COMFORCE CORP, S-3, 1999-07-02

COMFORCE CORP
S-3, 1999-07-02
HELP SUPPLY SERVICES

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As filed with the Securities and Exchange Commission on July 2, 1999

Registration No. 333-

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-3
REGISTRATION STATEMENT
Under The Securities Act of 1933

COMFORCE Corporation
(Exact name of registrant as specified in its charter)

Delaware 7361 36 - 2262248
(State or other jurisdiction (Primary Standard (I.R.S Employer
of incorporation Industrial Classification Identification No.)
or organization) Code Number)

--------------------

COMFORCE Corporation
415 Crossways Park Drive
P.O. Box 9006
Woodbury, New York 11797
(516) 437-3300
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
--------------------

Harry Maccarrone
Executive Vice President
COMFORCE Corporation
415 Crossways Park Drive
P.O. Box 9006
Woodbury, New York 11797
(516) 437-3300

(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------------

Copy to:

David G. Edwards, Esquire
Doepken Keevican & Weiss Professional Corporation
58th Floor, USX Tower
600 Grant Street
Pittsburgh, Pennsylvania 15219-2703
(412) 355-2600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------------

<PAGE>

(Cover page continued)

Approximate date of commencement of proposed sale to the public:

From time to time after the effective date of this Registration Statement as
determined by market conditions and other factors.

If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]

If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ X ]

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==================================================================================================================================
Title of Each Class of Proposed Maximum Proposed Maximum Amount of
Securities to be Amount to be Offering Price Per Share Aggregate Offering Price Registration
Registered Registered (1) (2) (2) Fee
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 193,124 $3.00 $579,372 $161.07
==================================================================================================================================
</TABLE>

(1) Includes certain shares of common stock of COMFORCE Corporation issuable
pursuant to the terms of a contract entered with COMFORCE.

(2) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(c), the offering price and registration fee are
computed on the basis of the average of the high and low prices of
COMFORCE's shares of common stock traded on the American Stock Exchange
within five business days prior to the filing of this registration
statement. The per share price of $3.00 represents such average on June 30,
1999, a date within five business days prior to the filing of this (the fee
as to which is paid herewith).

COMFORCE hereby amends this Registration Statement on such date or dates as may
be necessary to delay its effective date until COMFORCE shall file a further
amendment which specifically states that this Registration Statement shall
thereafter become effective in accordance with section 8(a) of the Securities
Act of 1933, or until the Registration Statement shall become effective on such
date as the Commission, acting pursuant to said section 8(a), may determine.

<PAGE>

Subject to Completion Dated July 2, 1999

PROSPECTUS

COMFORCE Corporation
193,124 Shares of Common Stock

This prospectus relates to 193,124 shares of common stock of COMFORCE
Corporation that may be sold from time to time by the selling stockholder named
in this prospectus.

COMFORCE will not receive any of the proceeds from the sales by the selling
stockholder.

The common stock is traded on the American Stock Exchange under the symbol
"CFS." On June 30, 1999, the last reported sale price of the common stock on the
American Stock Exchange was $3.00 per share.

Investing in the common stock involves certain risks. You should carefully
consider the risk factors beginning on page 2. Neither the Securities and
Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined that this prospectus is truthful
or complete. Any representation to the contrary is a criminal offense.

COMFORCE Corporation
415 Crossways Park Drive
P.O. Box 9006
Woodbury, New York 11797
(516) 437-3300

The date of this Prospectus is _________, 1999.

<PAGE>

TABLE OF CONTENTS

Page

Where You Can Find More Information ..........................................2
Risk Factors..................................................................3
The Company...................................................................8
Use of Proceeds...............................................................9
Selling Stockholder...........................................................9
Method of Sale................................................................9
Legal Matters................................................................10
Experts......................................................................10

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You can read and copy
any document filed by us at the public reference facilities maintained by the
SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. You may request copies of
these documents, upon payment of a duplicating fee, by writing the SEC at the
address in the previous sentence. Please call the SEC at 1-800-SEC-0330 for
further information on the operation of its public reference room. Our SEC
filings are also available on the SEC's Website at "http://www.sec.gov."

The SEC allows us to "incorporate by reference" information from other
documents that we file with it, which means that we can disclose important
information by referring you to those documents. The information incorporated by
reference is an important part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this information. We
incorporate by reference the following documents:

o Our Annual Report on Form 10-K for the fiscal year ended December 31, 1998.

o Our Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.

o Our Current Reports on Form 8-K dated January 7, 1999 and May 7, 1999.

o The description of our common stock contained in our Form 8-A dated October
10, 1985, as amended by Amendment No. 1 on Form 8A/A dated July 25, 1997.

o All other documents filed by us pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this prospectus and prior to
termination of this offering of common stock.

