<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 4, 1996
REGISTRATION NO. 333-12207
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PRE-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
ACCUSTAFF INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FLORIDA 7363 59-3116655
(STATE OR OTHER (PRIMARY STANDARD (I.R.S. EMPLOYER
JURISDICTION OF INDUSTRIAL IDENTIFICATION NO.)
INCORPORATION) CLASSIFICATION CODE
NUMBER)
6440 ATLANTIC BOULEVARD
JACKSONVILLE, FLORIDA 32211
(904) 725-5574
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
DEREK E. DEWAN
CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER
ACCUSTAFF INCORPORATED
6440 ATLANTIC BOULEVARD
JACKSONVILLE, FLORIDA 32211
(904) 725-5574
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
JEFFREY A. ALLRED LEONARD GUBAR
DAVID E. BROWN, JR. STEVEN L. WASSERMAN
TIMOTHY MANN, JR. RICHARD S. GREEN
ALSTON & BIRD REID & PRIEST LLP
ONE ATLANTIC CENTER 40 WEST 57TH STREET
1201 WEST PEACHTREE STREET NEW YORK, NEW YORK 10019-4097
ATLANTA, GEORGIA 30309-3424 (212) 603-2000
(404) 881-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the consummation of the Merger (as defined below).
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. [_]
----------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
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.
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- -------------------------------------------------------------------------------
<PAGE>
CAREER HORIZONS, INC.
177 CROSSWAYS PARK DRIVE
WOODBURY, NEW YORK 11797
October 8, 1996
Dear Stockholder:
You are cordially invited to attend the special meeting of stockholders
("Special Meeting") of Career Horizons, Inc., a Delaware corporation
("Career"), to be held at the Long Island Marriott Hotel, 101 James Doolittle
Blvd., Uniondale, New York, at 10:00 a.m., local time, on November 14, 1996.
At this important meeting, you will be asked to consider and vote upon a
proposal to adopt the Agreement and Plan of Merger, dated as of August 25,
1996 (the "Merger Agreement"), by and among AccuStaff Incorporated, a Florida
corporation ("AccuStaff"), Sunrise Merger Corporation, a wholly owned
subsidiary of AccuStaff ("Newco"), and Career, which provides for the merger
(the "Merger") of Newco with and into Career. If the proposed Merger is
consummated, Career will become a wholly owned subsidiary of AccuStaff and
each outstanding share of common stock, par value $.01 per share, of Career
("Career Common Stock") (excluding shares held by Career, AccuStaff or any of
their respective subsidiaries) will be converted into the right to receive a
number of shares of AccuStaff common stock equal to the Exchange Ratio (as
defined below), with cash being paid in lieu of any fractional share interest.
The "Exchange Ratio" will equal 1.53 shares of AccuStaff Common Stock;
provided, that, in the event that the average of the daily last sale prices
for the shares of AccuStaff Common Stock for the 20 consecutive trading days
on which such shares are actually traded and quoted on the Nasdaq National
Market (as reported by The Wall Street Journal) ending at the close of trading
on the second trading day immediately preceding the closing date of the Merger
(the "Average Closing Price") is greater than $31.60, the Exchange Ratio will
equal that multiple of a share of AccuStaff Common Stock (rounded to the
nearest ten thousandth of a share) obtained by dividing $48.348 (the product
of 1.53 and $31.60) by the Average Closing Price, but in no event will the
Exchange Ratio be less than 1.2444; provided further, that, in the event that
the Average Closing Price is less than $21.07, the Exchange Ratio shall equal
that multiple of a share of AccuStaff Common Stock (rounded to the nearest ten
thousandth of a share) obtained by dividing $32.2371 (the product of 1.53 and
$21.07) by the Average Closing Price, but in no event will the Exchange Ratio
be greater than 1.8006.
Adoption of the Merger Agreement requires the affirmative vote of the
holders of a majority of the outstanding shares of Career Common Stock
entitled to vote at the Special Meeting.
Enclosed are (i) a Notice of Special Meeting, (ii) a Joint Proxy
Statement/Prospectus, and (iii) a form of proxy for the Special Meeting. The
Joint Proxy Statement/Prospectus describes in more detail the Merger Agreement
and the Merger, including a description of the conditions to consummation of
the Merger and the effects of the Merger on the rights of Career stockholders,
and contains financial and other information about AccuStaff and Career.
Please give this information your careful attention.
Salomon Brothers Inc, independent financial advisor to the Board of
Directors in connection with the Merger, has rendered an opinion to the Board
of Directors that, as of August 25, 1996, the Exchange Ratio was fair to the
holders of Career Common Stock from a financial point of view.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED AND ADOPTED THE MERGER
AGREEMENT AND UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR ADOPTION OF THE MERGER
AGREEMENT.
In view of the importance of the action to be taken, we urge you to
complete, sign, and date the enclosed proxy and to return it promptly in the
enclosed envelope, whether or not you plan to attend the Special Meeting (if
you attend the Special Meeting, you may vote in person, even if you previously
returned your proxy).
We look forward to seeing you at the Special Meeting.
Sincerely,
Walter W. Macauley
President and Chief Executive
Officer
<PAGE>
CAREER HORIZONS, INC.
177 CROSSWAYS PARK DRIVE
WOODBURY, NEW YORK 11797
----------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD AT 10:00 A.M. ON NOVEMBER 14, 1996
To the Stockholders of Career Horizons, Inc.:
NOTICE IS HEREBY GIVEN that a special meeting of stockholders ("Special
Meeting") of Career Horizons, Inc., a Delaware corporation ("Career"), will be
held at the Long Island Marriott Hotel, 101 James Doolittle Blvd., Uniondale,
New York, at 10:00 a.m., local time, on November 14, 1996, to consider and
vote upon a proposal to approve the Agreement and Plan of Merger, dated as of
August 25, 1996 (the "Merger Agreement"), by and among Career, AccuStaff
Incorporated, a Florida corporation ("AccuStaff") and Sunrise Merger
Corporation, a wholly owned subsidiary of AccuStaff ("Newco"), pursuant to
which, among other matters, Newco will merge with and into Career (the
"Merger"), with Career becoming a wholly owned subsidiary of AccuStaff, and
each share of common stock, par value $.01 per share, of Career ("Career
Common Stock") (excluding shares held by Career, AccuStaff, or any of their
respective subsidiaries) will be converted into the right to receive a number
of shares of AccuStaff common stock ("AccuStaff Common Stock") equal to the
Exchange Ratio (as defined below), with cash being paid in lieu of any
fractional share interest. The "Exchange Ratio" will equal 1.53 shares of
AccuStaff Common Stock; provided, that, in the event that the average of the
daily last sale prices for the shares of AccuStaff Common Stock for the 20
consecutive trading days on which such shares are actually traded and quoted
on the Nasdaq National Market (as reported by The Wall Street Journal) ending
at the close of trading on the second trading day immediately preceding the
closing date of the Merger (the "Average Closing Price") is greater than
$31.60, the Exchange Ratio will equal that multiple of a share of AccuStaff
Common Stock (rounded to the nearest ten thousandth of a share) obtained by
dividing $48.348 (the product of 1.53 and $31.60) by the Average Closing
Price, but in no event will the Exchange Ratio be less than 1.2444; provided
further, that, in the event that the Average Closing Price is less than
$21.07, the Exchange Ratio shall equal that multiple of a share of AccuStaff
Common Stock (rounded to the nearest ten thousandth of a share) obtained by
dividing $32.2371 (the product of 1.53 and $21.07) by the Average Closing
Price, but in no event will the Exchange Ratio be greater than 1.8006. A copy
of the Merger Agreement is set forth in Annex A to the accompanying Joint
Proxy Statement/Prospectus and is hereby incorporated by reference herein.
Only stockholders of record at the close of business on October 4, 1996, are
entitled to receive notice of and to vote at the Special Meeting or any
adjournments or postponements thereof. Holders of Career Common Stock are
entitled to one vote on each matter considered and voted on at the Special
Meeting for each share of Career Common Stock held of record at the close of
business on such date. Adoption of the Merger Agreement requires the
affirmative vote of the holders of a majority of the outstanding shares of
Career Common Stock entitled to vote at the Special Meeting.
THE BOARD OF DIRECTORS OF CAREER UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS
VOTE "FOR" ADOPTION OF THE MERGER AGREEMENT.
BY ORDER OF THE BOARD OF DIRECTORS
Mike G. Reinecke
Secretary
Woodbury, New York
October 8, 1996
<PAGE>
ACCUSTAFF INCORPORATED
6440 ATLANTIC BOULEVARD
JACKSONVILLE, FLORIDA 32211
October 8, 1996
Dear Stockholder:
You are cordially invited to attend the special meeting of stockholders
("Special Meeting") of AccuStaff Incorporated ("AccuStaff") to be held in the
South Ballroom of the Prime F. Osborn Convention Center, 1000 Water Street,
Jacksonville, Florida, at 10:00 a.m., local time, on November 14, 1996.
At this important meeting, you will be asked to consider and vote upon the
approval of the issuance of shares of AccuStaff common stock, par value $.01
per share ("AccuStaff Common Stock"), pursuant to an Agreement and Plan of
Merger, dated as of August 25, 1996 (the "Merger Agreement"), by and among
AccuStaff, Sunrise Merger Corporation, a wholly owned subsidiary of AccuStaff
("Newco"), and Career Horizons, Inc. ("Career"), which provides for the merger
(the "Merger") of Newco with and into Career. If the proposed Merger is
consummated, Career will become a wholly owned subsidiary of AccuStaff and
each outstanding share of Career common stock will be converted into the right
to receive shares of AccuStaff Common Stock, all on the basis set forth in the
Merger Agreement and described in the enclosed Joint Proxy
Statement/Prospectus.
Enclosed are (i) a Notice of Special Meeting, (ii) a Joint Proxy
Statement/Prospectus, and (iii) a form of proxy for the Special Meeting. The
Joint Proxy Statement/Prospectus describes in more detail the Merger Agreement
and the Merger, including a description of the conditions to consummation of
the Merger, and contains financial and other information about Career and
AccuStaff. Please give this information your careful attention.
THE BOARD OF DIRECTORS HAS APPROVED AND ADOPTED THE MERGER AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR APPROVAL OF THE ISSUANCE OF SHARES OF
ACCUSTAFF COMMON STOCK PURSUANT TO THE MERGER AGREEMENT.
In view of the importance of the action to be taken, we urge you to
complete, sign, and date the enclosed proxy and to return it promptly in the
enclosed envelope, whether or not you plan to attend the Special Meeting (if
you attend the Special Meeting, you may vote in person, even if you previously
returned your proxy).
We look forward to seeing you at the Special Meeting.
Sincerely,
Derek E. Dewan
Chairman of the Board, President and
Chief Executive Officer
<PAGE>
ACCUSTAFF INCORPORATED
6440 ATLANTIC BOULEVARD
JACKSONVILLE, FLORIDA 32211
----------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD AT 10:00 A.M. ON NOVEMBER 14, 1996
October 8, 1996
To the Stockholders of AccuStaff Incorporated:
NOTICE IS HEREBY GIVEN that the special meeting of stockholders ("Special
Meeting") of AccuStaff Incorporated ("AccuStaff") will be held in the South
Ballroom of the Prime F. Osborn Convention Center, 1000 Water Street,
Jacksonville, Florida, at 10:00 a.m., local time, on November 14, 1996 for the
following purposes:
1. Issuance of Shares of AccuStaff Common Stock Pursuant to the Merger
Agreement. To consider and vote upon a proposal to approve the issuance of
shares of AccuStaff common stock, par value $.01 per share ("AccuStaff
Common Stock"), pursuant to an Agreement and Plan of Merger, dated as of
August 25, 1996 (the "Merger Agreement"), by and among AccuStaff, Sunrise
Merger Corporation, a wholly owned subsidiary of AccuStaff ("Newco"), and
Career Horizons, Inc. ("Career"), pursuant to which, among other matters,
Newco will merge with and into Career (the "Merger"), with Career becoming
a wholly owned subsidiary of AccuStaff and each share of Career common
stock (excluding shares held by Career, AccuStaff or any of their
respective subsidiaries) will be converted into the right to receive shares
of AccuStaff Common Stock, all as more fully described in the accompanying
Joint Proxy Statement/Prospectus. A copy of the Merger Agreement is set
forth in Annex A to the accompanying Joint Proxy Statement/Prospectus and
is hereby incorporated by reference herein.
2. Other Business. To transact such other business as may properly come
before the Special Meeting or any adjournments or postponements thereof.
Only holders of record of AccuStaff Common Stock at the close of business on
October 4, 1996, are entitled to receive notice of and to vote at the Special
Meeting or any adjournments or postponements thereof. Holders of AccuStaff
Common Stock are entitled to one vote on each matter considered and voted on
at the AccuStaff Special Meeting for each share of AccuStaff Common Stock held
of record at the close of business on such date. The presence in person or by
proxy of a majority of the votes entitled to be cast by holders of AccuStaff
Common Stock will constitute a quorum, and the issuance of shares of AccuStaff
Common Stock pursuant to the Merger Agreement must be approved by a majority
of the votes cast on such proposal.
THE BOARD OF DIRECTORS OF ACCUSTAFF UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS
VOTE "FOR" APPROVAL OF THE ISSUANCE OF SHARES OF ACCUSTAFF COMMON STOCK
PURSUANT TO THE MERGER AGREEMENT.
BY ORDER OF THE BOARD OF DIRECTORS
Michael D. Abney
Assistant Secretary
<PAGE>
PROSPECTUS
----------
ACCUSTAFF INCORPORATED
COMMON STOCK
(PAR VALUE $.01 PER SHARE)
JOINT PROXY STATEMENT
---------------------
ACCUSTAFF INCORPORATED CAREER HORIZONS, INC.
SPECIAL MEETING OF STOCKHOLDERS SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 14, 1996 TO BE HELD ON NOVEMBER 14, 1996
---------------
This Joint Proxy Statement/Prospectus is being furnished to holders of
common stock, par value $.01 per share ("Career Common Stock"), of Career
Horizons, Inc., a Delaware corporation ("Career"), in connection with the
solicitation of proxies by the Career Board of Directors for use at the
Special Meeting of Stockholders to be held at 10:00 a.m., local time, on
November 14, 1996, at the Long Island Marriott Hotel, 101 James Doolittle
Blvd., Uniondale, New York, and at any adjournments or postponements thereof
(the "Career Special Meeting"). The purpose of the Career Special Meeting is
to consider and vote upon a proposal to approve the Agreement and Plan of
Merger, dated as of August 25, 1996 (the "Merger Agreement"), by and among
Career, AccuStaff Incorporated, a Florida corporation ("AccuStaff"), and
Sunrise Merger Corporation, a Delaware corporation and wholly owned subsidiary
of AccuStaff ("Newco"), which provides for, among other things, the merger of
Newco with and into Career (the "Merger"), with Career becoming a wholly owned
subsidiary of AccuStaff. Upon consummation of the Merger, each outstanding
share of Career Common Stock (excluding shares held by Career, AccuStaff or
any of their respective subsidiaries) shall cease to be outstanding and shall
be converted into the right to receive a number of shares of AccuStaff common
stock, par value $.01 per share ("AccuStaff Common Stock"), equal to the
Exchange Ratio (as defined below), with cash being paid in lieu of any
fractional share interest. The "Exchange Ratio" will equal 1.53 shares of
AccuStaff Common Stock; provided, that, in the event that the average of the
daily last sale prices for the shares of AccuStaff Common Stock for the 20
consecutive trading days on which such shares are actually traded and quoted
on the Nasdaq National Market (as reported by The Wall Street Journal) ending
at the close of trading on the second trading day immediately preceding the
closing date of the Merger (the "Average Closing Price") is greater than
$31.60, the Exchange Ratio will equal that multiple of a share of AccuStaff
Common Stock (rounded to the nearest ten thousandth of a share) obtained by
dividing $48.348 (the product of 1.53 and $31.60) by the Average Closing
Price, but in no event will the Exchange Ratio be less than 1.2444; provided
further, that, in the event that the Average Closing Price is less than
$21.07, the Exchange Ratio shall equal that multiple of a share of AccuStaff
Common Stock (rounded to the nearest ten thousandth of a share) obtained by
dividing $32.2371 (the product of 1.53 and $21.07) by the Average Closing
Price, but in no event will the Exchange Ratio be greater than 1.8006. See
"Summary," "The Merger," and Annex A to this Joint Proxy Statement/Prospectus.
This Joint Proxy Statement/Prospectus is also being furnished to holders of
AccuStaff Common Stock, in connection with the solicitation of proxies by the
AccuStaff Board of Directors for use at the Special Meeting of Stockholders to
be held at 10:00 a.m., local time, on November 14, 1996, in the South Ballroom
of the Prime F. Osborn Convention Center, 1000 Water Street, Jacksonville,
Florida, and at any adjournments or postponements thereof (the "AccuStaff
Special Meeting"). The purpose of the AccuStaff Special Meeting is to consider
and vote upon a proposal to approve the issuance of shares of AccuStaff Common
Stock pursuant to the Merger Agreement. See "Summary," "The Merger," and Annex
A to this Joint Proxy Statement/Prospectus.
This Joint Proxy Statement/Prospectus also constitutes the prospectus of
AccuStaff relating to the approximately 43,348,854 shares of AccuStaff Common
Stock issuable to Career stockholders in the Merger. See "Certain Differences
in the Rights of AccuStaff and Career Stockholders."
SEE "RISK FACTORS" ON PAGE 22 FOR CERTAIN INFORMATION THAT SHOULD BE
CONSIDERED BY HOLDERS OF CAREER COMMON STOCK WITH RESPECT TO THE SHARES OF
ACCUSTAFF COMMON STOCK OFFERED HEREBY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Joint Proxy Statement/Prospectus is October 8, 1996, and it
is first being mailed or otherwise delivered to Career stockholders and to
AccuStaff stockholders on or about October 8, 1996.
<PAGE>
AVAILABLE INFORMATION
AccuStaff and Career are each subject to the reporting and informational
requirements of the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder (the "Exchange Act"), and, in accordance therewith,
file reports, proxy and information statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy and
information statements and other information filed by AccuStaff and Career
with the Commission may be inspected and copied at the principal office of the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and should be available at the Commission's Regional Offices at 7
World Trade Center, New York, New York 10048, and Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material may also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. In addition, the Commission maintains a site on the World Wide Web at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. Reports, proxy statements and other information concerning Career
also may be inspected at the offices of the New York Stock Exchange, Inc.
("NYSE"), 20 Broad Street, New York, New York 10005.
This Joint Proxy Statement/Prospectus constitutes a part of a Registration
Statement on Form S-4 (together with any amendments thereto, the "Registration
Statement"), which has been filed by AccuStaff with the Commission under the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(the "Securities Act"). This Joint Proxy Statement/Prospectus omits certain
information contained in the Registration Statement, and reference is hereby
made to the Registration Statement and to the exhibits thereto for further
information with respect to AccuStaff and Career and the securities to which
this Joint Proxy Statement/Prospectus relates. Statements contained in this
Joint Proxy Statement/Prospectus concerning the provisions of certain
documents filed as exhibits to the Registration Statement are necessarily
brief descriptions thereof, and are not necessarily complete, and each such
statement is qualified in its entirety by reference to the full text of such
document.
THIS PROXY STATEMENT/PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE THAT ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE
WITHOUT CHARGE UPON REQUEST FROM: ACCUSTAFF INCORPORATED, 6440 ATLANTIC
BOULEVARD, JACKSONVILLE, FLORIDA 32211, ATTN: MICHAEL D. ABNEY, CHIEF
FINANCIAL OFFICER, (904) 725-5574, AS TO ACCUSTAFF DOCUMENTS; AND FROM CAREER
HORIZONS, INC., 177 CROSSWAYS PARK DRIVE, WOODBURY, NEW YORK 11797, ATTN: MIKE
G. REINECKE, VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY, (516) 682-1400, AS
TO CAREER DOCUMENTS. IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY
REQUESTS SHOULD BE MADE AT LEAST FIVE BUSINESS DAYS PRIOR TO THE DATE OF THE
SPECIAL MEETINGS.
All information contained herein with respect to AccuStaff and its
subsidiaries has been supplied by AccuStaff, and all information with respect
to Career and its subsidiaries has been supplied by Career.
No person has been authorized to give any information or to make any
representation other than those contained in this Joint Proxy
Statement/Prospectus and, if given or made, such information or representation
should not be relied upon as having been authorized by AccuStaff or Career.
Neither the delivery of this Joint Proxy Statement/Prospectus nor any
distribution of the securities to which this Joint Proxy Statement/Prospectus
relates shall, under any circumstances, create any implication that there has
been no change in the affairs of AccuStaff, Career or any of their respective
subsidiaries since the date hereof or that the information contained herein is
correct as of any time subsequent to its date. This Joint Proxy
Statement/Prospectus does not constitute an offer to sell, or a solicitation
of an offer to purchase, any securities other than the securities to which it
relates or an offer to sell or a solicitation of an offer to purchase the
securities offered by this Joint Proxy Statement/Prospectus in any
jurisdiction in which such an offer or solicitation is not lawful.
2
<PAGE>
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by AccuStaff and Career with the Commission
(AccuStaff Commission File No. 0-24484; Career Commission File No. 001-14172)
under Section 13(a) or 15(d) of the Exchange Act are hereby incorporated by
reference in this Joint Proxy Statement/Prospectus:
AccuStaff documents:
(i) Annual Report on Form 10-K for the fiscal year ended December 31,
1995;
(ii) Quarterly Reports on Form 10-Q for the fiscal quarters ended March
31, 1996 and June 30, 1996;
(iii) the following Current Reports on Form 8-K: Form 8-K/A dated July 2,
1995; Form 8-K/A dated October 31, 1995; Form 8-K/A dated December 13,
1995; Form 8-K dated January 2, 1996; Form 8-K/A dated January 2, 1996;
Form 8-K dated January 3, 1996; Form 8-K dated February 19, 1996; Form 8-K
dated February 20, 1996; Form 8-K/A dated February 19, 1996; Form 8-K dated
June 19, 1996; Form 8-K/A dated June 19, 1996; and Form 8-K dated August
25, 1996; Form 8-K dated September 16, 1996; and Form 8-K dated September
16, 1996; and
(iv) the description of AccuStaff Common Stock set forth in AccuStaff's
registration statement filed pursuant to Section 12 of the Exchange Act,
and any amendment or report filed for the purpose of updating any such
description.
Career documents:
(i) Annual Report on Form 10-K for the fiscal year ended June 30, 1995;
(ii) Transition Report on Form 10-K for the period from July 1, 1995 to
December 31, 1995;
(iii) Quarterly Reports on Form 10-Q for the fiscal quarters ended March
31, 1996 and June 30, 1996; and
(iv) Current Reports on Form 8-K, dated August 17, 1995, October 4, 1995,
October 26, 1995, December 20, 1995, January 11, 1996, January 17, 1996,
January 18, 1996, February 8, 1996, February 20, 1996, March 1, 1996, March
4, 1996, April 1, 1996, April 24, 1996, April 30, 1996, May 1, 1996, May
21, 1996, June 24, 1996, July 24, 1996, August 25, 1996, August 28, 1996,
and September 16, 1996 and Amended Current Reports on Form 8-K/A, dated
December 20, 1995 and June 24, 1996.
All documents filed by AccuStaff or Career pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Joint
Proxy Statement/Prospectus and prior to the later of the date of the AccuStaff
Special Meeting and the date of the Career Special Meeting are hereby
incorporated by reference in this Joint Proxy Statement/Prospectus and shall
be deemed to be a part hereof from the date of filing of such documents.
Any statement contained herein, in any amendment or supplement hereto or in
a document incorporated or deemed to be incorporated by reference herein,
shall be deemed to be modified or superseded for purposes of the Registration
Statement and this Joint Proxy Statement/Prospectus to the extent that a
statement contained herein, in any amendment or supplement hereto or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference herein, modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of the Registration Statement,
this Joint Proxy Statement/Prospectus, or any amendment or supplement hereto.
3
<PAGE>
FORWARD LOOKING STATEMENTS
THIS JOINT PROXY STATEMENT/PROSPECTUS CONTAINS AND INCORPORATES BY REFERENCE
CERTAIN FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995 WITH RESPECT TO THE RESULTS OF
OPERATIONS AND BUSINESSES OF ACCUSTAFF AND CAREER. THESE FORWARD LOOKING
STATEMENTS INVOLVE CERTAIN RISKS AND UNCERTAINTIES. FACTORS THAT MAY CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTEMPLATED, PROJECTED,
FORECAST, ESTIMATED OR BUDGETED IN SUCH FORWARD LOOKING STATEMENTS INCLUDE,
AMONG OTHERS, THE FOLLOWING POSSIBILITIES: (i) HEIGHTENED COMPETITION,
INCLUDING SPECIFICALLY THE INTENSIFICATION OF PRICE COMPETITION, THE ENTRY OF
NEW COMPETITORS AND THE FORMATION OF NEW PRODUCTS BY NEW AND EXISTING
COMPETITORS; (ii) FAILURE TO OBTAIN NEW CUSTOMERS OR RETAIN EXISTING
CUSTOMERS; (iii) INABILITY TO CARRY OUT MARKETING AND SALES PLANS; (iv) LOSS
OF KEY EXECUTIVES; (v) GENERAL ECONOMIC AND BUSINESS CONDITIONS WHICH ARE LESS
FAVORABLE THAN EXPECTED; AND (vi) UNANTICIPATED CHANGES IN INDUSTRY TRENDS. IN
ADDITION, FACTORS THAT COULD CAUSE ACTUAL RESULTS OF ACCUSTAFF (ASSUMING
CONSUMMATION OF THE MERGER) TO DIFFER MATERIALLY FROM THOSE CONTEMPLATED BY OR
PROJECTED, FORECAST, ESTIMATED OR BUDGETED IN FORWARD LOOKING STATEMENTS
RELATING TO THE RESULTS OF OPERATIONS AND BUSINESS OF ACCUSTAFF FOLLOWING THE
MERGER, INCLUDE (A) ANY COST SAVINGS OR REVENUE ENHANCEMENTS THAT MAY BE
REALIZED FROM THE MERGER (SEE "THE MERGER--REASONS FOR THE MERGER; ACCUSTAFF"
AND "THE MERGER--REASONS FOR THE MERGER; CAREER") AND (B) THE COSTS ASSOCIATED
WITH THE MERGER (SEE "PRO FORMA CONDENSED COMBINED FINANCIAL DATA" AND
"SUMMARY--COMPARISON OF CERTAIN UNAUDITED PER SHARE DATA"), SUCH AS THE
FOLLOWING: (i) THE EXPECTED COST SAVINGS TO BE REALIZED BEGINNING PRIMARILY IN
1997 THROUGH COMBINING CERTAIN FUNCTIONS OF BOTH ACCUSTAFF AND CAREER, MAKING
CHANGES TO THE OPERATING STRUCTURE OF BOTH COMPANIES TO ELIMINATE REDUNDANT
FACILITIES AND BETTER SERVE THE COMBINED COMPANY'S CUSTOMERS, AND REDUCTIONS
IN STAFF CANNOT BE FULLY REALIZED BECAUSE THE CHANGES ARE NOT MADE OR
UNANTICIPATED OFFSETTING COSTS ARE INCURRED; AND (ii) COSTS OR DIFFICULTIES
RELATED TO THE INTEGRATION OF THE BUSINESSES OF ACCUSTAFF AND CAREER ARE
GREATER THAN EXPECTED. SEE "RISK FACTORS."
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TABLE OF CONTENTS
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AVAILABLE INFORMATION.................................................... 2
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE........................ 3
FORWARD LOOKING STATEMENTS............................................... 4
SUMMARY.................................................................. 7
Parties to the Merger.................................................. 7
The Career Special Meeting; Record Date; Vote Required;
Recommendation........................................................ 9
The AccuStaff Special Meeting; Record Date; Vote Required;
Recommendation........................................................ 10
The Merger............................................................. 10
Market Prices and Dividends............................................ 16
Comparison of Certain Unaudited Per Share Data......................... 17
Selected Financial Data................................................ 18
RISK FACTORS............................................................. 22
Effect of the Merger; Integration of Operations........................ 22
Ability to Achieve and Manage Growth; Acquisition Risks................ 22
Effect of Economic Fluctuations........................................ 22
Competitive Market..................................................... 22
Dependence on Availability of Qualified Temporary Personnel............ 23
Client Concentration................................................... 23
Reliance on Key Personnel.............................................. 23
Increased Employee Costs............................................... 23
Industry Risks......................................................... 23
Professional Regulation of Temporary Attorneys......................... 24
Franchising Risks...................................................... 24
Possible Adverse Effect of National and State Health Care Reform
Proposals............................................................. 24
Governmental Regulation Relating to Health Care Providers.............. 24
Intangible Assets...................................................... 25
Reliance on Information Processing Systems............................. 25
Anti-Takeover Considerations........................................... 25
Dividend Policy; Restrictions on Payment............................... 25
Volatility of Stock Price.............................................. 25
GENERAL INFORMATION...................................................... 26
Career Special Meeting................................................. 26
AccuStaff Special Meeting.............................................. 27
THE MERGER............................................................... 29
General................................................................ 29
Effective Time......................................................... 29
Background of the Merger............................................... 29
Reasons for the Merger................................................. 32
Opinions of Salomon and Baird ......................................... 34
Merger Consideration................................................... 42
Fractional Shares...................................................... 42
Distribution of Merger Consideration................................... 43
Treatment of Options and Convertible Notes............................. 44
Management and Operations After the Merger............................. 44
Interests of Certain Persons in the Merger............................. 45
Certain Federal Income Tax Consequences................................ 47
Conditions to Consummation............................................. 48
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Regulatory Approvals................................................... 49
Conduct of Business Pending the Merger................................. 50
Amendment, Waiver, and Termination..................................... 51
Expenses and Fees...................................................... 53
Accounting Treatment................................................... 54
Resales of AccuStaff Common Stock...................................... 54
PRO FORMA CONDENSED COMBINED FINANCIAL DATA.............................. 55
CERTAIN DIFFERENCES IN THE RIGHTS OF ACCUSTAFF AND CAREER STOCKHOLDERS... 64
Authorized Capital Stock............................................... 64
Directors; Vacancies................................................... 64
Special Meetings of Stockholders....................................... 65
Advance Notice Requirements for Stockholder Proposals and Director
Nominations........................................................... 65
Adjournment of Meetings of Stockholders................................ 65
Amendment of Charter or Articles and Bylaws............................ 66
Indemnification and Director Exculpation............................... 66
Actions by Stockholders Without a Meeting.............................. 68
Payment of Dividends................................................... 68
Merger, Consolidation, and Sales of Assets............................. 69
Dissenters' Rights of Appraisal........................................ 69
Control Share Acquisition Statute...................................... 69
Certain Business Combinations.......................................... 70
Consideration of Societal Factors...................................... 70
EXPERTS.................................................................. 71
LEGAL MATTERS............................................................ 73
STOCKHOLDER PROPOSALS.................................................... 73
Career................................................................. 73
AccuStaff.............................................................. 73
OTHER MATTERS............................................................ 74
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ANNEXES:
ANNEX A-- Agreement and Plan of Merger, dated as of August 25, 1996, by and
among AccuStaff, Newco and Career
ANNEX B--Opinion of Salomon Brothers Inc
ANNEX C--Opinion of Robert W. Baird & Co. Incorporated
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SUMMARY
The following is a summary of certain information contained elsewhere in this
Joint Proxy Statement/Prospectus. This summary is not intended to be a complete
description of the matters covered in this Joint Proxy Statement/Prospectus and
is subject to and qualified in its entirety by reference to the more detailed
information contained elsewhere in this Joint Proxy Statement/Prospectus,
including the Annexes hereto, and in the documents incorporated by reference in
this Joint Proxy Statement/Prospectus. The Merger Agreement is set forth in
Annex A to this Joint Proxy Statement/Prospectus and reference is made thereto
for a complete description of the terms of the Merger. Stockholders are urged
to read carefully the entire Joint Proxy Statement/Prospectus, including the
Annexes. As used in this Joint Proxy Statement/Prospectus, the terms
"AccuStaff" and "Career" refer to such corporations, respectively, and where
the context requires, such corporations and their respective subsidiaries.
PARTIES TO THE MERGER
Career. Career is a national provider of temporary personnel to businesses,
professional and service organizations, individuals requiring home health care,
government agencies and health care facilities. Career also supplies financial
and support services to independently owned temporary personnel firms
("Associated Offices"). Career has approximately 269 company-owned and
franchised offices and 315 Associated Offices that operate in 43 states and the
District of Columbia. Since August 1995, Career has made eight strategic
acquisitions in the information technology staffing services sector and
believes that it is now a significant provider of staffing services in that
sector. Since August 1995, Career has made four additional acquisitions in
areas other than the information technology staffing services sector.
Career is organized into four divisions: Information Technology Services ("IT
Services"), Human Resource Services ("HR Services"), Health Care and Private
Label Services ("PL Services"):
IT Services provides highly skilled information technology specialists for
short-term, long-term and permanent placement to primarily large
corporations and financial institutions. These specialists provide computer
programming assistance, systems analysis and design, software engineering,
network support and personal computer help desk services. Career started
this division in August 1995 with the acquisitions of Contract Staffing
Group Inc. d/b/a Computer Consulting Group and Professionals for Computing,
Inc., and, in January 1996, Career expanded the division with the
acquisitions of Programming Enterprises, Inc. d/b/a Mini-Systems Associates
("Mini-Systems") and Zeitech Inc. ("Zeitech"). In addition, Career acquired
American Computer Professionals, Inc. in March 1996, WHY Systems, Inc. in
May 1996, Berger & Co. in August 1996 and TSG Professional Services, Inc.
("TSG") in September 1996. Combined revenues for the eight acquired
businesses for the twelve months preceding the date of each such
acquisition were approximately $197.6 million.
HR Services supplies personnel for office support and light industrial
applications to a variety of business and service organizations. HR
Services' brand names are well established, with the majority of them
having been in continuous use for more than 20 years.
Health Care provides a wide range of personnel primarily to individuals
requiring home health care and, to a lesser extent, to health care
facilities. Such personnel include certified home health and personal care
aides, companions, health care technicians, licensed nurses and therapists.
PL Services provides Associated Offices with a wide range of back office
and financial support services, including billing and payroll services and
preparation of payroll tax filings and management reports. In addition, the
PL Services division advances the Associated Offices' temporary employee
payroll expenses, including withholding taxes, and pays to Associated
Offices an amount equal to their gross profit after deduction of Career's
fees and expenses.
Career changed its fiscal year end from June 30 to December 31 commencing
December 31, 1995.
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Career is a Delaware corporation organized in 1990. Career's principal
executive offices are located at 177 Crossways Park Drive, Woodbury, New York
11797, and its telephone number is (516) 682-1400. For additional information
regarding Career and its business, see "Available Information," "Incorporation
of Certain Information by Reference," "--Selected Financial Data" and
"Information Regarding Career."
AccuStaff. AccuStaff is a national provider of staffing and outsourcing
services to businesses, professional and service organizations and government
agencies. AccuStaff, headquartered in Jacksonville, Florida, operates 192
branch offices in 28 states and the District of Columbia and is organized into
three divisions: Professional Services, Commercial and Telecommunications. The
Professional Services division provides personnel for information technology,
technical, legal and accounting functions. The Commercial division provides
clerical and light industrial staffing services. The Telecommunications
division provides trained customer care and telemarketing personnel to American
Transtech, Inc. ("ATI"), a subsidiary of AT&T.
Each of AccuStaff's three divisions has experienced substantial revenue and
earnings growth driven primarily by acquisitions of other staffing companies,
increased business with existing clients, increased penetration of existing and
new markets and trends toward increased use of supplemental employees and
outsourcing arrangements. AccuStaff has pursued an aggressive acquisition
program, having acquired 35 staffing companies through September 15, 1996,
including ten in fiscal 1995 and 22 during 1996. AccuStaff's pro forma revenue
in fiscal 1995, after giving effect to the acquisitions from January 1, 1995
through September 16, 1996, would have been $744.1 million compared to
AccuStaff's actual fiscal 1995 revenue of $316.8 million.
The temporary staffing industry has grown rapidly in recent years as
companies have utilized temporary employees to control personnel costs and to
meet specialized or fluctuating personnel needs. According to the National
Association of Temporary and Staffing Services ("NATSS"), the U.S. market for
temporary staffing services grew at a compound annual growth rate of
approximately 17.7% from approximately $20.4 billion in revenue in 1991 to
approximately $39.2 billion in 1995. One of the fastest growing sectors of the
staffing services industry, and of AccuStaff's Professional Services division,
is information technology staffing services. According to the Staffing Industry
Report, revenue from the information technology sector in 1995 is estimated to
have been $8.9 billion, representing a 25% increase over 1994. AccuStaff
believes the temporary staffing industry is highly fragmented but is
experiencing consolidation largely in response to opportunities to provide
comprehensive supplemental staffing solutions to regional and national
accounts.
AccuStaff's strategy is to increase its revenue and improve its profitability
by offering an extensive range of specialized services through a national
network of branch offices while expanding its Professional Services division
and creating value-added partnering and outsourcing relationships with
customers. AccuStaff markets and delivers its services with an emphasis on
local entrepreneurial spirit and decision making at the branch level combined
with strong corporate technological, marketing and managerial support. Where
appropriate, AccuStaff clusters branches within markets to provide specialized
service delivery, to take advantage of cross-selling opportunities and, in
certain circumstances, to reduce overhead costs. AccuStaff seeks to provide
innovative and customized solutions to staffing problems and to expand its
relationship with such clients as ATI, American Express Company, Ameritech
Corporation, Barnett Banks, Inc., Baxter International, Inc., Cisco Systems,
Inc., International Business Machines Corporation, NationsBank Corporation, Sun
Microsystems Incorporated and Xerox Corporation. Management believes that this
approach, coupled with its compensation structure which is tied to branch
office profitability and cross-referrals among service lines, results in a
creative and committed management team, enhanced client service and increased
revenue growth.
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AccuStaff has supported its strategy of service diversification and
geographic expansion with an aggressive acquisition program and, to a lesser
extent, with newly-opened branch offices. A key element of AccuStaff's
expansion strategy is to acquire existing businesses with strong management,
profitable operating results and recognized local and regional presence.
Acquisition criteria also include a desirable market location, significant
market share, new or expanded specialties that can be added to AccuStaff's
existing lines of business, efficient operating systems and existing management
that will fit well within AccuStaff's decentralized, entrepreneurial
environment. As a result of its acquisition program, AccuStaff is one of the
leading consolidators in the fragmented staffing services industry and believes
that there will continue to be attractive acquisition opportunities. AccuStaff
believes that the acquisition of Career would complement its acquisition
strategy and would be a significant step in achieving AccuStaff's goal of
becoming a national staffing company with revenues of approximately $2 billion
by the year 2000. See "The Merger--Reasons for the Merger--AccuStaff."
