain Amendment No. 13 to Credit and Security Agreement dated as of August 2, 2019, by that certain Amendment No. 14 dated as of August 8, 2020, by that certain Amendment No. 15 dated as of September 7, 2020, by that certain Amendment No. 16 dated as of October 7, 2020, by that certain Amendment No. 18 to Credit and Security Agreement dated as of February 8, 2021, by that certain Amendment No. 19 to Credit and Security Agreement dated as of December 23, 2021, by that certain Amendment No. 20 to Credit and Security Agreement and Limited Consent dated as of April 18, 2022, by that certain Amendment No. 21 to Credit and Security Agreement and Limited Consent dated as of August 30, 2022, by that certain Amendment No. 22 to Credit and Security Agreement dated as of September 15, 2022, by that certain Amendment No. 23 to Credit and Security Agreement dated as of September 26, 2022, by that certain Amendment No. 24 to Credit and Security Agreement dated as of September 29, 2022, by that certain Amendment No. 25 to Credit and Security Agreement dated as of October 13, 2022, by that certain Amendment No. 26 to Credit and Security Agreement dated as of October 20, 2022, by that certain Amendment No. 27 and Joinder Agreement to Credit and Security Agreement dated as of October 27, 2022, by that certain Amendment No. 28 to Credit and Security Agreement and Limited Waiver dated as of August 30, 2023, by that certain Amendment No. 29 to Credit and Security Agreement dated as of July 18, 2024, by that certain Amendment No. 30 to Credit and Security Agreement dated as of September 11, 2024, by that certain Amendment No. 31 to Credit and Security Agreement dated as of October 9, 2024, by that certain Amendment No. 32 to Credit and Security Agreement dated as of December 9, 2024, by that certain Amendment No. 33 to Credit and Security Agreement dated as of December 13, 2024, by that certain Amendment No. 34 to Credit and Security Agreement dated as of December 24, 2024, and by that certain Amendment No. 35 to Credit and Security Agreement dated as of January 2, 2025 (as so amended, the “Existing Credit Agreement”, and as amended hereby and as it may be further amended, modified, supplemented and/or restated from time to time, the “Credit Agreement”)). Capitalized terms used but not otherwise defined in this Amendment shall have the meanings set forth in the Credit Agreement.

 

 
 

 

B. Borrowers have requested that the Agent and the Lenders have agreed to amend the Existing Credit Agreement to extend the Commitment Expiry Date.

 

C. Borrowers, Agent and Lenders have agreed to amend the Credit Agreement as set forth herein.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set forth in this Amendment, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Agent, Lenders, Parent and Borrowers hereby agree as follows:

 

1. Recitals. This Amendment shall constitute a Financing Document and the Recitals set forth above shall be construed as part of this Amendment as if set forth fully in the body of this Amendment.

 

2. Amendments to Existing Credit Agreement.

 

(a) Section 1.1 (Defined Terms). The definition of “Commitment Expiry Date” in Section 1.1 of the Credit Agreement is hereby amended and restated to read as follows:

 

“Commitment Expiry Date” means January 10, 2025.

 

(b) Section 1.1 (Defined Terms). The definition of “Additional Reserve Amount” in Section 1.1 of the Credit Agreement is hereby amended by restating the same as follows:

 

2
 

 

“Additional Reserve Amount” means, as of any date of determination, $490,000.00.

 

3. Confirmation of Representations and Warranties; Reaffirmation of Security Interest.

 

(a) Each Borrower hereby confirms that all of the representations and warranties set forth in Article 3 of the Credit Agreement are true and correct in all material respects with respect to such Borrower as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, and covenants to perform its respective obligations under the Credit Agreement. To induce Agent and Lender to enter into this Agreement, Borrowers and Parent further represent and warrant that:

 

(i) no Default or Event of Default has occurred or is continuing as of the date hereof (excluding those certain Events of Default set forth in the Reservation of Rights Letters (as defined below)), which has not been waived in writing by the Agent;

 

(ii) as of the date hereof and, immediately after giving effect to this Amendment and the transactions contemplated hereby, the representations and warranties of Borrowers contained in the Financing Documents are true and correct in all material respects (or if any representation or warranty is qualified with respect to materiality, in all respects) on and as of the date hereof to the same extent as though made on and as of such date except to the extent such representations and warranties specifically relate to an earlier date; and