You may request a copy of any of these documents, except exhibits to the
documents (unless the exhibits are specifically incorporated by reference), at
no cost, by writing or telephoning us at the following address:

COMFORCE Corporation
Attention: Linda Annicelli
415 Crossways Park Drive
P.O. Box 9006
Woodbury, New York 11797
(516) 437-3300

You should rely only on the information contained in this document or that
we have referred you to. We have not authorized anyone else to provide you with
different information.

<PAGE>

RISK FACTORS

Before you invest in the common stock, you should consider carefully the
following factors, in addition to the other information contained in this
prospectus. In addition to historical information, this prospectus contains
forward-looking statements that involve risks and uncertainties. Our actual
results could differ materially from those projected or suggested in any
forward-looking statement. The factors discussed below and the other factors
discussed in this prospectus could cause or contribute to such differences.
Other factors which we have not yet identified could also cause or contribute to
such differences.

Effect of Fluctuations in the General Economy

The general level of economic activity in the country significantly affects
demand for staffing and consulting services. Companies use staffing and
consulting services to manage personnel costs and changes in staffing needs, in
part due to business fluctuations. When economic activity increases, employers
often add employees from staffing and consulting companies before they hire
full-time employees. During such times, there is intense competition among
staffing and consulting companies for qualified personnel for placement, and we
may not be able to recruit and retain sufficient personnel to meet the needs of
our clients. Conversely, as economic activity slows, companies may choose to
reduce their usage of employees from staffing and consulting companies before
laying off their regular employees.

Highly Competitive Market

The contingent staffing and consulting industry is highly competitive.
Heightened competition for customers as well as for contingent personnel could
adversely impact our business in several ways:

o We may need to reduce our current fee scales without being able to reduce
the personnel costs of our billable employees.

o Large, traditional staffing companies have begun to enter the specialty
staffing and consulting sector. As a result, margins may decrease,
particularly for the less highly skilled personnel in that sector.

o Barriers to entry in the contingent staffing business are low, and we could
experience competition from additional competitors entering the business.

o We may not be able to fulfill our customers' needs because of shortages of
qualified personnel, which currently exist in some specialty sectors and
could occur in the future.

o Customers could employ personnel directly (rather than using our services)
to ensure the availability of such personnel.

Some of our competitors have greater marketing, financial and personnel
resources than we do and could offer increased competition. We expect that the
level of competition will remain high in the future and that this competition
could affect our margins, which could have a material adverse effect on our
business, financial condition and results of operations.

<PAGE>

Dependence on Availability of Qualified Staffing Personnel

Our business depends on our ability to attract and retain personnel who
possess the skills and experience necessary to meet the staffing and consulting
requirements of our customers. Competition for individuals with proven skills in
certain areas, particularly information technology, is intense. We compete for
such individuals with other contingent staffing and consulting firms, systems
integrators, providers of outsourcing services, computer systems consultants,
customers and personnel agencies. We must continually evaluate and upgrade our
base of available personnel to keep pace with changing customers' needs and
emerging technologies. We may not be able to continue to attract qualified
personnel in sufficient numbers and on acceptable economic terms. In addition,
although the employment agreements we have entered into contain non-compete
covenants, we may not be able to effectively enforce such agreements against our
former employees.

Liabilities for Customer and Employee Actions

Contingent staffing and consulting firms are in the business of employing
people and placing them in the workplace of other businesses. An attendant risk
of such activity includes possible claims by customers of employee misconduct or
negligence, claims of discrimination and harassment, claims relating to
employment of illegal aliens and other similar claims. We have implemented
policies and guidelines to minimize our exposure to these risks. However, a
failure to follow these policies and guidelines may result in negative publicity
and we could be required to pay money damages or fines. Although historically we
have not had any significant problems in this area, we may experience such
problems in the future.

We are also exposed to liability for actions taken by our employees while
on assignment, such as damage caused by employee errors, misuse of customer
proprietary information or theft of customer property. We maintain insurance to
limit our exposure to these risks. However, because of the nature of our
assignments, in particular the access of our employees to customer information
systems and confidential information, and the potential liability for improper
acts by employees, insurance coverage may not continue to be available or may
not be adequate to cover any such liability.

Increases in Employment Related Costs

We must pay unemployment insurance premiums and workers' compensation
benefits for our billable employees. The states in which employees perform
services set unemployment insurance premiums annually. These premiums could
increase for various reasons, including increased levels of unemployment and the
lengthening of periods for which unemployment compensation is available.
Workers' compensation costs may increase if various states in which we conduct
operations raise levels of compensation or liberalize allowable claims. We are
focusing on efforts to reduce our potential exposure to such claims. We are
largely self-insured with respect to workers' compensation claims, but we
maintain an umbrella insurance policy limiting our exposure for self-insured
claims to $250,000 per claim and a total of $2.3 million in any year. However,
we may incur costs related to workers' compensation claims at rates higher than
anticipated if we experience an increase in the number or the severity of
claims.