AccuStaff continually evaluates acquisition opportunities and, as a result,
frequently engages in acquisition discussions, conducts due diligence
activities in connection with possible acquisitions, and, where appropriate,
engages in acquisition negotiations. Future acquisitions involving cash, debt
or equity securities can be expected. See "Pro Forma Condensed Combined
Financial Data."
Newco is a wholly owned subsidiary of AccuStaff that was incorporated in
August 1996 solely as a vehicle to facilitate the Merger. See "The Merger."
AccuStaff is a Florida corporation that was incorporated in 1992. AccuStaff's
principal executive offices are located at 6440 Atlantic Boulevard,
Jacksonville, Florida 32211, and its telephone number is (904) 725-5574. For
additional information regarding AccuStaff and its business, see "Available
Information," "Incorporation of Certain Information by Reference," "--Selected
Financial Data" and "Information Regarding AccuStaff."
THE CAREER SPECIAL MEETING; RECORD DATE; VOTE REQUIRED; RECOMMENDATION
The Career Special Meeting will be held at 10:00 a.m., local time, on
November 14, 1996, at the Long Island Marriott Hotel, 101 James Doolittle
Blvd., Uniondale, New York. At the Career Special Meeting, Career's
stockholders will consider and vote upon a proposal to adopt the Merger
Agreement. Career's Board of Directors has fixed the close of business on
October 4, 1996, as the record date for determining the Career stockholders
entitled to receive notice of and to vote at the Career Special Meeting (the
"Career Record Date"). As of the close of business on the Career Record Date,
there were 17,663,789 shares of Career Common Stock outstanding and entitled to
be voted at the Career Special Meeting. Holders of Career Common Stock are
entitled to one vote on each matter considered and voted on at the Career
Special Meeting for each share of Career Common Stock held of record at the
close of business on the Career Record Date. For additional information with
respect to the Career Special Meeting, including the Career Record Date and
votes required for adoption, see "General Information--Career Special Meeting."
Vote Required. Adoption of the Merger Agreement by the stockholders of Career
requires the affirmative vote of the holders of a majority of the outstanding
shares of Career Common Stock entitled to vote at the Special Meeting. As of
the Career Record Date, Career's directors and executive officers and their
affiliates held approximately 1.33% of the outstanding shares of Career Common
Stock entitled to vote at the Career Special Meeting. See "General
Information--Career Special Meeting." As of the Record Date, AccuStaff, its
directors and executive officers, and their affiliates, held 500 shares of
Career Common Stock.
Recommendation of the Career Board of Directors. The Career Board of
Directors believes that the Merger is in the best interests of Career and its
stockholders and has unanimously approved the Merger Agreement and the
consummation of the transactions contemplated thereby. The Career Board of
Directors unanimously recommends that the stockholders vote FOR adoption of the
Merger Agreement and the consummation of the transactions contemplated thereby.
In deciding to approve the Merger Agreement and the
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transactions contemplated thereby, the Career Board of Directors considered
relevant business, financial, legal and market factors. The Career Board of
Directors ascribed comparatively greater weight to the premium in relation to
recent market prices of Career Common Stock to be received by the holders of
Career Common Stock in the Merger and the presentation, analyses and opinion of
Salomon Brothers Inc ("Salomon"), the exclusive financial advisor to the Career
Board of Directors, which indicated that, as of August 25, 1996, the Exchange
Ratio was fair to holders of Career Common Stock from a financial point of
view, than to the other factors considered by the Career Board of Directors.
The full text of Salomon's opinion, dated August 25, 1996, is attached as Annex
B to this Joint Proxy Statement/Prospectus. See "The Merger--Reasons for the
Merger; Career" and "The Merger--Opinions of Salomon and Baird; Salomon."
THE ACCUSTAFF SPECIAL MEETING; RECORD DATE; VOTE REQUIRED; RECOMMENDATION
The AccuStaff Special Meeting will be held at 10:00 a.m., local time, on
November 14, 1996, in the South Ballroom of the Prime F. Osborn Convention
Center, 1000 Water Street, Jacksonville, Florida. At the AccuStaff Special
Meeting, AccuStaff's stockholders will consider and vote upon a proposal to
approve the issuance of shares of AccuStaff Common Stock pursuant to the Merger
Agreement and will transact such other business as may properly come before the
AccuStaff Special Meeting. AccuStaff's Board of Directors has fixed the close
of business on October 4, 1996, as the record date for determining the
AccuStaff stockholders entitled to receive notice of and to vote at the
AccuStaff Special Meeting (the "AccuStaff Record Date"). As of the close of
business on the AccuStaff Record Date, there were 66,044,640 shares of
AccuStaff Common Stock outstanding and entitled to be voted at the AccuStaff
Special Meeting. Holders of AccuStaff Common Stock are entitled to one vote on
each matter considered and voted on at the AccuStaff Special Meeting for each
share of AccuStaff Common Stock held of record at the close of business on the
AccuStaff Record Date. For additional information with respect to the AccuStaff
Special Meeting, including the AccuStaff Record Date and votes required for
adoption, see "General Information--AccuStaff Special Meeting."
Vote Required. The issuance of shares of AccuStaff Common Stock pursuant to
the Merger Agreement must be approved by a majority of votes cast on such
proposal, provided that the total vote cast on such proposal represents over
50% in interest of all shares of AccuStaff Common Stock entitled to vote at the
Special Meeting. As of the AccuStaff Record Date, AccuStaff's directors and
executive officers and their affiliates held approximately 9.8% of the
outstanding shares of AccuStaff Common Stock entitled to vote at the AccuStaff
Special Meeting. See "General Information--AccuStaff Special Meeting." As of
the AccuStaff Record Date, Career, its directors and executive officers, and
their affiliates, held no shares of AccuStaff Common Stock.
Recommendation of the AccuStaff Board of Directors. The Board of Directors of
AccuStaff believes that the issuance of shares of AccuStaff Common Stock
pursuant to the Merger Agreement is in the best interests of AccuStaff and its
stockholders and has unanimously approved the Merger Agreement and the
consummation of the transactions contemplated thereby. The AccuStaff Board of
Directors unanimously recommends that the stockholders vote FOR approval of the
issuance of shares of AccuStaff Common Stock pursuant to the Merger Agreement.
In deciding to approve the Merger Agreement and the consummation of the
transactions contemplated therein, AccuStaff's Board of Directors considered a
number of factors, including the terms of the Merger, the compatibility of the
operations of Career and AccuStaff, the financial condition, results of
operations, and future prospects of Career and AccuStaff and the opinion of
Robert W. Baird & Co. Incorporated ("Baird"), dated August 25, 1996 to the
effect that, as of such date, the Exchange Ratio was fair, from a financial
point of view, to AccuStaff. The full text of Baird's opinion is attached as
Annex C to this Joint Proxy Statement/Prospectus. See "The Merger--Reasons for
the Merger; AccuStaff" and "The Merger--Opinions of Salomon and Baird; Baird. "
THE MERGER
The Merger Agreement provides that Newco shall merge with and into Career,
which shall be the surviving corporation in the Merger and, as a result
thereof, Career shall become a wholly owned subsidiary of AccuStaff.
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At the time the Merger becomes effective, each outstanding share of Career
Common Stock (excluding shares held by Career, AccuStaff, or any of their
respective subsidiaries) shall cease to be outstanding and shall be converted
into the right to receive a number of shares of AccuStaff Common Stock equal to
the Exchange Ratio, with cash being paid in lieu of any fractional share
interest. The Exchange Ratio will equal 1.53 shares of AccuStaff Common Stock;
provided, that, in the event that the Average Closing Price is greater than
$31.60, the Exchange Ratio will equal that multiple of a share of AccuStaff
Common Stock (rounded to the nearest ten thousandth of a share) obtained by
dividing $48.348 (the product of 1.53 and $31.60) by the Average Closing Price,
but in no event will the Exchange Ratio be less than 1.2444; provided further,
that, in the event that the Average Closing Price is less than $21.07, the
Exchange Ratio shall equal that multiple of a share of AccuStaff Common Stock
(rounded to the nearest ten thousandth of a share) obtained by dividing
$32.2371 (the product of 1.53 and $21.07) by the Average Closing Price, but in
no event will the Exchange Ratio be greater than 1.8006. See "The Merger--
Merger Consideration" and "The Merger--Fractional Shares."
ALTHOUGH THE EXCHANGE RATIO WILL BE BASED ON THE AVERAGE OF MARKET PRICES OF
ACCUSTAFF COMMON STOCK DURING THE VALUATION PERIOD (THE "FINAL ACCUSTAFF STOCK
PRICE"), THE MARKET PRICE OF ACCUSTAFF COMMON STOCK MAY FLUCTUATE AND, ON THE
DATE OF THE EFFECTIVE TIME, THE DATE OF RECEIPT OF SHARES OF ACCUSTAFF COMMON
STOCK BY HOLDERS OF CAREER COMMON STOCK, OR THE DATE ON WHICH SUCH SHARES ARE
EVENTUALLY SOLD, MAY BE MORE OR LESS THAN THE FINAL ACCUSTAFF STOCK PRICE.
If the Merger Agreement is approved at the Career Special Meeting, the
issuance of shares of AccuStaff Common Stock pursuant to the Merger is approved
at the AccuStaff Special Meeting, all required governmental and other consents
and approvals specified as conditions to consummation of the Merger are
obtained, and all of the other conditions to the obligations of the parties to
consummate the Merger are either satisfied or waived (as permitted), the Merger
will be consummated. A copy of the Merger Agreement is set forth in Annex A to
this Joint Proxy Statement/Prospectus. See "The Merger."
Opinions of Salomon and Baird. The Career Board of Directors has received a
written opinion of Salomon, dated August 25, 1996, that, as of such date, the
Exchange Ratio was fair to holders of Career Common Stock from a financial
point of view. The full text of Salomon's written opinion delivered to the
Career Board of Directors, which describes the procedures followed, assumptions
made, limitations on the review undertaken, and other matters considered in
connection with rendering such opinion, is set forth in Annex B to this Joint
Proxy Statement/Prospectus and should be read in its entirety by holders of
Career Common Stock. For additional information regarding the opinion of
Salomon and a discussion of the qualifications of Salomon, the method of its
selection as independent financial advisor to the Career Board of Directors,
and certain relationships between Salomon and Career and AccuStaff, see "The
Merger--Opinions of Salomon and Baird; Salomon."
The AccuStaff Board of Directors has received the written opinion of Baird,
dated August 25, 1996, to the effect that, as of such date, the Exchange Ratio
was fair, from a financial point of view, to AccuStaff. The full text of
Baird's written opinion, which describes the procedures followed, assumptions
made, limitations on the review undertaken, and other matters considered in
connection with rendering such opinion, is set forth in Annex C to this Joint
Proxy Statement/Prospectus and should be read carefully in its entirety by
AccuStaff stockholders. For additional information regarding the opinion of
Baird and a discussion of the qualifications of Baird, the method of its
selection, and certain relationships between Baird and AccuStaff and Career,
see "The Merger--Opinions of Salomon and Baird; Baird."
Effective Time. If the Merger Agreement is approved by the requisite vote of
the holders of Career Common Stock, the issuance of shares of AccuStaff Common
Stock pursuant to the Merger Agreement is approved by the requisite vote of the
holders of AccuStaff Common Stock, all required governmental and other consents
and approvals specified as conditions to consummation of the Merger are
obtained, and the other conditions to the obligations of the parties to
consummate the Merger are either satisfied or waived (as permitted), the Merger
will be consummated and will become effective on the date and at the time that
a
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Certificate of Merger, reflecting the Merger, is duly filed with the Secretary
of State of the State of Delaware (the "Effective Time"). Assuming satisfaction
or waiver of all conditions to consummation, the Merger is expected to become
effective during the fourth quarter of 1996. AccuStaff and Career each has the
right, acting unilaterally, to terminate the Merger Agreement should the Merger
not be consummated by December 31, 1996. See "The Merger--Effective Time" and
"The Merger--Amendment, Waiver, and Termination."
Delivery of AccuStaff Certificates. Promptly after the Effective Time, each
record holder of shares of Career Common Stock outstanding at the Effective
Time will be mailed a transmittal letter (with instructions) to use in
effecting the surrender and cancellation of Career Common Stock certificates in
exchange for certificates representing AccuStaff Common Stock. AccuStaff shall
not be obligated to deliver the consideration to which any former holder of
Career Common Stock is entitled until such holder surrenders such holder's
certificate or certificates representing such holder's shares of Career Common
Stock for exchange. The certificate or certificates so surrendered shall be
duly endorsed as the exchange agent may require. See "The Merger--Distribution
of Merger Consideration."
Certain Federal Income Tax Consequences. The Merger is intended to be a tax-
free reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code"). Generally, no gain or loss
should be recognized for federal income tax purposes by Career stockholders as
a result of the Merger, except that gain or loss will be recognized with
respect to cash received in lieu of fractional shares. A condition to
consummation of the Merger is the receipt by each of AccuStaff and Career of an
opinion of Alston & Bird, counsel to AccuStaff, stating that the Merger will
constitute a reorganization and describing certain other federal income tax
consequences of the Merger and related transactions. The opinion of Alston &
Bird does not address the tax consequences of the Merger to holders of Career
Convertible Notes (as defined hereinafter). Holders of such instruments should
consult their tax advisors as to such consequences. See "The Merger--Certain
Federal Income Tax Consequences."
BECAUSE CERTAIN TAX CONSEQUENCES OF THE MERGER MAY VARY DEPENDING UPON THE
PARTICULAR CIRCUMSTANCES OF EACH STOCKHOLDER AND OTHER FACTORS, EACH HOLDER OF
CAREER COMMON STOCK IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO
DETERMINE THE PARTICULAR TAX CONSEQUENCES TO SUCH HOLDER OF THE MERGER
(INCLUDING THE APPLICATION AND EFFECT OF FOREIGN, STATE AND LOCAL INCOME AND
OTHER TAX LAWS).
Treatment of Stock Options and Convertible Notes. Upon consummation of the
Merger: (i) all rights with respect to Career Common Stock pursuant to stock
options ("Career Options") granted by Career under its existing stock option
plans (the "Career Stock Plans"), which are outstanding at the Effective Time,
whether or not exercisable, shall be converted into and become rights with
respect to AccuStaff Common Stock, and AccuStaff shall assume each Career
Option, in accordance with the terms of the Career Stock Plans and each stock
option agreement by which it is evidenced, after giving effect to the Exchange
Ratio; and (ii) all rights with respect to Career Common Stock pursuant to
Career's outstanding 7% Convertible Senior Notes Due 2002 (the "Career
Convertible Notes"), which are outstanding at the Effective Time, shall be
converted into and become rights to exchange the Career Convertible Notes for
shares of AccuStaff Common Stock, and AccuStaff shall assume the obligation to
issue shares of common stock upon exchange of Career Convertible Notes, in
accordance with the terms thereof, after giving effect to the Exchange Ratio.
At or prior to the Effective Time, AccuStaff and Career will execute and
deliver to the trustee under the indenture (the "Indenture") governing the
Career Convertible Notes a supplemental indenture (the "Supplemental
Indenture") evidencing AccuStaff's assumption of the obligation to issue shares
of common stock under the Indenture. See "The Merger--Treatment of Stock
Options and Convertible Notes."
Conditions to Consummation. Consummation of the Merger is subject to various
conditions, including among other matters: (i) adoption of the Merger Agreement
by the requisite vote of Career stockholders; (ii) approval of the issuance of
shares of AccuStaff Common Stock pursuant to the Merger Agreement by the
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requisite vote of AccuStaff stockholders; (iii) receipt of certain governmental
and other consents and approvals specified as conditions to consummation of the
Merger, including expiration or termination of the statutory waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 ("HSR Act");
(iv) receipt by AccuStaff and Career of letters from AccuStaff's and Career's
independent auditors to the effect that the Merger will qualify for pooling-of-
interests accounting treatment; and (v) satisfaction of certain other customary
conditions, including the receipt of the tax opinion discussed above. The
foregoing are the material conditions to the consummation of the Merger. See
"The Merger--Conditions to Consummation" and "The Merger--Amendment, Waiver,
and Termination."
Interests of Certain Persons in the Merger. Certain members of Career's
management and the Board of Directors of Career have interests in the Merger in
addition to their interests as stockholders of Career generally. These include,
among other things, provisions in the Merger Agreement relating to
indemnification, eligibility for certain AccuStaff employee benefits,
provisions in change in control agreements between Career and certain of its
executive officers, and employment agreements with AccuStaff. See "The Merger--
Management and Operations After the Merger" and "The Merger--Interests of
Certain Persons in the Merger."
Regulatory Approvals. The consummation of the Merger is subject to the
expiration or termination of the statutory waiting period under the HSR Act.
See "The Merger--Regulatory Approvals."
Conduct of Business Pending the Merger. Career has agreed in the Merger
Agreement to, among other things, operate its business only in the ordinary
course and to take no action that would adversely affect its ability to perform
its covenants and agreements under the Merger Agreement. In addition, Career
has agreed not to take certain actions relating to the operation of Career
pending consummation of the Merger without the prior written consent of
AccuStaff, except as otherwise permitted by the Merger Agreement, including,
among other things: (i) becoming responsible for any debt or other obligation
for borrowed money in excess of an aggregate of $500,000, except in the
ordinary course of business in accordance with past practices; (ii)
repurchasing, redeeming or otherwise acquiring any shares of Career capital
stock; (iii) subject to certain exceptions, issuing any additional shares of
its capital stock or giving any person the right to acquire any such shares;
(iv) subject to certain exceptions, granting any increase in compensation or
benefits, or paying any bonus, to any of its directors, officers or employees
except in the ordinary course of business and consistent with past practice; or
(v) modifying or adopting any employee benefit plans, including any employment
contract. See "The Merger--Conduct of Business Pending the Merger."
Termination. The Merger Agreement may be terminated, and the Merger
abandoned, at any time prior to the Effective Time by mutual consent of the
Boards of Directors of Career and AccuStaff. In addition, the Merger Agreement
may be terminated, and the Merger abandoned, prior to the Effective Time by
either AccuStaff or Career if (i) the other party breaches and does not timely
cure any representation, warranty, covenant or other agreement contained in the
Merger Agreement and such breach, individually or in the aggregate, has a
Material Adverse Effect, as defined in the Merger Agreement, on the breaching
party, (ii) any consent or approval of any of the regulatory authorities
specified as a condition to consummation of the Merger is denied by final
nonappealable action of such authority or if any action taken by such authority
is not appealed within the time limit for appeal, (iii) the Career stockholders
fail to adopt the Merger Agreement and the transactions contemplated thereby at
the Career Special Meeting or the AccuStaff stockholders fail to approve the
issuance of shares of AccuStaff Common Stock pursuant to the Merger Agreement
at the AccuStaff Special Meeting, (iv) any of the conditions precedent to the
obligations of the terminating party to consummate the Merger cannot be
satisfied or fulfilled by December 31, 1996, or (v) the Merger has not been
consummated by December 31, 1996.
In addition, Career may terminate the Merger Agreement (a "Transaction
Termination") if, prior to adoption of the Merger Agreement by the requisite
vote of the holders of Career Common Stock, the Board of Directors of Career
has (i) withdrawn, modified or changed its recommendation or approval of the
Merger Agreement in a manner adverse to AccuStaff in order to approve and
permit Career to accept an Acquisition
13
<PAGE>
Proposal (as defined in "The Merger--Amendment, Waiver and Termination"), and
(ii) determined, based on the advice of outside legal counsel to Career, that
the failure to take such action as set forth in the preceding clause (i) would
result in breach of the Board of Directors' fiduciary duties under applicable
law; provided, that (a) the Board of Directors of Career shall have been
advised by such outside counsel that notwithstanding the Merger Agreement, and
notwithstanding any concessions which may be offered by AccuStaff in
negotiations entered into pursuant to clause (b) below, such fiduciary duties
would also require the directors to terminate the Merger Agreement as a result
of such Acquisition Proposal, (b) at least two business days prior to any such
termination, Career shall, and shall cause its advisors to, negotiate with
AccuStaff to make such adjustments in the terms and conditions of the Merger
Agreement as would enable Career to proceed with the transactions contemplated
herein on such adjusted terms, and (c) Career shall have tendered to AccuStaff
payment in full of the Fee (as defined below) concurrently with delivery of
notice of such termination; and, provided further, that Career shall
immediately advise AccuStaff following the receipt by it of any Acquisition
Proposal and the details thereof, and advise AccuStaff of any developments with
respect to such Acquisition Proposal immediately upon the occurrence thereof.
See "The Merger--Amendment, Waiver, and Termination" and "The Merger--Expenses
and Fees."
Expenses and Fees. The Merger Agreement provides that each party shall be
responsible for its own costs and expenses incurred in connection with the
negotiation and consummation of the transactions contemplated by the Merger
Agreement, except that each of AccuStaff and Career shall pay one-half of the
filing fees payable and printing costs incurred in connection with the
Registration Statement and this Joint Proxy Statement/Prospectus, and AccuStaff
shall pay the entire HSR Act filing fee.
If the Merger Agreement is terminated by a party as a result of a material
breach by the other party of any representation, warranty, covenant or other
agreement contained in the Merger Agreement which is not timely cured (a
"Breach Termination") or if the Merger Agreement is terminated as a result of
the failure of the other party's stockholders to approve the matters relating
to the Merger Agreement required to be approved by such stockholders or if the
Merger is not consummated as a result of the other party failing to satisfy
certain conditions to consummation, then the breaching party or the party that
failed to satisfy such conditions shall promptly (but not later than five
business days after receipt of notice from such party) pay to such party an
amount equal to all documented out-of-pocket fees and expenses incurred by such
party (including, without limitation, fees and expenses payable to investment
bankers, accountants and counsel) arising out of, in connection with or related
to the Merger or the transactions contemplated by the Merger Agreement not to
exceed $2,500,000 in the aggregate, provided, that if such breach was a result
of intentional or willful misconduct or misrepresentation, the breaching party
shall pay such additional amounts as the terminating party may be entitled to
receive at law or in equity.
Career also has agreed to pay AccuStaff, subject to specified terms and
conditions, a fee (the "Fee") of $30 million upon the occurrence of any of the
following events: (i) upon a Transaction Termination; or (ii) if, during the
period beginning on the date of the Merger Agreement and ending six months
after any termination of the Merger Agreement by either party by reason of the
stockholders of Career having failed to approve the Merger Agreement (but only
if the Career Board of Directors shall have failed to recommend, or shall have
withdrawn or modified in any manner adverse to AccuStaff its recommendation,
that Career stockholders approve the Merger Agreement) or by AccuStaff pursuant
to a Breach Termination (or ending 12 months following any such termination,
if, prior to such termination, there shall have occurred a Triggering Event (as
defined in "The Merger--Expenses and Fees")), the Career Board of Directors
shall authorize entry into an agreement with any person (other than AccuStaff
or any AccuStaff subsidiary) providing for an Acquisition Transaction (as
defined hereinafter) or shall recommend acceptance of, or shall fail to
recommend rejection of, a tender offer or exchange offer that, if successful,
would result in an Acquisition Transaction, or an Acquisition Transaction shall
have been consummated (each, a "Payment Event") (such Fee to be payable by wire
transfer of immediately available funds within five business days following the
occurrence of such Payment Event); provided, that the amount of such Fee shall
be reduced by any amounts previously paid by Career to AccuStaff pursuant to
the preceding paragraph. See "The Merger--Expenses and Fees."
14
<PAGE>
Accounting Treatment. It is anticipated that the Merger will qualify as a
pooling-of-interests transaction for accounting and financial reporting
purposes. It is a condition to consummation of the Merger that each of
AccuStaff and Career shall have received letters from AccuStaff's and Career's
independent auditors to the effect that the Merger will qualify for pooling-of-
interests accounting treatment. See "The Merger--Accounting Treatment."
Resale of AccuStaff Common Stock. The AccuStaff Common Stock issued in
connection with the Merger will be freely transferable by the holders of such
shares, except for those holders who may be deemed to be "affiliates"
(generally including directors, certain executive officers, and 10% or more
stockholders) of Career or AccuStaff under applicable federal securities laws.
See "The Merger--Resale of AccuStaff Common Stock."
Certain Differences in the Rights of Career and AccuStaff Stockholders. The
rights of Career stockholders currently are determined by reference to the
Delaware General Corporation Law (the "Delaware GCL") and Career's Restated
Certificate of Incorporation ("Career's Charter") and Bylaws ("Career's
Bylaws"). Following the Effective Time, Career stockholders will become
stockholders of AccuStaff, and their rights as stockholders will be determined
by the Florida Business Corporation Act (the "Florida BCA") and AccuStaff's
Articles of Incorporation ("AccuStaff's Articles") and Bylaws ("AccuStaff's
Bylaws"). For a description of the material differences in the rights of Career
and AccuStaff stockholders, see "Certain Differences in the Rights of Career
and AccuStaff Stockholders."
Appraisal Rights. Neither the holders of Career Common Stock nor the holders
of AccuStaff Common Stock are entitled to appraisal or dissenters' rights in
connection with the Merger.
15
<PAGE>
MARKET PRICES AND DIVIDENDS
AccuStaff Common Stock is traded on the Nasdaq National Market under the
symbol "ASTF" and Career Common Stock is traded on the NYSE under the symbol
"CHZ". The following table sets forth the high and low sale prices per share of
AccuStaff Common Stock on the Nasdaq National Market (as adjusted to reflect
both a three-for-one stock split, effective March 27, 1996, and a two-for-one
stock split, effective November 27, 1995) since August 16, 1994 (the date
AccuStaff completed its initial public offering) and the high and low sale
prices per share of Career Common Stock on the Nasdaq National Market for each
quarterly period from March 24, 1994 (the date Career completed its initial
public offering) until February 8, 1996, when the Career Common Stock began
trading on the NYSE, and as reported on the NYSE for the period since February
8, 1996 (as adjusted to reflect a two-for-one stock split, effective February
22, 1996).
<TABLE>
<CAPTION>
SALES PRICES SALES PRICES
PER SHARE OF PER SHARE OF
ACCUSTAFF CAREER
COMMON STOCK COMMON STOCK
------------- -------------
CALENDAR QUARTER ENDING HIGH LOW HIGH LOW
----------------------- ------ ------ ------ ------
<S> <C> <C> <C> <C>
1994
March 31...................................... N/A N/A $10.25 $ 8.63
June 30....................................... N/A N/A 10.50 8.25
September 30.................................. $ 2.44 $ 1.83 9.25 7.63
December 31................................... 2.33 1.77 9.38 6.88
1995
March 31...................................... $ 3.29 $ 2.23 $10.00 $ 7.75
June 30....................................... 4.13 3.04 12.00 8.38
September 30.................................. 6.21 3.58 13.88 9.50
December 31................................... 14.75 5.10 16.88 13.38
1996
March 31...................................... $26.50 $11.58 $30.00 $16.50
June 30....................................... 38.00 22.75 42.38 26.25
September 30.................................. 31.75 21.00 40.88 20.50
December 31 (through October 4, 1996)......... 26.00 23.50 39.00 36.25
</TABLE>
On August 23, 1996, the last trading day prior to public announcement that
AccuStaff and Career had executed the Merger Agreement, the last reported sale
prices per share of AccuStaff Common Stock on the Nasdaq National Market and
Career Common Stock on the NYSE were $28.00 and $31.88, respectively, or pro
forma equivalent per share of Career Common Stock (based on a 1.53 Exchange
Ratio) of $42.84. On October 4, 1996, the last reported sale prices per share
of AccuStaff Common Stock on the Nasdaq National Market and Career Common Stock
on the NYSE were $24.00 and $36.63, respectively. CAREER STOCKHOLDERS SHOULD
OBTAIN CURRENT MARKET QUOTATIONS FOR THE ACCUSTAFF COMMON STOCK AND CAREER
COMMON STOCK.
Neither AccuStaff nor Career has ever paid any cash dividends on their common
stock.
The Merger Agreement provides for the filing of a listing application with
the Nasdaq National Market covering the shares of AccuStaff Common Stock
issuable pursuant to the Merger Agreement. It is a condition to consummation of
the Merger that such shares of AccuStaff Common Stock be authorized for listing
on the Nasdaq National Market effective upon official notice of issuance. See
"The Merger--Conditions to Consummation."
16
<PAGE>
COMPARISON OF CERTAIN UNAUDITED PER SHARE DATA
The following summary presents selected comparative unaudited per share data
for AccuStaff and Career on a historical basis, and on a pro forma combined and
equivalent pro forma combined basis, assuming the Merger had been effective
during the periods presented and assuming a 1.53 Exchange Ratio for the Merger.
The Merger is reflected under the pooling-of-interests method of accounting and
pro forma data is derived accordingly. The information shown below should be
read in conjunction with the historical financial statements of AccuStaff and
Career, including the respective notes thereto, incorporated by reference
herein, and with the unaudited pro forma combined financial information,
including the notes thereto, appearing elsewhere and incorporated by reference
herein. Information concerning dividends paid per share by AccuStaff and Career
is not presented in the table below as neither AccuStaff nor Career has ever
paid a cash dividend. See "Available Information," "Incorporation of Certain
Information by Reference," "The Merger--Accounting Treatment," and "Pro Forma
Condensed Combined Financial Data."
<TABLE>
<CAPTION>
TRANSITION
SIX MONTHS PERIOD JULY 1,
ENDED 1995 TO FISCAL YEAR(1)
JUNE 30, DECEMBER 31, -----------------
1996 1995(1) 1995 1994 1993
---------- -------------- ----- ----- -----
<S> <C> <C> <C> <C> <C>
ACCUSTAFF COMMON STOCK
Income per share(2):
Historical....................... $0.17 -- $0.27 $0.15 $0.04
Pro forma combined(3)............ 0.25 -- 0.51 0.22 0.05
Book value per share:
Historical(4).................... $6.75 -- $2.28 -- --
Pro forma combined(5)............ 6.57 -- 2.57 -- --
CAREER COMMON STOCK
Income per share(2):
Historical....................... $0.43 $0.44 $0.65 $0.13 $0.06
Equivalent pro forma
combined(6)..................... 0.38 -- 0.78 0.34 0.08
Book value per share:
Historical(4).................... $10.83 $5.23 $4.59 -- --
Equivalent pro forma
combined(6)..................... 10.05 -- 3.93 -- --
</TABLE>
- --------
(1) AccuStaff's fiscal year ends on the Sunday closest to December 31 of each
year. Thus, AccuStaff's fiscal year ends for 1995, 1994 and 1993 were
December 31, January 1 and January 2, respectively. Until 1995, Career's
fiscal year ended on June 30 of each year. The Transition Period above
reflects the interim period due to Career's change to a December 31 year
end.
(2) Income represents income from continuing operations.
(3) Pro forma combined income per share amounts for AccuStaff Common Stock
represent the sum of pro forma combined amounts for AccuStaff and Career
(which does not include estimated non-recurring acquisition costs related
to the Merger of $15.0 million, or $0.16 per share, nor does it include
estimated non-recurring corporate restructuring costs related to the Merger
of $10.0 million or $0.10 per share), divided by pro forma combined
weighted average common shares outstanding.
(4) Historical book value per share information for AccuStaff and Career as of
the end of each period presented is computed by dividing historical
stockholders' equity for each company by the number of shares of AccuStaff
Common Stock or Career Common Stock, as the case may be, outstanding at the
end of each period presented, excluding stock options.
(5) Pro forma combined book value per share information as of the end of the
period presented is computed by dividing pro forma stockholders' equity by
the number of shares of AccuStaff Common Stock outstanding on such dates
and the shares of AccuStaff Common Stock assumed to be issued pursuant to
the Merger Agreement.
(6) Equivalent pro forma combined amounts per share of Career Common Stock
represent the pro forma combined per share amounts of AccuStaff Common
Stock, multiplied by an assumed 1.53 Exchange Ratio.
17
<PAGE>
SELECTED FINANCIAL DATA
Set forth below is certain historical consolidated selected financial data
relating to AccuStaff and Career, and certain unaudited combined selected
financial data, giving effect to the Merger under the pooling-of-interests
method of accounting. See "The Merger--Accounting Treatment." This information
should be read in conjunction with the historical financial statements of
AccuStaff and Career, including the respective notes thereto, incorporated by
reference herein, and with the unaudited pro forma combined financial
information, including the notes thereto, appearing elsewhere and incorporated
by reference herein. See "Available Information," "Incorporation of Certain
Information by Reference," and "Pro Forma Condensed Combined Financial Data."
SELECTED FINANCIAL DATA OF ACCUSTAFF (HISTORICAL)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
The following table sets forth selected historical financial data of
AccuStaff and has been derived from and should be read in conjunction with
AccuStaff's Current Report on 8-K dated September 16, 1996, Annual Report on
Form 10-K for the year ended December 31, 1995, and Quarterly Report on Form
10-Q for the quarter ended June 30, 1996, which are incorporated by reference
herein. See "Available Information" and "Incorporation of Certain Information
by Reference." Information for all periods other than the fiscal years ended
January 3, 1993 and December 29, 1991 has been restated to reflect the
acquisitions of The McKinley Group, Inc. and its affiliated company, MGI
Services, Inc. ("McKinley") and PTA International d/b/a Perma Temps ("Perma
Temps") each of which was accounted for as a pooling-of-interests. Interim
unaudited historical data reflects, in the opinion of management of AccuStaff,
all adjustments (consisting only of normal recurring adjustments) necessary for
a fair presentation of such data, and unaudited results of operations for the
six months ended June 30, 1996 are not necessarily indicative of results which
may be expected for any other interim period or for the fiscal year as a whole.
<TABLE>
<CAPTION>
SIX MONTHS ENDED FISCAL YEAR ENDED
------------------ ----------------------------------------------------------
JUNE 30, JULY 1, DECEMBER 31, JANUARY 1, JANUARY 2, JANUARY 3, DECEMBER 29,
1996 1995 1995 1995 1994 1993(1) 1991(2)
-------- -------- ------------ ---------- ---------- ---------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenue................. $334,461 $137,520 $316,847 $166,626 $108,199 $73,421 $65,034
Cost of revenue......... 264,521 113,763 256,844 136,398 89,143 60,895 51,748
Gross profit............ 69,940 23,757 60,003 30,228 19,056 12,526 13,286
Operating expenses...... 47,697 16,777 40,996 22,951 17,270 12,401 13,099
Management fee.......... -- -- -- -- 128 102 126
Interest expense........ (493) 115 (41) (221) (453) (281) (192)
Other income (loss)..... -- -- 146 46 7 17 60
Acquisition expense..... (2,800) -- -- -- -- -- --
Income before income
taxes.................. 18,950 7,095 19,112 7,102 1,468 (37) 181
Provision for income
taxes.................. 8,178 2,742 7,355 2,672 564 -- 61
Net income.............. $ 10,772 $ 4,353 $ 11,757 $ 4,430 $ 904 $ (37) $ 120
PER SHARE DATA:
Net income.............. $ 0.17 $ 0.11 $ 0.27 $ 0.15 $ 0.04 $ 0.01 $ 0.03
Stockholders' equity.... $ 6.75 $ 1.06 $ 2.28 $ 0.87 $ 0.24 $ 0.14 $ 0.30
Weighted average common
shares outstanding..... 62,175 39,112 43,386 29,967 24,989 3,535 3,535
BALANCE SHEET DATA (AT
PERIOD END):
Working capital......... $240,140 $ 22,203 $ 51,330 $ 26,135 $ 8,891 $ 4,990 $ 2,670
Total assets............ 492,374 63,431 150,871 40,478 16,010 9,781 14,483
Long-term debt.......... 7,442 12,814 6,810 1,968 6,222 4,003 2,178
Stockholders' equity.... 442,069 37,208 116,899 30,241 5,337 2,450 5,346
</TABLE>
- --------
(1) Includes the audited financial information of the four predecessor
companies, ATS Services, Inc., Abacus Services, Inc., Metrotech, Inc., and
BSI Temporaries, Inc. (the "AccuStaff Predecessors"), for the four-month
period ended May 3, 1992, combined with the audited financial information
of AccuStaff for the eight-month period ended January 3, 1993, and has not
been restated to reflect the consummation of the acquisitions of McKinley
and Perma Temps.
(2) Includes the audited financial information of the AccuStaff Predecessors
for the fiscal year ended December 29, 1991, and has not been restated to
reflect the acquisitions of McKinley and Perma Temps.
18
<PAGE>
SELECTED FINANCIAL DATA OF CAREER (HISTORICAL)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
The following table sets forth selected historical financial data of Career
and has been derived from and should be read in conjunction with Career's
Transition Report on Form 10-K for the period July 1, 1995 to December 31,
1995, Annual Report on Form 10-K for the fiscal year ended June 30, 1995, and
Quarterly Report on Form 10-Q for the quarter ended June 30, 1996, which are
incorporated by reference herein. See "Available Information," "Incorporation
of Certain Information by Reference," and "The Merger--Conduct of Business
Pending the Merger." Interim unaudited historical data reflect, in the opinion
of management of Career, all adjustments (consisting only of normal recurring
adjustments) necessary for a fair presentation of such data, and unaudited
results of operations for the six months ended June 30, 1996 are not
necessarily indicative of results which may be expected for any other interim
period or for the fiscal year as a whole.