 

(iii) the execution, delivery and performance by Borrowers and Parent of this Amendment are within each of its corporate powers and have been duly authorized by all necessary corporate action, and this Amendment is the legal, valid and binding obligation of Borrowers and Parent enforceable against Borrowers and Parent in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by equitable principles, and neither the execution, delivery or performance by Borrowers and Parent of this Agreement (A) violates any Law, or any other rule or decree of any Governmental Authority, (B) conflicts with or results in the breach or termination of, constitutes a default under or accelerates any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which Borrowers or Parent is a party or by which Borrowers or Parent or any of its property is bound, except for such conflicts, breaches, terminations, defaults or accelerations that would not reasonably be expected to have a Material Adverse Effect, (C) results in the creation or imposition of any Lien upon any of the Collateral, (D) violates or conflicts with the by-laws or other organizational documents of Borrowers and Parent, or (E) requires the consent, approval or authorization of, or declaration or filing with, any other Person, except for those already duly obtained.

 

(b) Each Borrower and Parent confirms and agrees that all security interests and Liens granted to Agent continue in full force and effect, and all Collateral remains free and clear of any Liens, other than those granted to Agent and Permitted Liens. Nothing herein is intended to impair or limit the validity, priority or extent of Agent’s security interests in and Liens on the Collateral. For the avoidance of any doubt, the Collateral secures repayment of the Obligations and the Affiliated Obligations, and in furtherance thereof, Borrowers and Parent hereby reaffirm the grant to Agent, for the benefit of itself and Lenders, of a continuing first priority Lien (subject to Permitted Liens) on and security interest in all of the Collateral as security for the payment and performance of the Obligations, and for the payment and performance of all obligations under the Affiliated Financing Documents.

 

3
 

 

4. Enforceability. This Amendment constitutes the legal, valid and binding obligation of each Borrower and Parent, and is enforceable against each Borrower and Parent in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by general equitable principles.

 

5. Costs and Fees. In consideration of Agent’s agreement to enter into this Amendment, Borrowers shall pay to Agent a modification fee equal to One Hundred Fifty Thousand Dollars ($150,000.00) (the “Amendment No. 36 Modification Fee”). The Amendment No. 36 Modification Fee shall be non-refundable and fully earned as of the Effective Date (as defined below). The Amendment No. 36 Modification Fee shall constitute a portion of the Obligations and shall be secured by all Collateral. The Amendment No. 36 Modification Fee shall be due and payable upon the earliest to occur of (a) the Termination Date, and (b) the repayment in full of all Obligations. Furthermore, Borrowers shall be responsible for the payment of all reasonable costs and fees of Agent’s counsel incurred in connection with the preparation of this Amendment and any related documents. If Agent or any Lender uses in-house counsel for any of these purposes, Borrowers further agree that the Obligations include reasonable charges for such work commensurate with the fees that would otherwise be charged by outside legal counsel selected by Agent or such Lender for the work performed. Borrowers hereby authorize Agent to deduct all of such fees set forth in this Section 5 from the proceeds of one or more Revolving Loans made under the Credit Agreement.

 

6. Reaffirmation of Security Interest. Each of the Borrowers and Parent confirms and agrees that: (i) all security interests and liens granted to Agent continue in full force and effect, and (ii) all Collateral remains free and clear of any liens other than liens in favor of Agent and Permitted Encumbrances. Nothing herein contained is intended to impair or limit the validity, priority and extent of Agent’s security interest in and liens upon the Collateral.

 

7. Conditions to Effectiveness. This Amendment shall become effective nunc pro tunc as of January 3, 2025 upon the satisfaction of each of the following conditions (the “Effective Date”):

 

(a) Amendment. Borrowers and Parent shall have delivered to Agent this Amendment, duly executed by an authorized officer of each Credit Party;

 

(b) Representations and Warranties. All representations and warranties of Borrowers contained herein shall be true and correct in all material respects as of the date hereof except to the extent such representations and warranties specifically relate to an earlier date (and such parties’ delivery of their respective signatures hereto shall be deemed to be their certification thereof);

 

(c) JIG Consent. Agent shall have received a duly executed copy of the Limited Consent to Intercreditor Agreement by JIG; and

 

4
 

 

(d) Fees and Expenses. Agent shall have received from Borrowers of all of the fees owing pursuant to this Amendment and Agent’s reasonable out-of-pocket legal fees and expenses.