Our costs could also increase as the result of any future health care
reforms. Certain federal and state legislative proposals have included
provisions extending health insurance benefits to billable employees who do not
presently receive such benefits.

We may not be able to increase the fees charged to our customers in a
sufficient amount to cover increased costs related to workers' compensation,
unemployment insurance and health care reforms or other employment-related
regulatory changes.

<PAGE>

Potential Impairment of Intangible Assets

More than 50% of our total assets are intangible assets. These intangible
assets substantially represent amounts attributable to goodwill recorded in
connection with our acquisitions and are generally amortized over a five to 40
year period. This amortization results in significant annual charges. Various
factors could impact our ability to generate the earnings necessary to support
this amortization schedule, including

o fluctuations in the economy;

o the degree and nature of competition;

o demand for our services; and

o Our ability to integrate the operations of acquired businesses, to recruit
and place staffing professionals and to maintain gross margins in the face
of pricing pressures.

If we fail to generate sufficient earnings to support the amortization
charge, an impairment of the asset may occur. The resulting write-off could have
a material adverse effect on our business, financial condition and results of
operations.

Substantial Leverage

We have a very high level of debt. Our level of debt could have important
consequences to you, including the following:

o we will have to use a substantial portion of our cash flow from operations
to pay for debt service, rather than for operations or growth;

o our competitors with less debt could have a competitive advantage;

o we could be more vulnerable to economic downturns and less able to take
advantage of significant business opportunities and react to changes in
market or industry conditions;

o we will be vulnerable to increases in interest rates to the extent of
borrowings under our senior credit facility;

o we may not be able to obtain additional financing for working capital,
capital expenditures, debt service requirements or other purposes; and

o we may have to dispose of material assets or operations or refinance our
debt to meet our debt service obligations. We may not be successful in
accomplishing these actions if any of them becomes necessary.

Restrictions Imposed by Terms of Indebtedness

The agreements governing the public debt obligations of our COMFORCE
Operating, Inc. subsidiary, and the credit facility to which we and our
subsidiaries are parties, contain restrictions that affect our ability to incur
debt, make distributions, make acquisitions, create liens, make capital
expenditures and affiliate payments and pay dividends. They also require us to
limit our capital expenditures, affiliate payments and dividends. In addition,
our credit facility requires us to meet specified financial ratios and tests.

Events beyond our control may affect our ability to comply with these
covenants and restrictions, and we may not achieve operating results that will
comply with the financial ratios and tests. If we do not comply with

<PAGE>

these covenants and restrictions, an event of default could occur. An event of
default under any of our financing agreements could have a material adverse
effect on our business and financial condition if it is not cured or waived.

Year 2000 Issues Could Disrupt our Operations

Many existing computer systems and software products do not properly
recognize dates after December 31, 1999. This Year 2000 issue could result in
system failures or miscalculations causing disruptions of operations, including,
among others, a temporary inability to process financial information,
communicate with our customers and our various field offices, issue bills and
payroll statements and otherwise engage in similar normal business activities.

We initiated a major system conversion beginning in early 1998 in order to
improve access to business information through common, integrated computing
systems nationwide. Our conversion to these new systems, which are expected to
make our information technology systems fully Year 2000 compliant, has not been
completed. If this conversion is not completed by December 31, 1999, certain
portions of our existing systems are not expected to be Year 2000 compliant. If
our systems' functions are impaired on January 1, 2000, we believe that we would
be able to perform necessary functions through manual intervention. However, the
use of manual intervention would significantly disrupt our operations and we
would be unable to continue manual processing for an extended period. Any such
disruptions would represent a significant drain on our financial and personnel
resources.

As a part of our Year 2000 compliance program, we are in communication with
material customers, vendors and service providers in order to assess their Year
2000 readiness and seek to ensure that they will be Year 2000 compliant. We
believe that Year 2000 issues faced by these customers and providers, if not
effectively remediated, could adversely affect our business. Other factors which
could potentially cause us to suffer business interruptions or other losses
include our failure to identify latent or other non-compliant codes or
technologies, or the ineffectiveness of any contingency plans we put in place to
mitigate the effects of interruptions in our businesses due to Year 2000
problems.