<TABLE>
<CAPTION>
SIX MONTHS TRANSITION
ENDED PERIOD JULY 1,
JUNE 30, 1995 TO FISCAL YEARS ENDED JUNE 30,(1)
-------------------- DECEMBER 31, ----------------------------------------------------
1996 1995 1995(1) 1995 1994 1993 1992 1991
-------- -------- -------------- -------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenue(2)............. $275,851 $183,733 $201,556 $361,026 $315,498 $265,108 $213,710 $202,609
Cost of revenue........ 210,233 141,115 153,531 276,864 245,000 206,117 162,134 153,722
Gross profit........... 65,618 42,618 48,025 84,162 70,498 58,991 51,576 48,887
Selling, general and
administrative
expenses.............. 41,637 25,429 27,979 48,990 44,594 37,876 32,391 31,370
Remittance to
franchisees(3)........ 9,898 9,235 9,254 18,747 14,839 13,908 13,218 13,058
Non-recurring
compensation
expense(4)............ -- -- -- -- 1,396(4) -- -- --
Interest expense -
net................... 1,802 960 1,245 1,803 4,684 5,899 5,364 4,979
Other expense (income),
net................... 389 1,134 201 1,276(5) 254 (394) 189 31
Income (loss) before
income taxes.......... 11,892 5,860 9,346 13,346 4,731 1,702 414 (551)
Provision for income
taxes................. 4,578 2,216 3,662 5,399 1,684 606 486 641
Income (loss) before
extraordinary item.... 7,314 3,644 5,684 7,947 3,047(6) 1,096 (72) (1,192)
Extraordinary loss on
retirement of debt,
net of tax benefit.... -- -- -- -- 1,403 -- -- --
Net income (loss)...... 7,314 3,644 5,684 7,947 1,644 1,096 (72) (1,192)
Preferred stock
dividend
requirements.......... -- -- -- -- 527 710 710 1,150
Net income (loss)
applicable to common
stockholders.......... $ 7,314 $ 3,644 $ 5,684 $ 7,947(7) $ 1,117 $ 386 $ (782) $ (2,342)
PER SHARE DATA:
Income (loss) per
common share(8):
Income (loss) after
preferred stock
dividends, before
extraordinary item... $ 0.43 $ 0.30 $ 0.44 $ 0.65 $ 0.30(6) $ 0.06 $ (0.17) $ (0.52)
Extraordinary loss on
retirement of debt,
net of tax benefit... -- -- -- -- (0.17) -- -- --
Net income (loss)
applicable to common
stockholders......... $ 0.43(9) $ 0.30 $ 0.44(9) $ 0.65(7) $ 0.13 $ 0.06 $ (0.17) $ (0.52)
Weighted average common
shares outstanding
(fully diluted)(8).... 21,452(9) 12,332 14,638(9) 12,304 8,397 6,786 4,500 4,470
BALANCE SHEET DATA (AT PERIOD
END):
Working capital........ $149,482 $ 51,264 $109,099 $ 51,264 $ 45,606 $ 36,879 $ 28,626 $ 17,775
Total assets........... 344,275 123,942 201,558 123,942 103,534 91,822 78,134 63,879
Total debt............. 86,250 23,149 86,250 23,149 21,130 48,468 41,439 27,905
Cumulative preferred
stock................. -- -- -- -- -- 10,357 10,357 9,647
Stockholders' equity
(deficit)............. 191,275 54,795 60,903 54,795 45,554 1,619 1,221 (1,214)
</TABLE>
19
<PAGE>
- --------
(1) Career changed its fiscal year end from June 30 to December 31, commencing
December 31, 1995.
(2) Career recognizes as revenues (i) the amounts billed to its clients and
substantially all franchisees and (ii) the service fees it receives from
Associated Offices and certain of its franchisees. Career does not
recognize as revenues the sales of Associated Offices or of certain of its
franchisees.
(3) The remittance to franchisees is that portion of gross profit owed to
franchisees, after deduction of fees and expenses.
(4) Represents a non-recurring compensation expense related to the grant as of
September 30, 1993 of certain stock options pursuant to Career's 1993 Stock
Option and Performance Award Plan.
(5) Includes $965,000 of expenses relating to the resignation of the former
chief executive officer of Career.
(6) Excluding non-recurring compensation expense, income after preferred stock
dividends before extraordinary item would have been $3,358,000 and, on a
per share basis, $.40.
(7) Excluding costs associated with the resignation of the former chief
executive officer of Career, net income and net income per common share
applicable to common stockholders, would have been $8,497,000 and $.69,
respectively.
(8) All share and per share data have been restated to reflect the two-for-one
split of the Career Common Stock, in the form of a 100% stock dividend,
effective February 22, 1996.
(9) Calculation of net income per share applicable to common stockholders for
the six months ended December 31, 1995 and June 30, 1996 is as follows, in
thousands, except per share data:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
---------------------
JUNE 30, DECEMBER 31,
1996 1995
-------- ------------
<S> <C> <C>
Net income........................................... $7,314 $5,684
Add: Interest expense on Career Convertible Notes,
net of tax benefit.................................. 1,869 766
------ ------
$9,183 $6,450
====== ======
Weighted average number of common shares
outstanding......................................... 16,484 12,694
Add: Deemed conversion of Career Convertible Notes... 4,968 1,944
------ ------
21,452 14,638
====== ======
Net income per share applicable to common
stockholders (fully diluted)........................ $ 0.43 $ 0.44
====== ======
</TABLE>
20
<PAGE>
SELECTED PRO FORMA COMBINED FINANCIAL DATA OF ACCUSTAFF AND CAREER
(IN THOUSANDS, EXCEPT PER SHARE DATA)
The following table sets forth selected combined financial information for
each of the three years in the period ended December 31, 1995, and the six
months ended June 30, 1996, giving effect to the Merger using the pooling-of-
interests method of accounting. See "The Merger--Accounting Treatment." In
addition the table below sets forth certain pro forma combined financial
information for the year ended December 31, 1995 and the six months ended June
30, 1996 which gives effect to the Merger and all other acquisitions completed
by AccuStaff and Career through September 16, 1996, as if the acquisitions had
been completed as of January 2, 1995. The pro forma information is provided for
informational purposes only and is not necessarily indicative of actual results
that would have been achieved had the Merger been consummated at the beginning
of the periods presented or of future results. The selected pro forma combined
financial information is derived from the unaudited pro forma combined
financial information appearing elsewhere and incorporated by reference herein.
This information should be read in conjunction with the historical financial
statements of AccuStaff and Career, including the respective notes thereto,
incorporated by reference herein, and the unaudited pro forma financial
information, including the notes thereto, appearing elsewhere and incorporated
by reference herein. See "Available Information," "Incorporation of Certain
Information by Reference," and "Pro Forma Condensed Combined Financial Data."
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
SIX MONTHS FISCAL YEAR SIX MONTHS FISCAL YEARS ENDED
ENDED ENDED ENDED ----------------------------------
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31, JANUARY 1, JANUARY 2,
1996(1) 1995(1) 1996 1995 1995 1994
---------- ------------ ---------- ------------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenue................. $752,989 $1,397,434 $610,312 $702,136 $500,714 $401,932
Cost of revenue......... 581,705 1,085,054 474,754 551,490 393,712 317,754
Gross profit............ 171,284 312,380 135,558 150,646 107,002 84,178
Operating expenses...... 125,846 234,840 99,621 114,228 86,370 74,498
Management fee.......... -- -- -- -- -- 128
Interest expense........ (5,338) (21,506) (2,295) (2,246) (2,845) (6,272)
Other income (expense).. 128 -- -- 146 46 7
Acquisition expense..... (2,800) -- (2,800) -- -- --
Income before income
taxes.................. 37,428 56,034 30,842 34,318 17,833 3,543
Provision for income
taxes.................. 15,335 21,737 12,756 13,233 7,149 1,160
Income from continuing
operations............. $22,093 $34,297 $18,086 $21,085 $10,684 $2,383
PER SHARE DATA:
Income from continuing
operations............. $0.25 $0.51 $0.21 $0.34 $0.22 $0.05
Stockholders' equity.... $6.57 -- (2) 6.58 2.57 $1.55 $0.34
Weighted average common
shares outstanding..... 96,721 74,233 94,997 64,130 46,821 35,821
BALANCE SHEET DATA (AT PERIOD END):
Working capital......... $290,527 -- (2) 364,622 160,429 $80,380 $22,892
Total assets............ 857,566 -- 836,649 352,429 156,129 119,422
Long-term debt.......... 100,205 -- 93,692 93,060 26,075 28,919
Stockholders' equity.... 610,066 -- 608,344 177,802 80,646 9,680
</TABLE>
- --------
(1) Reflects combined AccuStaff and Career information as if all acquisitions
completed by AccuStaff and Career had been completed as of January 2, 1995.
(2) Intentionally omitted.
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RISK FACTORS
In addition to the other information in this Joint Proxy
Statement/Prospectus, the following factors should be considered carefully in
evaluating an investment in the shares of AccuStaff Common Stock offered by
this Joint Proxy Statement/Prospectus. See "Forward Looking Statements."
EFFECT OF THE MERGER; INTEGRATION OF OPERATIONS
The success of the Merger will be determined by various factors, including
the financial performance of the combined company's operations after the
Merger and management's ability to effectively integrate the operations of
AccuStaff and Career. The integration of the operations of Career and
AccuStaff may be negatively affected if, among other things, clients,
particularly national account clients, do not react positively to some of the
planned changes intended to increase AccuStaff's staffing services or to
integrate the businesses of the two companies, unanticipated offsetting costs
are incurred, or costs or difficulties related to the integration of the
businesses of AccuStaff and Career are greater than expected. There can be no
assurance that the anticipated benefits of the Merger will be realized or that
the Merger will not adversely affect the future operating results of
AccuStaff. See "The Merger" and "Pro Forma Condensed Combined Financial Data."
ABILITY TO ACHIEVE AND MANAGE GROWTH; ACQUISITION RISKS
AccuStaff has experienced significant growth, principally through
acquisitions, internal growth and opening new offices. There can be no
assurance that AccuStaff will be able to expand its market presence in its
current locations or successfully enter other markets through acquisitions or
the opening of new offices. AccuStaff's ability to continue its growth and
profitability will depend on a number of factors, including the availability
of capital to fund acquisitions, existing and emerging competition, the
ability to maintain sufficient profit margins despite pricing pressures and
the strength of demand for temporary employees in AccuStaff's markets.
AccuStaff must also manage costs in a changing regulatory environment, adapt
its infrastructure and systems to accommodate growth and recruit and train
additional qualified personnel. Additionally, there can be no assurance that
AccuStaff will be able to successfully identify suitable acquisition
candidates, complete acquisitions or integrate acquired businesses into its
operations. Once integrated, acquisitions may not achieve comparable levels of
revenue, profitability or productivity as AccuStaff's existing locations or
otherwise perform as expected. Acquisitions also involve special risks,
including risks associated with unanticipated problems, liabilities and
contingencies, diversion of management attention and possible adverse effects
on earnings resulting from increased goodwill amortization, increased interest
costs, the issuance of additional securities and difficulties related to the
integration of the acquired business. AccuStaff is unable to predict whether
or when any prospective acquisition candidate will become available or the
likelihood that any acquisition will be completed.
EFFECT OF ECONOMIC FLUCTUATIONS
Demand for staffing services is significantly affected by the general level
of economic activity and unemployment in the United States. When economic
activity increases, temporary employees are often added before full-time
employees are hired. However, as economic activity slows, many companies
reduce their use of temporary employees before laying off full-time employees.
In addition, AccuStaff may experience more competitive pricing pressure during
such periods of economic downturn. Therefore, any significant economic
downturn could have a material adverse effect on AccuStaff's business.
COMPETITIVE MARKET
The temporary staffing industry is highly competitive with limited barriers
to entry. AccuStaff competes in national, regional and local markets with
full-service and specialized temporary staffing agencies. A significant number
of competitors have greater marketing, financial and other resources than
AccuStaff and could provide new or increased competition to AccuStaff. Price
competition in the staffing industry is intense, particularly for the
provision of clerical and light industrial personnel, and pricing pressures
from competitors and customers are
22
<PAGE>
increasing. In addition, to the extent that AccuStaff offers fixed price
contracts to clients in the future, AccuStaff may be responsible for cost
overruns which would have an adverse impact on earnings. AccuStaff expects
that the level of competition will remain high in the future. Competition,
particularly from companies with greater financial resources than AccuStaff,
could have a material adverse effect on AccuStaff's operations and
profitability.
DEPENDENCE ON AVAILABILITY OF QUALIFIED TEMPORARY PERSONNEL
AccuStaff depends on its ability to attract, train and retain personnel who
possess the skills and experience necessary to meet the staffing requirements
of its clients. Competition for individuals with proven skills in certain
areas, particularly legal, accounting and technical, is intense. AccuStaff
must continually evaluate, train and upgrade its base of available personnel
to keep pace with clients' needs. There can be no assurance that qualified
personnel will continue to be available to AccuStaff in sufficient numbers and
on economic terms acceptable to AccuStaff.
CLIENT CONCENTRATION
ATI accounted for approximately 24% and 31% of AccuStaff's revenue during
fiscal 1994 and fiscal 1995, respectively, 13% of AccuStaff's pro forma fiscal
1995 revenue and 6.9% of the pro forma combined AccuStaff revenue for fiscal
1995. No other client accounted for more than 5% of AccuStaff's revenue during
the same periods. The agreement with ATI prohibits AccuStaff from providing
similar services to any direct competitor of ATI. The loss of or a material
reduction in the revenue from ATI could have a material adverse effect on
AccuStaff's business.
RELIANCE ON KEY PERSONNEL
AccuStaff is highly dependent on its management. AccuStaff believes that its
continued success will depend to a significant extent upon the efforts and
abilities of its President and Chief Executive Officer, Derek E. Dewan, and
certain other key executives, including executives of its acquired
subsidiaries including, upon consummation of the Merger, key executives of
Career. The loss of the services of Mr. Dewan or other key executives could
have a material adverse effect upon AccuStaff's business. Mr. Dewan and
AccuStaff have entered into an employment agreement which expires December 31,
2001, and AccuStaff maintains $1.0 million in key man life insurance on Mr.
Dewan.
INCREASED EMPLOYEE COSTS
AccuStaff is responsible for and pays unemployment insurance premiums and
workers' compensation for its temporary employees. Unemployment insurance
premiums may increase as a result of, among other things, increased levels of
unemployment and the lengthening of periods for which unemployment benefits
are available. Workers' compensation costs may increase as a result of changes
in AccuStaff's experience rating or applicable laws. Furthermore, annual
workers' compensation expenses and the related liability accrual are based on
various estimates, including the cost of estimated future benefits. Any
material variation from the estimate of future benefits could have a material
adverse effect on AccuStaff. There can be no assurance that AccuStaff will be
able to increase the fees charged to its clients in a timely manner and in
sufficient amounts to cover increased costs related to workers' compensation
and unemployment insurance or health benefits if such health benefits are
extended to temporary employees as proposed in certain recent federal and
state legislative proposals.
INDUSTRY RISKS
Temporary staffing services providers employ and place people generally in
the workplace of other businesses. An attendant risk of such activity includes
possible claims of discrimination and harassment, employment of illegal
aliens, violations of wage and hour requirements, errors and omissions of its
temporary employees, particularly for the actions of professionals (e.g.,
attorneys, accountants and engineers), misuse of client proprietary
information, misappropriation of funds, other criminal activity or torts and
other similar claims. In some instances AccuStaff, pursuant to a written
contract, has agreed to indemnify clients against some or all of the foregoing
matters. Moreover, in certain circumstances, AccuStaff may be held responsible
for the actions
23
<PAGE>
at a workplace of persons not under AccuStaff's direct control. Although
AccuStaff historically has not had any significant problems with this area,
there can be no assurance that AccuStaff will not experience such problems in
the future or that AccuStaff's insurance, if any, will be sufficient in amount
or scope to cover any such liability. Temporary staffing providers also are
affected by fluctuations and interruptions in the business of their clients.
For example, inclement weather or work stoppages, which may require clients to
close or reduce their hours of operation, can adversely affect AccuStaff's
revenues.
PROFESSIONAL REGULATION OF TEMPORARY ATTORNEYS
There can be no assurance that an authority governing the practice of law
will not determine that the temporary attorney placement business as conducted
by AccuStaff violates such authority's regulations. AccuStaff has not
requested and does not intend to request an opinion on this matter from any
authority governing the practice of law.
FRANCHISING RISKS
For the twelve months ended December 31, 1995 and the six months ended June
30, 1996, 32% and 24%, respectively, of Career's revenues were derived from
franchised operations, ten of which accounted for 17% and 11%, respectively,
of Career's revenues in such periods. While Career's agreements contain non-
competition covenants, such covenants may not prevent the termination of
agreements by franchisees and the resulting loss of royalty income. Career
must also comply with federal and state laws and regulations governing the
sale of franchises. Compliance with such laws and regulations could adversely
impact the future operations of AccuStaff.
POSSIBLE ADVERSE EFFECT OF NATIONAL AND STATE HEALTH CARE REFORM PROPOSALS
The extent and type of government support for health care services, as well
as the extent and type of health insurance benefits that employers are
required to provide employees, have been the subject of intense scrutiny and
debate in recent years at both the national and state levels. Changes in
government support of health care services or the regulations governing such
services, including regulations governing the methods by which services are
delivered, the prices for services or reimbursements of fees, all could have a
material adverse effect on Career. In particular, Career derives a significant
portion of its revenues from Medicaid programs in the New York metropolitan
region. For the twelve months ended December 31, 1995 and the six months ended
June 30, 1996, approximately 7% and 5%, respectively, of Career's revenues
were derived from these programs. Accordingly, the enactment of any proposals
that would reduce the funding of such programs could have a material adverse
effect on this business. In addition, as part of health care reform, recent
federal and certain state legislative proposals have included provisions
extending health insurance benefits to temporary employees who currently are
not provided with such benefits. If health insurance benefits are extended to
temporary employees, there can be no assurance that upon consummation of the
Merger, AccuStaff will be able to pass on any resulting increased costs to its
clients.
GOVERNMENTAL REGULATION RELATING TO HEALTH CARE PROVIDERS
Career's Health Care division is subject to extensive federal, state and
local laws and governmental regulations, including licensing requirements,
periodic examinations by governmental agencies and federal and state anti-
fraud, abuse and kickback statutes and regulations. Although such regulations
have not had a material adverse effect on Career in the past, there can be no
assurance that upon consummation of the Merger AccuStaff will be able to
continue to obtain or maintain required government approvals or licenses or
that in the future regulatory changes will not have a material adverse effect
on AccuStaff.
In many states in which the Health Care division operates, Career is
required to be licensed in order to establish and operate a home care service
agency. In approximately 21 states and the District of Columbia, home health
care providers must initially receive certificate of need ("CON") approval
from the state, in addition to complying with licensure requirements. In some
states, the process of obtaining a CON may be costly and time consuming, and
several states currently are not granting CONs. CON and licensure laws can
restrict the types of services that a company may provide. Additionally, such
laws may limit a company's ability to establish or expand its operations
within a state. Consummation of the Merger is not conditioned on the obtaining
of certain approvals relating to Career's health care operations. Failure to
obtain any such approvals may have an adverse effect on such operations.
24
<PAGE>
INTANGIBLE ASSETS
As of December 31, 1995, approximately $65.5 million, or 46.2%, of
AccuStaff's total assets were intangible assets. Pro forma for the Merger and
AccuStaff's and Career's other acquisitions, intangible assets as of June 30,
1996 were approximately $392.6 million, or 45.8%, of AccuStaff's pro forma
total assets. These intangible assets substantially represent amounts
attributable to goodwill recorded in connection with AccuStaff's and Career's
acquisitions. Any impairment in the value of such assets could have a material
adverse effect on AccuStaff's financial condition and results of operations.
See "Pro Forma Condensed Combined Financial Data."
RELIANCE ON INFORMATION PROCESSING SYSTEMS
The business of both AccuStaff and Career depend upon each companies'
ability to store, retrieve, process and manage significant amounts of
information, and periodically expand and upgrade their information processing
capabilities. A significant percentage of each companies' computer equipment
and software systems is maintained at or near its each companies' respective
headquarters. Interruption or loss of either companies' information processing
capabilities through the loss of stored data, breakdown or malfunction of
computer equipment or software systems, telecommunications failure, conversion
difficulties or damage to either companies' headquarters and systems caused by
fire, hurricane, lightning, electrical power outage or other disruption could
have a material adverse effect on AccuStaff.
ANTI-TAKEOVER CONSIDERATIONS
AccuStaff's Articles, AccuStaff's Bylaws and the Florida BCA contain certain
provisions that could have the effect of making it more difficult for a party
to acquire, or of discouraging a party from attempting to acquire control of
AccuStaff without approval of AccuStaff's Board of Directors. See "Certain
Differences in the Rights of AccuStaff and Career Stockholders."
DIVIDEND POLICY; RESTRICTIONS ON PAYMENT
AccuStaff anticipates that for the foreseeable future its earnings will be
retained for the operation and expansion of its business and that it will not
pay cash dividends. In addition, AccuStaff's credit facility prohibits the
payment of cash dividends without the lender's consent.
VOLATILITY OF STOCK PRICE
From time to time, there may be significant volatility in the market price
for AccuStaff Common Stock. Quarterly operating results of AccuStaff or of
other temporary staffing companies, changes in general conditions in the
economy, the financial markets or the staffing industry, natural disasters or
other developments could cause the market price of AccuStaff Common Stock to
fluctuate substantially. 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. See "Summary--Market
Price and Dividends."
25
<PAGE>
GENERAL INFORMATION
CAREER SPECIAL MEETING
The Career Special Meeting will be held at 10:00 a.m., local time, on
November 14, 1996, at the Long Island Marriott Hotel, 101 James Doolittle
Blvd., Uniondale, New York. At the Career Special Meeting, holders of Career
Common Stock will consider and vote upon a proposal to adopt the Merger
Agreement.
The Career Board of Directors has fixed the close of business on October 4,
1996, as the record date for determining the Career stockholders entitled to
receive notice of and to vote at the Career Special Meeting (the "Career
Record Date"). Only holders of record of Career Common Stock as of the Career
Record Date are entitled to notice of and to vote at the Career Special
Meeting. As of the close of business on the Career Record Date, there were
17,663,789 shares of Career Common Stock outstanding and held by 992 holders
of record. Holders of Career Common Stock are entitled to one vote on each
matter considered and voted on at the Career Special Meeting for each share of
Career Common Stock held of record at the close of business on the Career
Record Date. The presence, in person or by properly executed proxy, of the
holders of a majority of the outstanding shares of Career Common Stock
entitled to vote at the Career Special Meeting is necessary to constitute a
quorum of the holders of Career Common Stock at the Career Special Meeting.
Abstentions will be counted as shares present for purposes of determining the
presence of a quorum. Abstentions will not be counted as votes cast for
purposes of determining whether a proposal has received sufficient votes for
adoption. Consequently, abstentions will have the effect of a vote against the
adoption of the Merger Agreement.
Proxies in the form enclosed are solicited by the Career Board of Directors.
Shares of Career Common Stock represented by properly executed proxies, if
such proxies are received in time and are not revoked, will be voted in
accordance with the instructions indicated on the proxies. IF NO INSTRUCTIONS
ARE INDICATED, SUCH PROXIES WILL BE VOTED FOR ADOPTION OF THE MERGER AGREEMENT
AND CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED THEREBY, AND AS DETERMINED
BY A MAJORITY OF THE MEMBERS OF THE CAREER BOARD OF DIRECTORS AS TO ANY OTHER
MATTER THAT MAY PROPERLY COME BEFORE THE CAREER SPECIAL MEETING. ANY HOLDER OF
CAREER COMMON STOCK WHO RETURNS A SIGNED PROXY BUT FAILS TO PROVIDE
INSTRUCTIONS AS TO THE MANNER IN WHICH SUCH HOLDER'S SHARES ARE TO BE VOTED
WILL BE DEEMED TO HAVE VOTED FOR THE ADOPTION OF THE MERGER AGREEMENT AND
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED THEREIN.
A Career stockholder who has given a proxy may revoke it at any time prior
to its exercise at the Career Special Meeting or prior to the receipt by
Career of proxies voting in favor of the Merger by all stockholders, by (i)
giving written notice of revocation to the Secretary of Career, (ii) properly
submitting to Career a duly executed proxy bearing a later date, or (iii)
voting in person at the Career Special Meeting. All written notices of
revocation and other communications with respect to revocation of proxies
should be addressed to Career as follows: Career Horizons, Inc., 177 Crossways
Park Drive, Woodbury, New York 11797, Attention: Secretary. A proxy
appointment will not be revoked by death or supervening incapacity of the
stockholder executing the proxy unless, before the shares are voted, notice of
such death or incapacity is filed with Career's Secretary or other person
responsible for tabulating votes on behalf of Career.
The expense of soliciting proxies for the Career Special Meeting will be
borne by Career, although AccuStaff has paid one-half of the cost of filing
fees and printing and mailing this Joint Proxy Statement/Prospectus. In
addition to the solicitation of stockholders of record by mail, telephone or
personal contact, Career will be contacting brokers, dealers, banks or voting
trustees or their nominees who can be identified as record holders of Career
Common Stock. Such holders, after inquiry by Career, will provide information
concerning quantity of proxy and other materials needed to supply such
materials to beneficial owners, and Career will reimburse them for the expense
of mailing the proxy materials to such persons. In addition, Career has
engaged the services of D.F. King & Co., Inc. to assist in the solicitation of
proxies at a cost of $7,500 plus expenses. The cost of such solicitation will
be borne by Career.
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<PAGE>
Adoption of the Merger Agreement by the stockholders of Career requires the
affirmative vote of the holders of majority of the outstanding shares of
Career Common Stock entitled to vote at the Special Meeting. As of the
Career Record Date, Career's directors and executive officers and their
affiliates held approximately 1.33% of the outstanding shares of Career Common
Stock entitled to vote at the Career Special Meeting. As of the Career Record
Date, AccuStaff, its directors and executive officers, and their affiliates,
held 500 shares of Career Common Stock. The holders of Career Common Stock are
not entitled to appraisal or dissenters' rights in connection with the Merger.
HOLDERS OF CAREER COMMON STOCK SHOULD NOT SEND IN THEIR CERTIFICATES UNTIL
THEY RECEIVE THE LETTER OF TRANSMITTAL AND INSTRUCTIONS.
ACCUSTAFF SPECIAL MEETING
The AccuStaff Special Meeting will be held at 10:00 a.m., local time on
November 14, 1996, in the South Ballroom of the Prime F. Osborn Convention
Center, 1000 Water Street, Jacksonville, Florida. At the AccuStaff Special
Meeting holders of AccuStaff Common Stock will consider and vote upon a
proposal to approve the issuance of shares of AccuStaff Common Stock pursuant
to the Merger Agreement and will transact such other business as may properly
come before the AccuStaff Special Meeting.
AccuStaff's Board of Directors has fixed the close of business on October 4,
1996, as the record date for determining the holders of AccuStaff Common Stock
entitled to receive notice of and to vote at the AccuStaff Special Meeting
(the "AccuStaff Record Date"). Only holders of record of AccuStaff Common
Stock as of the AccuStaff Record Date are entitled to notice of and to vote at
the AccuStaff Special Meeting. As of the close of business on the AccuStaff
Record Date, there were 66,044,640 shares of AccuStaff Common Stock issued and
outstanding and held by 507 holders of record. Holders of AccuStaff Common
Stock are entitled to one vote on each matter considered and voted on at the
AccuStaff Special Meeting for each share of AccuStaff Common Stock held of
record at the close of business on the AccuStaff Record Date. The presence, in
person or by properly executed proxy, of the holders of a majority of the
outstanding shares of AccuStaff Common Stock entitled to vote at the AccuStaff
Special Meeting is necessary to constitute a quorum of the holders of
AccuStaff Common Stock at the AccuStaff Special Meeting. Abstentions will be
counted as shares present for purposes of determining the presence of a quorum
but will not be counted as votes cast for purposes of determining whether a
proposal has received sufficient votes for adoption. Consequently, abstentions
will count against the participation threshold required with respect to the
approval of the issuance of shares of AccuStaff Common Stock pursuant to the
Merger Agreement, but, if such participation threshold is met, abstentions
will have no effect on the required vote for approval of such proposal.
Proxies in the form enclosed are solicited by AccuStaff's Board of
Directors. Shares of AccuStaff Common Stock represented by properly executed
proxies, if such proxies are received in time and are not revoked, will be
voted in accordance with the instructions indicated on the proxies. IF NO
INSTRUCTIONS ARE INDICATED, SUCH PROXIES WILL BE VOTED FOR APPROVAL OF THE
ISSUANCE OF SHARES OF ACCUSTAFF COMMON STOCK PURSUANT TO THE MERGER AGREEMENT,
AND AS DETERMINED BY A MAJORITY OF THE MEMBERS OF THE ACCUSTAFF BOARD OF
DIRECTORS AS TO ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE ACCUSTAFF
SPECIAL MEETING. ANY HOLDER OF ACCUSTAFF COMMON STOCK WHO RETURNS A SIGNED
PROXY BUT FAILS TO PROVIDE INSTRUCTIONS AS TO THE MANNER IN WHICH SUCH
HOLDER'S SHARES ARE TO BE VOTED WILL BE DEEMED TO HAVE VOTED FOR APPROVAL OF
THE ISSUANCE OF ACCUSTAFF COMMON STOCK PURSUANT TO THE MERGER AGREEMENT.
An AccuStaff stockholder who has given a proxy may revoke it at any time
prior to its exercise at the AccuStaff Special Meeting or prior to the receipt
by AccuStaff of proxies voting in favor of the issuance of shares of AccuStaff
Common Stock pursuant to the Merger Agreement by all stockholders, by (i)
giving written notice of revocation to the Corporate Secretary of AccuStaff,
(ii) properly submitting to AccuStaff a duly executed proxy bearing a later
date, or (iii) voting in person at the AccuStaff Special Meeting. All written
notices of revocation and other communications with respect to revocation of
proxies should be addressed to AccuStaff as follows: AccuStaff Incorporated,
6440 Atlantic Boulevard, Jacksonville, Florida 32211, Attention: Corporate
Secretary. A proxy appointment will not be revoked by death or supervening
incapacity of the stockholder executing the proxy unless, before the shares
are voted, notice of such death or incapacity is filed with AccuStaff's
Corporate Secretary or other person responsible for tabulating votes on behalf
of AccuStaff.
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<PAGE>
The expense of soliciting proxies for the AccuStaff Special Meeting will be
paid by AccuStaff. In addition to the solicitation of stockholders of record
by mail, telephone or personal contact, AccuStaff will be contacting brokers,
dealers, banks or voting trustees or their nominees who can be identified as
record holders of AccuStaff Common Stock. Such holders, after inquiry by
AccuStaff, will provide information concerning quantity of proxy and other
materials needed to supply such materials to beneficial owners, and AccuStaff
will reimburse them for the expense of mailing the proxy materials to such
persons. In addition, AccuStaff has engaged the services of Morrow & Co., Inc.
to assist in the solicitation of proxies at a cost of $7,000 plus expenses.
The cost of such solicitation will be borne by AccuStaff.
Approval of the issuance of shares of AccuStaff Common Stock pursuant to the
Merger Agreement requires the approval of a majority of the votes cast on such
proposal, provided that the total vote cast on such proposal represents over
50% in interest of all shares of AccuStaff Common Stock entitled to vote at
the AccuStaff Special Meeting. As of the AccuStaff Record Date, AccuStaff's
directors and executive officers and their affiliates held approximately 9.8%
of the outstanding shares of AccuStaff Common Stock entitled to vote at the
AccuStaff Special Meeting. As of the AccuStaff Record Date, Career, its
directors and executive officers, and their affiliates, held no shares of
AccuStaff Common Stock. The holders of AccuStaff Common Stock are not entitled
to appraisal or dissenters' rights in connection with the Merger.
28
<PAGE>
THE MERGER
The following information describes certain information pertaining to the
Merger. This description does not purport to be complete and is qualified in
its entirety by reference to the Annexes hereto, including the Merger
Agreement, a copy of which is set forth in Annex A to this Joint Proxy
Statement/Prospectus and incorporated herein by reference. All stockholders
are urged to read the Annexes in their entirety.
GENERAL
Subject to the terms and conditions of the Merger Agreement, Newco will
merge with and into Career, which will be the surviving corporation in the
Merger and, as a result thereof, Career will become a wholly owned subsidiary
of AccuStaff. Upon consummation of the Merger, each outstanding share of
Career Common Stock (excluding shares held by Career, AccuStaff, or their
respective subsidiaries) will cease to be outstanding and will be converted
into the right to receive a number of shares of AccuStaff Common Stock equal
to the Exchange Ratio, with cash being paid in lieu of any fractional share
interest. See "--Merger Consideration" and "--Fractional Shares."
Consummation of the Merger is subject to various conditions, including among
other matters: (i) adoption of the Merger Agreement by the requisite vote of
the holders of Career Common Stock; (ii) approval of the issuance of shares of
AccuStaff Common Stock pursuant to the Merger Agreement by the requisite vote
of the holders of AccuStaff Common Stock; (iii) receipt of all governmental
and other consents and approvals specified as conditions to consummation of
the Merger, including expiration or termination of the statutory waiting
period under the HSR Act; and (iv) satisfaction of certain other customary
conditions. The foregoing are the material conditions to the consummation of
the Merger. See "--Conditions to Consummation," "--Regulatory Approvals," and
"--Amendment, Waiver, and Termination." A copy of the Merger Agreement is set
forth in Annex A of this Joint Proxy Statement/Prospectus.
EFFECTIVE TIME
If the Merger Agreement is approved by the requisite votes of the Career
stockholders, the issuance of shares of AccuStaff Common Stock pursuant to the
Merger Agreement is approved by the requisite vote of the holders of AccuStaff
Common Stock, and all required governmental and other consents and approvals
specified as conditions to consummation of the Merger are received, and if the
other conditions to the obligations of the parties to consummate the Merger
are satisfied or waived (as permitted), the Merger will be consummated and
effected on the date and at the time the Certificate of Merger reflecting the
Merger is duly filed with the Secretary of State of the State of Delaware (the
"Effective Time"). AccuStaff and Career have mutually agreed to use all
reasonable efforts to cause the Effective Time to occur not later than the
second business day following the last to occur of: (i) the effective date
(including expiration of any applicable waiting period) of the last required
approval or clearance of any regulatory authority whose approval is specified
as a condition to consummation of the Merger, and (ii) the date on which the
stockholders of Career and AccuStaff approve the Merger Agreement to the
extent such approval is required by applicable law or the rules of the NYSE or
NASD. Assuming satisfaction of all conditions to the consummation of the
Merger, the Merger is expected to become effective during the fourth quarter
of 1996. Either AccuStaff or Career may terminate the Merger Agreement
unilaterally if the Merger has not been consummated by December 31, 1996. See
"--Conditions to Consummation," "--Regulatory Approvals," and "--Amendment,
Waiver, and Termination."
BACKGROUND OF THE MERGER
In mid-July, members of AccuStaff's senior management had discussions with
representatives of Salomon to consider the potential for strategic
combinations between AccuStaff and other staffing companies. In those
discussions, Mr. Derek E. Dewan, Chairman, President and Chief Executive
Officer of AccuStaff, indicated an interest in pursuing the possibility of a
strategic combination with Career and requested that representatives of
Salomon contact Career to explore the possibility of such a combination and
attempt to arrange a meeting with
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Career representatives. Salomon subsequently approached Mr. Walter W.
Macauley, the President and Chief Executive Officer of Career, and Mr. Harvey
J. Wertheim, the Chairman of the Board of Career, to report the discussion
with Mr. Dewan. Shortly thereafter, the Salomon representatives met with Mr.
Macauley, Mr. Wertheim, Mr. Ira Kleinman, a director of Career, and Mr.
Michael Druckman, Senior Vice President and Chief Financial Officer of Career,
to discuss their conversations with Mr. Dewan and the potential strategic
benefits of a business combination with AccuStaff.
On July 18, 1996, Messrs. Dewan, Macauley, Wertheim, Kleinman and
representatives of Salomon met to explore the potential benefits of a business
combination between Career and AccuStaff and to discuss the general terms of
such a combination. On July 19, 1996, Messrs. Macauley, Wertheim and
representatives of Salomon met to discuss in greater detail the basic terms of
the potential merger. As a result of such conversations, the representatives
of Career preliminarily concluded that the possibility of a combination of
AccuStaff and Career should be explored further.
On July 20, 1996, representatives of Career and AccuStaff, including Messrs.
Macauley and Dewan, together with representatives of Salomon and Baird and the
companies' respective counsel, met to explore further a possible combination
of Career and AccuStaff. At that meeting, the parties discussed generally the
potential benefits presented by such a combination and general pricing terms.
At that time, the representatives of Career, however, indicated that Career
did not desire to pursue discussions further in order to afford Career time to
consider further the merits of a potential strategic combination with
AccuStaff.
During the week and a half following the July 20, 1996 meeting,
representatives of AccuStaff met informally among themselves to discuss the
possible transaction and the terms of Mr. Macauley's possible employment
relationship with AccuStaff. In addition, during this period AccuStaff
continued its due diligence investigation of the publicly available
information on Career which had begun on July 19, 1996.
On July 25, 1996, representatives of Salomon met informally with the Career
Board of Directors to review the merits of a business combination with
AccuStaff. At that meeting, the Salomon representatives presented a general
overview of AccuStaff, the business mix, revenues, operating margins and
operating income of AccuStaff and Career, individually and combined, and
reviewed the potential contribution of each of the two companies on a combined
basis. The Salomon representatives also reviewed generally the potential
strategic benefits of a combination with AccuStaff as well as some of the
principal issues presented by a combination.
On August 1, 1996, officers and certain directors of Career met to consider
further potential advantages and disadvantages of a business combination with
AccuStaff, and expressed to AccuStaff the view that, in light of general
operational and strategic concerns, a combination between Career and AccuStaff
did not appear to be expedient for a variety of reasons. Thus, Career ceased
formal discussions with AccuStaff concerning the potential combination.
Nevertheless, during the two weeks following the August 1 meeting, informal
discussions among representatives of the two companies and their advisors
continued, and, in the course of those discussions, Salomon worked together
with Career in addressing such concerns.
The AccuStaff Board of Directors met on August 8, 1996, and discussed in
general terms the merits of a strategic combination with Career. At that
meeting management expressed its desire to pursue a combination and its belief
that, upon further investigation, Career would reopen discussions. AccuStaff's
Board of Directors authorized management to pursue further discussions with
Career on such terms as management determined were appropriate.
During the week of August 8, 1996, representatives of Career contacted
AccuStaff's representatives and proposed to resume discussions concerning the
possible strategic combination. On August 13, 1996, Career and AccuStaff
signed a confidentiality agreement to facilitate the conduct of a detailed due
diligence investigation of each other. On August 14, 1996, AccuStaff presented
Career with a draft of the Merger Agreement for its consideration. Thereafter
representatives of both Career and AccuStaff began negotiating the terms of
the Merger Agreement.
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The Career Board of Directors met on August 14, 1996 to review the recent
informal discussions with AccuStaff, and authorized the management of Career
to continue the discussions of a business combination with AccuStaff. At that
meeting, the Board of Directors of Career also authorized the formal
engagement of Salomon to act as exclusive financial advisor to Career in
connection with the potential transaction with AccuStaff.
On August 21, 1996, AccuStaff's Board of Directors met and discussed the
progress of negotiations with Career and the merits of the transaction as it
was then currently proposed. In addition, the AccuStaff Board of Directors
authorized management to engage Baird to render its opinion as to the fairness
to AccuStaff, from a financial point of view, of the exchange ratio. In
addition, at this meeting members of AccuStaff's management and its legal
advisors discussed the preliminary results of their diligence investigation of
Career and answered questions concerning that investigation and Career's
operations.