 

8. Release. Each Borrower, voluntarily, knowingly, unconditionally and irrevocably, with specific and express intent, for and on behalf of itself and all of its respective parents, subsidiaries, affiliates, members, managers, predecessors, successors, and assigns, and each of their respective current and former directors, officers, shareholders, agents, and employees (collectively, “Releasing Parties”), does hereby fully and completely release, acquit and forever discharge each Indemnitee (as defined in the Credit Agreement) of and from any and all actions, causes of action, suits, debts, disputes, damages, claims, obligations, liabilities, costs, expenses and demands of any kind whatsoever, at law or in equity, whether matured or unmatured, liquidated or unliquidated, vested or contingent, choate or inchoate, known or unknown that the Releasing Parties (or any of them) has against the Indemnitees (or any of them), that directly or indirectly arise out of, are based upon or are in any manner connected with any Prior Related Event. “Prior Related Event” means any transaction, event, circumstance, action, failure to act, occurrence of any type or sort, whether known or unknown, which occurred, existed, was taken, was permitted or begun in accordance with, pursuant to or by virtue of (a) any of the terms of this Amendment or any other Financing Document, (b) any actions, transactions, matters or circumstances related hereto or thereto, (c) the conduct of the relationship between any Indemnitee and any Borrower, or (d) any other actions or inactions by any Indemnitee, all on or prior to the date hereof. Each Borrower acknowledges that the foregoing release is a material inducement to Agent’s and Lender’s decision to enter into this Amendment and to agree to the modifications contemplated hereunder.

 

9. No Waiver or Novation. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Agent, nor constitute a waiver of any provision of the Credit Agreement, the Financing Documents or any other documents, instruments and agreements executed or delivered in connection with any of the foregoing. Nothing herein is intended or shall be construed as a waiver of any existing Defaults or Events of Default under the Credit Agreement or other Financing Documents or any of Agent’s rights and remedies in respect of such Defaults or Events of Default. This Amendment (together with any other document executed in connection herewith) is not intended to be, nor shall it be construed as, a novation of the Credit Agreement. For the avoidance of doubt, nothing herein shall operate as a waiver of any right, power or remedy of Agent or any Lender (including, without limitation, the right to implement additional reserves and/or adjustments, and/or increase existing reserves and/or adjustments to the Borrowing Base), nor constitute a waiver or other modification of any provision set forth in the Reservation of Rights Letter, dated April 12, 2024, the Post-Default Advance Letter, dated April 16, 2024, or the Reservation of Rights Letter, dated October 18, 2024, each of which shall remain in full force and effect (collectively, the “Reservation of Rights Letters”).

 

10. Affirmation. Except as specifically amended pursuant to the terms hereof, the Credit Agreement and all other Financing Documents (and all covenants, terms, conditions and agreements therein) shall remain in full force and effect, and are hereby ratified and confirmed in all respects by Borrowers. Each Borrower covenants and agrees to comply with all of the terms, covenants and conditions of the Credit Agreement (as amended hereby) and the Financing Documents, notwithstanding any prior course of conduct, waivers, releases or other actions or inactions on Agent’s or any Lender’s part which might otherwise constitute or be construed as a waiver of or amendment to such terms, covenants and conditions.

 

5
 

 

11. Post-Closing Covenant. On or before January 10, 2025 (or such later date as agreed upon by Agent in its sole discretion), Borrower and Parent shall have delivered to Agent a duly executed copy of an amendment to the JIG Note Purchase Agreement (and any other related documents or notes as necessary) which extends the scheduled maturity of the Term Debt (as defined in the Intercreditor Agreement) to a date acceptable to Agent, but in no event on or before the Commitment Expiry Date. The failure to satisfy this post-closing covenant shall constitute an Event of Default under the Credit Agreement.

 

12. Miscellaneous.

 

(a) Reference to the Effect on the Credit Agreement. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of similar import shall mean and be a reference to the Credit Agreement, as amended by this Amendment. Except as specifically amended above, the Credit Agreement, and all other Financing Documents (and all covenants, terms, conditions and agreements therein), shall remain in full force and effect, and are hereby ratified and confirmed in all respects by Borrowers.