Future Capital Needs; Potential Dilution

We may need additional financing to fund our strategy of growth through
market development and selective acquisitions. If we issue equity securities to
secure any needed financing, our stockholders may experience dilution. Such
equity securities may have rights, preferences, or privileges senior to those of
the common stock. If we issue debt securities, our leverage would increase. See
" --Substantial Leverage."

Risks Associated with Acquisitions

Since October 1995, we have completed 10 acquisitions. Acquisitions involve
special risks, including unanticipated liabilities and contingencies and
difficulties related to the integration of the acquired businesses. We are
currently in the process of integrating the various information systems of the
acquired businesses. Any significant delay in, or increase in the cost of,
completing this systems integration could have a material adverse effect on our
business, financial condition and results of operations.

Dependence on Key Personnel

We depend in a significant way on our management. Our success depends upon
the availability and performance of John Fanning, Chairman and Chief Executive
Officer, Harry Maccarrone, Executive Vice President, and Robert Baldwin, Chief
Financial Officer. The loss of services of any of these key persons could have a
material adverse effect upon our operations.

<PAGE>

Control by Insiders

John Fanning, Chairman and Chief Executive Officer, currently controls
nearly 30% of our outstanding common stock. As a result, Mr. Fanning will have a
significant influence on all issues submitted to our stockholders. This
concentration of ownership could limit the price that certain investors might be
willing to pay in the future for shares of common stock and could make it more
difficult for a third party to acquire, or could discourage a third party from
attempting to acquire control of us.

Anti-Takeover Provisions

Our Certificate of Incorporation and Bylaws authorize the issuance of
"blank check" preferred stock and establish advance notice requirements for
director nominations and actions to be taken at stockholder meetings. These
provisions could discourage or impede a tender offer, proxy contest or other
similar transaction involving control of COMFORCE, including transactions in
which the stockholders might otherwise receive a premium for their shares over
then current market prices and other transactions that they may deem to be in
their best interests. In particular, preferred stock

o has a preferred position over the common stock on liquidation;

o generally has the right to a fixed or minimum dividend before any dividend
is paid or accrued on the common stock;

o may have the right to approve certain extraordinary corporate matters; and

o could contain terms that would

o delay or prevent a change in control of COMFORCE;

o make removal of our present management more difficult;

o restrict the payment of dividends and other distributions to the
holders of common stock; and

o make it more difficult for a hostile acquiror to gain control of
COMFORCE.

No Cash Dividends

For the foreseeable future we expect to retain our earnings for the
operation and expansion of our business. Thus, we do not expect to pay cash
dividends on our common stock. In addition, our revolving credit facility
prohibits the payment of cash dividends on the common stock without the consent
of the lender.

Historical Losses

On a historical basis, we had net losses of $3.7 million for the year ended
December 31, 1997. While we had net income of $805,000 for the year ended
December 31, 1998, we had net losses in the quarter ended March 31, 1999 of $1.2
million and our operations may not be profitable in the future.

Risks Related to the Loss of Key Customers

As is common in the staffing industry, our engagements to provide services
to our customers are generally non-exclusive, of a short-term nature and subject
to termination by the customer with little or no notice, although some of our
business is done through long-term contracts and contracts that provide us with
the first

<PAGE>

opportunity to supply the personnel required by the customer. For the year ended
December 31, 1998, one customer accounted for approximately 10% of our revenues
and the largest four customers accounted for approximately 31% of our revenues.
We also have numerous other significant customers. The loss of or a material
reduction in the revenues from any of our significant customers could have a
material adverse effect on our business, results of operations and financial
condition.

Possible Volatility of Stock Price

From time to time, the market price for our common stock has been, and may
continue to be, volatile. The market price may fluctuate because of our
quarterly operating results, the operating results of other staffing companies,
changes in general conditions in the economy, the financial markets or the
staffing industry, natural disasters or other developments. In addition, in
recent years the stock market has experienced extreme price and volume
fluctuations. This volatility has had a significant effect on the market prices
of securities issued by many companies for reasons unrelated to their operating
performance.

THE COMPANY

We are a leading provider of specialty staffing, consulting and outsourcing
services primarily to Fortune 500 companies for their information technology,
telecommunications, scientific and engineering-related needs. Through a national
network of 66 offices (47 company-owned and 19 licensed), we recruit and place
highly skilled contingent personnel and provides financial and outsourcing
services for a broad customer base of over 2,300 companies, including Boeing
Corporation, Microsoft Corporation and Sun Microsystems. Our labor force
includes over 8,000 billable employees (on a full-time equivalent basis),
consisting primarily of computer programmers, systems consultants and analysts,
engineers, technicians, scientists, researchers and skilled office support
personnel. Since entering the staffing services business in 1995, we have grown
significantly through a combination of acquisitions and internal growth.