On August 22, 1996, the Board of Directors of Career met to consider the
proposed Merger. At that meeting, the Career Board of Directors received the
preliminary report of Salomon as to the fairness, from a financial point of
view, of the consideration to be received by holders of Career Common Stock in
the Merger, based upon an exchange ratio of 1.4717 (based upon the market
price of AccuStaff Common Stock of $27.375 per share during the week of July
23, 1996), subject to adjustment to provide a fixed value of $48.38 of
AccuStaff Common Stock for each share of Career Common Stock if the Average
Closing Price of the AccuStaff Common Stock exceeded $32.875 per share but did
not exceed $38.875, at which point the exchange ratio would be fixed at 1.2446
shares of AccuStaff Common Stock. Similarly, it was proposed that the exchange
ratio would remain fixed at 1.4717 unless the Average Closing Price was less
than $21.875 but more than $17.875, within which range the exchange ratio
would be adjusted to provide a fixed value of $32.19 of AccuStaff Common Stock
for each share of Career Common Stock. If the Average Closing Price was less
than $17.785, the exchange ratio would be fixed at 1.8010. The Career Board of
Directors also discussed the terms of the proposed employment arrangements
with Mr. Macauley, the outcome of the due diligence investigations conducted
by Salomon, and the strategic reasons for the Merger.
After meeting in executive session, the Board of Directors of Career
expressed concern that the proposed exchange ratio did not sufficiently take
into account recent changes in the relative market prices of the Career and
AccuStaff Common Stock and instructed management to discuss adjusting the
exchange ratio with AccuStaff. The meeting of the Career Board of Directors
was adjourned with the understanding that if negotiations with AccuStaff were
successful, the Career Board of Directors would reconvene on August 23, 1996
to consider the terms of a definitive Merger Agreement.
AccuStaff's Board of Directors also met on August 22, 1996 to consider the
Merger. At that meeting management made a presentation detailing the strategic
reasons for the Merger and the terms of the Merger, the AccuStaff Board
reviewed the then-current draft of the Merger Agreement and Baird reviewed the
terms of the transaction using a 1.4717 exchange ratio which was subject to
adjustment as provided in the Merger Agreement. The AccuStaff Board also
discussed the employment arrangements with Mr. Macauley and the possibility of
adding one or more Career representatives to the AccuStaff Board of Directors
following consummation of the Merger. During this meeting, AccuStaff was
informed that Career desired to adjust the proposed exchange ratio of 1.4717
to take into account recent changes in the relative market prices of Career
Common Stock and AccuStaff Common Stock. The AccuStaff Board meeting was
adjourned pending resolution of these issues with Career, with the
understanding that if these issues could be resolved, the AccuStaff Board
would reconvene on August 25, 1996 to consider the terms of the Merger.
Negotiations continued throughout the evening of August 22 and into August 23
until a tentative agreement was reached on the Exchange Ratio of 1.53 (subject
to adjustment as provided in the Merger Agreement).
On August 23, 1996, the Career Board of Directors reconvened to review the
terms of the definitive Merger Agreement and the employment arrangements with
Mr. Macauley. The Career Board of Directors also received reports concerning
the due diligence investigations with respect to AccuStaff conducted by
Career's management and Career's counsel. The Career Board of Directors also
received the oral opinion of Salomon as to the fairness of
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the Exchange Ratio from a financial point of view. The Career Board then
authorized the execution of the Merger Agreement, subject to the approval of
the Merger Agreement by the Board of AccuStaff.
On August 25, 1996, AccuStaff's Board of Directors met to review the revised
terms of the Merger Agreement. The Board heard management's report of the
continued negotiations with Career and was updated on the results of
management's and AccuStaff's advisors' diligence investigation of Career. The
Board of Directors also received the opinion of Baird as to the fairness to
AccuStaff, from a financial point of view, of the Exchange Ratio. The
AccuStaff Board then discussed the proposed employment arrangements with Mr.
Macauley and the possibility of inviting him to become a member of the
AccuStaff Board of Directors following completion of the Merger. The AccuStaff
Board of Directors then unanimously approved entering into the Merger
Agreement. The Board also unanimously approved entering into the proposed
employment agreement with Mr. Macauley and authorized the appointment of Mr.
Macauley to the AccuStaff Board of Directors as Vice Chairman of the Board
upon completion of the Merger.
On August 25, 1996, after Career had been advised that the AccuStaff Board
of Directors had approved the Merger Agreement, the Merger Agreement was
executed and delivered.
REASONS FOR THE MERGER
Career. The Career Board of Directors believes that the terms of the Merger
are fair to, and in the best interests of, Career and holders of Career Common
Stock. Accordingly, the Career Board of Directors has unanimously approved the
Merger Agreement and the transactions contemplated thereby and unanimously
recommends that holders of Career Common Stock vote FOR approval and adoption
of the Merger Agreement. In deciding to approve the Merger Agreement and the
transactions contemplated thereby, the Career Board of Directors considered
relevant business, financial and legal and market factors. The Career Board of
Directors ascribed comparatively greater weight to the amount and nature of
the premium to be received by holders of Career Common Stock in the Merger in
relation to recent market prices of Career Common Stock and the presentation,
analyses and opinion of Salomon than to the other factors described below. The
Career Board of Directors otherwise did not assign any relative or specific
weight to any particular factor.
In determining to approve the Merger Agreement, the Career Board of
Directors considered: (i) the amount and nature of the consideration to be
received by holders of Career Common Stock in the Merger; (ii) the premium to
be received in the Merger by the holders of Career Common Stock in relation to
recent market prices of Career Common Stock; and (iii) the opinion of Salomon
to the effect that the Exchange Ratio is fair to holders of Career Common
Stock from a financial point of view.
The Career Board of Directors also believed that the Merger would offer
significant strategic benefits by creating a more competitive company. In
particular, the Career Board of Directors also believed that the combination
of Career with AccuStaff would create one of the largest providers of
information technology ("IT") staffing services and would complement Career's
existing commercial sector activities. The Career Board of Directors also
believed that Career, when combined with AccuStaff, would be able to offer a
greater breadth of products and services on a nationwide basis, which would
offer the potential for the combined companies to compete successfully for
customers on a national basis, particularly in the IT staffing services area,
and to offer a wider variety of services to existing customers. The Career
Board of Directors also noted that the Merger could provide the combined
enterprise with the critical mass necessary to serve existing and new
customers more efficiently, particularly in major metropolitan areas. The
Career Board of Directors also believed that the Merger could yield operating
cost savings of approximately $1.5-2.0 million per year and could enable the
combined enterprise to make efficient use of existing excess capacity in
Career's corporate and management information systems.
The Career Board of Directors also took into consideration the historical
market prices of shares of Career and AccuStaff Common Stock, the
significantly wider market base of the AccuStaff Common Stock that would
result from the Merger and the potential for the continued use of AccuStaff
Common Stock in future acquisitions.
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THE BOARD OF DIRECTORS OF CAREER UNANIMOUSLY RECOMMENDS THAT CAREER
STOCKHOLDERS VOTE "FOR" ADOPTION OF THE MERGER AGREEMENT.
AccuStaff. The AccuStaff Board of Directors believes that the terms of the
Merger Agreement are fair to and in the best interests of AccuStaff's
stockholders. Accordingly, the AccuStaff Board of Directors has unanimously
approved the Merger Agreement and unanimously recommends that the holders of
AccuStaff Common Stock vote FOR approval of the issuance of shares of
AccuStaff Common Stock pursuant to the Merger Agreement. In approving the
Merger Agreement, the AccuStaff Board considered a variety of relevant
financial, business, legal and market factors and did not assign any relative
or specific weight to the factors considered. These factors included:
(i) Merger Supports AccuStaff's Growth Strategy. The Merger, in the
opinion of the AccuStaff Board, would be a major step in implementing
AccuStaff's stated strategy of becoming a national staffing company with
annual revenues of approximately $2 billion by the year 2000. AccuStaff's
previously stated strategy is to increase its revenue and profitability by
offering an extensive range of specialty staffing services through a
national network of branch offices, while expanding its Professional
Services division and creating value-added partnering and outsourcing
relationships with customers. A key element of this strategy is the
acquisition of existing staffing services businesses with a view toward
expanding AccuStaff's geographic service base and diversifying and
strengthening its services mix. Upon completion of the Merger, AccuStaff
would be one of the nation's largest staffing services providers, with a
branch office network of more than 750 offices which would allow it to
compete more effectively for customers on a national basis, particularly in
the IT staffing services area. The Merger, in the opinion of the AccuStaff
Board, would also increase AccuStaff's attractiveness as an acquirer of
other existing staffing businesses, particularly IT staffing businesses,
because of the opportunity for such businesses to be part of a national IT
staffing operation with the attendant cross-selling opportunities to other
AccuStaff IT staffing clients as well as to AccuStaff's established non-IT
staffing client base. The Merger, in the opinion of the AccuStaff Board,
would also enhance AccuStaff's ability to efficiently complete the
acquisition of and integrate other existing staffing business into its
operations at a lower overall cost and with less distraction from day-to-
day business operations than its competitors because of management's
acquisition, negotiation and integration experience, particularly from the
addition of Walter Macauley and Michael Druckman to AccuStaff's management
team.
(ii) Possible Cost Savings. The AccuStaff Board of Directors noted that
the Merger could result in cost savings to the combined enterprise of
approximately $1.5 - 2.0 million per year.
(iii) Certain Nonfinancial Information. The AccuStaff Board also
considered the possible addition of Mr. Macauley to AccuStaff's Board of
Directors and the AccuStaff management team. The Board considered that Mr.
Macauley would join the AccuStaff Board of Directors and management team
and that Career had other valuable members of its existing management team
that would become part of the AccuStaff management team. It also considered
the existence of the Fee to be paid to AccuStaff if the Merger was not
completed in certain circumstances. See "--Expenses and Fees."
(iv) Structure of Merger as a Stock-for-Stock Transaction Accounted for
as a Pooling-of-Interests. The AccuStaff Board considered the structure of
the transaction as an exchange of stock-for-stock as opposed to a
transaction or series of transactions in which AccuStaff's cash on hand
would have been used, thus preserving AccuStaff's existing cash on hand for
use in other acquisitions. In addition, the Board considered that the
transaction would be accounted for as a pooling-of-interests and as such
would avoid the recognition of any additional goodwill by AccuStaff and the
future amortization expense associated with the recognition of that
goodwill.
(v) Opinion of Baird. The AccuStaff Board considered the oral opinion of
Baird which was delivered to the AccuStaff Board on August 25, 1996, to the
effect that as of such date, the Exchange Ratio was fair, from a financial
point of view, to AccuStaff. See "--Opinions of Financial Advisors;
AccuStaff."
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(vi) Regulatory Approvals. The AccuStaff Board also considered the
likelihood of obtaining regulatory approvals that might be required with
respect to the Merger. See "--Regulatory Approvals."
THE BOARD OF DIRECTORS OF ACCUSTAFF UNANIMOUSLY RECOMMENDS THAT ACCUSTAFF
STOCKHOLDERS VOTE "FOR" APPROVAL OF THE ISSUANCE OF SHARES OF ACCUSTAFF COMMON
STOCK PURSUANT TO THE MERGER AGREEMENT.
OPINIONS OF SALOMON AND BAIRD
Salomon
At the meeting of the Career Board of Directors held on August 22-23, 1996,
Salomon delivered its oral opinion, subsequently confirmed in writing as of
August 25, 1996, that, as of such date, the Exchange Ratio was fair to the
holders of Career Common Stock from a financial point of view. No limitations
were imposed by the Career Board of Directors upon Salomon with respect to the
investigation made or the procedures followed by Salomon in rendering its
opinion.
The full text of the written opinion of Salomon, dated as of August 25,
1996, is set forth as Annex B to this Joint Proxy Statement/Prospectus and
sets forth the assumptions made, procedures followed and matters considered by
Salomon. Holders of Career Common Stock are urged to read Salomon's opinion in
its entirety. The summary of the opinion as set forth in this Joint Proxy
Statement/Prospectus is qualified in its entirety by reference to the full
text of such opinion. Salomon's opinion will not be updated prior to
consummation of the Merger.
In connection with rendering its opinion, Salomon reviewed certain publicly
available information concerning Career and AccuStaff and certain other
financial information concerning Career and AccuStaff, including financial
forecasts, that were provided to Salomon by Career and AccuStaff,
respectively. Salomon also discussed the business operations and financial
condition of Career and AccuStaff as well as other matters Salomon believed
relevant to its inquiry with certain officers and employees of Career and
AccuStaff. Salomon also considered such other information, financial studies,
analyses, investigations and financial, economic and market criteria that
Salomon deemed relevant.
In its review and analysis and in arriving at its opinion, Salomon assumed
and relied upon the accuracy and completeness of the financial and other
information (including information relating to the obtaining of regulatory
approvals for the Merger), and Salomon did not assume any responsibility for
independent verification of such information. With respect to the financial
forecasts of Career and AccuStaff, Salomon assumed that such forecasts had
been reasonably prepared on bases reflecting the best currently available
estimates and judgments of the respective managements of Career or AccuStaff
as to the future financial performance of Career or AccuStaff, respectively,
and Salomon expressed no opinion with respect to such forecasts or the
assumptions on which such forecasts were based. Salomon did not make or obtain
or assume any responsibility for making or obtaining any independent
evaluations or appraisals of the assets (including properties and facilities)
or liabilities of Career or AccuStaff.
Salomon's opinion is based upon conditions as they existed and could be
evaluated on the date thereof. Salomon's opinion does not imply any conclusion
as to the likely trading range for AccuStaff Common Stock following the
consummation of the Merger, which may vary depending upon, among other
factors, changes in interest rates, dividend rates, market conditions, general
economic conditions and other factors that generally influence the price of
securities. Salomon's opinion does not address Career's underlying business
decision to effect the Merger. Further, Salomon's opinion is directed only to
the fairness, from a financial point of view, of the Exchange Ratio to the
holders of Career Common Stock and does not constitute a recommendation
concerning how holders of Career Common Stock should vote with respect to the
Merger Agreement or the Merger. Salomon was not asked to and did not solicit
other proposals for the acquisition of Career. In rendering its opinion,
Salomon assumed that no restrictions would be imposed by any regulatory
authority that would have a material adverse effect on the contemplated
benefits of the Merger to AccuStaff following the Merger.
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The following is a summary of the reports and analyses (collectively, the
"Salomon Report") presented on August 22, 1996, by Salomon to the Career Board
of Directors in connection with the rendering of Salomon's opinion, which
reports and analyses were based on the then-current exchange ratio of 1.4717
(the "Initial Exchange Ratio").
(i) Historical Trading Analysis. Salomon reviewed the history of trading
prices for shares of Career Common Stock and AccuStaff Common Stock in
relation to each other over the period from August 21, 1995 to August 20,
1996. This review showed average, high and low prices to be $23.06, $41.75
and $11.88, respectively, per share of Career Common Stock and $18.47,
$36.88 and $4.58, respectively, per share of AccuStaff Common Stock.
Salomon noted that the prices of Career Common Stock and AccuStaff Common
Stock have experienced similar fluctuations over the six month period ended
August 20, 1996.
(ii) Exchange Ratio Analysis. Salomon reviewed the historical ratio of
the daily closing prices of Career Common Stock to AccuStaff Common Stock
over the period from January 1, 1996 to August 20, 1996. Based on such
prices and over such period, the average, high and low ratios were 1.17,
1.46 and 0.89 shares of AccuStaff Common Stock to each share of Career
Common Stock. Salomon noted that on August 20, 1996, such ratio was 1.14.
(iii) Premium Analysis. Salomon calculated the implied premium to be
received by holders of Career Common Stock (the "Career Premium") based on
a number of scenarios. Salomon noted that the Career Premium, based on the
prices of Career Common Stock and AccuStaff Common Stock as of August 21,
1996, was 29%, while the Career Premium based on Career's stock price as of
July 24, 1996 was 52%. Further, Salomon calculated the Career Premium as
42% based on the 30-day average stock prices, 32% based on the 60-day
average stock prices, 32% based on the 90-day average stock prices and 18%
based on the 12-month average stock prices of the Career Common Stock and
the AccuStaff Common Stock. Salomon also calculated the Career Premium as
29% based on stock prices as of May 24, 1996 (the date of the Career Common
Stock's 52-week high trading price) and -38% based on stock prices as of
August 21, 1995 (the date of Career Common Stock's 52-week low trading
price). Salomon also calculated that, in accordance with the Exchange Ratio
pricing collar (the "Collar"), the Career Premium at each of the upward
breaks in the Collar occurring as the result of an increase in the trading
price of AccuStaff Common Stock was 57% based on Career's August 21, 1996
closing price of $30.75, while at each of the downward breaks in the Collar
occurring as the result of a decrease in the AccuStaff Common Stock, the
Career Premium was 5%. Additionally, Salomon reviewed the premiums paid in
all recent stock-for-stock transactions from $1.0 to 5.0 billion and
compared such premiums to the premium to be received by holders of Career
Common Stock.
(iv) Comparable Company Analysis. Salomon compared the financial and
market performance of Career and AccuStaff with that of the following group
of selected publicly traded temporary staffing companies: COREStaff, Inc.;
Alternative Resources Corporation; Robert Half International Inc.; Norrell
Corporation; Interim Services Inc.; Olsten Corporation; and Manpower Inc.
Salomon examined certain publicly available financial and operating data of
such comparable companies, in particular: the ratio ("P/E Ratio") of
current stock prices per share to 1996 fiscal year estimated earnings per
share ("EPS") and to 1997 fiscal year estimated EPS (such estimated
earnings, for each year, as reported on First Call); the ratio of the
estimated 1997 P/E Ratio to projected EPS growth from December 31, 1996 to
December 31, 1997; and the ratio of the market capitalization plus total
debt, preferred stock and minority interests but less cash (collectively,
"Firm Value") to earnings before interest, taxes, depreciation and
amortization ("EBITDA") for the latest twelve months ("LTM") ending June
30, 1996. This analysis showed: a range of 1996 P/E Ratios from 17.6 to
54.7 for the comparable companies, as compared to 29.3 for Career, 50.7 for
AccuStaff, and 37.7 for the implied price per share of Career Common Stock
as of August 20, 1996, based on an exchange ratio of 1.4717 (the "Initial
Implied Career Price"); a range of estimated 1997 P/E Ratios from 14.5 to
39.8 for the comparable companies, as compared to 22.9 for Career, 34.9 for
AccuStaff and 29.5 for the Initial Implied Career Price; a range of ratios
of projected 1997 P/E Ratios to projected 1996-1997 EPS growth rates from
68% to 124% for the comparable companies, as compared to 83% for Career,
77% for AccuStaff and 107% for the Initial Implied Career Price; and Firm
Value to LTM EBITDA ratios ranging from 10.0 to 34.2 for the comparable
companies, as compared to 17.2 for Career, 30.3 for AccuStaff and 22.8 for
the Initial Implied Career Price.
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(v) Precedent Transaction Review. The Salomon Report contained a summary
of the only recent comparable acquisition transaction in the United States
temporary staffing industry, the acquisition of Brandon Systems ("Brandon")
by Interim Services, Inc. ("Interim") (the "Brandon Transaction"). Interim
paid 19.7 times Brandon's estimated 1997 EPS, 14.8 times Brandon's EBITDA
for the LTM prior to the date of the announcement of such transaction, and
a premium of 43.3% based on the price per share of the common stock of
Brandon one month prior to the announcement of the transaction. The Salomon
Report also contained a summary of the merger transaction between Adia,
S.A. ("Adia") and ECCO Staffing Services, Inc. ("ECCO"), which was priced
approximately at then-current market prices. Adia paid 15.6 times estimated
1997 EPS and a premium of 3.5% for each share of common stock of ECCO based
on the price per share of such common stock one month prior to the date of
the announcement of the transaction. EBITDA figures for the 12 months prior
to the date of the announcement of the Adia/ECCO transaction were not
available. Salomon noted that the Initial Exchange Ratio provided for a
payment of 29.5 times Career's estimated 1997 EPS, 23 times Career's LTM
EBITDA and a 52% premium based on the price of Career Common Stock 30 days
before the announcement of the proposed transaction.
(vi) Discounted Cash Flow Analysis. Using a discounted cash flow ("DCF")
methodology, Salomon valued each of Career and AccuStaff by estimating the
present value of future free cash flows available to their respective
equity holders if each of Career and AccuStaff were to continue on a stand-
alone basis (without giving effect to the Merger). Salomon valued Career in
accordance with Career management's forecasts (the "Career Base Case") and
also in accordance with Salomon forecasts based on the Career Base Case
adjusted to reflect estimated results of acquisition activities which,
absent the Merger, may have been engaged in by Career in 1997 (the "Career
Adjusted Case"). Similarly, Salomon valued AccuStaff in accordance with
AccuStaff management's forecasts (the "AccuStaff Base Case") and also in
accordance with Salomon forecasts based on the AccuStaff Base Case,
adjusted to reflect estimated results of acquisition activities which,
absent the Merger, may have been engaged in by AccuStaff in 1997 (the
"AccuStaff Adjusted Case"). Free cash flow to equity holders represents the
amount of cash generated and available for dividend payments after
providing for ongoing business operations and principal and interest
payments. For each entity and under each case, Salomon aggregated (x) the
present value of the free cash flows over the applicable forecast period
under each scenario with (y) the present value of the range of terminal
values described below. The range of terminal values was generally
calculated by applying multiples (ranging from 18.0-26.0 for Career and
22.0-30.0 for AccuStaff) to each entity's net income for the last 12 months
of the forecast period. This range of terminal values represented, for each
of Career and AccuStaff, their respective value beyond the applicable
forecast period. As part of the DCF analysis, Salomon used discount rates
reflecting each entity's specific financial characteristics, ranging from
14.0% to 18.0% for each of Career and AccuStaff. This DCF analysis resulted
in values ranging from $23.00 to $29.00 per share of AccuStaff Common Stock
under the AccuStaff Base Case, $26.00 to $32.00 per share of AccuStaff
Common Stock under the AccuStaff Adjusted Case, $29.00 to $36.00 per share
of Career Common Stock under the Career Base Case and $30.00 to $38.00 per
share of Career Common Stock under the Career Adjusted Case.
(vii) Contribution Analysis. Salomon reviewed the pro forma contribution
to the revenues, EBITDA, EBIT and net income of the combined entity by
Career and AccuStaff, without consideration to any cost savings related to
the Merger, for the LTM ending June 30, 1996; and for the years ending
December 31, 1996 and December 31, 1997, such estimates having been
prepared in accordance with each of the Career and AccuStaff management
forecasts. The contribution analysis showed that Career's estimated
percentage contribution to the financial results of the combined entity
were 44.2%, 43.9% and 42.4% of total revenues, 41.0%, 39.8% and 38.4% of
EBITDA, 41.3%, 39.9% and 38.5% of EBIT and 43.9%, 36.4% and 35.2% of net
income, in each case for the LTM ending June 30, 1996, and the years ending
December 31, 1996; and December 31, 1997, respectively. The analyses also
showed that, as of August 21, 1996, Career would have contributed 41% of
the total assets, 39% of the shareholder equity and 28% of the Firm Value
of the combined company, and the market capitalization of Career will
represent 28% of the market capitalization of the combined company. Salomon
noted that, based on the Initial Exchange Ratio, holders of Career Common
Stock would hold 34% of the outstanding common stock of the combined
company following the consummation of the Merger.
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(viii) Pro Forma Merger Consequences Analysis. Based on the Initial
Exchange Ratio and the management forecasts for Career and AccuStaff,
Salomon examined the pro forma impacts on EPS in 1996 and 1997 with respect
to the holders of the common stock of each of Career and AccuStaff assuming
that the combined company experiences $2.0 million of pre-tax savings
resulting from certain merger-related synergies in 1997 (the "Synergies").
Salomon also considered the applicability of exchange ratios which may be
applicable in accordance with the Collar.
The preparation of a fairness opinion is not susceptible to partial analysis
or summary descriptions. Salomon believes that its analysis and the summary
set forth above must be considered as a whole and that selecting portions of
its analyses and the factors considered by it, without considering all
analyses and factors, could create an incomplete view of the processes
underlying the analysis set forth in its opinion and the Salomon Report. The
ranges of valuations resulting from any particular analysis described above
should not be taken to be the view of Salomon of the actual value of Career or
AccuStaff.
In performing its analyses, Salomon made numerous assumptions with respect
to industry performance, general business, financial, market and economic
conditions and other matters, many of which are beyond the control of Career
or AccuStaff. The analyses which Salomon performed are not necessarily
indicative of actual values or actual future results, which may be
significantly more or less favorable than suggested by such analyses. Such
analyses were prepared solely as part of Salomon's analysis of the fairness,
from a financial point of view, of the consideration which the holders of
Career Common Stock would receive in the Merger. The analyses do not purport
to be appraisals or to reflect the prices at which a company might actually be
sold or the prices at which any securities may trade at the present time or at
any time in the future.
In the ordinary course of its business, Salomon actively trades the equity
securities of Career and AccuStaff for its own account and the accounts of its
customers and, accordingly, may at any time hold a long or short position in
such securities. Pursuant to an engagement letter dated August 14, 1996,
Career agreed to pay Salomon for its services in connection with the Merger an
advisory fee equal to 0.75% (approximately $7.0 million) of the total
consideration paid or to be paid to Career or holders of Career Common Stock
in connection with the Merger, of which $500,000 was due upon the execution of
the Merger Agreement and Salomon's completion of the work that was appropriate
to prepare it to render its fairness opinion and the balance of which will be
payable upon consummation of the Merger. Career also agreed, under certain
circumstances, to reimburse Salomon for certain out-of-pocket expenses
incurred by Salomon in connection with the Merger, and agreed to indemnify
Salomon and certain related persons against certain liabilities, including
liabilities under the Federal securities laws, relating to or arising out of
its engagement.
Salomon is an internationally recognized investment banking firm that
provides financial services in connection with a wide range of business
transactions. As part of its business, Salomon regularly engages in the
valuation of companies and their securities in connection with mergers and
acquisitions, negotiated underwritings, competitive biddings, secondary
distributions of listed and unlisted securities, private placements and other
purposes. In the past, Salomon has rendered banking and financial advisory
services to Career and AccuStaff for which Salomon received customary
compensation. The Career Board of Directors retained Salomon based on
Salomon's expertise in the valuation of companies as well as its familiarity
with companies in the temporary staffing industry.
Baird
The Board of Directors of AccuStaff retained Baird to render its opinion as
to whether the Exchange Ratio is fair, from a financial point of view, to
AccuStaff. On August 25, 1996, Baird rendered its opinion to the Board of
Directors of AccuStaff to the effect that, as of such date, the Exchange Ratio
was fair, from a financial point of view, to AccuStaff.
THE FULL TEXT OF BAIRD'S OPINION, DATED AUGUST 25, 1996, WHICH SETS FORTH
THE ASSUMPTIONS MADE, GENERAL PROCEDURES FOLLOWED, MATTERS CONSIDERED AND
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LIMITATIONS ON THE SCOPE OF REVIEW UNDERTAKEN BY BAIRD IN RENDERING ITS
OPINION, IS ATTACHED AS ANNEX C TO THIS PROXY STATEMENT/PROSPECTUS AND IS
INCORPORATED HEREIN BY REFERENCE. BAIRD'S OPINION IS DIRECTED ONLY TO THE
FAIRNESS, AS OF AUGUST 25, 1996 AND FROM A FINANCIAL POINT OF VIEW, OF THE
EXCHANGE RATIO TO ACCUSTAFF AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY
ACCUSTAFF STOCKHOLDER AS TO HOW SUCH STOCKHOLDER SHOULD VOTE WITH RESPECT TO
THE MERGER AGREEMENT. BAIRD DID NOT MAKE RECOMMENDATIONS TO ACCUSTAFF
CONCERNING THE AMOUNT OF CONSIDERATION TO BE PAID BY ACCUSTAFF. THE SUMMARY OF
BAIRD'S OPINION SET FORTH BELOW IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
THE FULL TEXT OF SUCH OPINION ATTACHED AS ANNEX C. ACCUSTAFF STOCKHOLDERS ARE
URGED TO READ THE OPINION CAREFULLY IN ITS ENTIRETY.
In conducting its investigation and analysis in arriving at its opinion
attached as Annex C, Baird reviewed such information and took into account
such financial and economic factors as it deemed relevant under the
circumstances. In that connection, Baird among other things (i) reviewed
certain internal information, primarily financial in nature, including
projections, concerning the business and operations of Career furnished to
Baird by or on behalf of Career for the purposes of its analysis, as well as
publicly available information including, but not limited to, Career's recent
filings with the Commission and equity analyst research reports prepared by
various investment banking firms, including Baird; (ii) reviewed certain
internal information, primarily financial in nature, including projections,
concerning the business and operations of AccuStaff furnished to Baird by or
on behalf of AccuStaff for purposes of its analysis, as well as publicly
available information, including, but not limited to, AccuStaff's recent
filings with the Commission and equity analyst research reports prepared by
various investment banking firms including Baird; (iii) reviewed the draft of
the Merger Agreement in the form presented to the AccuStaff Board of
Directors; (iv) compared the historical market prices and trading activity of
the AccuStaff Common Stock and Career Common Stock with those of certain other
publicly traded companies that Baird deemed relevant; (v) compared the
financial position and operating results of AccuStaff and Career with those of
other publicly traded companies that Baird deemed relevant; (vi) reviewed, to
the extent publicly available, the financial terms of certain other business
combinations that Baird deemed relevant; and (vii) reviewed the potential pro
forma effects of the Merger on AccuStaff. Baird held discussions with certain
members of AccuStaff's and Career's respective senior management concerning
AccuStaff's and Career's historic and current financial condition and
operating results as well as the future prospects of AccuStaff and Career,
respectively. Baird also considered such other information, financial studies,
analysis and investigations and financial, economic and market criteria which
it deemed relevant for the preparation of its opinion. The Exchange Ratio was
determined by AccuStaff and Career in arms-length negotiations. AccuStaff did
not place any limitation upon Baird with respect to the procedures followed or
factors considered by Baird in rendering its opinion.
In arriving at its opinion, Baird assumed and relied upon the accuracy and
completeness of all of the financial and other information provided to it by
or on behalf of AccuStaff and Career, or publicly available, and was not
engaged, and did not attempt, to verify any such information. Baird also
assumed, with AccuStaff's consent, that: (i) the Merger will be accounted for
as a pooling-of-interests; (ii) all material assets and liabilities
(contingent or otherwise, known or unknown) of AccuStaff and Career are as set
forth in the consolidated financial statements of AccuStaff and Career,
respectively; and (iii) the Merger would be consummated in accordance with the
terms of the Merger Agreement, without any amendment thereto and without
waiver by AccuStaff or Career of any of the conditions to their respective
obligations thereunder. Baird also assumed that the financial forecasts
examined by them had been reasonably prepared on bases reflecting the best
available estimates and good faith judgments of senior management of AccuStaff
and Career, respectively, as to the future performance of their respective
companies. In conducting its review, Baird did not make nor obtain an
independent evaluation or appraisal of any of the assets or liabilities
(contingent or otherwise) of AccuStaff or Career, nor did Baird make a
physical inspection of the properties or facilities of AccuStaff or Career.
Baird's opinion was based upon economic, monetary and market conditions as
they existed on and to the extent that they could be evaluated as of the date
of such opinion and did not predict or take into account any changes which may
occur, or information which may become available, thereafter. Baird's opinion
does not constitute an
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opinion as to the price at which AccuStaff Common Stock will actually trade at
any time. Baird's opinion will not be updated prior to consummation of the
Merger.
In connection with preparing its opinion on August 25, 1996, Baird conducted
a variety of financial analyses summarized below with respect to AccuStaff and
Career:
Analysis of Career Valuation Multiples. Baird calculated the "Implied
Consideration" to be $999.7 million, obtained by multiplying an assumed
Exchange Ratio of 1.53 by the last sale price per share of AccuStaff Common
Stock of $28.00 per share on August 23, 1996, resulting in an "Implied Price"
of $42.84 for each share of Career Common Stock, and multiplying the Implied
Price by the total number of outstanding shares of Career Common Stock,
including shares issuable upon the assumed conversion of convertible notes and
exercise of stock options, less net proceeds from such stock options. In
performing its analyses, Baird used, among other items, operating statistics
for Career's LTM through June 30, 1996, as provided by Career management on a
pro forma basis to reflect the results of operations as if all acquisitions
completed by Career over the LTM period had been completed as of July 1, 1995.
Baird calculated multiples of the Implied Price to Career's LTM fully diluted
earnings per share and its projected net income for calendar years 1996 and
1997 (based on management's estimates) and multiples of Career's "Enterprise
Value" (defined as market value of equity plus debt less cash and cash
equivalents and, in the case of Career, using the Implied Consideration as the
market value of equity) to its LTM revenues, its LTM EBITDA and its LTM
earnings before interest and taxes ("EBIT"). The calculations resulted in P/E
Ratios of 44.9x based on LTM results; 40.2x based on projected 1996 results;
and 30.5x based on projected 1997 results. The ratio of Enterprise Value to
LTM revenues was 1.6x, the ratio of Enterprise Value to LTM EBITDA was 24.3x
and the ratio of Enterprise Value to LTM EBIT was 29.5x.
Analysis of Selected Publicly Traded Career Comparable Companies. Baird
reviewed certain publicly available financial information as of the most
recently reported period and stock market information as of August 23, 1996
for certain selected publicly traded companies which Baird deemed relevant.
Such comparable companies consisted of: AccuStaff, Alternative Resources
Corp., COREStaff, Inc., Interim Services, Inc., Norrell Corp. and Robert Half
International, Inc. For each comparable company, Baird calculated multiples as
of August 23, 1996 of Enterprise Value to LTM revenues, LTM EBITDA and LTM
EBIT. Baird then compared these multiples to the relevant Career multiples. An
analysis of the multiples of Enterprise Value to LTM revenues, LTM EBITDA and
LTM EBIT yielded 1.6x, 24.3x and 29.5x, respectively, for Career compared to
medians of 2.3x, 21.8x and 23.5x, respectively, and means of 1.9x, 22.0x and
25.8x, respectively, for Career's comparable companies. For Career and each
comparable company, Baird also calculated P/E Ratios as of August 23, 1996
based on market stock prices as of such date and LTM earnings per share and
estimated earnings per share (derived from AccuStaff and Career management
respective estimates and the mean of the analysts' estimates as compiled by
FirstCall for the comparable companies) for calendar years 1996 and 1997. An
analysis of the P/E Ratios based on earnings per share for LTM, December 31,
1996 and 1997 yielded 44.9x, 40.2x and 30.5x, respectively, for Career
compared to medians of 41.4x, 36.5x and 29.1x, respectively, and means of
45.9x, 38.0x and 29.0x, respectively, for Career's comparable companies. In
rendering its opinion, Baird noted, among other items, that the Career
multiples based on Enterprise Value were generally only modestly higher, and
the Career P/E Ratios were generally similar to, the corresponding multiples
of the comparable companies.
Analysis of Selected Publicly Traded AccuStaff Comparable Companies. In
order to assess the relative public market valuation of the AccuStaff Common
Stock to be used by AccuStaff in exchange for Career Common Stock, Baird
reviewed certain publicly available financial information as of the most
recently reported period and stock market information as of August 23, 1996
for certain selected publicly traded companies which Baird deemed relevant.
Such comparable companies consisted of: Alternative Resources Corp., Career,
COREStaff, Inc., Norrell Corp., Robert Half International, Inc. and Romac
International. For each comparable company, Baird calculated multiples as of
August 23, 1996 of Enterprise Value to LTM revenues, LTM EBITDA and LTM EBIT.
Baird then compared these multiples to the relevant AccuStaff multiples based
on an AccuStaff share price of $28.00 (the last sale price of such stock on
August 23, 1996). In performing its analyses, Baird used, among other items,
operating statistics for AccuStaff's LTM through June 30, 1996, as provided by
AccuStaff management on a pro forma basis to reflect the results of operations
as if all acquisitions completed
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by AccuStaff over the LTM period had been completed as of July 1, 1995. An
analysis of the multiples of Enterprise Value to LTM revenues, LTM EBITDA and
LTM EBIT yielded 2.4x, 32.8x and 40.0x, respectively, for AccuStaff compared
to medians of 2.3x, 21.8x and 24.4x, respectively, and means of 2.3x, 24.7x
and 28.5x, respectively, for AccuStaff's comparable companies. For AccuStaff
and each comparable company, Baird also calculated P/E Ratios as of August 23,
1996 based on market stock prices as of such date and LTM earnings per share
and estimated earnings per share (derived from AccuStaff and Career management
respective estimates and the mean of the analysts' estimates as compiled by
FirstCall for the comparable companies) for calendar years 1996 and 1997. An
analysis of the P/E Ratios based on earnings per share for LTM, 1996 and 1997
yielded 68.1x, 52.8x and 36.4x, respectively, for AccuStaff compared to
medians of 41.7x, 36.5x and 29.1x, respectively, and means of 48.4x, 41.1x and
31.3x, respectively, for AccuStaff's comparable companies. In rendering its
opinion, Baird noted, among other items, that the AccuStaff multiples and P/E
Ratios were higher than the corresponding multiples and P/E Ratios of the
comparable companies.
Analysis of Selected Comparable Acquisition Transactions. Baird reviewed
selected transactions involving the acquisition of companies in businesses
which Baird deemed relevant. Such transactions were chosen based on a review
of acquired companies which possessed general business, operating and
financial characteristics representative of companies in the industry in which
Career operates. Baird noted that none of the selected transactions reviewed
was identical to the Merger and that, accordingly, the analysis of comparable
transactions necessarily involves complex consideration and judgments
concerning differences in financial and operating characteristics of Career
and other factors that would affect the acquisition value of comparable
transactions. For each comparable transaction, Baird calculated multiples of
Enterprise Value to LTM revenues, LTM EBITDA and LTM EBIT; calculated the P/E
Ratio based on LTM earnings per share; and calculated the premium paid for the
equity in these transactions over the public market value of the equity at
various times prior to the announcement of such transaction. Baird then
compared those multiples and premiums to the relevant Career multiples and
premiums based on the Implied Price. For the transactions selected, these
calculations yielded multiples of Enterprise Value to LTM revenues, LTM EBITDA
and LTM EBIT of 1.6x, 24.3x and 29.5x, respectively, for Career compared to
medians of 2.1x, 17.1x and 26.0x, respectively, and means of 3.6x, 19.6x and
29.9x, respectively, for the comparable acquisition transactions. An analysis
of the P/E Ratios based on LTM earnings per share yielded 44.9x for Career
compared to a median of 33.1x and a mean of 46.1x for the comparable
transactions. An analysis of the Implied Price to the market value of Career
shares as of August 23, 1996, 30 days and 90 days prior thereto, compared to
the prices paid for the equity in the comparable acquisition transactions
relative to the market value of equity one day, 30 days and 90 days prior to
the announcement date of such transactions, yielded premiums of 34.4%, 64.8%
and 9.1%, respectively, for Career, compared to median premiums of 19.1%,
51.5% and 62.3%, respectively, and means of 29.6%, 45.8% and 62.7%,
respectively, for the comparable acquisition transactions. In rendering its
opinion, Baird noted, among other items, that the Career multiples and P/E
Ratio were generally only modestly higher than the corresponding median
multiples and P/E Ratio of the comparable acquisition transactions and similar
to the corresponding mean multiples and P/E Ratio of the comparable
acquisition transactions, and the Career price premiums ranged from modestly
higher to significantly lower than the corresponding premiums associated with
the comparable acquisition transactions.