 

(b) Incorporation of Credit Agreement Provisions. The provisions contained in Section 11.6 (Indemnification), Section 12.8 (Governing Law; Submission to Jurisdiction) and Section 12.9 (Waiver of Jury Trial) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in their entirety.

 

(c) Headings. Section headings in this Amendment are included for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

 

(d) Counterparts. This Amendment may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Signatures by facsimile or by electronic mail delivery of an electronic version (e.g., .pdf or .tif file) of an executed signature page shall be treated as delivery of an original and shall bind the parties hereto. This Amendment constitutes the entire agreement and understanding among the parties hereto and supersede any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.

 

[SIGNATURES APPEAR ON FOLLOWING PAGES]

 

6
 

 

IN WITNESS WHEREOF, intending to be legally bound, and intending that this document constitute an agreement executed under seal, the undersigned have executed this Amendment under seal as of the day and year first hereinabove set forth.

 

AGENT:     MIDCAP FUNDING IV TRUST
         
      By: Apollo Capital Management, L.P.,
        its investment manager
         
      By: Apollo Capital Management GP, LLC,
        its general partner
         
      By: /s/ Maurice Amsellem          (SEAL)
      Name: Maurice Amsellem
      Title: Authorized Signatory
         
LENDER:     MIDCAP FUNDING IV TRUST
         
      By: Apollo Capital Management, L.P.,
        its investment manager
         
      By: Apollo Capital Management GP, LLC,
        its general partner
         
      By: /s/ Maurice Amsellem          (SEAL)
      Name: Maurice Amsellem
      Title: Authorized Signatory

 

Signature Page to

Amendment No. 36 to Credit and Security Agreement

 

 
 

 

BORROWERS:     MONROE STAFFING SERVICES, LLC,
a Delaware limited liability company
         
      By: /s/ Brendan Flood            (Seal)
      Name: Brendan Flood
      Title: Chairman and Chief Executive Officer
         

LIGHTHOUSE PLACEMENT SERVICES, INC.,

a Massachusetts corporation

  FARO RECRUITMENT AMERICA, INC.,
a New York corporation

     
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
HEADWAY WORKFORCE SOLUTIONS, INC., a Delaware corporation


 

KEY RESOURCES, INC.,

a North Carolina corporation


         
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
HEADWAY PAYROLL SOLUTIONS, LLC, a Delaware limited liability company


 

HEADWAY EMPLOYER SERVICES

LLC, a Delaware limited liability company


 
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         

HEADWAY HR SOLUTIONS, INC., a

New York corporation


 

NC PEO HOLDINGS, LLC, a Delaware

limited liability company


         
By: /s/ Brendan Flood            (Seal)   By: /s/ Brendan Flood            (Seal)
Name: Brendan Flood   Name: Brendan Flood
Title: Chief Executive Officer   Title: Chief Executive Officer
         
PARENT:    

STAFFING 360 SOLUTIONS, INC.,

a Delaware corporation

     
      By: /s/ Brendan Flood            (Seal)
      Name: Brendan Flood
      Title: Chief Executive Officer

 

Signature Page to

Amendment No. 36 to Credit and Security Agreement

 

 

 

v3.24.4
Cover
Jan. 02, 2025
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date Jan. 02, 2025
Entity File Number 001-37575
Entity Registrant Name STAFFING 360 SOLUTIONS, INC.
Entity Central Index Key 0001499717
Entity Tax Identification Number 68-0680859
Entity Incorporation, State or Country Code DE
Entity Address, Address Line One 757 Third Avenue
Entity Address, Address Line Two 27th Floor
Entity Address, City or Town New York
Entity Address, State or Province NY
Entity Address, Postal Zip Code 10017
City Area Code (646)
Local Phone Number 507-5710
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock
Trading Symbol STAF
Security Exchange Name NASDAQ
Entity Emerging Growth Company false

Staffing 360 Solutions (NASDAQ:STAF)
과거 데이터 주식 차트
부터 12월(12) 2024 으로 1월(1) 2025 Staffing 360 Solutions 차트를 더 보려면 여기를 클릭.
Staffing 360 Solutions (NASDAQ:STAF)
과거 데이터 주식 차트
부터 1월(1) 2024 으로 1월(1) 2025 Staffing 360 Solutions 차트를 더 보려면 여기를 클릭.