We operate the Staff Augmentation segment of our business through three
divisions -- Information Technology (IT), Telecom and Staffing Services. We
operate the Financial Services segment of our business through our Financial
Services Division. A description of the types of services provided by each
division follows:

o Our IT division provides highly skilled programmers, help desk
personnel, systems consultants and analysts, software engineers and
project managers for a wide range of technical assignments, including
client/server, mainframe, desktop services and Internet/Intranet.

o Our Telecom division provides skilled personnel to plan, design,
engineer, install and maintain wireless and wireline
telecommunications systems, including cellular, PCS, microwave, radio,
satellite and other networks.

o Our Staffing Services division includes the Technical Services group
and the Professional Services group. Our Technical Services group
provides staffing for national laboratory research in such areas as
environmental safety, alternative energy source development and laser
technology, and provides highly-skilled labor meeting diverse
commercial needs in the avionics and aerospace, architectural,
automotive, energy and power, pharmaceutical, marine and petrochemical
fields. Our Professional Services group provides highly specialized
professional chemists, biologists, engineers, laboratory
instrumentation operators, technicians and others to companies
involved in pharmaceutical, environmental, biotech and processing
businesses.

o Through our Financial Services' PrO Unlimited subsidiary, we provide
confidential consulting and conversion services to companies that
require assistance in complying with regulations associated with the
use of independent contractors, returning retirees and consultants.
The

<PAGE>

Financial Services segment also includes outsourcing services to
independent consulting and staffing companies, in which we provide
payroll funding services and back office support to those clients.

USE OF PROCEEDS

We will not receive any proceeds from the sale of the common stock offered
by the selling stockholder.

SELLING STOCKHOLDER

The security holder listed below and any transferee, pledgee or assignee of
this holder named in any supplement to this prospectus are offering for resale
193,124 shares of common stock. We undertake to file a supplement to name as a
selling stockholder any such subsequent holder of these shares of common stock.
Because the selling stockholder may offer all or some part of the common stock
they hold pursuant to the offering contemplated by this prospectus, and because
this offering is not being underwritten (on a firm commitment or any other
basis), no estimate can be given as to the amount of common stock that will be
held by the selling stockholder upon termination of this offering. The table
below sets forth information as of June 29, 1999, concerning the beneficial
ownership of common stock of the selling stockholder named below.

Name of Beneficial Owner Shares Beneficially Shares Offered in this
Owned Prospectus

J. Scott Erbe 224,749 (1) 193,124

- ----------
(1) These shares are owned of record by Mr. Erbe. The shares beneficially owned
by Mr. Erbe represent 1.4% of our issued and outstanding common stock.

METHOD OF SALE

The selling stockholder may offer and sell the shares of common stock to
which this prospectus relates from time to time in one or more types of
transactions (which may include block transactions) on the American Stock
exchange, where our common stock is listed for trading under the symbol "CFS,"
in other markets where our common stock is traded, in negotiated transactions,
through put or call options transactions, through short sales transactions, or
in a combination of such methods of sale. The selling stockholder will sell the
common stock at prices which are current when the sales take place or at other
prices to which the parties agree. The selling stockholder may use brokers or
dealers to sell the shares, and will pay any brokerage fees or commissions
relating to sales in amounts to be negotiated by the parties prior to sale. The
selling stockholder and any brokers or dealers participating in the sale of the
common stock may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended (the "Securities Act"), and any discounts and
commissions received by them and any profit realized by them on the resale of
the shares may be deemed to be underwriting discounts and commissions under the
Securities Act. Some shares may also be sold by other people or entities which
receive the shares from the selling stockholder by gift, by operation of law
(including the laws of descent and distribution) or by other transfers or
assignments.

<PAGE>

The selling stockholder also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act,
provided the selling stockholder meets the criteria and conforms to the
requirements of such Rule.

LEGAL MATTERS

Doepken, Keevican & Weiss Professional Corporation, Pittsburgh,
Pennsylvania, will render a legal opinion on the validity of the common stock
being offered.

EXPERTS

The consolidated balance sheets of COMFORCE Corporation and Subsidiaries as
of December 31, 1998 and 1997, and the consolidated statements of operations,
changes in stockholders' equity and cash flows for each of the three years in
the period ended December 31, 1998, incorporated by reference in this
prospectus, have been incorporated herein in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
that firm as experts in accounting and auditing.

<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution

The expenses estimated to be incurred (other than the fees of the
Commission which are actual) in connection with the offering, all of which are
payable by COMFORCE, are as follows:

Description Amount
----------- ------
SEC. Registration Fee $ 161
Printing Costs 200*
Legal Fees 2,000*
Accounting Fees 5,000*
Miscellaneous 639*
Total $ 8,000*

- -----------
*Estimate

Item 15. Indemnification of Directors and Officers.