Discounted Cash Flow Analysis. Baird performed a discounted cash flow
analysis of Career on a stand alone basis using Career management projections
of future EBIT and free cash flow for fiscal years 1997 through 2001, after
downward adjustments to EBIT with respect to certain service segments and
without taking into account cost savings and synergies which may be realized
following the Merger. In such analysis, Baird assumed terminal value multiples
of 18.0x to 22.0x EBIT in the year 2001 and discount rates of 11.0% to 13.0%.
Such analysis produced implied values of Career shares ranging from $47.50 to
$61.50.
Contribution Analysis. Baird analyzed AccuStaff's and Career's relative
contribution to the combined company resulting from the Merger with respect to
revenues, gross profit, EBIT and net income. As a result of the Merger and
assuming an Exchange Ratio of 1.53, Career stockholders will own approximately
34.0% of the outstanding AccuStaff Common Stock, which compares to Career's
contribution (based on Career's and AccuStaff's LTM and estimated results for
fiscal years 1996 and 1997 as provided by Career and AccuStaff
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management) ranging from 44.2% to 42.3% of revenues, 47.5% to 45.4% of gross
profit, 41.4% to 38.5% of EBIT and 50.0% to 37.5% of net income, regardless of
the actual Exchange Ratio at the Effective Time.
Pro Forma Merger Analysis. Baird prepared a pro forma analysis of the
financial impact of the Merger. Using earnings estimates for Career (prepared
by Career management) and AccuStaff (prepared by AccuStaff management) for the
years 1996 and 1997, Baird compared the earnings per share of AccuStaff Common
Stock, on a stand alone basis, to the EPS of the common stock of the combined
company resulting from the Merger on a pro forma basis assuming an Exchange
Ratio of 1.53. Baird performed this analysis under scenarios assuming (i) one-
time transaction related expenses in 1996 as estimated by AccuStaff management
and (ii) no transaction related expenses. Neither scenario assumed any cost
savings or synergies which may be realized following the Merger. The analysis
assuming one-time transaction related expenses in 1996 indicated that the
proposed transaction would be dilutive to AccuStaff's EPS in fiscal year 1996
and accretive to such EPS in fiscal year 1997. The analysis assuming no
transaction related expenses indicated that the proposed transaction would not
be dilutive to AccuStaff's stockholders on an EPS basis in fiscal years 1996
and 1997. Assuming no transaction expenses, Baird also performed this analysis
using the minimum possible Exchange Ratio (1.2444) and maximum possible
Exchange Ratio (1.8006). Such analyses indicated that the proposed transaction
would not be dilutive to AccuStaff stockholders on an earnings per share basis
in fiscal years 1996 and 1997.
Historical Trading Ratio Analysis. Baird performed an analysis of the
historical trading ratio between Career Common Stock and AccuStaff Common
Stock based on the closing market price per share of Career Common Stock
relative to the closing market price per share of AccuStaff Common Stock for
each trading day during the period from August 23, 1994 through August 23,
1996. This analysis yielded a historical trading ratio during the two-year
period ranging from a low of 0.8913 to a high of 4.3754, with an average
trading ratio during the two year period of 2.3653; and a historical trading
ratio during the most recent one-year period ranging from a low of 0.8913 to a
high of 2.7705, with an average trading ratio during the most recent one-year
period of 1.4397. Baird also calculated the ratio of the per share price on
August 23, 1996 of Career Common Stock ($31.875) to the per share closing
price on such day of AccuStaff Common Stock ($28.00). This yielded a trading
ratio of 1.1384. Baird noted that the range of possible Exchange Ratios
(ranging from a low of 1.2444 to a high of 1.8006) fell within the relative
trading ratio of Career Common Stock and AccuStaff Common Stock during both
the two-year and one-year periods, and that the Exchange Ratio of 1.53 (based
on the Implied Price and a closing stock price for AccuStaff Common Stock of
$28.00 on August 23, 1996) was well below the average trading ratio during the
two-year period and only modestly higher than the average trading ratio during
the one-year period.
The foregoing summary does not purport to be a complete description of the
analyses performed by Baird or of its presentations to the AccuStaff Board.
The preparation of financial analyses and a fairness opinion is a complex
process and is not necessarily susceptible to partial analyses or summary
description. Baird believes that its analyses (and the summary set forth
above) must be considered as a whole, and that selecting portions of such
analyses and of the factors considered by Baird, without considering all of
such analyses and factors, could create an incomplete view of the processes
underlying the analyses conducted by Baird and its opinion. Baird did not
attempt to assign specific weights to particular analyses. Any estimates
contained in Baird's analyses are not necessarily indicative of actual values,
which may be significantly more or less favorable than as set forth therein.
Estimates of values of companies do not purport to be appraisals or
necessarily to reflect the prices at which companies may actually be sold.
Because such estimates are inherently subject to uncertainty, Baird does not
assume responsibility for their accuracy.
Baird, as part of its investment banking business, is continually engaged in
the evaluation of businesses and their securities in connection with mergers
and acquisitions, negotiated underwritings, competitive biddings, secondary
distributions of listed and unlisted securities, private placements, and
valuations for estate, corporate and other purposes. AccuStaff retained Baird
because of its experience and expertise in the valuation of businesses and
their securities in connection with mergers and acquisitions. In the ordinary
course of business,
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Baird may from time to time trade equity securities of AccuStaff and Career
for its own account and for accounts of its customers and, accordingly, may at
any time hold a long or short position in such securities.
Compensation. Pursuant to an engagement letter agreement dated July 19, 1996
between AccuStaff and Baird, AccuStaff agreed to pay Baird a retainer fee of
$50,000 and a fee of $1.0 million, payable upon delivery of its opinion,
regardless of the conclusions reached by Baird in such opinion and regardless
of whether any transaction is consummated. AccuStaff has also agreed to
reimburse Baird for its reasonable out-of-pocket expenses, including
reasonable fees and disbursements of counsel. AccuStaff has also agreed to
indemnify Baird, its affiliates and their respective directors, officers,
employees and agents and controlling persons against certain liabilities
relating to or arising out of its engagement, including liabilities under the
federal securities laws. In the past, Baird has provided investment banking
services to both AccuStaff and Career for which Baird has received customary
compensation, including acting as co-manager in connection with the initial
public offering of AccuStaff Common Stock in 1994 and the subsequent public
offering of AccuStaff Common Stock in 1995, lead manager in connection with
the 1996 public offering of AccuStaff Common Stock, and co-manager in
connection with the initial public offering of Career Common Stock in 1994 and
subsequent offerings of the Career Convertible Notes in 1995 and Career Common
Stock in 1996.
MERGER CONSIDERATION
The Merger Agreement provides that, at the Effective Time, each share of
Career Common Stock (excluding shares held by Career, AccuStaff, or their
respective subsidiaries) will be canceled and extinguished and converted into
the right to receive a number of shares of AccuStaff Common Stock equal to the
Exchange Ratio (the "Merger Consideration"). The exchange ratio for
determining the number of shares of AccuStaff Common Stock to be issued in
exchange for each share of Career Common Stock (the "Exchange Ratio") will
equal 1.53 shares of AccuStaff Common Stock; provided, that, in the event that
the average of the daily last sale prices for the shares of AccuStaff Common
Stock for the 20 consecutive trading days on which such shares are actually
traded and quoted on the Nasdaq National Market (as reported by The Wall
Street Journal) ending at the close of trading on the second trading day
immediately preceding the closing date of the Merger (the "Average Closing
Price") is greater than $31.60, the Exchange Ratio will equal that multiple of
a share of AccuStaff Common Stock (rounded to the nearest ten thousandth of a
share) obtained by dividing $48.348 (the product of 1.53 and $31.60) by the
Average Closing Price, but in no event will the Exchange Ratio be less than
1.2444; provided further, that, in the event that the Average Closing Price is
less than $21.07, the Exchange Ratio shall equal that multiple of a share of
AccuStaff Common Stock (rounded to the nearest ten thousandth of a share)
obtained by dividing $32.2371 (the product of 1.53 and $21.07) by the Average
Closing Price, but in no event will the Exchange Ratio be greater than 1.8006.
Based upon the last sale price of AccuStaff Common Stock of $24.00 on October
4, 1996, the Exchange Ratio would be 1.53. All shares converted or exchanged
into the Merger Consideration will no longer be outstanding, will
automatically be canceled and retired, and will cease to exist, and each
Certificate thereafter will represent the right to receive, upon the surrender
of such Certificate in accordance with the Merger Agreement, only the
applicable Merger Consideration.
ALTHOUGH THE EXCHANGE RATIO WILL BE BASED ON THE FINAL ACCUSTAFF STOCK
PRICE, THE MARKET PRICE OF ACCUSTAFF COMMON STOCK MAY FLUCTUATE AND, ON THE
DATE OF THE EFFECTIVE TIME, THE DATE OF RECEIPT OF SHARES OF ACCUSTAFF COMMON
STOCK BY HOLDERS OF CAREER COMMON STOCK, OR THE DATE ON WHICH SUCH SHARES ARE
EVENTUALLY SOLD, MAY BE MORE OR LESS THAN THE FINAL ACCUSTAFF STOCK PRICE.
FRACTIONAL SHARES
Pursuant to the terms of the Merger Agreement, each holder of shares of
Career Common Stock exchanged pursuant to the Merger, who would otherwise have
been entitled to receive a fraction of a share of AccuStaff Common Stock shall
receive, in lieu thereof, cash (without interest) in an amount equal to such
fractional part of a share of AccuStaff Common Stock multiplied by the last
sale price per share of AccuStaff Common Stock as reported on the Nasdaq
National Market on the trading day immediately preceding the Effective Time as
reported
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in The Wall Street Journal. No such holder will be entitled to dividends,
voting rights, or any other rights as a stockholder in respect of any
fractional shares.
DISTRIBUTION OF MERGER CONSIDERATION
As promptly as practicable after the Effective Time, AccuStaff shall deposit
with SunTrust Bank, Atlanta (the "Exchange Agent") certificates representing
shares of AccuStaff Common Stock to be delivered to holders of Career Common
Stock, together with cash payable in respect of fractional shares. See "--
Fractional Shares." Promptly after the Effective Time, AccuStaff and Career
shall cause the Exchange Agent to mail to each holder of record of a
certificate or certificates which represented shares of Career Common Stock
immediately prior to the Effective Time (the "Certificates") (i) a form of
letter of transmittal (which shall specify that delivery shall be effected,
and risk of loss and title to the Certificates shall pass, only upon proper
delivery of such Certificates to the Exchange Agent) and (ii) instructions for
use in effecting the surrender of Certificates in exchange for certificates
representing shares of AccuStaff Common Stock and cash in lieu of fractional
shares.
CAREER STOCKHOLDERS SHOULD NOT SURRENDER THEIR CERTIFICATES FOR EXCHANGE
UNTIL THEY RECEIVE SUCH LETTER OF TRANSMITTAL AND INSTRUCTIONS.
After the Effective Time, each holder of shares of Career Common Stock
(other than shares held by AccuStaff, Career or any of their respective
subsidiaries) issued and outstanding at the Effective Time shall surrender the
Certificates to the Exchange Agent and shall promptly upon surrender thereof
receive in exchange therefor the Merger Consideration to which such holder is
entitled, together with any undelivered dividends or distributions in respect
of such shares (without interest thereon). To the extent required by the
Merger Agreement, each holder of shares of Career Common Stock issued and
outstanding at the Effective Time also shall receive, upon surrender of the
Certificates, cash in lieu of any fractional share of AccuStaff Common Stock
to which such holder may be otherwise entitled (without interest). AccuStaff
shall not be obligated to deliver the consideration to which any former holder
of Career Common Stock is entitled as a result of the Merger until such holder
surrenders such holder's Certificates for exchange as provided in the Merger
Agreement. The Exchange Agent may establish reasonable and customary rules and
procedures in connection with its duties.
Unless otherwise designated by a Career stockholder on the transmittal
letter, certificates representing shares of AccuStaff Common Stock issued to
Career stockholders in connection with the Merger will be issued and delivered
to the tendering Career stockholder at the address on record with the Career
Common Stock transfer agent. In the event of a transfer of ownership of shares
of Career Common Stock represented by Certificates that are not registered in
the transfer records of Career, the Merger Consideration may be issued to a
transferee if the Certificates are delivered to the Exchange Agent,
accompanied by all documents required to evidence such transfer and by
evidence satisfactory to the Exchange Agent that any applicable stock transfer
taxes have been paid. If any Certificate shall have been lost, stolen, mislaid
or destroyed, upon receipt of (i) an affidavit of that fact from the holder
claiming such Certificate to be lost, mislaid, stolen or destroyed, (ii) such
bond, security or indemnity as AccuStaff and the Exchange Agent may reasonably
require and (iii) any other documents necessary to evidence and effect the
bona fide exchange thereof, the Exchange Agent shall issue to such holder the
Merger Consideration into which the shares represented by such lost, stolen,
mislaid or destroyed Certificate shall have been converted. At any time
following the sixth month after the Effective Time, AccuStaff will be entitled
to require the Exchange Agent to deliver to it any cash then held by the
Exchange Agent and all shares of AccuStaff Common Stock deposited with the
Exchange Agent which had not been disbursed to holders of Certificates
(including all interest and other income received by the Exchange Agent in
respect of all funds made available to it), and thereafter former holders of
Career Common Stock shall be entitled to look only to AccuStaff (subject to
abandoned property laws) as general creditors thereof with respect to the
Merger Consideration that may be payable upon due surrender of the
Certificates held by them. Any other provision of the Merger Agreement
notwithstanding, neither AccuStaff, Career nor the Exchange Agent shall be
liable to a holder of Career Common Stock for any amounts paid or property
delivered in good faith to a public official pursuant to any applicable
abandoned property Law. Adoption of the Merger Agreement by the stockholders
of Career shall constitute ratification of the appointment of the Exchange
Agent.
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After the Effective Time, holders of Certificates will have no rights with
respect to the shares of Career Common Stock represented thereby other than
the right to surrender such Certificates and receive in exchange therefor the
shares of AccuStaff Common Stock, if any, to which such holders are entitled,
as described above. In addition, no dividend or other distribution payable to
holders of record of AccuStaff Common Stock will be paid to the holder of any
Certificates until such holder surrenders such Certificates for exchange as
instructed. Subject to applicable law, upon surrender of the Certificates,
such holder will receive the certificates representing the shares of AccuStaff
Common Stock issuable upon the exchange or conversion of such shares of Career
Common Stock, all withheld dividends or other distributions (without
interest), and any withheld cash payments (without interest) to which such
stockholder is entitled.
No dividends or distributions that are declared on shares of AccuStaff
Common Stock will be paid to persons entitled to receive certificates
representing shares of AccuStaff Common Stock until such persons surrender
their Certificates. Upon such surrender, there will be paid to the person in
whose name the certificates representing such shares of AccuStaff Common Stock
will be issued, any dividends or distributions with respect to such shares of
AccuStaff Common Stock which have a record date on or after the Effective Time
and have become payable between the Effective Time and the time of such
surrender. In no event will the person entitled to receive such dividends or
distributions be entitled to receive interest thereon.
TREATMENT OF OPTIONS AND CONVERTIBLE NOTES
The Merger Agreement provides that, at the Effective Time, all rights with
respect to Career Common Stock pursuant to Career Options granted under the
Career Stock Plans which are outstanding at the Effective Time, whether or not
exercisable, shall be converted into and become rights with respect to
AccuStaff Common Stock, and AccuStaff shall assume each Career Option, in
accordance with the terms of the Career Stock Plans and each stock option
agreement by which it is evidenced. From and after the Effective Time: (i)
AccuStaff or its Compensation Committee, as appropriate, shall be substituted
as the administrator of the applicable Career Stock Plan, (ii) each Career
Option assumed by AccuStaff may be exercised solely for shares of AccuStaff
Common Stock (or cash, if so provided), (iii) the number of shares of
AccuStaff Common Stock subject to such Career Option shall be equal to the
number of shares of Career Common Stock subject to such Career Option
immediately prior to the Effective Time multiplied by the Exchange Ratio, and
(iv) the per share exercise price under each such Career Option shall be
adjusted by dividing the per share exercise price under each such Career
Option by the Exchange Ratio and rounding up to the nearest cent. The
foregoing assumption shall be undertaken in a manner that will not prejudice
the rights of any holder of a Career Option under the terms of the Career
Option, the applicable Career Stock Plan or the corresponding stock option
agreement or constitute a "modification" as defined in Section 424 of the
Code, as to any stock option which is an "incentive stock option."
The Merger Agreement provides that, at the Effective Time, all rights to
convert Career Convertible Notes into shares of Career Common Stock which are
outstanding at the Effective Time shall become conversion rights with respect
to AccuStaff Common Stock, and AccuStaff shall assume the obligation to issue
shares of common stock upon conversion of Career Convertible Notes, in
accordance with the terms of the Indenture covering such Career Convertible
Notes, such that from and after the Effective Time: (i) each Career
Convertible Note may be exchanged solely for shares of AccuStaff Common Stock;
(ii) the number of shares of AccuStaff Common Stock subject to such Career
Convertible Note shall be equal to product of the Exchange Ratio and the
number of shares of Career Common Stock subject to such Career Convertible
Note immediately prior to the Effective Time; and (iii) the per share exchange
price under such Career Convertible Note shall be adjusted by dividing the per
share exchange price under each such Career Convertible Note by the Exchange
Ratio and rounding up to the nearest cent. At or prior to the Effective Time,
AccuStaff and Career will execute and deliver to the trustee under the
Indenture the Supplemental Indenture reflecting the foregoing and evidencing
AccuStaff's assumption of the obligation to issue shares of common stock under
the Indenture.
MANAGEMENT AND OPERATIONS AFTER THE MERGER
Career will be the surviving corporation resulting from the Merger and will
become a wholly owned subsidiary of AccuStaff. The Merger Agreement provides
that from and after the Effective Time, the Board of
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Directors of Career will consist of the directors of Newco immediately prior
to the Effective Time. The Merger Agreement further provides that the officers
of Newco in office immediately prior to the Effective Time will serve as the
officers of Career from and after the Effective Time in accordance with
Career's Bylaws. It is expected that Walter W. Macauley, President and Chief
Executive Officer of Career, will become a Vice Chairman of AccuStaff and will
join the AccuStaff Board of Directors in connection with the Merger. It is not
expected that the consummation of the Merger will result in any other changes
in the Board of Directors or management of AccuStaff or any of its
subsidiaries.
INTERESTS OF CERTAIN PERSONS IN THE MERGER
In considering the recommendation of the Career Board of Directors with
respect to the Merger Agreement and the transaction contemplated thereby,
Career stockholders should be aware that certain of the members of the Career
Board of Directors and members of Career's management have interests in the
Merger that are in addition to the interests of stockholders of Career
generally. The Career Board of Directors was aware of these interests and
considered them, among other matters, in approving the Merger Agreement and
the transaction contemplated thereby.
Indemnification. The Merger Agreement provides that AccuStaff shall
indemnify the present and former directors and officers of Career or any of
its subsidiaries to the fullest extent permitted under Delaware GCL and by
Career's Charter and Bylaws as in effect on the date of the Merger Agreement,
with respect to matters occurring at or prior to the Effective Time (including
the transactions contemplated by the Merger Agreement), including provisions
relating to advances of expenses incurred in the defense of any litigation and
whether or not AccuStaff or any of its subsidiaries is insured against any
such matter. AccuStaff also has agreed to use all reasonable efforts to
maintain Career's existing directors' and officers' liability insurance policy
(or a policy providing at least comparable coverage) for a period of six years
after the Effective Time of the Merger; provided, that AccuStaff shall not be
obligated to make aggregate premium payments in respect of such policy which
exceed, for the portion relating to Career's directors and officers, 300% of
the annual premium payments on Career's current policy.
Post-Acquisition Compensation and Benefits. The Merger Agreement provides
that, after the Effective Time, AccuStaff will provide generally to officers
and employees of Career and its subsidiaries, employee benefits under employee
benefit plans (other than stock option or other plans involving the potential
issuance of AccuStaff Common Stock), on terms and conditions that, when taken
as a whole, are substantially similar to those currently provided by AccuStaff
and its subsidiaries to their similarly situated officers and employees;
provided, that AccuStaff shall maintain for the benefit of all of Career's
officers and employees, for a period of six months following the Effective
Time, Career's existing medical and dental plans. For purposes of
participation and vesting and benefit accrual under such employee benefit
plans (other than benefit accrual under AccuStaff's retirement plans), service
with Career or its subsidiaries prior to the Effective Time will be treated as
service with AccuStaff or its subsidiaries. The Merger Agreement also provides
that AccuStaff will honor all employment, severance, consulting and other
compensation contracts previously disclosed to AccuStaff between Career or any
of its subsidiaries and any current or former director, officer or employee,
and all provisions for vested amounts earned or accrued through the Effective
Time under Career's benefit plans.
Directorship. At the Effective Time, it is anticipated that the AccuStaff
Board of Directors will be increased by one member and that Walter W.
Macauley, President, Chief Executive Officer and a director of Career, will be
elected to fill that directorship and will serve as Vice Chairman of the
AccuStaff Board of Directors.
Macauley Employment Agreement. Mr. Walter W. Macauley has an Employment
Agreement with Career, dated April 13, 1995 (the "Career Employment
Agreement"), which provides that, following a change in control of Career, Mr.
Macauley has the right to terminate his employment and receive certain
benefits. The cash portion of such benefit consists of (i) his full bonus for
the year of termination, plus (ii) a severance payment equal to
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two times his base salary in effect on the date of termination, subject to a
reduction of such severance payment the extent necessary to avoid a loss of
deduction under Code Section 280G (the "280G Cut Back"). In addition, Mr.
Macauley would be entitled to continued medical insurance coverage and
automobile expenses through June 1998. It is estimated that the cash benefit
payable to Mr. Macauley under the Career Employment Agreement had his
employment terminated in 1997 following the Merger would be approximately
$545,150, after the 280G Cut Back. However, on or before the Effective Time,
AccuStaff will pay Mr. Macauley $1,350,000 in consideration for his
termination of the Career Employment Agreement, which represents the
approximate amount of the cash benefit he would have received under the Career
Employment Agreement, absent the 280G Cut Back, if he had terminated
employment in 1997 following consummation of the Merger. In addition, Career
will pay to Mr. Macauley his 1996 bonus under the Career Employment Agreement,
which bonus will not exceed $450,000, and which is currently estimated to be
$450,000. In addition, as a result of the Merger and in accordance with their
terms, all of Mr. Macauley's options to acquire a total of 500,000 shares of
Career Common Stock will become immediately vested at the Effective Time.
Upon execution of the Merger Agreement, AccuStaff entered into a new
Employment Agreement with Mr. Macauley (the "New Employment Agreement") which
will be effective upon completion of the Merger. The New Employment Agreement
provides for a three-year employment term during which Mr. Macauley will
advise the Chairman and Chief Executive Officer of AccuStaff with respect to
strategic acquisitions and operations. The New Employment Agreement provides
for (i) an annual base salary of $350,000, (ii) an annual bonus based on
performance factors similar to those applicable to executive officers of
AccuStaff, with a maximum of $350,000 and a minimum of $150,000 per year, and
(iii) a grant of 1,000,000 non-qualified stock options under the AccuStaff
1995 Stock Option Plan, with an exercise price equal to the fair market value
of AccuStaff Common Stock as of the Effective Time. Such options will be fully
vested upon grant and will remain exercisable for five years, whether or not
Mr. Macauley continues to be employed by AccuStaff. During the employment
period, AccuStaff will provide medical coverage to Mr. Macauley in accordance
with the level of benefits generally provided to other AccuStaff senior
executives, and will reimburse Mr. Macauley for certain expenses (i.e., dues
and automobile expenses) in the same amounts as such expenses were being paid
or reimbursed to Mr. Macauley by Career prior to the Merger. In addition, if
Mr. Macauley elects to relocate his principal residence during the employment
period, AccuStaff will reimburse him for certain losses (up to $250,000) he
may incur with respect to the sale of his existing residence.
Either party may terminate the New Employment Agreement on 30 days' notice
to the other. If Mr. Macauley dies, becomes disabled or terminates the
agreement for any reason, or if AccuStaff terminates the agreement for cause,
Mr. Macauley will be entitled to the full base salary and minimum bonus for
the year of termination prorated through the date of termination. If AccuStaff
terminates the agreement other than for cause, Mr. Macauley will be entitled
to the full base salary and minimum bonus for the balance of the original
three-year term of the New Employment Agreement. In any case other than Mr.
Macauley's death, each party will continue to have the obligations described
below with respect to certain covenants.
Under the New Employment Agreement, Mr. Macauley covenants (i) not to
divulge confidential information or trade secrets of AccuStaff, (ii) not to
solicit customers or employees of AccuStaff for the employment term plus two
years, and (iii) not to compete with AccuStaff for the employment term plus
five years. In consideration for the non-competition covenant, AccuStaff will
pay Mr. Macauley a fee of $150,000 per year for each year of the covenant
after the employment term and will provide continued coverage under
AccuStaff's health and medical benefits (to the extent available) at Mr.
Macauley's expense. At the end of any year during the non-competition period
(but not earlier than three years after consummation of the Merger), Mr.
Macauley may terminate the covenant not to compete by giving notice to
AccuStaff, whereupon AccuStaff's obligations to pay any further consideration
for the covenant will also terminate.
In the event that it shall be determined that any payment or distribution by
AccuStaff to or for the benefit of Mr. Macauley (whether pursuant to the terms
of the New Employment Agreement or otherwise) would be subject to the excise
tax imposed by Section 4999 of the Code, or any interest or penalties are
incurred by him with
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respect to such excise tax, then Mr. Macauley will be entitled to receive an
additional payment (a "Gross-Up Payment") in an amount such that after payment
by him of all taxes, he would retain an amount of the Gross-Up Payment equal
to the excise tax so imposed; provided, however, that (i) the portion of the
Gross-Up Payment that relates to a payment attributable to the termination of
the Career Employment Agreement or the acceleration of Mr. Macauley's Career
stock options shall be limited to $900,000, and (ii) AccuStaff's obligation to
make a Gross-Up Payment that relates to a payment attributable to benefits
payable under the New Employment Agreement (other than a payment described in
(i) above) or the grant of AccuStaff stock options thereunder will be null and
void if Mr. Macauley terminates his employment with AccuStaff prior to the
expiration of the first year of the New Employment Agreement.
Employment Agreement With Michael T. Druckman. Career has entered into an
employment agreement with Mr. Michael T. Druckman which provides for his
employment as Senior Vice President and Chief Financial Officer of Career
until June 30, 1997, subject to automatic renewal for successive one-year
periods unless either Career or Mr. Druckman has given prior notice of non-
renewal. This employment agreement provides for an annual base salary of
$200,000 (subject to adjustment on July 1 of each year based on increases in
the annual cost of living) and annual bonuses equal to 40% of the bonus earned
by Mr. Macauley, but not to exceed his base salary for such year. If the
employment agreement is terminated by Mr. Druckman within six months following
a "change in control of Career," as defined in such employment agreement, Mr.
Druckman is entitled, subject to specified limitations, to receive a lump sum
payment equal to his then current base salary and the bonus for the
immediately preceding fiscal year, but not to exceed the amount that would be
deductible in accordance with Section 280G of the Code. This lump sum payment,
based upon current base salary and estimated bonus, is currently estimated to
be $400,000. The Merger will constitute a change in control for purposes of
Mr. Druckman's employment agreement.
Employment Agreement with Arnold Rind. Career has entered into an employment
agreement with Mr. Arnold Rind which provides for his employment as Vice
President of Career until June 30, 1997, subject to automatic renewal for
successive one-year periods unless either Career or Mr. Rind has given prior
notice of non-renewal. This employment agreement provides for an annual base
salary of $150,000 (subject to adjustment on July 1 of each year based on
increases in the annual cost of living) and discretionary annual bonuses. If
there is a "change in control of Career," as defined in such employment
agreement, and within 18 months thereafter, (i) Mr. Rind's employment is
terminated by Career other than for cause, (ii) Mr. Rind shall no longer be
designated and have the authority of a Vice President of Career, (iii) the
location at which Mr. Rind's services are to be regularly performed shall be
changed to a location outside of a 50-mile radius of Woodbury, New York or the
island of Manhattan in the City of New York, (iv) there shall occur any
willful or material breach by Career of any provision of the employment
agreement which shall generally remain uncured for a period of 30 days or (v)
Career shall elect not to renew the employment agreement for an additional
one-year period, Mr. Rind may terminate the employment agreement and receive,
subject to specified limitations, a lump sum payment of two times his then
current base salary, but not to exceed the amount that would be deductible in
accordance with Section 280G of the Code. This lump sum payment based upon
current base salary is currently estimated to be approximately $320,000. The
Merger will constitute a change in control for purposes of Mr. Rind's
employment agreement.
Stock Options. All of Career's executive officers and directors hold options
to acquire shares of Career Common Stock. At the Effective Time, all such
Career Options, whether or not exercisable, shall be converted into and become
rights with respect to AccuStaff Common Stock, and AccuStaff shall assume each
such option in accordance with its terms and the stock option agreement by
which it is evidenced, after giving effect to the Exchange Ratio and after
making appropriate adjustments to the exercise prices. See "--Treatment of
Options and Convertible Notes." At October 4, 1996, the directors and
executive officers of Career collectively held Career Options, whether or not
then exercisable, to acquire a total of 934,628 shares of Career Common Stock
at a weighted average exercise price of $10.14 per share.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a discussion of the material federal income tax
consequences of the Merger. This discussion is based on the provisions of the
Code, the United States Department of the Treasury Regulations
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thereunder and rulings and court decisions as of the date hereof, all of which
are subject to change, which changes may have retroactive effect. This
discussion is included for general informational purposes only and applies
only to Career stockholders, if any, who hold their stock as a capital asset.
The following discussion does not address the federal income tax consequences
of a special classes of taxpayers, including, without limitation, foreign
corporations, tax-exempt entities, taxpayers holding stock as part of a
conversion or straddle transaction, or Career stockholders, if any, who
received their stock upon the exercise of employee stock options or otherwise
as compensation.
AccuStaff and Career have not requested a ruling from the Internal Revenue
Service (the "Service") regarding the federal income tax consequences of the
Merger. A condition to consummation of the Merger is the receipt by each of
AccuStaff and Career of an opinion of Alston & Bird, counsel to AccuStaff,
stating that the Merger will constitute a reorganization and describing
certain other federal income tax consequences of the Merger, most of which are
set forth below. The opinion of Alston & Bird that the Merger will qualify as
a tax-free reorganization within the meaning of Section 368(a) of the Code
will be based upon certain assumptions and representations made by the
management of each of AccuStaff and Career. Based on the correctness of such
assumptions and representations, it is the opinion of Alston & Bird that the
Merger will constitute a reorganization as defined in Section 368(a) of the
Code. Further, provided that the Merger constitutes a reorganization as
defined in Section 368(a) of the Code, the following will be the material
federal income tax consequences to the Career stockholders:
(i) No gain or loss will be recognized for federal income tax purposes by
Career stockholders upon the exchange of their shares of Career Common
Stock for shares of AccuStaff Common Stock;
(ii) The basis of the shares of AccuStaff Common Stock to be received by
Career stockholders will be the same as the basis of the Career Common
Stock surrendered in exchange therefor;
(iii) The holding period of the AccuStaff Common Stock to be received by
Career stockholders will include the period during which the shares of
Career Common Stock surrendered in exchange therefor had been held,
provided such shares were held by such stockholders as a capital asset at
the Effective Time; and
(iv) The payment of cash in lieu of fractional shares of AccuStaff Common
Stock will be treated as if the fractional shares were issued as part of
the exchange and then redeemed by AccuStaff. These cash payments will be
treated as having been received as distributions in full payment in
exchange for the fractional shares of AccuStaff Common Stock redeemed as
provided in Section 302(a) of the Code. Generally, any gain or loss
recognized upon such exchange will be capital gain or loss, provided the
fractional share would constitute a capital asset in the hands of the
exchanging stockholder.
(v) No gain or loss will be recognized by AccuStaff, Career or Newco
pursuant to the Merger.
The opinion does not address the tax consequences of the Merger to holders
of the Career Convertible Notes. Holders of such instruments should consult
their tax advisors with respect to such consequences.
BECAUSE CERTAIN TAX CONSEQUENCES OF THE MERGER MAY VARY DEPENDING UPON THE
PARTICULAR CIRCUMSTANCES OF EACH STOCKHOLDER AND OTHER FACTORS, EACH HOLDER OF
CAREER COMMON STOCK IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO
DETERMINE THE PARTICULAR TAX CONSEQUENCES TO SUCH HOLDER OF THE MERGER
(INCLUDING THE APPLICATION AND EFFECT OF FOREIGN, STATE AND LOCAL INCOME AND
OTHER TAX LAWS).
CONDITIONS TO CONSUMMATION
The obligations of Career and AccuStaff to consummate the Merger are subject
to the satisfaction or waiver (to the extent permitted) of the following
conditions: (i) the stockholders of Career shall have duly adopted the Merger
Agreement by the requisite vote; (ii) the stockholders of AccuStaff shall have
duly approved the issuance of shares of AccuStaff Common Stock pursuant to the
Merger Agreement by the requisite vote; (iii) there shall not be in effect any
law (other than a law requiring the obtaining of consents that are not
specified as required to
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be obtained as a condition to consummation of the Merger) or order of a court
or governmental or regulatory agency of competent jurisdiction which
prohibits, restricts (other than specified restrictions) or makes illegal
consummation of the Merger; (iv) the required regulatory approvals and
consents described under "--Regulatory Approvals" shall have been received and
shall be in full force and effect with all waiting periods required by law
having expired, and no such regulatory approval shall be conditioned or
restricted in a manner which would, in the reasonable judgment of the Board of
Directors of AccuStaff, so materially adversely affect the economic or
business benefits of the transactions contemplated by the Merger Agreement
that had AccuStaff known of such condition it would not have entered into the
Merger Agreement; (v) the shares of AccuStaff Common Stock issuable pursuant
to the Merger Agreement shall have been approved for listing on the Nasdaq
National Market, upon official notice of issuance; (vi) the Registration
Statement of which this Joint Proxy Statement/Prospectus is a part shall have
been declared effective by the Commission and shall not be subject to a stop
order or any threatened stop order, and the shares of AccuStaff Common Stock
issuable in connection with the Merger shall have been qualified, registered
or otherwise approved for exchange under the securities laws of the various
states in which such qualification, registration or approval is required;
(vii) AccuStaff and Career shall have received an opinion of Alston & Bird as
to certain federal income tax matters (see "--Certain Federal Income Tax
Consequences"); (viii) AccuStaff shall have received letters from AccuStaff's
and Career's independent auditors to the effect that the Merger will qualify
for pooling-of-interests accounting treatment (see "--Accounting Treatment");
(ix) AccuStaff shall have received letters from each affiliate of Career to
the extent necessary to assure AccuStaff, in its reasonable judgment, that the
transactions contemplated in the Merger Agreement will qualify for pooling-of-
interests accounting treatment; (x) each party shall have received from the
other letters from the other party's independent auditors with respect to
certain financial information about the other party; (xi) the representations
and warranties of the other party as set forth in the Merger Agreement shall
be accurate, as of the date of the Merger Agreement and the Effective Time
(except where a representation or warranty speaks as of a particular date, in
which case such representation and warranty need be accurate only as of such
date); (xii) the other party shall have performed in all material respects all
of its respective covenants and agreements to be performed by it pursuant to
the Merger Agreement; and (xiii) each of AccuStaff and Career shall have
received a certificate dated as of the Closing Date and executed by the Chief
Executive Officer or the Chief Financial Officer of the other party certifying
as to the fulfillment of the conditions listed in clauses (xi) and (xii)
above.
The conditions to consummation of the Merger may be waived, in whole or in
part, and the time for the performance of any of the obligations of the
parties to the Merger Agreement may be extended, in each case to the extent
permissible under applicable law, by the parties to the Merger Agreement in
writing. See "--Amendment, Waiver, and Termination."
No assurances can be provided as to when or if all of the conditions
precedent to the Merger can or will be satisfied or waived by the appropriate
party. As of the date of this Joint Proxy Statement/Prospectus, the parties
have no reason to believe that any of the conditions set forth above will not
be satisfied.
REGULATORY APPROVALS
The obligations of AccuStaff and Career to perform the Merger Agreement and
consummate the Merger are subject to all consents of, and filings and
registrations with, and notifications to, all regulatory authorities specified
in the Merger Agreement as conditions to consummation of the Merger having
been obtained or made and being in full force and effect and to the expiration
of all waiting periods required by law. Furthermore, no consent from any
regulatory authority which has been specified as a condition to consummation
of the Merger shall be conditioned or restricted in a manner which in the
reasonable judgment of the Board of Directors of AccuStaff would so materially
adversely impact the economic or business benefits of the Merger that, had
such condition or requirement been known, AccuStaff would not, in its
reasonable judgment, have entered into the Merger Agreement. The receipt of
consents and approvals not specified as conditions to consummation of the
Merger is at the sole risk of AccuStaff.
Under the HSR Act and the rules promulgated thereunder by the Federal Trade
Commission (the "FTC"), the Merger may not be consummated until notifications
have been given and certain information has been
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furnished to the FTC and the Antitrust Division of the Department of Justice
(the "Antitrust Division") and the applicable waiting period has expired or
been terminated. AccuStaff and Career each filed a Notification and Report
Form with the Antitrust Division and the FTC on September 26, 1996, requesting
early termination of the waiting period under the HSR Act. The requirements of
the HSR Act will be satisfied if the Merger is consummated within one year
from the termination of the waiting period.
At any time before or after consummation of the Merger, the Antitrust
Division or the FTC could take such action under the antitrust laws as it
deems necessary or desirable in the public interest, including seeking to
enjoin the consummation of the Merger or seeking divestiture of substantial
assets of AccuStaff or Career. At any time before or after the Effective Time,
and notwithstanding that the waiting period under the HSR Act has expired, any
state could take such action under the antitrust laws as it deems necessary or
desirable in the public interest. Such action could include seeking to enjoin
the consummation for the Merger or seeking divestiture of substantial assets
of AccuStaff or Career. Private parties (including individual states) may also
seek to take legal action under the antitrust laws under certain
circumstances.
Based on information available to them, AccuStaff and Career believe that
the Merger can be effected in compliance with Federal and state antitrust
laws. However, there can be no assurance that a challenge to the consummation
of the Merger on antitrust grounds will not be made or that, if such a
challenge were made, AccuStaff and Career would prevail or would not be
required to accept certain adverse conditions in order to consummate the
Merger.
Other than the approvals discussed above, AccuStaff and Career are not aware
of any federal, state or foreign regulatory requirements that must be complied
with or approval that must be obtained in connection with the Merger other
than the filing with the Commission of the Registration Statement and this
Joint Proxy Statement/Prospectus and compliance with applicable state
securities laws and regulations. Should any such approval be required, it is
currently contemplated that such approval will be sought.
CONDUCT OF BUSINESS PENDING THE MERGER
Career generally has agreed in the Merger Agreement, unless the prior
consent of AccuStaff is obtained, and except as otherwise contemplated by the
Merger Agreement, to operate its business only in the ordinary course, to
preserve its business organizations and assets and to maintain its rights and
franchises and to take no action that would adversely affect either the
ability of either party to perform its covenants and agreements under the
Merger Agreement or the ability of either party to obtain any consents or
approvals pursuant to any contract, law, order or permit that are required for
the transactions contemplated by the Merger Agreement. In addition, the Merger
Agreement contains certain other restrictions applicable to the conduct of the
business of Career prior to consummation of the Merger, as described below.
Career has agreed in the Merger Agreement not to take certain actions
relating to the operation of its business pending consummation of the Merger
without the prior approval of AccuStaff. Those actions generally include,
without limitation: (i) amending its Charter or Bylaws; (ii) becoming
responsible for any debt or other obligation for borrowed money in excess of
an aggregate of $500,000, except in the ordinary course of the business of
Career's subsidiaries consistent with past practices; (iii) redeeming,
purchasing, acquiring or exchanging any shares of its capital stock or paying
any dividend or other distribution in respect of its capital stock; (iv)
subject to certain exceptions, issuing, selling or pledging additional shares
of any Career capital stock, any rights to acquire any such stock or any
security convertible into such stock, except pursuant to the exercise of
outstanding stock options; (v) adjusting or reclassifying any of its capital
stock; (vi) acquiring control over any other entity; (vii) granting any
increase in compensation or benefits to its employees or officers (except in
the ordinary course of business and consistent with past practices), paying
any bonus (except as previously disclosed to AccuStaff or in accordance with
any existing program or plan), entering into or amending any severance
agreements with its officers or granting any increase in compensation or other
benefits to any of its directors (except in the ordinary course of business
and consistent with past practices); (viii) entering into or amending any
employment contract that it does not have the unconditional right to terminate
without certain
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liability, except as previously disclosed to AccuStaff and except for any
amendment required by law; (ix) adopting any new employee benefit plan or
program or materially changing any existing plan or program; (x) making any
significant changes in accounting methods, except for any change required by
law; (xi) commencing any litigation other than in accordance with past
practice or settling any litigation for material money damages; or (xii)
materially amending or terminating any material contracts except in the
ordinary course of business.
In addition, Career has agreed not to solicit, directly or indirectly, any
Acquisition Proposal from any person. Further, except to the extent the Board
of Directors of Career, after having consulted with and considered the advice
of outside counsel, reasonably determines in good faith that the failure to
take such actions would constitute a breach of fiduciary duties of the members
of such Board of Directors to Career's stockholders under applicable law,
neither Career nor any subsidiary or affiliate of Career, nor any investment
banker, financial advisor, attorney, accountant, consultant, or other
representative retained or employed by Career or any of its subsidiaries or
affiliates, shall furnish any non-public information that it is not legally
obligated to furnish, negotiate with respect to, or enter into any contract
with respect to, any Acquisition Proposal, but Career may communicate
information about such an Acquisition Proposal to its stockholders (including
any statement required pursuant to Rule 14e-2 of the Exchange Act) if and to
the extent that it is required to do so in order to comply with its legal
obligations as advised by outside counsel. Career must notify AccuStaff orally
as promptly as practicable and in writing within 24 hours following the
receipt of any Acquisition Proposal and the details thereof, and advise
AccuStaff of any developments with respect to such Acquisition Proposal
promptly upon the occurrence thereof. Career has also agreed to use all
reasonable efforts to cause its advisors and other representatives not to
engage in any of the foregoing activities.
Pursuant to the Merger Agreement, AccuStaff has agreed that, prior to the
Effective Time, it will continue to conduct its business and the business of
its subsidiaries in a manner designed in its reasonable judgment to enhance
the long-term value of the AccuStaff Common Stock and the business prospects
of AccuStaff and to the extent consistent therewith use all reasonable efforts
to preserve intact the core businesses and goodwill of AccuStaff and its
subsidiaries with their respective employees and the communities they serve.
AccuStaff has also agreed to take no action which would (i) materially
adversely affect the ability of any party to obtain any consents required for
the transactions contemplated hereby without imposition of a materially
burdensome condition or restriction, or (ii) materially adversely affect the
ability of any party to perform its covenants and agreements under the Merger
Agreement; provided, that the foregoing shall not prevent AccuStaff or any
subsidiary from acquiring any assets or other businesses or from discontinuing
or disposing of any of its assets or business if such action is, in the
judgment of AccuStaff, desirable in the conduct of the business of AccuStaff
and its subsidiaries. AccuStaff also has agreed that it will not, without the
prior written consent of Career, (i) amend the Articles or Bylaws of
AccuStaff, in each case in any manner adverse to the holders of Career Common
Stock as compared to rights of holders of AccuStaff Common Stock generally as
of the date of the Merger Agreement, (ii) during any period used to determine
the Average Closing Price, repurchase, redeem, or otherwise acquire or
exchange (other than exchanges in the ordinary course under employee benefit
plans), directly or indirectly, any shares, or any securities convertible into
any shares, of AccuStaff Common Stock, or (iii) acquire direct or indirect
control over any person where the consideration for such acquisition consists
of AccuStaff Common Stock having an aggregate market value as of the date of
public announcement of such acquisition of $300 million or more without the
prior written consent of the chief executive officer of Career, which consent
shall not be unreasonably withheld (provided that such consent shall be deemed
to be unreasonably withheld if such acquisition, in the good faith judgment of
the chief executive officer of AccuStaff when publicly announced, will be
accretive to AccuStaff's EPS in the first full year after consummation of such
acquisition).
AMENDMENT, WAIVER, AND TERMINATION
To the extent permitted by law, AccuStaff and Career may amend the Merger
Agreement by written agreement at any time without the approval of the
stockholders of Career; provided, that after the adoption of
51
<PAGE>
the Merger Agreement by Career's stockholders, no amendment may change the
consideration to be received by Career stockholders or the rights of the
Career stockholders under the Merger Agreement without the requisite approval
of such stockholders.
Prior to or at the Effective Time, either Career or AccuStaff may also (i)
extend the time for the performance of any of the obligations or other acts of
the other party under the Merger Agreement, (ii) waive any inaccuracies in the
representations and warranties contained in the Merger Agreement or any
document delivered pursuant thereto, or (iii) except to the extent prohibited
by law, waive compliance with any of the agreements or conditions contained in
the Merger Agreement.
The Merger Agreement may be terminated, and the Merger abandoned, at any
time prior to the Effective Time, before or after the approval by stockholders
of Career and AccuStaff, (a) by the mutual consent of the Boards of Directors
of Career and AccuStaff, (b) by either party, in the event of any inaccuracy
of any representation or warranty of the other party contained in the Merger
Agreement which cannot be or has not been cured within 15 days after giving
written notice to the breaching party of such inaccuracy and which inaccuracy
would provide the terminating party the ability to refuse to consummate the
Merger under the applicable standards set forth in the Merger Agreement
(provided that the terminating party is not then in breach of any
representation or warranty contained in the Merger Agreement under the
applicable standards set forth in the Merger Agreement or in material breach
of any covenant or other agreement contained in the Merger Agreement), (c) in
the event of a material breach by the other party of any covenant or agreement
contained in the Merger Agreement which cannot be or has not been cured within
15 days after the giving of written notice to the breaching party of such
breach, (d) if the Merger is not consummated by December 31, 1996, provided
that the failure to consummate is not due to the breach by the party electing
to terminate, (e) if (1) any approval of any regulatory authority specified as
a condition to consummation of the Merger and the other transactions
contemplated by the Merger Agreement has been denied by final nonappealable
action, or if any action taken by such authority is not appealed within the
time limit for appeal or (2) the stockholders of Career or AccuStaff fail to
approve by the required vote the matters relating to the Merger Agreement and
the transactions contemplated hereby at the Special Meetings where such
matters were presented to such stockholders for approval and voted upon, or
(f) if any of the conditions precedent to the obligations of such party to
consummate the Merger cannot be satisfied, fulfilled, or waived by the
appropriate party by December 31, 1996 (provided that the terminating party is
not then in breach of any representation or warranty contained in the Merger
Agreement under the applicable standards set forth in the Merger Agreement or
in material breach of any covenant or other agreement contained in the Merger
Agreement). See "--Expenses and Fees."
Finally, Career may terminate the Merger Agreement (a "Transaction
Termination") if, prior to adoption of the Merger Agreement by the requisite
vote of the holders of Career Common Stock, the Board of Directors of Career
has (x) withdrawn or modified or changed its recommendation or approval of the
Merger Agreement in a manner adverse to AccuStaff in order to approve and
permit Career to accept an Acquisition Proposal (as defined hereinafter), and
(y) determined, based on the advice of outside legal counsel to Career, that
the failure to take such action as set forth in the preceding clause (x) would
result in breach of the Board of Directors' fiduciary duties under applicable
law; provided, that (A) the Board of Directors of Career shall have been
advised by such outside counsel that notwithstanding the Merger Agreement, and
notwithstanding any concessions which may be offered by AccuStaff in
negotiations entered into pursuant to clause (B) below, such fiduciary duties
would also require the directors to terminate the Merger Agreement as a result
of such Acquisition Proposal, (B) at least two business days prior to any such
termination, Career shall, and shall cause its advisors to, negotiate with
AccuStaff to make such adjustments in the terms and conditions of the Merger
Agreement as would enable Career to proceed with the transactions contemplated
herein on such adjusted terms, and (C) Career shall have tendered to AccuStaff
payment in full of the Fee (as defined herein) concurrently with delivery of
notice of termination pursuant to this provision; and, provided further, that
Career shall immediately advise AccuStaff following the receipt by it of any
Acquisition Proposal and the details thereof, and advise AccuStaff of any
developments with respect to such Acquisition Proposal immediately upon the
occurrence thereof. The term "Acquisition Proposal" is defined to mean any
proposal for an Acquisition Transaction (including any tender offer or
exchange offer that, if successful, would constitute or result in an
Acquisition Transaction), other than
52
<PAGE>
the transactions contemplated by the Merger Agreement. The term "Acquisition
Transaction" is defined to mean (A) a merger, consolidation or similar
transaction involving Career or any Career subsidiaries, the assets of which
constitute 25% or more of the consolidated assets of Career and its
subsidiaries (other than transactions solely between Career and its
subsidiaries), (B) except as permitted pursuant to the Merger Agreement, the
disposition, by sale, lease, exchange or otherwise, of assets of Career or any
of its Subsidiaries representing in either case 25% or more of the
consolidated assets of Career and its subsidiaries or (C) the issuance, sale
or other disposition (including by way of merger, consolidation, share
exchange, tender offer, exchange offer or any similar transaction) by Career
or any Career subsidiary or any other persons of securities representing 25%
or more of the voting power of Career (including any securities previously
acquired). See "--Expenses and Fees."
EXPENSES AND FEES
The Merger Agreement provides that each party is responsible for its own
expenses incident to preparing for, entering into, and carrying out the Merger
Agreement and the consummation of the transactions contemplated thereby. Any
party who willfully breaches any of its representations, warranties,
covenants, or agreements set forth in the Merger Agreement, however, will be
liable for damages occasioned by such breach, including any expenses incurred
by the other party in connection with the Merger Agreement.
If the Merger Agreement is terminated by a party as a result of a material
breach by the other party of any representation, warranty, covenant or other
agreement contained in the Merger Agreement which is not timely cured (a
"Breach Termination") or if the Merger Agreement is terminated as a result of
the failure of the other party's stockholders to approve the matters relating
to the Merger Agreement required to be approved by such stockholders or if the
Merger is not consummated as a result of the other party failing to satisfy
certain conditions to consummation, then the breaching party or the party that
failed to satisfy such conditions shall promptly (but not later than five
business days after receipt of notice from such party) pay to such party an
amount equal to all documented out-of-pocket fees and expenses incurred by
such party (including, without limitation, fees and expenses payable to
investment bankers, accountants and counsel) arising out of, in connection
with or related to the Merger or the transactions contemplated by the Merger
Agreement not to exceed $2,500,000 in the aggregate, provided, that if such
breach was a result of intentional or willful misconduct or misrepresentation,
the breaching party shall pay such additional amounts as the terminating party
may be entitled to receive at law or in equity.
Career also has agreed to pay AccuStaff, subject to specified terms and
conditions, a fee (the "Fee") of $30,000,000, upon the occurrence of any of
the following events: (i) upon a Transaction Termination; or (ii) if, during
the period beginning on the date of the Merger Agreement and ending six months
after any termination of the Merger Agreement by either party by reason of the
stockholders of Career having failed to approve the Merger Agreement (but only
if the Career Board of Directors shall have failed to recommend, or shall have
withdrawn or modified in any manner adverse to AccuStaff their recommendation,
that Career stockholders approve the Merger Agreement) or by AccuStaff
pursuant to a Breach Termination (or ending 12 months following any such
termination, if, prior to such termination, there shall have occurred a
Triggering Event (as defined herein)), the Career Board of Directors shall
authorize entry into an agreement with any person (other than AccuStaff or any
AccuStaff subsidiary) providing for an Acquisition Transaction or shall
recommend acceptance of, or shall fail to recommend rejection of, a tender
offer or exchange offer that, if successful, would result in an Acquisition
Transaction, or an Acquisition Transaction shall have been consummated (each,
a "Payment Event") (such Fee to be payable by wire transfer of immediately
available funds within five business days following the occurrence of such
Payment Event); provided, that the amount of such Fee shall be reduced by any
amounts previously paid by Career to AccuStaff pursuant to the preceding
paragraph. The term "Triggering Event" is defined to mean any of the following
events subsequent to the date of this Agreement: (i) any person (other than
AccuStaff or any AccuStaff subsidiary) shall have (A) made, or disclosed an
intention to make, a bona fide proposal to Career or its stockholders to
engage in an Acquisition Transaction; (B) commenced (as such term is defined
in Rule 14d-2 under the Exchange Act) or filed a registration statement under
the Securities Act with respect to a tender offer or exchange offer to
purchase any shares of Career Common Stock such that, upon consummation of
such offer, such person would own or control 25% or more of the then-
outstanding shares of Career Common Stock; or (C) filed, or disclosed an
intention to file, an application
53
<PAGE>
or notice, whether in draft or final form, under any applicable federal or
state law (including a notice filed under the HSR Act) seeking the consent to
an Acquisition Transaction from any federal or state governmental or
regulatory authority or agency; or (ii) any person (other than AccuStaff or
any AccuStaff subsidiary) shall have acquired beneficial ownership (as such
term is defined in Rule 13d-3 promulgated under the Exchange Act) of or the
right to acquire beneficial ownership of, or any "group" (as such term is
defined under the Exchange Act), other than a group of which AccuStaff or any
of its Subsidiaries is a member, shall have been formed which beneficially
owns or has the right to acquire beneficial ownership of 20% or more of the
then-outstanding shares of Career Common Stock; or (iii) Career shall have
breached any of the provisions of the Merger Agreement relating to Acquisition
Proposals. See "--Amendment, Waiver and Termination."
ACCOUNTING TREATMENT
The Merger is anticipated to be accounted for on a pooling-of-interests
accounting basis. Under this method of accounting, as of the Effective Time,
the assets and liabilities of Career would be added to those of AccuStaff at
their recorded book values and the stockholders' equity accounts of AccuStaff
and Career would be combined on AccuStaff's consolidated balance sheet.
Consummation of the Merger is conditioned on, among other things, receipt by
AccuStaff and Career of letters from AccuStaff's and Career's independent
auditors to the effect that the Merger will qualify for pooling-of-interests
accounting treatment. See "Summary" and "Pro Forma Condensed Combined
Financial Data."
RESALES OF ACCUSTAFF COMMON STOCK
The shares of AccuStaff Common Stock issued in connection with the Merger
will be freely transferable under the Securities Act, except for shares issued
to any stockholder who may be deemed as of the date of the Career Special
Meeting to be an "affiliate" (generally including, without limitation,
directors, certain executive officers, and beneficial owners of 10% or more of
any class of Common Stock) of Career for purposes of Rule 145 under the
Securities Act or for purposes of applicable interpretations regarding
pooling-of-interests accounting treatment. Such affiliates may not sell their
shares of AccuStaff Common Stock acquired in connection with the Merger except
pursuant to an effective registration statement under the Securities Act or
other applicable exemption from the registration requirements of the
Securities Act and until such time as financial results covering at least 30
days of combined operations of AccuStaff and Career after the consummation of
the Merger have been published. In addition, Career has agreed to use its
reasonable efforts to cause each person or entity that is an affiliate to
enter into a written agreement in a form customary for the type of transaction
contemplated by the Merger Agreement relating to such restrictions on sale or
other transfer. This Joint Proxy Statement/Prospectus does not cover resales
of AccuStaff Common Stock received by any person who may be deemed to be an
affiliate of Career.
54
<PAGE>
PRO FORMA CONDENSED COMBINED FINANCIAL DATA
The unaudited pro forma condensed combined financial statements are based
upon the historical consolidated financial statements of AccuStaff (restated
to give effect to the acquisitions of McKinley and Perma Temp which were
accounted for under the pooling-of-interests method of accounting; such
restated financial statements are included in AccuStaff's Current Report on
Form 8-K dated September 16, 1996 and are incorporated herein by reference)
and Career (adjusted to reflect the acquisition of Berger & Co. and TSG which
were accounted for using the purchase method of accounting; such adjusted
financial statements are included in Career's Current Report on Form 8-K dated
September 16, 1996 and incorporated by reference herein) and their respective
subsidiaries, which are incorporated by reference in this Joint Proxy
Statement/Prospectus, and should be read in conjunction with those
consolidated financial statements and related notes thereto. See "Available
Information" and "Incorporation of Certain Documents By Reference." The
unaudited pro forma condensed combined financial statements are not
necessarily indicative of the results that would have occurred if the assumed
transactions had occurred on the dates indicated or the expected financial
position or results of operations in the future.
The unaudited pro forma condensed combined balance sheet presents the
combined financial position of AccuStaff and Career as of June 30, 1996, as if
the Merger was consummated as of June 30, 1996. The unaudited pro forma
condensed balance sheet reflects (i) the merger with Career applying the
pooling-of-interests method of accounting, (ii) certain adjustments that are
directly attributable to the Merger, including estimated non-recurring
acquisition costs of $15.0 million and estimated non-recurring corporate
restructuring costs of $10.0 million and (iii) all other acquisitions
completed by AccuStaff and Career subsequent to June 30, 1996 through
September 16, 1996 as if such acquisitions had been consummated as of such
date. In accordance with Securities and Exchange Commission rules, the
estimated non-recurring acquisition costs related to the Merger of $15.0
million and estimated non-recurring corporate restructuring costs related to
the Merger of $10.0 million have not been included in the pro forma condensed
statements of operations included herein.
The unaudited pro forma condensed combined statements of operations for the
six months ended June 30, 1996 and the year ended December 31, 1995 give
effect to (i) the acquisition of Career applying the pooling-of-interests
method of accounting and (ii) all other acquisitions completed by AccuStaff
and Career between January 1, 1996 and September 16, 1996 as if each had been
completed on January 1, 1996. The unaudited condensed combined statements of
operations for the six months ended June 30, 1996 and the years ended December
31, 1995, January 1, 1995 and January 2, 1994 give effect to the merger with
Career applying the pooling-of-interests method of accounting as if the
transaction was consummated as of the beginning of each respective fiscal
year. In addition Career has changed its fiscal year end from June 30 to
December 31, commencing December 31, 1995. Accordingly, for comparability
purposes, the Career results of operations for the years ended December 31,
1995, January 1, 1995, and January 2, 1994, have been presented on a basis
consistent with AccuStaff's fiscal year.
On October 26, 1995, the AccuStaff Board of Directors authorized a two-for-
one stock split. The stock split was effected as a 100% stock dividend and was
paid on November 27, 1995 to shareholders of record on November 9, 1995.
Additionally, on March 6, 1996, the AccuStaff Board of Directors authorized a
three-for-one stock split. The stock split was effected as a 200% stock
dividend and was paid on March 27, 1996 to shareholders of record on March 20,
1996. In addition, on January 17, 1996, the Career Board of Directors
authorized a two-for-one stock split. The stock split was effected as a 100%
stock dividend effective February 22, 1996, to stockholders of record on
February 8, 1996. The pro forma financial statements and EPS data for the
periods presented herein are computed after giving effect to all of the above
described stock splits.
The Merger is expected to be accounted for under the pooling-of-interests
method of accounting. See "The Merger--Accounting Treatment."
55
<PAGE>
PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF JUNE 30, 1996
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
ACCUSTAFF CAREER ADJUSTMENTS COMBINED
--------- -------- ----------- ---------
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents........ $136,384 $ 31,018 $ -- $167,402
Accounts receivable, net......... 109,199 101,370 -- 210,569
Due from associated offices,
net............................. -- 38,442 -- 38,442
Prepaid expenses................. 10,276 3,518 -- 13,794
Other receivables, net........... -- 1,896 -- 1,896
Deferred income taxes............ 157 4,617 -- 4,774
-------- -------- ------- --------
Total current assets........... 256,016 180,861 -- 436,877
Furniture, equipment, and leasehold
improvements, net................. 11,792 9,570 -- 21,362
Goodwill, net...................... 228,670 163,887 -- 392,557
Deferred income taxes.............. -- 1,190 (972)(c) 218
Other assets....................... 2,908 3,644 -- 6,552
-------- -------- ------- --------
Total assets................... $499,386 $359,152 $ (972) $857,566
======== ======== ======= ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Notes payable, current portion... $ 9,176 $ 4,869 $ -- $ 14,045
Accounts payable and accrued
expenses........................ 12,492 35,025 25,000(a) 72,517
Accrued payroll and related
taxes........................... 21,343 37,445 -- 58,788
Convertible subordinated
debentures...................... 1,000 -- -- 1,000
-------- -------- ------- --------
Total current liabilities...... 44,011 77,339 25,000 146,350
7% Convertible senior notes........ -- 86,250 -- 86,250
Notes payable, long term portion... 10,612 3,343 -- 13,955
Deferred income taxes.............. 972 -- (972)(c) --
Other.............................. -- 945 -- 945
-------- -------- ------- --------
Total liabilities.............. 55,595 167,877 24,028 247,500
-------- -------- ------- --------
Commitments
Stockholders' equity:
Preferred stock, $.01 par value;
10,000 shares authorized; no
shares issued and outstanding..... -- -- -- --
Common stock, $.01 par value;
150,000 shares authorized; 92,916
shares issued and outstanding on
June 30, 1996..................... 659 177 93 (b) 929
Additional contributed capital..... 413,348 169,510 (148)(b) 582,710
Retained earnings.................. 29,830 21,643 (25,000)(a) 26,473
-------- -------- ------- --------
443,837 191,330 (25,055) 610,112
Less: Deferred stock
compensation.................... (46) -- -- (46)
Treasury stock................. -- (55) 55 (b) --
-------- -------- ------- --------
Total stockholders' equity....... 443,791 191,275 (25,000) 610,066
-------- -------- ------- --------
Total liabilities and
stockholders' equity............ $499,386 $359,152 $ (972) $857,566
======== ======== ======= ========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Combined Financial Statements
56
<PAGE>
PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA PRO FORMA
ACCUSTAFF(1) CAREER(2) COMBINED(3)
------------ --------- -----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue..................... $410,060 $342,929 $752,989
Cost of revenue............. 321,282 260,423 581,705
-------- -------- --------
Gross profit.............. 88,778 82,506 171,284
Operating expenses:
General and
administrative........... 55,006 51,047 106,053
Remittance to
franchisees.............. -- 10,141 10,141
Depreciation and
amortization............. 5,704 3,948 9,652
-------- -------- --------
Total operating
expenses............... 60,710 65,136 125,846
-------- -------- --------
Income from operations.... 28,068 17,370 45,438
Other income (expense):
Interest expense, net..... (3,536) (1,802) (5,338)
Acquisition expense....... (2,800) -- (2,800)
Other..................... 128 -- 128
-------- -------- --------
Total other income
(expense).............. (6,208) (1,802) (8,010)
-------- -------- --------
Income before provision for
income taxes............... 21,860 15,568 37,428
Provision for income taxes.. 9,342 5,993 15,335
-------- -------- --------
Income from continuing
operations............. $ 12,518 $ 9,575 $ 22,093
======== ======== ========
Income from continuing
operations per share of
common and common stock
equivalents................ $ 0.20 $ 0.25
======== ========
Weighted average number of
shares outstanding......... 62,608 96,721
======== ========
</TABLE>
- --------
(1) Reflects AccuStaff's pro forma statement of operations as if all
acquisitions completed through September 16, 1996 had been completed as of
January 1, 1996.
(2) Reflects Career's pro forma statement of operations as if all acquisitions
completed through September 16, 1996 had been completed as of January 1,
1996.
(3) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
57
<PAGE>
PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA PRO FORMA
ACCUSTAFF(1) CAREER(2) COMBINED(3)
------------ --------- -----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue..................... $744,096 $653,338 $1,397,434
Cost of revenue............. 588,460 496,594 1,085,054
-------- -------- ----------
Gross profit.............. 155,636 156,744 312,380
Operating expenses:
General and
administrative........... 103,599 91,268 194,867
Remittance to
franchisees.............. -- 21,347 21,347
Depreciation and
amortization............. 10,953 7,673 18,626
-------- -------- ----------
Total operating
expenses............... 114,552 120,288 234,840
-------- -------- ----------
Income from operations.. 41,084 36,456 77,540
Other income (expense):
Interest expense, net..... (15,916) (5,590) (21,506)
-------- -------- ----------
Total other income
(expense).............. (15,916) (5,590) (21,506)
-------- -------- ----------
Income before provision for
income taxes............... 25,168 30,866 56,034
Provision for income taxes.. 9,804 11,933 21,737
-------- -------- ----------
Income from continuing
operations ............ $ 15,364 $ 18,933 $ 34,297
======== ======== ==========
Income from continuing
operations per share of
common and common stock
equivalents................ $ 0.35 $ 0.51
======== ==========
Weighted average number of
shares outstanding......... 43,818 74,233
======== ==========
</TABLE>
- --------
(1) Reflects AccuStaff's pro forma statement of operations as if all
acquisitions completed in 1995 and through September 16, 1996 had been
completed as of January 2, 1995.
(2) Reflects Career's pro forma statement of operations as if all acquisitions
completed in 1995 and through September 16, 1996 had been completed as of
January 2, 1995.
(3) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
58
<PAGE>
CONDENSED COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
ACCUSTAFF CAREER COMBINED(1)
------------ ------------ -------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue.......................... $334,461 $275,851 $610,312
Cost of revenue.................. 264,521 210,233 474,754
------------ ------------ ------------
Gross profit................... 69,940 65,618 135,558
Operating expenses:
General and administrative..... 43,519 39,110 82,629
Remittance to franchisees...... -- 9,898 9,898
Depreciation and amortization.. 4,178 2,916 7,094
------------ ------------ ------------
Total operating expenses....... 47,697 51,924 99,621
------------ ------------ ------------
Income from operations......... 22,243 13,694 35,937
Other income (expense):
Interest expense............... (493) (1,802) (2,295)
Acquisition expense............ (2,800) -- (2,800)
------------ ------------ ------------
Total other income (expense)... (3,293) (1,802) (5,095)
------------ ------------ ------------
Income before provision for
income taxes.................... 18,950 11,892 30,842
Provision for income taxes....... 8,178 4,578 12,756
------------ ------------ ------------
Income from continuing
operations.................... $ 10,772 $ 7,314 $ 18,086
============ ============ ============
Income from continuing operations
per share of common and common
stock equivalents............... $0.17 $0.21
============ ============
Weighted average number of shares
outstanding..................... 62,175 94,997
============ ============
</TABLE>
- --------
(1) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
59
<PAGE>
CONDENSED COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
ACCUSTAFF CAREER COMBINED(1)
------------ ------------ -------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue.......................... $316,847 $385,289 $702,136
Cost of revenue.................. 256,844 294,646 551,490
------------ ------------ ------------
Gross profit................... 60,003 90,643 150,646
Operating expenses:
General and administrative..... 38,695 51,281 89,976
Remittance to franchisees...... -- 18,489 18,489
Depreciation and amortization.. 2,301 3,462 5,763
------------ ------------ ------------
Total operating expenses....... 40,996 73,232 114,228
------------ ------------ ------------
Income from operations......... 19,007 17,411 36,418
Other income (expense):
Other.......................... 146 -- 146
Interest expense............... (41) (2,205) (2,246)
------------ ------------ ------------
Total other income (expense)... 105 (2,205) (2,100)
------------ ------------ ------------
Income before provision for
income taxes.................... 19,112 15,206 34,318
Provision for income taxes....... 7,355 5,878 13,233
------------ ------------ ------------
Income from continuing
operations.................... $ 11,757 $ 9,328 $ 21,085
============ ============ ============
Income from continuing operations
per share of common and common
stock equivalents............... $ 0.27 $ 0.34
============ ============
Weighted average number of shares
outstanding..................... 43,386 64,130
============ ============
</TABLE>
- --------
(1) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
60
<PAGE>
CONDENSED COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED JANUARY 1, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
ACCUSTAFF CAREER COMBINED(1)
------------ ------------ -------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue.......................... $ 166,626 $ 334,088 $ 500,714
Cost of revenue.................. 136,398 257,314 393,712
------------ ------------ ------------
Gross profit.................. 30,228 76,774 107,002
Operating expenses:
General and administrative..... 22,074 42,936 65,010
Remittance to franchisees...... -- 16,975 16,975
Depreciation and amortization.. 877 3,508 4,385
------------ ------------ ------------
Total operating expenses...... 22,951 63,419 86,370
------------ ------------ ------------
Income from operations........ 7,277 13,355 20,632
Other income (expense):
Interest expense, net.......... (221) (2,624) (2,845)
Other.......................... 46 -- 46
------------ ------------ ------------
Total other income (expense).. (175) (2,624) (2,799)
------------ ------------ ------------
Income before provision for
income taxes.................... 7,102 10,731 17,833
Provision for income taxes....... 2,672 4,477 7,149
------------ ------------ ------------
Income from continuing
operations................... 4,430 6,254 10,684
Preferred stock dividend
requirement...................... -- (175) (175)
------------ ------------ ------------
Income from continuing
operations applicable to
common stockholders........... $ 4,430 $ 6,079 $ 10,509
============ ============ ============
Income from continuing operations
per share of common and common
stock equivalents............... $ 0.15 $ 0.22
============ ============
Weighted average number of shares
outstanding..................... 29,967 46,821
============ ============
</TABLE>
- --------
(1) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
61
<PAGE>
CONDENSED COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED JANUARY 2, 1994
(UNAUDITED)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
ACCUSTAFF CAREER COMBINED(1)
------------ ------------ -------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Revenue.......................... $108,199 $293,733 $401,932
Cost of revenue.................. 89,143 228,611 317,754
------------ ------------ ------------
Gross profit................... 19,056 65,122 84,178
Operating expenses:
General and administrative..... 16,907 39,894 56,801
Remittance to franchisees...... -- 14,146 14,146
Depreciation and amortization.. 363 3,188 3,551
------------ ------------ ------------
Total operating expenses....... 17,270 57,228 74,498
------------ ------------ ------------
Income from operations......... 1,786 7,894 9,680
Other income (expense):
Interest expense............... (453) (5,819) (6,272)
Management fee................. 128 -- 128
Other.......................... 7 -- 7
------------ ------------ ------------
Total other income (expense)... (318) (5,819) (6,137)
------------ ------------ ------------
Income before provision for
income taxes.................... 1,468 2,075 3,543
Provision for income taxes....... 564 596 1,160
------------ ------------ ------------
Income from continuing
operations.................... 904 1,479 2,383
Preferred stock dividend
requirement..................... -- (707) (707)
------------ ------------ ------------
Income from continuing
operations applicable to
common stockholders........... $ 904 $ 772 $ 1,676
============ ============ ============
Income from continuing operations
per share of common and common
stock equivalents............... $ 0.04 0.05
============ ============
Weighted average number of shares
outstanding..................... 24,989 35,821
============ ============
</TABLE>
- --------
(1) As there were no pro forma adjustments, no adjustments column has been
presented in this columnar presentation.
See Notes to Pro Forma Condensed Combined Financial Statements
62
<PAGE>
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
PRO FORMA ADJUSTMENTS
(a) This adjustment reflects the accrual of the acquisition expenses related
to the Merger and the related reduction to retained earnings.
(b) This adjustment reflects the reclassification of stockholders' equity
required under the pooling-
of-interests method of accounting.
(c) This adjustment reflects the reclassification of the non-current
deferred tax liability of AccuStaff.
CALCULATION OF EARNINGS PER SHARE
Historical EPS of AccuStaff is presented after giving effect to both of
AccuStaff's stock splits. The pro forma EPS is computed on the basis of the
combined weighted average number of shares and common share equivalents of
AccuStaff, after giving effect to the stock splits, and the issuance of shares
to consummate the Merger, calculated by multiplying the weighted average
shares outstanding for Career by the conversion ratio for each of the
respective years.
63
<PAGE>
CERTAIN DIFFERENCES IN THE RIGHTS OF ACCUSTAFF AND CAREER STOCKHOLDERS
At the Effective Time, Career stockholders will become stockholders of
AccuStaff, and their rights as stockholders will be determined by AccuStaff's
Articles and Bylaws. In addition, Career is a Delaware corporation governed by
the Delaware GCL and AccuStaff is a Florida corporation governed by the
Florida BCA. The following is a summary of the material differences in the
rights of stockholders of Career and AccuStaff. Except as set forth below,
there are no material differences between the rights of a Career stockholder
under Career's Charter and Bylaws and the Delaware GCL, on the one hand, and
the rights of a AccuStaff stockholder under AccuStaff's Articles and Bylaws
and the Florida BCA, on the other hand. This summary does not purport to be a
complete discussion of, and is qualified in its entirety by reference to, the
Delaware GCL, Florida BCA and AccuStaff's Articles, Career's Charter and the
Bylaws of each corporation. Copies of AccuStaff's Articles, Career's Charter
and the Bylaws of each corporation are on file at their respective principal
executive offices.
AUTHORIZED CAPITAL STOCK
AccuStaff. AccuStaff's Articles authorize the issuance of up to 150,000,000
shares of AccuStaff Common Stock and 10,000,000 shares of preferred stock, par
value $.01 per share (the "AccuStaff Preferred Stock"). As of the AccuStaff
Record Date, there were 66,044,640 shares of AccuStaff Common Stock
outstanding and no shares of AccuStaff Preferred Stock outstanding. The
AccuStaff Board of Directors has the authority to issue AccuStaff Preferred
Stock in one or more classes or series and, by filing the appropriate articles
of amendment with the Department of State of the State of Florida, to
establish the designation of each series and the variations in rights,
preferences, and limitations for each series, without any further vote or
action by the stockholders, unless such action is required by applicable rules
or regulations or by the terms of other outstanding series of AccuStaff
Preferred Stock.
Career. Career's Charter authorizes the issuance of up to 50,000,000 shares
of Career Common Stock and 1,000,000 shares of preferred stock, par value $.01
per share (the "Career Preferred Stock"). On the Career Record Date, there
were 17,663,789 shares of Career Common Stock outstanding and no shares of
Career Preferred Stock outstanding. The Career Board of Directors has the
authority to issue Career Preferred Stock in one or more series and to fix the
voting powers, full or limited, or no voting powers and such other relative
rights, powers and preferences, including, without limitation, the dividend
rate, conversion rights, if any, redemption price and liquidation preference,
without any further vote or action by the stockholders, unless such action is
required by applicable rules or regulations or by the terms of other
outstanding series of Career Preferred Stock.
DIRECTORS; VACANCIES
AccuStaff. AccuStaff's Bylaws provide for a Board of Directors of not less
than four nor more than eleven directors, the exact number of members to be
fixed from time to time by a majority of the members of the Board then in
office; the current number is set at six. Any vacancy occurring on the Board
of Directors for any reason, including a vacancy resulting from a newly-
created directorship, may be filled by a majority of the remaining directors
though less than a quorum, or by stockholders in accordance with Florida law.
If the directors first fill a vacancy, the stockholders shall have no further
right with respect to the vacancy, and if the stockholders first fill the
vacancy, the directors shall have no further rights with respect to that
vacancy.
Career. Career's Bylaws provide for a Board of Directors of not less than
three nor more than ten, the exact number of members to be fixed from time to
time by a majority of the members of the Board then in office; the current
number of directors is set at six. Vacancies and newly created directorships
resulting from an increase in the authorized number of directors may be filled
by a majority of the directors then in office, although less than a quorum, or
by a sole remaining director. If there are no directors in office, then a
special meeting of the stockholders for the election of directors may be
called and held in the manner provided for by the Delaware GCL.
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<PAGE>
SPECIAL MEETINGS OF STOCKHOLDERS
AccuStaff. The Florida BCA provides that special meetings of stockholders
may be called by a corporation's board of directors or any other person as may
be authorized by the corporation's articles or bylaws, or by the holders of
not less than ten percent (unless a higher percentage is called for by the
corporation's articles) of all votes entitled to be cast on any issue at the
proposed special meeting who sign, date, and deliver to the corporation's
secretary one or more written demands for the meeting, describing the purpose
or purposes for which it is to be held. AccuStaff's Bylaws provide that
special meetings of the stockholders may be called at any time by the Board of
Directors, the Chairman of the Board or the President or by the stockholders
as provided for under the Florida BCA.