The Registrant's Bylaws effectively provide that the Registrant, to the
full extent permitted by Section 145 of the General Corporation Law of the State
of Delaware, as amended from time to time ("Section 145"), shall indemnify all
directors and officers of COMFORCE and may indemnify all employees,
representatives and other persons as permitted pursuant thereto.

Section 145 permits a corporation to indemnify its directors and officers
against expenses (including attorney's fees), judgments, fines and amounts paid
in settlements actually and reasonably incurred by them in connection with any
action, suit or proceeding brought by a third party if such directors or
officers acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reason to believe their conduct was
unlawful. In a derivative action, indemnification may be made only for expenses
actually and reasonably incurred by directors and officers in connection with
the defense or settlement of an action or suit and only with respect to a matter
as to which they shall have acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interest of the corporation, except
that no indemnification shall be made if such person shall have been adjudged
liable to the corporation, unless and only to the extent that the court in which
the action or suit was brought shall determine upon application that the
defendant officers or directors are reasonably entitled to indemnity for such
expenses despite such adjudication of liability.

COMFORCE has entered into separate indemnification agreements with certain
of its current directors, officers and employees. COMFORCE maintains insurance
against liabilities under the Securities Act of 1933 for the benefit of its
officers and directors.

<PAGE>

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to directors, officers or
persons controlling COMFORCE pursuant to the foregoing provisions, COMFORCE has
been informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is therefore unenforceable.

Item 16. Exhibits

2.1 Agreement and Plan of Merger, dated as of August 13, 1997, by and among
COMFORCE Corporation, COMFORCE Columbus, Inc. and Uniforce Services,
Inc. (included as an exhibit to the Company's Current Report on Form
8-K dated August 20, 1997 and incorporated herein by reference).

2.2 Stockholders Agreement, dated as of August 13, 1997, by and among
COMFORCE Corporation, COMFORCE Columbus, Inc., John Fanning and Fanning
Limited Partnership, L.P. (included as an exhibit to the Company's
Current Report on Form 8-K dated August 20, 1997 and incorporated
herein by reference).

2.3 Registration Rights Agreement dated as of August 13, 1997 by and among
the Company, John Fanning and Fanning Asset Partners, L.P., a Georgia
limited partnership (included as an exhibit to Amendment No. 2 to the
Registration Statement on Form S-4 of the Company filed with the
Commission on October 24, 1997 and incorporated herein by reference).

3.1 Restated Certificate of Incorporation of the Company, as amended by
Certificates of Amendment filed with the Delaware Secretary of State on
June 14, 1987 and February 12, 1991 (included as an exhibit to
Amendment No. 1 to the Registration Statement on Form S-1 of the
Company filed with the Commission on May 10, 1996 and incorporated
herein by reference).

3.2 Certificate of Ownership (Merger) of COMFORCE Corporation into the
Company (included as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1995 and incorporated herein by
reference).

3.3 Bylaws of the Company, as amended and restated effective as of February
26, 1997 (included as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1996 and incorporated herein by
reference).

3.4 Certificate of Ownership (Merger) of AZATAR into the Company (included
as an exhibit to the Company's Current Report on Form 8-K dated
November 8, 1996 and incorporated herein by reference).

4.1 Indenture dated as of November 26, 1997 with respect to 12% Senior
Notes due 2007 between COMFORCE Operating, Inc., as issuer, and
Wilmington Trust Company, as trustee (included as an exhibit to the
Company's Current Report on Form 8-K dated December 9, 1997 and
incorporated herein by reference).

4.2 Indenture dated as of November 26, 1997 with respect to 15% Senior
Secured PIK Debentures due 2009 between COMFORCE Corporation, as
issuer, and The Bank of New York, as trustee (included as an exhibit to
the Company's Current Report on Form 8-K dated December 9, 1997 and
incorporated herein by reference).

5.1* Opinion of Doepken Keevican & Weiss.

10.1 Loan and Security Agreement dated as of November 26, 1997 among
COMFORCE Corporation and specified subsidiaries thereof and Heller
Financial, Inc., as lender and agent for other lenders (included

<PAGE>

as an exhibit to the Company's Current Report on Form 8-K dated
December 9, 1997 and incorporated herein by reference).

10.2 Purchase Agreement, dated as of November 19, 1997, by and between
COMFORCE Operating, Inc. and NatWest Capital Markets Limited, as
Initial Purchaser (included as an exhibit to the Registration Statement
on Form S-4 of the Company filed with the Commission on December 24,
1997 and incorporated herein by reference).