Career. The Delaware GCL provides that special meetings of stockholders may
be called only by the directors or any other person as may be authorized by
the corporation's certificate or bylaws. Career's Bylaws provide that special
meetings of the stockholders may be called at any time only by the Board of
Directors.
ADVANCE NOTICE REQUIREMENTS FOR STOCKHOLDER PROPOSALS AND DIRECTOR
NOMINATIONS.
AccuStaff. The AccuStaff Bylaws provide that any stockholder nomination for
director or proposal for action at a stockholder meeting must be delivered to
AccuStaff no later than the deadline for submitting stockholder proposals
pursuant to Commission Rule 14a-8 promulgated under the Exchange Act. The
presiding officer at any such meeting is not required to recognize any
nomination or proposal which does not comply with such deadline.
Career. The Career Bylaws provide that stockholders seeking to bring
business before an annual meeting of stockholders, or to nominate candidates
for election as directors at an annual or special meeting of stockholders,
must provide timely notice thereof in writing. To be timely, a stockholder's
notice must be delivered to, or mailed and received at, the principal
executive offices of Career (i) in the case of an annual meeting that is
called for a date that is within 30 days before or after the anniversary date
of the immediately preceding annual meeting of stockholders, not fewer than 60
days nor more than 90 days prior to such anniversary date and (ii) in the case
of an annual meeting that is called for a date that is not within 30 days
before or after the anniversary date of the immediately preceding annual
meeting, or in the case of a special meeting of stockholders called for the
purpose of electing directors, not later than the close of business on the
tenth day following the day on which notice of the date of the meeting was
mailed or public disclosure of the date of the meeting was made, whichever
occurs first. The Career Bylaws also specify certain requirements for a
stockholders' notice to be in proper written form. These provisions may
preclude some stockholders from bringing matters before the stockholders at an
annual or special meeting or from making nominations for directors at an
annual or special meeting.
ADJOURNMENT OF MEETINGS OF STOCKHOLDERS
AccuStaff. The AccuStaff Bylaws provide that when a stockholder meeting is
convened, and a quorum has not been established to transact business, the
holders of the majority of the shares represented and who would be entitled to
vote at the meeting if a quorum were present, may adjourn such meeting from
time to time.
Career. The Career Bylaws provide that, in the absence of a quorum, the
holders of a majority of the shares of common stock present in person or by
proxy and entitled to vote may adjourn the meeting from time to time. In
addition, the Career Bylaws provide that when a meeting of stockholders is
convened, the presiding officer, if directed by the Board of Directors, may
adjourn the meeting, if no quorum is present for the transaction of business
or if the Board of Directors determines that adjournment is necessary or
appropriate to enable the stockholders to consider fully information the Board
of Directors determines has not been made sufficiently or timely available to
stockholders or to otherwise effectively exercise their voting rights. This
provision will, under certain circumstances, make more difficult or delay
actions by the stockholders opposed by the Board of Directors. The effect of
such provision could be to delay the timing of a stockholders' meeting,
including in cases where stockholders have brought proposals before the
stockholders that are in opposition to those brought
65
<PAGE>
by the Board of Directors and therefore may provide the Board of Directors
with additional flexibility in responding to such stockholder proposals.
AMENDMENT OF CHARTER OR ARTICLES AND BYLAWS
AccuStaff. Pursuant to the Florida BCA, amendments to a corporation's
articles of incorporation relating to (i) the extension of the duration of the
corporation, (ii) the deletion of the names and addresses of the initial
directors and the initial registered agent, (iii) the deletion of information
solely of historical interest, (iv) certain changes in the number of issued
and outstanding shares, (v) the deletion of authorization for a class or
series of shares, (vi) certain changes in the corporation's name and (vii) any
other change permitted by the Florida BCA without stockholder approval, may be
made by the board of directors without stockholder approval, unless the
corporation's articles of incorporation provide otherwise. All other
amendments to the articles of incorporation must be recommended by the Board
of Directors to the stockholders and approved by a majority of the
stockholders entitled to vote on the amendment, unless a greater percentage is
provided for in the articles of incorporation or in the resolution of the
Board of Directors proposing such amendment. In addition, the Florida BCA,
provides that the holders of the outstanding shares of a class shall be
entitled to vote as a single class if the holders of such a class would be
adversely or particularly affected by the amendment. AccuStaff's Articles do
not alter the required vote.
Under the Florida BCA and AccuStaff's Articles and Bylaws, the Board of
Directors or the stockholders may amend or repeal AccuStaff's Bylaws unless
the Florida BCA specifically reserves the power to amend the Bylaws to the
stockholders, or unless the stockholders, in amending or repealing the Bylaws,
provide expressly that the Board of Directors may not amend or repeal the
Bylaws or that Bylaw provision. The Florida BCA permits a corporation's
stockholders to amend or repeal the corporation's bylaws even though the
bylaws may also be amended or repealed by its board of directors.
Career. Under the Delaware GCL, unless a corporation's certificate of
incorporation or bylaws otherwise provide, the amendment of a corporation's
certificate of incorporation generally requires the approval of the holders of
a majority of the outstanding stock entitled to vote thereon, and if such
amendment would increase or decrease the number of authorized shares of any
class or series or the par value of such shares or would adversely affect the
shares of such class or series, the amendment requires the approval of the
holders of a majority of the outstanding stock of such class or series.
Career's Charter further requires the affirmative vote of at least 66 2/3% of
the outstanding shares of the Common Stock to amend the sections of such
Charter which address certain voting rights of Career Common Stock, the vote
required to amend Career's Bylaws and the vote required to amend the section
establishing such supermajority vote.
Pursuant to the Delaware GCL and Career's Charter and Bylaws, Career's
Bylaws may be amended or repealed by the Board of Directors or upon the
affirmative vote of the holders of at least 66 2/3% of the outstanding stock
entitled to vote thereon.
INDEMNIFICATION AND DIRECTOR EXCULPATION
AccuStaff. Article 10 of AccuStaff's Bylaws require AccuStaff, to the
fullest extent permitted or required by the Florida BCA, to (i) indemnify its
directors against any and all liabilities and (ii) advance any and all
reasonable expenses, incurred in any proceeding to which any such director is
a party or in which such director is deposed or called to testify as a witness
because he or she is or was a director of AccuStaff. Generally, the Florida
BCA permits indemnification of a director upon a determination that he or she
acted in good faith and in a manner he or she 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 reasonable cause to believe his or her
conduct was unlawful. The Florida BCA also provides that a person may not be
indemnified nor may expenses be advanced if a judgment or final adjudication
establishes that such person's actions, or omissions to act, were material to
the cause of action so adjudicated and constitute: (i) a violation of criminal
law, unless such person had reasonable cause to believe such person's conduct
was lawful or had no reasonable cause to believe such person's conduct
66
<PAGE>
was unlawful; (ii) a transaction from which the director, officer, employee or
agent derived improper personal benefit; (iii) an unlawful distribution under
Florida law; or (iv) willful misconduct or conscious disregard for the best
interests of the corporation in a proceeding by or in the right of the
corporation to procure a judgment in its favor or in a proceeding by or in the
right of a stockholder. The right to indemnification granted in AccuStaff's
Bylaws is not exclusive of any other rights to indemnification against
liabilities or the advancement of expenses which a director may be entitled
under any written agreement, Board resolution, vote of stockholders, the
Florida BCA or otherwise.
AccuStaff's Bylaws also provide that AccuStaff may purchase insurance on
behalf of one or more of its directors, irrespective of whether AccuStaff
would be obligated to indemnify or advance expenses to such director.
AccuStaff has purchased insurance to protect directors, officers, employees or
other agents and AccuStaff from any liability asserted against them for acts
taken or omissions occurring in their capacities as such.
According to the Florida BCA, a director is not personally liable for
monetary damages to AccuStaff or any other person for any statement, vote,
decision or failure to act, regarding corporate management or policy, unless
the director breached or failed to perform his duties as a director and the
director's breach of, or failure to perform those duties constitutes: (i) a
violation of criminal law, unless the director had reasonable cause to believe
his conduct was lawful or had no reason to believe his conduct was unlawful;
(ii) a transaction from which the director derived improper personal benefit;
(iii) a violation of Section 607.0834 of the Florida BCA, which concerns
unlawful payment of dividends; (iv) in a proceeding by or in the right of the
corporation or a stockholder, conscious disregard for the best interests of
the corporation, or willful misconduct; or (v) in a proceeding by or in the
right of someone other than the corporation or a stockholder, recklessness or
an act or omission which was committed in bad faith or with malicious purpose
or in a manner exhibiting wanton and willful disregard of human rights, safety
or property.
Career. Career's Charter and Bylaws provide that Career shall indemnify any
person who was or is threatened to be made a party to any threatened, pending
or complete action, suit, or proceeding, whether civil, criminal,
administrative, or investigative or by or in the right of the Career to
procure judgment in its favor, by reason of the fact that he is or was a
director, officer, employee or agent of Career, or is or was serving at the
request of Career as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other enterprise, against
expenses (including attorney's fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of Career,
in accordance with and to the fullest extent permitted by the Delaware GCL.
Career's Bylaws provide that such indemnification will be in accordance with
any future amendments of the Delaware GCL, only to the extent that such
amendments permit Career broader indemnification rights than were previously
permitted.
Under Section 145 of the Delaware GCL as currently in effect, other than in
actions brought by or in the right of Career, such indemnification would apply
if it was determined (i) by a majority vote of the directors who are not a
party to such action, suit or proceeding, (ii) by independent legal counsel in
a written opinion or (iii) by the stockholders of Career, in the specific case
that the proposed indemnitee acted in good faith and in a manner such
indemnitee reasonably believed to be in or not opposed to the best interests
of Career and, with respect to any criminal proceeding, if such indemnitee had
no reasonable cause to believe that such indemnitee's conduct was unlawful. In
actions brought by or in the right of Career, such indemnification would
probably be limited to reasonable expenses (including attorneys' fees), and
would apply if it were determined in the specific case that the proposed
indemnitee acted in good faith and in a manner such indemnitee reasonably
believed to be in or not opposed to the best interests of Career, except that
no indemnification may be made with respect to any claim, issue, or matter as
to which such person is adjudged liable to Career unless, and only to the
extent that, the Court of Chancery or the court in which that action was
brought determines upon application that, in view of all the circumstances of
the case, the proposed indemnity is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper. To the extent that any
director, officer, employee, or agent of Career
67
<PAGE>
has been successful on the merits or otherwise in defense of any proceeding,
he must be indemnified against reasonable expenses incurred by him in
connection therewith.
Career's Charter and Bylaws provide that the right of such directors and
officers to indemnification includes the right to advancement by Career of
expenses incurred in defending any such proceeding in advance of its final
disposition upon delivery to Career of an undertaking to repay any amount so
advanced if it is ultimately determined by final judicial decision that the
proposed indemnitee is not entitled to be indemnified for such expenses.
Career's Charter also limits or eliminates, to the fullest extent that the
Delaware GCL permits, the personal liability of a director to Career or its
stockholders for monetary damages for breach of fiduciary duty as a director,
provided that the liability of a director may not be eliminated or limited (i)
for any injury resulting from the breach of the director's duty of loyalty to
Career or its stockholders, (ii) from injury resulting from acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law, or (iii) violations under Section 174 of the Delaware GCL
(which concerns unlawful payment of dividends or other distributions), or (iv)
for any transaction from which the director derived an improper personal
benefit.
ACTIONS BY STOCKHOLDERS WITHOUT A MEETING
AccuStaff. Under the Florida BCA and AccuStaff's Bylaws, any action that is
required or permitted to be taken at an annual or special meeting of
stockholders may be taken without a meeting, without prior notice and without
a vote, if a consent or consents, setting forth the action so taken, are
signed by the holders of outstanding stock having not less than the minimum
number of votes with respect to each voting group that would be necessary to
authorize the action at a meeting at which all shares entitled to vote were
present.
Career. The Delaware GCL generally provides that, unless otherwise provided
in the corporation's certificate of incorporation, any action that is required
to be taken or that may be taken at an annual or special meeting of
stockholders of a corporation may be taken without a meeting, without prior
notice and without a vote, if a consent or consents, setting forth the action
so taken, are signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize the action at
a meeting at which all shares entitled to vote were present and voted.
Career's Charter, however, provides that any action required or permitted to
be taken at any annual or special meeting of the stockholders may be taken
only upon the vote of the stockholders at an annual or special meeting duly
noticed and called, as provided in the Career Bylaws, and may not be taken by
a written consent of the stockholders pursuant to the Delaware GCL.
PAYMENT OF DIVIDENDS
AccuStaff. Under the Florida BCA, a dividend may be paid, unless after
giving it effect, (i) the corporation would not be able to pay its debts as
they become due in the usual course of business or (ii) the corporation's
total assets would be less than the sum of its total liabilities plus the
amount needed to satisfy the preferential rights of any preferred stockholders
of the company.
Career. The Delaware GCL provides that, subject to any restrictions in a
corporation's certificate of incorporation, dividends may be declared from a
corporation's surplus or, if there is no surplus, from its net profits for the
fiscal year in which the dividend is declared and/or the preceding fiscal
year. However, if the corporation's capital (generally defined in the Delaware
GCL as the sum of the aggregate par value of all shares of the corporation's
capital stock, where all such shares have a par value and the board of
directors has not established a higher level of capital) has been diminished
to an amount less than the aggregate amount of the capital represented by the
issued and outstanding stock of all classes having a preference upon the
distribution of assets, dividends may not be declared and paid out of such net
profits until the deficiency in such capital has been repaired.
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<PAGE>
MERGER, CONSOLIDATION, AND SALES OF ASSETS
AccuStaff. The Florida BCA provides that a vote of a majority of the shares
of each class of stock outstanding and entitled to vote thereon is required to
authorize a merger or consolidation of the corporation into any other
corporation, unless the articles of incorporation require a greater vote or a
vote by classes. The sale, lease, or exchange of all or substantially all of a
corporation's property and assets other than in the regular course of business
is permitted under the Florida BCA with the approval of a majority of all
votes entitled to be cast on the transaction, unless the articles of
incorporation require a greater vote or a vote by classes.
Career. The Delaware GCL requires the approval of the Board of Directors and
the holders of a majority of the outstanding stock of Career entitled to vote
thereon for mergers or consolidations involving a Delaware corporation, and
for sales, leases, or exchanges of substantially all of a Delaware
corporation's property and assets. The Delaware GCL permits a corporation to
merge with another corporation without obtaining the approval of its
stockholders if: (i) such corporation is the surviving corporation of the
merger; (ii) the merger agreement does not require an amendment to such
corporation's certificate of incorporation; (iii) each share of such
corporation's capital stock outstanding immediately prior to the effective
date of the merger is to be an identical outstanding or treasury share of such
corporation after the merger; and (iv) any authorized but unissued shares or
treasury shares of common stock to be issued or delivered under the plan of
merger plus those initially issuable upon conversion of any other securities
or obligations to be issued or delivered under such plan do not exceed 20% of
the shares of common stock outstanding immediately prior to the effective date
of the merger.
DISSENTERS' RIGHTS OF APPRAISAL
AccuStaff. The Florida BCA sets forth procedures under which stockholders
may dissent from, and receive payment of the fair value of their shares in
connection with most mergers, consolidations and exchanges or sales of
substantially all or all of a corporation's assets. Such dissenter's rights
are not available with respect to a plan of merger, consolidation or sale or
exchange of assets, to holders of shares of any class or series which were
either registered on a national securities exchange, designated as a national
market system security on an interdealer quotation system by the National
Association of Securities Dealers, Inc., or held of record by more than 2,000
stockholders.
Career. Pursuant to the Delaware GCL, any stockholder has the right to
dissent from any merger or consolidation, except as described below, of which
Career is a constituent corporation. No such appraisal rights are available
for the shares of any class or series of Career capital stock if (i) as of the
record date fixed to determine the stockholders entitled to receive notice of
and to vote at the meeting of stockholders to act upon the agreement of merger
or consolidation, such shares were either listed on a national securities
exchange, designated as a national market system security on an interdealer
quotation system operated by a national securities association, or held of
record by more than 2,000 stockholders or (ii) Career is the surviving
corporation of a merger and the merger did not require the approval of
Career's stockholders, unless, in either case, the holders of such stock are
required by an agreement of merger or consolidation to accept for that stock
something other than: (a) shares of stock of the corporation surviving or
resulting from the merger or consolidation; (b) shares of stock of any other
corporation that, at the effective date of the merger, will be listed on a
national securities exchange, designated as a national market system security
on a interdealer quotation system operated by a national securities
association, or held of record by more than 2,000 stockholders; (c) cash in
lieu of fractional shares of a corporation described in clause (a) or (b)
above; or (d) any combination of the shares of stock and cash in lieu of
fractional shares described in clauses (a) through (c) above. As the Career
Common Stock is listed on the NYSE and the exception described above does not
apply to the Merger, holders of Career Common Stock do not have dissenters'
rights with respect to the Merger or any similar future transaction.
CONTROL SHARE ACQUISITIONS
AccuStaff. As a Florida corporation, AccuStaff is subject to provisions of
Section 607.0902 of the Florida BCA, which provides that shares acquired in a
"control share acquisition" shall have the same voting rights as
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<PAGE>
were accorded such shares before the control share acquisition only to the
extent granted by resolution approved by the holders of a majority of
AccuStaff's voting shares (exclusive of shares held by officers of AccuStaff,
inside directors or the acquiring party). A "control share acquisition" is
defined to mean an acquisition that immediately thereafter entitled the
acquiring party to vote in the election of directors within any of the
following ranges of voting power: (i) one-fifth or more but less than one-
third of such voting power; (ii) one-third or more but less than a majority of
such voting power; and (iii) a majority or more of such voting power.
Career. The Delaware GCL does not have a similar statute.
CERTAIN BUSINESS COMBINATIONS
AccuStaff. Section 607.0901 of the Florida BCA would prohibit an "affiliate
transaction" (defined generally to include mergers, sales and leases of
assets, issuances of securities and other similar transactions) by AccuStaff
or any subsidiary with an "interested shareholder" (defined generally to be
the beneficial owner of 10% or more of AccuStaff's voting stock) within three
years after the person or entity becomes an interested stockholder, unless:
(i) the affiliate transaction shall have been approved by the disinterested
directors of AccuStaff before the person became an interested shareholder;
(ii) the interested shareholder has owned at least 80% of AccuStaff's
outstanding voting shares for at least five years or is the owner of at least
90% of AccuStaff's outstanding voting shares (excluding shares acquired
directly from AccuStaff in a transaction not approved by the disinterested
directors); (iii) the consideration to be paid to AccuStaff's stockholders
satisfies certain fair price and form requisites; or (iv) the affiliate
transaction is approved by the holders of at least two-thirds of the
outstanding voting stock of AccuStaff, excluding shares held by the interested
stockholder.
Career. Section 203 of the Delaware GCL would prohibit a "business
combination" (defined generally to include mergers, sales and leases of
assets, issuances of securities and similar transactions) by Career or a
subsidiary with an "interested stockholder" (defined generally to be the
beneficial owner of 15% or more of Career's voting stock) within three years
after the person or entity becomes an interested stockholder, unless:
(i) prior to the person or entity becoming an interested stockholder, the
business combination or the transaction pursuant to which such person or
entity became an interested stockholder shall have been approved by the Board
of Directors of Career; (ii) upon the consummation of the transaction in which
the person or entity became an interested stockholder, the interested
stockholder holds at least 85% of the voting stock of Career (excluding shares
held by persons who are both officers and directors of Career and shares held
by certain employee benefit plans); or (iii) the business combination is
approved by the Board of Directors of Career and by the holders of at least
two-thirds of the outstanding voting stock of Career, excluding shares held by
the interested stockholder. The Merger is not subject to the limitations set
forth in Section 203 of the Delaware GCL.
CONSIDERATION OF SOCIETAL FACTORS
AccuStaff. Florida law expressly provides that in determining what a
director reasonably believes to be in the best interests of the corporation,
such director may consider the long-term interests and prospects of the
corporation and its stockholders, and the social, economic, legal or other
effects of any action on the employees, suppliers, customers of the
corporation or its subsidiaries, the communities and society in which the
corporation or its subsidiaries operate, and the economy of the state and the
nation. Thus, these interests could be considered even in connection with, or
after, a decision to sell a corporation. The AccuStaff Articles and Bylaws do
not discuss the consideration of societal factors.
Career. Delaware does not explicitly provide for the consideration of
societal interests by a corporation's board of directors in making decisions.
The Delaware Supreme Court has, however, held that, in discharging their
responsibilities to a corporation, directors may consider constituencies other
than stockholders, such as creditors, customers, employees and perhaps even
the community in general, as long as there are rationally related benefits
accruing to stockholders as well. The Delaware Supreme Court has held,
however, that concern for non-stockholder interest is inappropriate when a
sale of a company is inevitable and an auction among active bidders is in
progress. Career's Charter does not directly discuss consideration of societal
factors.
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EXPERTS
The following financial statements incorporated by reference in this Joint
Proxy Statement/Prospectus have been so incorporated in reliance on the
reports of Coopers & Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in accounting and auditing:
. The consolidated balance sheets of AccuStaff as of December 31, 1995 and
January 1, 1995 and the related consolidated statements of income,
stockholders' equity and cash flows for each of the three fiscal years in
the period ended December 31, 1995.
. The combined balance sheet of Excel Temporary Services, Inc. and
affiliated companies as of December 31, 1995 and the related statement of
income, stockholders' equity and cash flows for the year then ended.
. The balance sheets of Perma Temps as of December 31, 1995 and 1994 and
the related statements of income, stockholders' equity and cash flows for
each of the two years in the period ended December 31, 1995.
. The combined balance sheets of Special Counsel International, Inc. and
its affiliates as of December 31, 1994 and 1993, and the related combined
statements of income, stockholders' equity and cash flows for each of the
two years in the period ended December 31, 1994.
. The balance sheet of Bogard Temps, Inc. as of December 31, 1994, and the
related statements of income, retained earnings and cash flows for the
year then ended.
. The balance sheets of Matthews Professional Employment Specialists, Inc.
as of December 31, 1994 and 1993 and the related statements of income
(loss), stockholders' equity and cash flows for each of the three years
in the period ended December 31, 1994.
. The balance sheet of HNS Software, Inc. as of December 31, 1995 and
related statement of income, stockholders' equity and cash flows for the
year then ended.
. The balance sheet of Staffware, Inc. as of December 31, 1995, and the
related statement of income, stockholders' equity and cash flows for the
year then ended.
. The balance sheet of DataCorp Business Systems, Inc. as of December 31,
1995 and the related statements of income, stockholders' equity and cash
flows for the year then ended.
. The balance sheet of Openware Technologies, Inc. as of December 31, 1995
and the related statements of income, stockholders' equity and cash flows
for the year then ended.
. The balance sheets of McKinley as of September 30, 1995 and 1994 and the
related statements of income, stockholders' equity and cash flows for the
years then ended.
The balance sheets of Computer Professionals, Inc. as of December 31, 1994
and 1993 and the related statements of income, stockholders' equity and cash
flows for each of the years in the two year period ended December 31, 1994
incorporated by reference in this Joint Proxy Statement/Prospectus have been
audited by McGladrey & Pullen, LLP, independent auditors, as stated in their
report incorporated by reference herein and are so incorporated in reliance
upon the report of such firm given upon their authority as experts in
accounting and auditing.
The balance sheets of Advance/Possis Technical Services, Inc. as of
September 30, 1995 and 1994 and related statements of income, retained
earnings and cash flows for each of the two years in the period ended
September 30, 1995 incorporated by reference into this Joint Proxy
Statement/Prospectus have been audited by Bertram, Vallez, Kaplan and Talbot,
LTD, independent auditors, as stated in their report incorporated by reference
herein and are so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
The balance sheets of GW Temporaries, Inc. and Goldfarb-Wesson Associates,
Inc. as of December 31, 1995 and March 31, 1995 and 1994 and the related
statements of income, expense and retained earnings and cash flows for the
nine months ended December 31, 1995 and each of the two years in the period
ended March
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31, 1995, incorporated by reference in this Joint Proxy Statement/Prospectus,
have been audited by Stadtler, Rosenblum & Saris, independent auditors, as
stated in their reports incorporated by reference herein and are so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
The combined balance sheets of Additional Technical Support, Inc. and
affiliated companies as of July 31, 1995 and 1994 and the related statements
of income, stockholders' equity and cash flows for each of the two years in
the period ended July 31, 1995, incorporated by reference in this Joint Proxy
Statement/Prospectus have been audited by Nyhan & Mazza, P.C., independent
auditors, as stated in their report incorporated by reference herein and are
so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
The balance sheet of Career Enhancement International, Inc. as of December
31, 1995 and the related statements of income, stockholders' equity and cash
flows for the year then ended, incorporated by reference in this Joint Proxy
Statement/Prospectus have been audited by Dennis I. Berner, C.P.A.,
independent auditor, as stated in his report incorporated by reference herein
and are so incorporated in reliance upon the report of such individual given
upon his authority as an expert in accounting and auditing.
The balance sheet of Perspective Technology Corporation as of December 31,
1995 and the related statements of income, stockholder's equity and cash flows
for the year then ended, incorporated by reference in this Joint Proxy
Statement/Prospectus have been audited by Beers & Cutler PLLC, independent
auditors, as stated in their report incorporated by reference herein and are
so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
The consolidated financial statements of Career and subsidiaries as of
December 31, 1995, and June 30, 1995 and 1994, and for the six months ended
December 31, 1995 and for each of the three years in the period ended June 30,
1995, incorporated by reference in this Joint Proxy Statement/Prospectus, have
been audited by Coopers & Lybrand L.L.P., independent accountants, as stated
in their report dated February 16, 1996, and are incorporated by reference
herein in reliance upon such report given upon their authority as experts in
accounting and auditing.
The consolidated financial statements of Career and subsidiaries as of June
30, 1995 and 1994, and for each of the three years in the period ended June
30, 1995, incorporated by reference in this Joint Proxy Statement/Prospectus,
have been audited by Coopers & Lybrand L.L.P., independent accountants, as
stated in their report dated August 17, 1995, and are incorporated by
reference herein in reliance upon such report given upon their authority as
experts in accounting and auditing.
The financial statements of Programming Enterprises, Inc. dba Mini-Systems
Associates as of December 23, 1994 and for the 52 weeks ended December 23,
1994 appearing in Career Horizons, Inc.'s Amended Current Report on Form 8-K/A
dated December 20, 1995, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such financial statements are incorporated
herein by reference in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
The balance sheet of Programming Enterprises, Inc. as of December 24, 1993,
and the related statements of income and retained earnings and cash flows for
the 52-week period ended December 24, 1993 included in Career's amended
Current Report on Form 8-K/A dated December 20, 1995, have been audited by BDO
Seidman LLP, independent auditors, as set forth in their report thereon
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
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The balance sheets of Zeitech, Inc. as of December 31, 1994 and 1993, and
the related statements of income, changes in stockholders' equity and cash
flows for the years then ended appearing in Career's Amended Current Report on
Form 8-K/A dated December 20, 1995, have been audited by Dorfman, Abrams,
Music & Co., independent auditors, as set forth in their report thereon
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
The combined balance sheets of Management Search, Inc. and Subsidiary and
Affiliate as of March 31, 1995 and 1994, and the related combined statements
of operations, stockholder's deficit and cash flows for the years then ended
appearing in Career's Current Report on Form 8-K, dated May 1, 1996, have been
audited by KPMG Peat Marwick LLP, independent auditors, as set forth in their
report thereon incorporated herein by reference in reliance upon such report
given on the authority of such firm as experts in accounting and auditing.
The combined financial statements of Century Temporary Services, Inc. and
Grant Management Company at December 31, 1995 and 1994, and for the years then
ended, appearing in Career Horizons, Inc.'s Current Report on Form 8-K dated
May 1, 1996 have been audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon included therein and incorporated herein by
reference. The combined financial statements referred to above audited by
Ernst & Young LLP are incorporated herein by reference in reliance on their
report given on their authority as experts in accounting and auditing.
The consolidated balance sheet of Daedalian Group, Inc. and Subsidiaries as
of January 31, 1996 and 1995, and the related consolidated statements of
income, stockholders' equity and cash flows for the years then ended appearing
in Career's Current Report on Form 8-K, dated August 28, 1996, have been
audited by Levine, Hughes & Mithuen, Inc., independent auditors, as set forth
in their report thereon incorporated herein by reference in reliance upon such
report given on the authority of such firm as experts in accounting and
auditing.
The balance sheet of TSG Professional Services, Inc. as of December 31, 1995
and January 1, 1995 and the related statements of income, stockholders' equity
and cash flows for the years then ended appearing in Career's Current Report
on Form 8-K, dated September 16, 1996, have been audited by Dubois &
Bornstein, P.C., independent auditors, as set forth in their report thereon
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
LEGAL MATTERS
The legality of the shares of AccuStaff Common Stock being offered hereby is
being passed upon for AccuStaff by Alston & Bird, Atlanta, Georgia. Alston &
Bird, counsel for AccuStaff, also will opine as to certain federal income tax
consequences of the Merger. See "The Merger--Certain Federal Income Tax
Consequences."
STOCKHOLDER PROPOSALS
CAREER
Career will hold a 1997 annual meeting of stockholders only if the Merger is
not consummated before the time of such meeting. In the event that such
meeting is held, any proposals of stockholders intended to be presented at the
1997 annual meeting of stockholders must be received by Career at its
principal executive offices not later than the tenth day following the day on
which notice of the date of the meeting is mailed to Career stockholders in
order to be considered for inclusion in Career's proxy statement for such
annual meeting.
ACCUSTAFF
Stockholder proposals intended to be presented at AccuStaff's 1997 annual
meeting of stockholders should be directed to the Corporate Secretary and be
received by AccuStaff no later than January 22, 1997, to be considered for
qualification and inclusion in AccuStaff's proxy statement and proxy card for
such annual meeting.
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OTHER MATTERS
As of the date of this Joint Proxy Statement/Prospectus, the Board of
Directors of AccuStaff knows of no matters that will be presented for
consideration at the AccuStaff Special Meeting other than as described in this
Joint Proxy Statement/Prospectus. The Career Bylaws do not permit action to be
taken at the Career Special Meeting if such proposed action has not been
specified in the Notice of the Career Special Meeting. However, if any other
matter shall come before the AccuStaff Special Meeting or any adjournments or
postponements thereof and shall be voted upon, the proposed proxy will be
deemed to confer authority to the individuals named as authorized therein to
vote the shares represented by such proxy as to any such matters that fall
within the purposes set forth in the Notice of such Special Meeting as
determined by a majority of the Board of Directors of AccuStaff.
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ANNEX A
AGREEMENT AND PLAN OF MERGER
----------------------------
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ACCUSTAFF INCORPORATED,
SUNRISE MERGER CORPORATION,
AND
CAREER HORIZONS, INC.
DATED AS OF AUGUST 25, 1996
A-1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<C> <S> <C>
PARTIES........................................................................................................... A-6
PREAMBLE.......................................................................................................... A-6
ARTICLE 1--TRANSACTIONS AND TERMS OF MERGER....................................................................... A-6
1.1 Merger...................................................................................................... A-6
1.2 Time and Place of Closing................................................................................... A-6
1.3 Effective Time.............................................................................................. A-6
ARTICLE 2--TERMS OF MERGER........................................................................................ A-7
2.1 Charter..................................................................................................... A-7
2.2 Bylaws...................................................................................................... A-7
2.3 Directors and Officers...................................................................................... A-7
ARTICLE 3--MANNER OF CONVERTING SHARES............................................................................ A-7
3.1 Conversion of Shares........................................................................................ A-7
3.2 Anti-Dilution Provisions.................................................................................... A-7
3.3 Shares Held by Career or AccuStaff.......................................................................... A-8
3.4 Fractional Shares........................................................................................... A-8
3.5 Conversion of Stock Options; Convertible Notes; Restricted Stock............................................ A-8
ARTICLE 4--EXCHANGE OF SHARES..................................................................................... A-10
4.1 Exchange Procedures......................................................................................... A-10
4.2 Rights of Former Career Shareholders........................................................................ A-10
ARTICLE 5--REPRESENTATIONS AND WARRANTIES OF CAREER............................................................... A-11
5.1 Organization, Standing, and Power........................................................................... A-11
5.2 Authority; No Breach By Agreement........................................................................... A-11
5.3 Capital Stock............................................................................................... A-12
5.4 Career Subsidiaries......................................................................................... A-12
5.5 SEC Filings; Financial Statements........................................................................... A-13
5.6 Absence of Undisclosed Liabilities.......................................................................... A-13
5.7 Absence of Certain Changes or Events........................................................................ A-14
5.8 Tax Matters................................................................................................. A-14
5.9 Assets...................................................................................................... A-14
5.10 Intellectual Property....................................................................................... A-15
5.11 Environmental Matters....................................................................................... A-15
5.12 Compliance with Laws........................................................................................ A-15
5.13 Labor Relations............................................................................................. A-16
5.14 Employee Benefit Plans...................................................................................... A-16
5.15 Material Contracts.......................................................................................... A-17
5.16 Legal Proceedings........................................................................................... A-17
5.17 Reports..................................................................................................... A-18
5.18 Statements True and Correct................................................................................. A-18
5.19 Accounting, Tax and Regulatory Matters...................................................................... A-18
5.20 State Takeover Laws......................................................................................... A-18
5.21 Charter Provisions.......................................................................................... A-19
5.22 Opinion of Financial Advisor................................................................................ A-19
ARTICLE 6--REPRESENTATIONS AND WARRANTIES OF ACCUSTAFF............................................................ A-19
6.1 Organization, Standing, and Power........................................................................... A-19
6.2 Authority; No Breach By Agreement........................................................................... A-19
6.3 Capital Stock............................................................................................... A-20
6.4 SEC Filings; Financial Statements........................................................................... A-20
</TABLE>
A-2
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<TABLE>
<CAPTION>
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<C> <S> <C>
6.5 Absence of Undisclosed Liabilities................................ A-21
6.6 Absence of Certain Changes or Events.............................. A-21
6.7 Tax Matters....................................................... A-21
6.8 Intellectual Property............................................. A-21
6.9 Environmental Matters............................................. A-22
6.10 Compliance With Laws.............................................. A-22
6.11 Labor Relations................................................... A-22
6.12 Employee Benefit Plans............................................ A-23
6.13 Legal Proceedings................................................. A-23
6.14 Reports........................................................... A-23
6.15 Statements True and Correct....................................... A-24
6.16 Authority of Sub.................................................. A-24
6.17 Accounting, Tax and Regulatory Matters............................ A-24
ARTICLE 7--CONDUCT OF BUSINESS PENDING CONSUMMATION...................... A-24
7.1 Affirmative Covenants of Career................................... A-24
7.2 Negative Covenants of Career...................................... A-25
7.3 Covenants of AccuStaff............................................ A-26
7.4 Adverse Changes in Condition...................................... A-27
7.5 Reports........................................................... A-27
ARTICLE 8--ADDITIONAL AGREEMENTS......................................... A-27
8.1 Registration Statement; Proxy Statement; Shareholder Approval..... A-27
8.2 Exchange Listing.................................................. A-28
8.3 Applications; Antitrust Notification.............................. A-28
8.4 Filings with State Offices........................................ A-28
8.5 Agreement as to Efforts to Consummate............................. A-28
8.6 Investigation and Confidentiality................................. A-28
8.7 Press Releases.................................................... A-29
8.8 Certain Actions................................................... A-29
8.9 Accounting and Tax Treatment...................................... A-29
8.10 Agreement of Affiliates........................................... A-29
8.11 Employee Benefits and Contracts................................... A-29
8.12 Indemnification................................................... A-30
8.13 Agreement Regarding Certain Acquisitions.......................... A-31
ARTICLE 9--CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE............. A-31
9.1 Conditions to Obligations of Each Party........................... A-31
9.2 Conditions to Obligations of AccuStaff............................ A-32
9.3 Conditions to Obligations of Career............................... A-33
ARTICLE 10--TERMINATION.................................................. A-34
10.1 Termination....................................................... A-34
10.2 Effect of Termination............................................. A-35
10.3 Non-Survival of Representations and Covenants..................... A-35
ARTICLE 11--MISCELLANEOUS................................................ A-35
11.1 Definitions....................................................... A-35
11.2 Expenses.......................................................... A-41
11.3 Brokers and Finders............................................... A-43
11.4 Entire Agreement.................................................. A-43
11.5 Amendments........................................................ A-43
11.6 Waivers........................................................... A-43
11.7 Assignment........................................................ A-44
</TABLE>
A-3
<PAGE>
<TABLE>
<CAPTION>
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<C> <S> <C>
11.8 Notices............................................................ A-44
11.9 Governing Law...................................................... A-44
11.10 Counterparts....................................................... A-44
11.11 Captions; Articles and Sections.................................... A-44
11.12 Interpretations.................................................... A-44
11.13 Severability....................................................... A-44
SIGNATURES................................................................ A-45
</TABLE>
A-4
<PAGE>
LIST OF EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
1. Form of agreement of affiliates of Career. ((S)(S) 8.10, 9.2(e)).
</TABLE>
A-5
<PAGE>
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of August 25, 1996, by and among ACCUSTAFF INCORPORATED ("AccuStaff"),
a Florida corporation; SUNRISE MERGER CORPORATION ("Sub"), a Delaware
corporation; and CAREER HORIZONS, INC. ("Career"), a Delaware corporation.
PREAMBLE
The respective Boards of Directors of Career, Sub and AccuStaff are of the
opinion that the transactions described herein are in the best interests of
the parties and their respective shareholders. This Agreement provides for the
acquisition of Career by AccuStaff pursuant to the merger of Sub with and into
Career. At the effective time of such merger, the outstanding shares of the
capital stock of Career shall be converted into the right to receive shares of
the common stock of AccuStaff (except as provided herein). As a result,
shareholders of Career shall become shareholders of AccuStaff and Career shall
continue to conduct its business and operations as a wholly owned subsidiary
of AccuStaff. The transactions described in this Agreement are subject to the
approvals of the shareholders of Career, the shareholders of AccuStaff,
expiration of the required waiting period under the HSR Act, and the
satisfaction of certain other conditions described in this Agreement. It is
the intention of the parties to this Agreement that the Merger for federal
income tax purposes shall qualify as a "reorganization" within the meaning of
Section 368(a) of the Internal Revenue Code, and for accounting purposes shall
qualify for treatment as a pooling of interests.