10.3 Purchase Agreement, dated as of November 19, 1997, by and between dated
as of November 26, 1997, by and between the Company and NatWest Capital
Markets Limited, as Initial Purchaser (included as an exhibit to the
Registration Statement on Form S-4 of the Company filed with the
Commission on December 24, 1997 and incorporated herein by reference).

10.4 Warrant Agreement dated November 26, 1997 by and between the Company
and The Bank of New York, as Warrant Agent (included as an exhibit to
the Registration Statement on Form S-4 of the Company filed with the
Commission on December 24, 1997 and incorporated herein by reference).

10.5 Pledge Agreement dated November 26, 1997 by and between the Company and
The Bank of New York, as Collateral Agent (included as an exhibit to
the Registration Statement on Form S-4 of the Company filed with the
Commission on December 24, 1997 and incorporated herein by reference).

10.6 Employment Agreement dated as of January 1, 1999 between the Company,
COMFORCE Operating, Inc. and John C. Fanning (included as an exhibit to
the Company's Annual Report on Form 10-K for the year ended December
31, 1998 and incorporated herein by reference).

10.7 Employment Agreement dated as of January 1, 1999 between the Company,
COMFORCE Operating, Inc. and Harry Maccarrone (included as an exhibit
to the Company's Annual Report on Form 10-K for the year ended December
31, 1998 and incorporated herein by reference).

21.1* List of Subsidiaries.

23.1* Consent of Doepken Keevican & Weiss (included in the opinion filed as
Exhibit 5.1 to this Registration Statement.

23.2* Consent of PricewaterhouseCoopers LLP.

24.1* Powers of Attorney.
- -------------------------
* Filed herewith.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

<PAGE>

(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be filed on its behalf by the
undersigned, thereunto duly authorized, in the City of Woodbury, State of New
York, on July 2, 1999.

COMFORCE Corporation
(Registrant)

By: /s/ Robert H.B. Baldwin, Jr.
----------------------------
Robert H.B. Baldwin, Jr.,
Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ John C. Fanning* Chairman, Chief Executive
- ------------------------------ Officer and Director
John C. Fanning (Principal Executive Officer) July 2, 1999

/s/ Harry Maccarrone* Executive Vice President
- ------------------------------ and Director (Principal
Harry Maccarrone Accounting Officer) July 2, 1999

/s/ Robert H.B. Baldwin, Jr. Senior Vice President and
- ------------------------------ Chief Financial Officer
Robert H.B. Baldwin, Jr. (Principal Financial Officer) July 2, 1999

/s/ Gordon Robinett* Director July 2, 1999
- ------------------------------
Gordon Robinett

/s/ Daniel Raynor* Director July 2, 1999
- ------------------------------
Daniel Raynor

/s/ Kenneth Daley* Director July 2, 1999
- ------------------------------

* By: /s/ Robert H.B. Baldwin, Jr. Attorney-in-Fact July 2, 1999
--------------------------------
Robert H.B. Baldwin, Jr.
</TABLE>

Exhibit 5.1

July 2, 1999

COMFORCE Corporation
415 Crossways Park Drive
P.O. Box 9006
Woodbury, NY 11797

RE: COMFORCE Corporation
Registration Statement of Form S-3

Ladies and Gentlemen:

We have acted as counsel for COMFORCE Corporation, a Delaware corporation
(the "Company"), in connection with the registration with the Securities and
Exchange Commission (the "SEC") by the Company of 193,124 shares of the
Company's common stock ("Common Stock") pursuant to the Securities Act of 1933,
as amended (the "Act"), for sale by a selling stockholder.

In connection with the registration, we have examined the following:

(a) The Certificate of Incorporation and By-laws of the Company, each as
amended to date;

(b) The Registration Statement on Form S-3 (the "Registration Statement"),
including the prospectus which is a part thereof (the "Prospectus"),
relating to the Common Stock, as filed with the SEC;

(d) Such other agreements, documents, records, opinions, certificates and
papers as we have deemed necessary or appropriate in order to give the
opinions hereinafter set forth.

The opinions hereinafter expressed are subject to the following
qualifications and assumptions :

(i) In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals and the
conformity of all documents submitted to us as copies to the originals
thereof.

(ii) As to the accuracy of certain factual matters, we have relied on the
certificates of officers of the Company and certificates, letters,
telegrams or statements of public officials.

Based upon and subject to the foregoing, we are pleased to advise you that,
insofar as the laws of the State of Delaware are concerned, it is our opinion
that the 193,124 shares of Common Stock being registered for resale under the
Registration Statement have been legally issued, fully paid and non-assessable.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement, and to the use of our name in the Prospectus in
connection with the matters referred to under the caption "Legal Matters."

Very truly yours,

/s/ Doepken Keevican & Weiss

DOEPKEN KEEVICAN & WEISS
PROFESSIONAL CORPORATION

Exhibit 21.1

Subsidiaries of COMFORCE Corporation

The following is a complete list of all of the subsidiaries of COMFORCE
Corporation with jurisdiction of incorporation indicated thereby.

1. COMFORCE Operating, Inc. (Delaware)
2. COMFORCE Technical Services, Inc. (Delaware)
3. COMFORCE Information Technologies, Inc. (Delaware)
4. COMFORCE Telecom, Inc. (Delaware)
5. Project Staffing Support Team, Inc. (Arizona)
6. RHO Acquisition Company (Delaware)
7. RHO Company Incorporated (Washington)
8. COMFORCE IT Acquisition Corp., Inc. (Delaware)
9. Force Five, Inc. (Texas)
10. SUMTEC Corporation (Delaware)
11. Uniforce Services, Inc. (New York)
12. PrO Unlimited, Inc. (New York)
13. Uniforce Staffing Services, Inc. (New York)
14. PrO N.E., Inc. (New York)
15. USSI-NE Corp. (New York)
16. Uniforce Payrolling Services, Inc. (New York)
17. USI Inc. of California (California)
18. UTS Corp. of Minnesota (Minnesota)
19. UTS of Delaware, Inc. (Delaware)
20. LabForce of America, Inc. (New York)
21. Uniforce MIS Services of Georgia, Inc. (Georgia)
22. Uniforce Information Services of Texas, Inc. (New York)
23. Temporary Help Industry Servicing Co., Inc. (New York)
24. Montare International, Inc. (Texas)
25. Brannon & Tully, Inc. (Georgia)
26. Professional Staffing Funding & Support, Inc. (New York)
27. Brentwood Service Group, Inc. (New York)
28. Computer Consultants Funding & Support, Inc. (New York)
29. Thisco of Canada, Inc. (New York)
30. Camelot Consulting Group, Inc. (New Jersey)
31. Camelot Communications Group, Inc. (New Jersey)
32. Camelot Control Group, Inc. (New Jersey)
33. Camelot Group, Inc. (New Jersey)
34. RHO Services, Inc. (Washington)
35. PrO Services, Inc. (Delaware)
36. PrO Unlimited Services, Inc. (Delaware)
37. COMFORCE Technical Administrative Services, Inc. (New York)
38. Uniforce Payrolling Tri-State, Inc. (New York)

Exhibit 23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in the registration statement
of COMFORCE Corporation on Form S-3 (File no. ) of our report dated February 25,
1999, on our audits of the consolidated financial statements and financial
statement schedule of COMFORCE Corporation as of December 31, 1998 and 1997 and
for the years ended December 31, 1998, 1997 and 1996, which report is included
in the Annual Report on Form 10-K. We also consent to the reference to our firm
under the caption "Experts."

PRICEWATERHOUSECOOPERS LLP

New York, New York
July 2, 1999

Exhibit 24.1

POWER OF ATTORNEY

KNOW BY ALL MEN BY THESE PRESENTS, that each of the undersigned, a director
or officer or both, of COMFORCE Corporation, a Delaware corporation (the
"Company"), does hereby appoint Harry Maccarrone and Robert H.B. Baldwin, Jr.,
and each of them, with full power to act without the other, such person's true
and lawful attorneys-in-fact, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign Form S-3 and S-8 Registration Statements, and any and all
amendments thereto (including post-effective amendments), relating to the
registration of shares to be issued by selling stockholders, including any S-8
respecting the COMFORCE Corporation Long-Term Stock Investment Plan, and to file
the same, with exhibits and schedules thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact, and each of them, with full power and authority to do and
perform each and every act and thing necessary or desirable to be done in or
about the premises, as fully to all intents and purposes as he or she might or
could do in person, thereby ratifying and confirming all that said
attorneys-in-fact, or any of them, or their or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has subscribed these presents this 29th
day of June, 1999.

/s/ Gordon Robinett
- --------------------------
Gordon Robinett

/s/ Daniel Raynor
- --------------------------
Daniel Raynor

/s/ Kenneth Daley
- --------------------------
Kenneth Daley

<PAGE>

POWER OF ATTORNEY

IN WITNESS WHEREOF, the undersigned has subscribed these presents this 2nd
day of July, 1999.

/s/ John C. Fanning
- -------------------------------
John C. Fanning

/s/ Harry Maccarrone
- -------------------------------
Harry Maccarrone

/s/ Robert H.B. Baldwin, Jr.
- -------------------------------
Robert H.B. Baldwin, Jr.