Certain terms used in this Agreement are defined in Section 11.1 of this
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants, and agreements set forth herein, the parties agree
as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
--------------------------------
1.1 MERGER. Subject to the terms and conditions of this Agreement, at the
------
Effective Time the separate corporate existence of Sub shall cease and Sub
shall be merged with and into Career in accordance with the provisions of
Section 251 of the DGCL and with the effect provided in Section 259 of the
DGCL (the "Merger"). Career shall be the Surviving Corporation resulting from
the Merger and shall become a wholly owned Subsidiary of AccuStaff and shall
continue to exist under the Laws of the State of Delaware. The Merger shall be
consummated pursuant to the terms of this Agreement, which has been approved
and adopted by the respective Boards of Directors of Career, Sub and AccuStaff
and by AccuStaff, as the sole shareholder of Sub.
1.2 TIME AND PLACE OF CLOSING. The closing of the transactions contemplated
-------------------------
hereby (the "Closing") will take place at 9:00 A.M. on the date that the
Effective Time occurs (or the immediately preceding day if the Effective Time
is earlier than 9:00 A.M.), or at such other time as the Parties, acting
through their authorized officers, may mutually agree. The Closing shall be
held at such location as may be mutually agreed upon by the Parties.
1.3 EFFECTIVE TIME. The Merger and other transactions contemplated by this
--------------
Agreement shall become effective on the date and at the time the Certificate
of Merger reflecting the Merger shall become effective with the Secretary of
State of the State of Delaware (the "Effective Time"). Subject to the terms
and conditions hereof, unless otherwise mutually agreed upon in writing by the
authorized officers of each Party, the Effective Time shall occur not later
than the second business day following the satisfaction or waiver of the
conditions set forth in Article 9.
A-6
<PAGE>
ARTICLE 2
TERMS OF MERGER
---------------
2.1 CHARTER. The Certificate of Incorporation of Career in effect
-------
immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Surviving Corporation until duly amended or repealed.
2.2 BYLAWS. The Bylaws of Career in effect immediately prior to the
------
Effective Time shall be the Bylaws of the Surviving Corporation until duly
amended or repealed.
2.3 DIRECTORS AND OFFICERS. The directors of Sub in office immediately prior
----------------------
to the Effective Time, together with such additional persons as may thereafter
be elected, shall serve as the directors of the Surviving Corporation from and
after the Effective Time in accordance with the Bylaws of the Surviving
Corporation. The officers of Sub in office immediately prior to the Effective
Time, together with such additional persons as may thereafter be elected,
shall serve as the officers of the Surviving Corporation from and after the
Effective Time in accordance with the Bylaws of the Surviving Corporation.
ARTICLE 3
MANNER OF CONVERTING SHARES
---------------------------
3.1 CONVERSION OF SHARES. Subject to the provisions of this Article 3, at
--------------------
the Effective Time, by virtue of the Merger and without any action on the part
of AccuStaff, Career, Sub or the shareholders of any of the foregoing, the
shares of the constituent corporations shall be converted as follows:
(a) Each share of AccuStaff Common Stock issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding
from and after the Effective Time.
(b) Each share of Sub Common Stock issued and outstanding immediately
prior to the Effective Time shall cease to be outstanding and shall be
converted into one share of Career Common Stock.
(c) Each share of Career Common Stock (excluding shares held by any
Career Company or any AccuStaff Company) issued and outstanding immediately
prior to the Effective Time shall cease to be outstanding and shall be
converted into and exchanged for the right to receive 1.53 shares of
AccuStaff Common Stock (the "Base Exchange Ratio" and, subject to the
provisions of the remainder of this sentence, the "Exchange Ratio");
provided, that, in the event that the Average Closing Price shall be
greater than $31.60 (the "Upper Threshold Price"), the Exchange Ratio shall
equal that multiple of a share of AccuStaff Common Stock (rounded to the
nearest ten thousandth of a share) obtained by dividing the product of the
Base Exchange Ratio and the Upper Threshold Price by the Average Closing
Price, but not less than 1.2444 (the "Minimum Exchange Ratio"); provided
further, that, in the event that the Average Closing Price shall be less
than $21.07 (the "Lower Threshold Price" and, together with the Upper
Threshold Price, the "Threshold Prices"), the Exchange Ratio shall equal
that multiple of a share of AccuStaff Common Stock (rounded to the nearest
ten thousandth of a share) obtained by dividing the product of the Base
Exchange Ratio and the Lower Threshold Price by the Average Closing Price,
but not more than 1.8006 (the "Maximum Exchange Ratio").
3.2 ANTI-DILUTION PROVISIONS. In the event AccuStaff changes the number of
------------------------
shares of AccuStaff Common Stock issued and outstanding prior to the Effective
Time as a result of a stock split, stock dividend, or similar recapitalization
with respect to such stock and the record date therefor (in the case of a
stock dividend) or the effective date thereof (in the case of a stock split or
similar recapitalization for which a record date is not established) shall be
after the Exchange Ratio has been determined in accordance with Section 3.1(c)
and prior to the Effective Time, the Exchange Ratio shall be proportionately
adjusted. In the event AccuStaff changes the number of shares of AccuStaff
Common Stock issued and outstanding prior to the Effective Time as a result of
a stock split, stock dividend, or similar recapitalization with respect to
such stock and the record date therefor (in the case of a stock dividend) or
the effective date thereof (in the case of a stock split or similar
recapitalization
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<PAGE>
for which a record date is not established) shall be prior to the date on
which the Exchange Ratio is determined in accordance with Section 3.1(c), (i)
the Base Exchange Ratio, the Minimum Exchange Ratio, the Maximum Exchange
Ratio and the Threshold Prices shall be adjusted to appropriately adjust the
ratio under which shares of Career Common Stock will be converted into shares
of AccuStaff Common Stock pursuant to Section 3.1(c), and (ii) if necessary,
the anticipated Effective Time shall be postponed for an appropriate period of
time agreed upon by the parties in order for the Average Closing Price to
reflect the market effect of such stock split, stock dividend, or similar
recapitalization.
3.3 SHARES HELD BY CAREER OR ACCUSTAFF. Each of the shares of Career Common
----------------------------------
Stock held by any Career Company or by any AccuStaff Company shall be canceled
and retired at the Effective Time and no consideration shall be issued in
exchange therefor.
3.4 FRACTIONAL SHARES. Notwithstanding any other provision of this
-----------------
Agreement, each holder of shares of Career Common Stock exchanged pursuant to
the Merger who would otherwise have been entitled to receive a fraction of a
share of AccuStaff Common Stock (after taking into account all certificates
delivered by such holder) shall receive, in lieu thereof, cash (without
interest) in an amount equal to such fractional part of a share of AccuStaff
Common Stock multiplied by the market value of one share of AccuStaff Common
Stock at the Effective Time. The market value of one share of AccuStaff Common
Stock at the Effective Time shall be the last sale price of such common stock
on the Nasdaq National Market (as reported by The Wall Street Journal or, if
not reported thereby, any other authoritative source reasonably selected by
AccuStaff) on the last trading day immediately preceding the Effective Time.
No such holder will be entitled to dividends, voting rights, or any other
rights as a shareholder in respect of any fractional shares.
3.5 CONVERSION OF STOCK OPTIONS; CONVERTIBLE NOTES; RESTRICTED STOCK.
----------------------------------------------------------------
(a) At the Effective Time, each option or other right to purchase shares of
Career Common Stock pursuant to stock options or stock appreciation rights
("Career Options") granted by Career under the Career Stock Plans, which are
outstanding at the Effective Time, whether or not exercisable, shall be
converted into and become rights with respect to AccuStaff Common Stock, and
AccuStaff shall assume each Career Option, in accordance with the terms of the
Career Stock Plan and stock option agreement by which it is evidenced, except
that from and after the Effective Time, (i) AccuStaff and its Compensation
Committee shall be substituted for Career and the Committee of Career's Board
of Directors (including, if applicable, the entire Board of Directors of
Career) administering such Career Stock Plan, (ii) each Career Option assumed
by AccuStaff may be exercised solely for shares of AccuStaff Common Stock (or
cash, if so provided under the terms of such Career Option), (iii) the number
of shares of AccuStaff Common Stock subject to such Career Option shall be
equal to the number of shares of Career Common Stock subject to such Career
Option immediately prior to the Effective Time multiplied by the Exchange
Ratio, and (iv) the per share exercise price under each such Career Option
shall be adjusted by dividing the per share exercise price under each such
Career Option by the Exchange Ratio and rounding up to the nearest cent.
Notwithstanding the provisions of clause (iii) of the preceding sentence,
AccuStaff shall not be obligated to issue any fraction of a share of AccuStaff
Common Stock upon exercise of Career Options and any fraction of a share of
AccuStaff Common Stock that otherwise would be subject to a converted Career
Option shall represent the right to receive a cash payment upon exercise of
such converted Career Option equal to the product of such fraction and the
difference between the market value of one share of AccuStaff Common Stock at
the time of exercise of such Option and the per share exercise price of such
Option. The market value of one share of AccuStaff Common Stock at the time of
exercise of an Option shall be the last sale price of such common stock on the
Nasdaq National Market (as reported by The Wall Street Journal or, if not
reported thereby, any other authoritative source selected by AccuStaff) on the
last trading day preceding the date of exercise. In addition, notwithstanding
the provisions of clauses (iii) and (iv) of the first sentence of this Section
3.5(a), each Career Option which is an "incentive stock option" shall be
adjusted as required by Section 424 of the Internal Revenue Code, and the
regulations promulgated thereunder, so as not to constitute a modification,
extension or renewal of the option, within the meaning of Section 424(h) of
the Internal Revenue Code. Each of Career and AccuStaff agrees to take all
necessary steps to effectuate the foregoing provisions of
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this Section 3.5(a), including using all reasonable efforts to obtain from
each holder of a Career Option any Consent or Contract that may be deemed
necessary or advisable in order to effect the transactions contemplated by
this Section 3.5(a). Anything in this Agreement to the contrary
notwithstanding, AccuStaff shall have the right, in its sole discretion, not
to deliver the consideration provided in this Section 3.5(a) to a former
holder of a Career Option who has not delivered such Consent or Contract. Not
later than five business days after the Effective Time, AccuStaff shall
deliver to the participants in each Career Stock Plan an appropriate notice
setting forth such participant's rights pursuant thereto and the grants
subject to such Career Stock Plan shall continue in effect on the same terms
and conditions (subject to the adjustments required by this Section 3.5(a)
after giving effect to the Merger), and AccuStaff shall comply with the terms
of each Career Stock Plan to ensure, to the extent required by, and subject to
the provisions of, such Career Stock Plan, that Career Options which qualified
as incentive stock options prior to the Effective Time continue to qualify as
incentive stock options after the Effective Time. At or prior to the Effective
Time, AccuStaff shall take all corporate action necessary to reserve for
issuance sufficient shares of AccuStaff Common Stock for delivery upon
exercise of Career Options assumed by it in accordance with this Section 3.5.
At or prior to the Effective Time, AccuStaff shall file a registration
statement on Form S-3 or Form S-8, as the case may be (or any successor or
other appropriate forms), with respect to the shares of AccuStaff Common Stock
subject to such options and shall take all necessary steps to maintain the
effectiveness of such registration statements (and maintain the current status
of the prospectus or prospectuses contained therein) for so long as such
options remain outstanding. With respect to those individuals who subsequent
to the Merger will be subject to the reporting requirements under Section
16(a) of the 1934 Act, where applicable, AccuStaff shall administer the Career
Stock Plan assumed pursuant to this Section 3.5 in a manner that complies with
Rule 16b-3 promulgated under the Exchange Act to the extent the Career Stock
Plan complied with such rule prior to the Effective Time.
(b) In connection with the Closing, AccuStaff and Career shall execute and
deliver to the trustee under the Career Indenture the supplemental indenture
contemplated by Section 5.13 of the Career Indenture (the "Supplemental
Indenture"), which Supplemental Indenture shall, as required by Section 5.13
of the Career Indenture, provide that, effective as of the Effective Time,
each right to acquire shares of Career Common Stock pursuant to conversion of
Career Convertible Notes, which are outstanding at the Effective Time, shall
be converted into and become rights with respect to AccuStaff Common Stock,
and AccuStaff shall assume the conversion obligations (and related
registration obligations) under each Career Convertible Note (the "Conversion
Obligations"), in accordance with the terms of such Career Convertible Note,
the Career Indenture and the Supplemental Indenture, except that from and
after the Effective Time, (i) each Conversion Obligation assumed by AccuStaff
may be exercised solely for shares of AccuStaff Common Stock, (ii) the number
of shares of AccuStaff Common Stock subject to such Conversion Obligation
shall be equal to the number of shares of Career Common Stock subject to such
Conversion Obligation immediately prior to the Effective Time multiplied by
the Exchange Ratio (subject to such further adjustment as may be provided in
Article V of the Career Indenture), and (iv) the per share conversion price
under each such Conversion Obligation shall be adjusted by dividing the per
share conversion price under each such Conversion Obligation by the Exchange
Ratio and rounding up to the nearest cent (subject to such further adjustment
as may be provided in Article V of the Career Indenture). Each of Career and
AccuStaff agrees to take all necessary steps to effectuate the foregoing
provisions of this Section 3.5(b). At or prior to the Effective Time,
AccuStaff shall take all corporate action necessary to reserve for issuance
sufficient shares of AccuStaff Common Stock for delivery upon exercise of
Career Convertible Notes. Not later than 30 days after the Effective Time,
AccuStaff shall cause Career to offer to repurchase the outstanding Career
Convertible Notes in accordance with the terms of Section 4.07 of the Career
Indenture and to mail to each holder of Career Convertible Notes the notice
provided by Section 3.08(e) of the Career Indenture.
(c) All contractual restrictions or limitations on transfer with respect to
Career Common Stock awarded under the Career Stock Plans or any other plan,
program, Contract or arrangement of any Career Company, to the extent that
such restrictions or limitations shall not have already lapsed (whether as a
result of the Merger or otherwise), and except as otherwise expressly provided
in such plan, program, Contract or arrangement, shall remain in full force and
effect with respect to shares of AccuStaff Common Stock into which such
restricted stock is converted pursuant to Section 3.1.
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<PAGE>
ARTICLE 4
EXCHANGE OF SHARES
------------------
4.1 EXCHANGE PROCEDURES. As promptly as practicable after the Effective
-------------------
Time, AccuStaff shall deposit with SunTrust Bank, Atlanta (the "Exchange
Agent") certificates representing shares of AccuStaff Common Stock required to
effectuate the exchanges referred to in Article 3, together with cash payable
in respect of fractional shares pursuant to Section 3.4. Promptly after the
Effective Time, AccuStaff and Career shall cause the Exchange Agent to mail to
each holder of record of a certificate or certificates which represented
shares of Career Common Stock immediately prior to the Effective Time (the
"Certificates") (i) a form of letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the certificates
theretofore representing shares of Career Common Stock shall pass, only upon
proper delivery of such certificates to the Exchange Agent) and (ii)
instructions for use in effecting the surrender of Certificates in exchange
for certificates representing shares of AccuStaff Common Stock and cash in
lieu of fractional shares. The Exchange Agent may establish reasonable and
customary rules and procedures in connection with its duties. After the
Effective Time, each holder of shares of Career Common Stock (other than
shares to be canceled pursuant to Section 3.3) issued and outstanding at the
Effective Time shall surrender the certificate or certificates representing
such shares to the Exchange Agent and shall promptly upon surrender thereof
receive in exchange therefor the consideration provided in Section 3.1,
together with all undelivered dividends or distributions in respect of such
shares (without interest thereon) pursuant to Section 4.2. To the extent
required by Section 3.4, each holder of shares of Career Common Stock issued
and outstanding at the Effective Time also shall receive, upon surrender of
the certificate or certificates representing such shares, cash in lieu of any
fractional share of AccuStaff Common Stock to which such holder may be
otherwise entitled (without interest). AccuStaff shall not be obligated to
deliver the consideration to which any former holder of Career Common Stock is
entitled as a result of the Merger until such holder surrenders such holder's
certificate or certificates representing the shares of Career Common Stock for
exchange as provided in this Section 4.1. In the event of a transfer of
ownership of shares of Career Common Stock represented by Certificates that
are not registered in the transfer records of Career, the consideration
provided in Section 3.1 may be issued to a transferee if the Certificates
representing such shares are delivered to the Exchange Agent, accompanied by
all documents required to evidence such transfer and by evidence satisfactory
to the Exchange Agent that any applicable stock transfer taxes have been paid.
If any Certificate shall have been lost, stolen, mislaid or destroyed, upon
receipt of (i) an affidavit of that fact from the holder claiming such
Certificate to be lost, mislaid, stolen or destroyed, (ii) such bond, security
or indemnity as AccuStaff and the Exchange Agent may reasonably require and
(iii) any other documents necessary to evidence and effect the bona fide
exchange thereof, the Exchange Agent shall issue to such holder the
consideration into which the shares represented by such lost, stolen, mislaid
or destroyed Certificate shall have been converted. At any time following the
sixth month after the Effective Time, AccuStaff shall be entitled to require
the Exchange Agent to deliver to it any cash then held by the Exchange Agent
and all shares of AccuStaff Common Stock deposited with the Exchange Agent
pursuant to this Section 4.1 which had not been disbursed to holders of
Certificates (including all interest and other income received by the Exchange
Agent in respect of all funds made available to it), and thereafter former
holders of Career Common Stock shall be entitled to look only to AccuStaff
(subject to abandoned property Laws) as general creditors thereof with respect
to the consideration that may be payable upon due surrender of the
Certificates held by them. Any other provision of this Agreement
notwithstanding, neither AccuStaff, the Surviving Corporation nor the Exchange
Agent shall be liable to a holder of Career Common Stock for any amounts paid
or property delivered in good faith to a public official pursuant to any
applicable abandoned property Law. Adoption of this Agreement by the
shareholders of Career shall constitute ratification of the appointment of the
Exchange Agent.
4.2 RIGHTS OF FORMER CAREER SHAREHOLDERS. At the Effective Time, the stock
------------------------------------
transfer books of Career shall be closed as to holders of Career Common Stock
immediately prior to the Effective Time and no transfer of Career Common Stock
by any such holder shall thereafter be made or recognized. Until surrendered
for exchange in accordance with the provisions of Section 4.1, each
certificate theretofore representing shares of Career Common Stock (other than
shares to be canceled pursuant to Section 3.3) shall from and after the
Effective Time represent for all purposes only the right to receive the
consideration provided in Sections 3.1 and
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<PAGE>
3.4 in exchange therefor, subject, however, to the Surviving Corporation's
obligation to pay any dividends or make any other distributions with a record
date prior to the Effective Time which have been declared or made by Career in
respect of such shares of Career Common Stock in accordance with the terms of
this Agreement and which remain unpaid at the Effective Time. Whenever a
dividend or other distribution is declared by AccuStaff on the AccuStaff
Common Stock, the record date for which is at or after the Effective Time, the
declaration shall include dividends or other distributions on all shares of
AccuStaff Common Stock issuable pursuant to this Agreement, but no dividend or
other distribution payable to the holders of record of AccuStaff Common Stock
as of any time subsequent to the Effective Time shall be delivered to the
holder of any certificate representing shares of Career Common Stock issued
and outstanding at the Effective Time until such holder surrenders such
certificate for exchange as provided in Section 4.1. However, upon surrender
of such Career Common Stock certificate, both the AccuStaff Common Stock
certificate (together with all such undelivered dividends or other
distributions without interest) and any undelivered dividends and cash
payments payable hereunder (without interest) shall be delivered and paid with
respect to each share represented by such certificate.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF CAREER
----------------------------------------
Career hereby represents and warrants to AccuStaff as follows:
5.1 ORGANIZATION, STANDING, AND POWER. Career is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the State
of Delaware, and has the corporate power and authority to carry on its
business as now conducted and to own, lease and operate its Assets. Career is
duly qualified or licensed to transact business as a foreign corporation in
good standing in the States of the United States and foreign jurisdictions
where the character of its Assets or the nature or conduct of its business
requires it to be so qualified or licensed, except for such jurisdictions in
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Career.
The minute book and other organizational documents for Career have been made
available to AccuStaff for its review and, except as disclosed in Section 5.1
of the Career Disclosure Memorandum, are true and complete in all material
respects as in effect as of the date of this Agreement and accurately reflect
in all material respects all amendments thereto and all proceedings of the
Board of Directors and shareholders thereof.
5.2 AUTHORITY; NO BREACH BY AGREEMENT.
---------------------------------
(a) Career has the corporate power and authority necessary to execute,
deliver, and perform its obligations under this Agreement and, subject, with
respect to the consummation of the Merger, to the adoption of this Agreement
by an affirmative vote of the holders of a majority of the outstanding shares
of Career Common Stock entitled to vote thereon, to consummate the
transactions contemplated hereby. The execution, delivery, and performance of
this Agreement and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of Career, subject, with
respect to the consummation of the Merger, to the adoption of this Agreement
by an affirmative vote of the holders of a majority of the outstanding shares
of Career Common Stock entitled to vote thereon, which is the only shareholder
vote required for approval of this Agreement and consummation of the Merger by
Career. Subject to such requisite shareholder approval, and assuming this
Agreement represents a valid and binding obligation of AccuStaff and Sub, this
Agreement represents a legal, valid, and binding obligation of Career,
enforceable against Career in accordance with its terms (except in all cases
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, conservatorship, moratorium, or similar Laws
affecting the enforcement of creditors' rights generally and except that the
availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding
may be brought).
(b) Neither the execution and delivery of this Agreement by Career, nor the
consummation by Career of the transactions contemplated hereby, nor compliance
by Career with any of the provisions hereof, will
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(i) conflict with or result in a breach of any provision of Career's
Certificate of Incorporation or Bylaws or the certificate or articles of
incorporation or bylaws of any Career Subsidiary, or (ii) except as disclosed
in Section 5.2(b) of the Career Disclosure Memorandum, constitute or result in
a Default under, or require any Consent pursuant to, or result in the creation
of any Lien on any Asset of any Career Company under, any Contract or Permit
of any Career Company, except any such Default or Lien, or any failure to
obtain any such Consent, is not reasonably likely to have a Material Adverse
Effect on Career, or, (iii) subject to receipt of the requisite Consents
referred to in Section 9.1(b), violate any Law or Order applicable to any
Career Company or any of their respective material Assets, except for any such
violation which is not reasonably likely to have a Material Adverse Effect on
Career.
(c) Other than in connection or compliance with the provisions of the
Securities Laws, applicable state corporate and securities Laws, and rules of
the NYSE, and other than Consents required from Regulatory Authorities set
forth in Section 5.2(c) of the Career Disclosure Memorandum, and other than
notices to or filings with the Internal Revenue Service or the Pension Benefit
Guaranty Corporation with respect to any employee benefit plans, or under the
HSR Act, no notice to, filing with, or Consent of, any public body or
authority is necessary for the consummation by Career of the Merger and the
other transactions contemplated in this Agreement.
5.3 CAPITAL STOCK.
-------------
(a) The authorized capital stock of Career consists of (i) 50,000,000 shares
of Career Common Stock, of which 17,658,318 shares are issued and outstanding
as of the date of this Agreement and not more than 24,074,672 shares will be
issued and outstanding at the Effective Time, and (ii) 1,000,000 shares of
preferred stock, par value $.01 per share, none of which are issued and
outstanding. All of the issued and outstanding shares of capital stock of
Career are duly and validly issued and outstanding and are fully paid and
nonassessable under the DGCL. None of the outstanding shares of capital stock
of Career has been issued in violation of any preemptive rights of the current
or past shareholders of Career.
(b) Except as set forth in Section 5.3(a), or as provided in the Stock
Option Agreement, or as disclosed in Section 5.3 of the Career Disclosure
Memorandum, there are no shares of capital stock or other equity securities of
Career outstanding and no outstanding Rights created by Career or any Career
Company relating to the capital stock of Career.
5.4 CAREER SUBSIDIARIES. Career has disclosed in Section 5.4 of the Career
-------------------
Disclosure Memorandum all of the Career Subsidiaries that are corporations
(identifying its jurisdiction of incorporation, each jurisdiction in which it
has been qualified and/or licensed to transact business, and the percentage
ownership interest represented by such share ownership) and all of the Career
Subsidiaries that are general or limited partnerships, limited liability
companies, or other non-corporate entities (identifying the Law under which
such entity is organized, each jurisdiction in which it has been qualified
and/or licensed to transact business, and the amount and nature of the
ownership interest therein). Except as disclosed in Section 5.4 of the Career
Disclosure Memorandum, Career or one of its wholly owned Subsidiaries owns all
of the issued and outstanding shares of capital stock (or other equity
interests) of each Career Subsidiary. No capital stock (or other equity
interest) of any Career Subsidiary is or may become required to be issued
(other than to another Career Company) by reason of any Rights, and there are
no Contracts by which any Career Subsidiary is bound to issue (other than to
another Career Company) additional shares of its capital stock (or other
equity interests) or Rights or by which any Career Company is or may be bound
to transfer any shares of the capital stock (or other equity interests) of any
Career Subsidiary (other than to another Career Company). There are no
Contracts relating to the rights of any Career Company to vote or to dispose
of any shares of the capital stock (or other equity interests) of any Career
Subsidiary. All of the shares of capital stock (or other equity interests) of
each Career Subsidiary held by a Career Company are fully paid and
nonassessable under the applicable corporation Law of the jurisdiction in
which such Subsidiary is incorporated or organized and, except as disclosed in
Section 5.4 of the Career Disclosure Memorandum, are owned by the Career
Company free and clear of any Lien. Except as disclosed in Section 5.4
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<PAGE>
of the Career Disclosure Memorandum, each Career Subsidiary is a corporation,
and each such Subsidiary is duly organized, validly existing, and (as to
corporations) in good standing under the Laws of the jurisdiction in which it
is incorporated or organized, and has the corporate power and authority
necessary for it to own, lease, and operate its Assets and to carry on its
business as now conducted. Each Career Subsidiary is duly qualified or
licensed to transact business as a foreign corporation in good standing in the
States of the United States and foreign jurisdictions where the character of
its Assets or the nature or conduct of its business requires it to be so
qualified or licensed, except for such jurisdictions in which the failure to
be so qualified or licensed is not reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on Career. The minute book and
other organizational documents for each Career Subsidiary have been made
available to AccuStaff for its review.
5.5 SEC FILINGS; FINANCIAL STATEMENTS.
---------------------------------
(a) Career has timely filed and made available to AccuStaff all SEC
Documents required to be filed by Career since December 31, 1992 (the "Career
SEC Reports"). The Career SEC Reports (i) at the time filed, complied or will
comply in all material respects with the applicable requirements of the
Securities Laws and other applicable Laws and (ii) did not, at the time they
were filed (or, if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing) contain any untrue statement of a
material fact or omit to state a material fact required to be stated in such
Career SEC Reports or necessary in order to make the statements in such Career
SEC Reports, in light of the circumstances under which they were made, not
misleading; provided, that any pro forma financial statements contained in the
Career SEC Reports are not necessarily indicative of the consolidated
financial position of the Career Companies as of the respective dates thereof
and the consolidated results of operations and cash flows of the Career
Companies for the periods indicated. No Career Subsidiary is required to file
any SEC Documents.
(b) Each of the Career Financial Statements (including, in each case, any
related notes) contained in the Career SEC Reports, including any Career SEC
Reports filed after the date of this Agreement until the Effective Time,
complied as to form in all material respects with the applicable published
rules and regulations of the SEC with respect thereto, was prepared in
accordance with GAAP (except to the extent required by changes in generally
accepted accounting principles, as may be indicated in the notes to such
financial statements or, in the case of unaudited interim statements, as
permitted by Form 10-Q of the SEC), and fairly presented in all material
respects the consolidated financial position of Career and its Subsidiaries as
at the respective dates and the consolidated results of operations and cash
flows for the periods indicated, except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which were not or are not expected to be material in amount or effect and that
any pro forma financial statements contained in the Career SEC Reports are not
necessarily indicative of the consolidated financial position of the Career
Companies as of the respective dates thereof and the consolidated results of
operations and cash flows of the Career Companies for the periods indicated.
5.6 ABSENCE OF UNDISCLOSED LIABILITIES. Except as disclosed in Section 5.6
----------------------------------
of the Career Disclosure Memorandum, no Career Company has any Liabilities
that are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Career, except Liabilities which are accrued or
reserved against in the consolidated balance sheets of Career as of December
31, 1995 and June 30, 1996, included in the Career Financial Statements
delivered prior to the date of this Agreement or reflected in the notes
thereto. No Career Company has incurred or paid any Liability since June 30,
1996, except for such Liabilities incurred or paid (i) in the ordinary course
of business consistent with past business practice or (ii) in connection with
the transactions contemplated by this Agreement. Except as disclosed in
Section 5.6 of the Career Disclosure Memorandum, no Career Company is directly
or indirectly liable, by guarantee, indemnity, or otherwise, upon or with
respect to, or obligated, by discount or repurchase agreement or in any other
way, to provide funds in respect to, or obligated to guarantee or assume any
Liability of any Affiliate (other than another Career Company) for any amount
in excess of $100,000.
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5.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since June 30, 1996, except as
------------------------------------
disclosed in Section 5.7 of the Career Disclosure Memorandum, (i) there have
been no events, changes, or occurrences which have had, or are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Career, and (ii) the Career Companies have not taken any action, or failed to
take any action, prior to the date of this Agreement, which action or failure,
if taken after the date of this Agreement, would represent or result in a
material breach or violation of any of the covenants and agreements of Career
provided in Article 7.
5.8 TAX MATTERS.
-----------
(a) All Tax Returns required to be filed by or on behalf of any of the
Career Companies have been timely filed or requests for extensions have been
timely filed, granted, and have not expired, and all such Tax Returns filed
are complete and accurate in all material respects. All Taxes shown on filed
Tax Returns have been paid. There is no pending or, to the Knowledge of
Career, threatened audit examination, deficiency, or refund Litigation with
respect to any Taxes, except as disclosed in Section 5.8 of the Career
Disclosure Memorandum. All Taxes and other Liabilities due with respect to
completed and settled examinations or concluded Litigation have been paid.
There are no Liens with respect to Taxes upon any of the Assets of the Career
Companies, except for any such Lien which is not reasonably likely to have a
Material Adverse Effect on Career.
(b) Except as disclosed in Section 5.8 of the Career Disclosure Memorandum,
none of the Career Companies has executed an extension or waiver of any
statute of limitations on the assessment or collection of any Tax due
(excluding such statutes that relate to years currently under examination by
the Internal Revenue Service or other applicable taxing authorities) that is
currently in effect.
(c) The provision for any Taxes due or to become due for any of the Career
Companies for the period or periods through and including the date of the
respective Career Financial Statements that has been made and is reflected on
such Career Financial Statements is sufficient to cover all such Taxes, except
for any insufficiency of such provision which is not reasonably likely to have
a Material Adverse Effect on AccuStaff.
(d) Each of the Career Companies is in compliance with, and its records
contain all information and documents (including properly completed IRS Forms
W-9) necessary to comply with, all applicable information reporting and Tax
withholding requirements under federal, state, and local Tax Laws, and such
records identify with specificity all accounts subject to backup withholding
under Section 3406 of the Internal Revenue Code, except for any such instance
of noncompliance or failure to so identify which is not reasonably likely to
have a Material Adverse Effect on Career.
(e) Except as disclosed in Section 5.8 of the Career Disclosure Memorandum,
none of the Career Companies has made any payments, is obligated to make any
payments, or is a party to any Contract that could obligate it to make any
payments that would be disallowed as a deduction under Section 280G or 162(m)
of the Internal Revenue Code.
5.9 ASSETS.
------
(a) Except as disclosed in Section 5.9 of the Career Disclosure Memorandum,
the Career Companies have good and marketable title, free and clear of all
Liens, to all of their respective Assets, except for any such Liens or other
defects of title which is not reasonably likely to have a Material Adverse
Effect on Career.
(b) All Assets which are material to Career's business on a consolidated
basis, held under leases or subleases by any of the Career Companies, are held
under valid Contracts enforceable in accordance with their respective terms
(except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or other Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceedings may be brought).
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(c) The Career Companies currently maintain insurance in such amounts,
scope, and coverage as Career believes is adequate to conduct its business. To
Career's Knowledge, none of the Career Companies has received notice from any
insurance carrier that any policy of insurance will be canceled or that
coverage thereunder will be reduced or eliminated, or that premium costs with
respect to such policies of insurance will be substantially increased. There
are presently no claims for amounts exceeding in any individual case $250,000
pending under such policies of insurance and, since January 1, 1995, no
notices of claims in excess of such amounts have been given by any Career
Company under such policies.
5.10 INTELLECTUAL PROPERTY. Except as disclosed in Section 5.10 of the
---------------------
Career Disclosure Memorandum, (i) each Career Company owns or has a license to
use all of the Intellectual Property used by such Career Company in the course
of its business, (ii) each Career Company is the owner of or has a license to
any Intellectual Property sold or licensed to a third party by such Career
Company in connection with such Career Company's business operations, and such
Career Company has the right to convey by sale or license any Intellectual
Property so conveyed, (iii) no Career Company is in Default under any of its
Intellectual Property licenses and (iv) no proceedings have been instituted,
or are pending or to the Knowledge of Career threatened, which challenge the
rights of any Career Company with respect to Intellectual Property used, sold
or licensed by such Career Company in the course of its business, nor has any
person claimed or alleged any rights to such Intellectual Property, except for
any failure to own or license, Default or proceeding which is not reasonably
likely to have a Material Adverse Effect on Career. To the Knowledge of
Career, the conduct of the business of the Career Companies does not infringe
any Intellectual Property of any other Person.
5.11 ENVIRONMENTAL MATTERS.
---------------------
(a) Each of the Career Companies is in compliance with all Environmental
Laws and has obtained all necessary Permits required to be issued pursuant to
any Environmental Law, except where the failure to so comply or to obtain such
Permits, individually or in the aggregate, is not reasonably likely to have a
Material Adverse Effect on Career. None of the Career Companies has received
notice or communication from any Regulatory Authority with respect to (i) any
Hazardous Material relative to its operations, property or acts or (ii) any
investigation, demand or request pursuant to enforcing any Environmental Law
relating to it or its operations, and no such investigation is pending or
threatened in any case which is reasonably likely to have a Material Adverse
Effect on Career.
(b) During the period of (i) any Career Company's ownership or operation of
any of their respective current properties, (ii) any Career Company's
participation in the management of any Participation Facility, or (iii) any
Career Company's holding of a security interest in an Operating Property,
there have been no releases, discharges, spillages, or disposals of Hazardous
Material in, on, under, adjacent to, or affecting (or potentially affecting)
such properties, except for any such release, discharge, spillage, or disposal
which is not reasonably likely to have a Material Adverse Effect on Career.
Prior to the period of (i) any Career Company's ownership or operation of any
of their respective current properties, (ii) any Career Company's
participation in the management of any Participation Facility, or (iii) any
Career Company's holding of a security interest in an Operating Property, to
the Knowledge of Career, there were no releases, discharges, spillages, or
disposals of Hazardous Material in, on, under, or affecting any such property,
Participation Facility or Operating Property, except for any such release,
discharge, spillage, or disposal which is not reasonably likely to have a
Material Adverse Effect on Career.
5.12 COMPLIANCE WITH LAWS. Each Career Company has in effect all Permits
--------------------
necessary for it to own, lease, or operate its material Assets and to carry on
its business as now conducted, except where the failure to so hold any such
Permit is not reasonably likely to have a Material Adverse Effect on Career,
and there has occurred no Default under any such Permit, except for any such
Default which is not reasonably likely to have a Material Adverse Effect on
Career. Except as disclosed in Section 5.12 of the Career Disclosure
Memorandum, none of the Career Companies:
(a) is in Default under any of the provisions of its Certificate of
Incorporation or Bylaws (or other governing instruments);
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(b) is in Default under any Laws, Orders, or Permits applicable to its
business or employees conducting its business, except for any such Default
which is not reasonably likely to have a Material Adverse Effect on Career;
or
(c) since January 1, 1993, has received any notification or communication
from any agency or department of federal, state, or local government or any
Regulatory Authority or the staff thereof (i) asserting that any Career
Company is not in compliance with any of the Laws or Orders which such
governmental authority or Regulatory Authority enforces, where any such
noncompliance is reasonably likely to have a Material Adverse Effect on
Career, (ii) threatening to revoke any Permits, where any such revocation
is reasonably likely to have a Material Adverse Effect on Career, or (iii)
requiring any Career Company to enter into or consent to the issuance of a
cease and desist order, formal agreement, directive, commitment, or
memorandum of understanding, or to adopt any Board resolution or similar
undertaking, except for any such order, agreement, directive, commitment,
memorandum, resolution or undertaking which is not reasonably likely to
have a Material Adverse Effect on Career.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action with respect to any Career Company by a Regulatory
Authority have been made available to AccuStaff.
5.13 LABOR RELATIONS. Except as disclosed in Section 5.13 of the Career
---------------
Disclosure Memorandum, no Career Company is the subject of any Litigation
asserting that it or any other Career Company has committed an unfair labor
practice (within the meaning of the National Labor Relations Act or comparable
state law) or seeking to compel it or any other Career Company to bargain with
any labor organization as to wages or conditions of employment, nor is any
Career Company party to any collective bargaining agreement, nor is there any
strike or other labor dispute involving any Career Company, pending or
threatened, or to the Knowledge of Career, is there any activity involving any
Career Company's employees seeking to certify a collective bargaining unit or
engaging in any other organization activity.
5.14 EMPLOYEE BENEFIT PLANS.
----------------------
(a) Career has or will deliver or make available to AccuStaff copies of all
pension, retirement, profit-sharing, deferred compensation, stock option,
employee stock ownership, severance pay, vacation, bonus, or other incentive
plan, all other written employee programs, arrangements, or agreements, all
medical, vision, dental, or other health plans, all life insurance plans, and
all other employee benefit plans or fringe benefit plans, including "employee
benefit plans" as that term is defined in Section 3(3) of ERISA, currently
adopted, maintained by, sponsored in whole or in part by, or contributed to by
any Career Company or ERISA Affiliate (within the meaning of Sections 414(b)
or (c) of the Internal Revenue Code) of a Career Company for the benefit of
employees, retirees, dependents, spouses, directors, independent contractors,
or other beneficiaries and under which employees, retirees, dependents,
spouses, directors, independent contractors, or other beneficiaries are
eligible to participate (collectively, the "Career Benefit Plans"). Career has
disclosed in Section 5.14 of the Career Disclosure Memorandum all qualified
retirement plans of Career Companies and all executive retirement plans of
Career. Any of the Career Benefit Plans which is an "employee pension benefit
plan," as that term is defined in Section 3(2) of ERISA, is referred to herein
as a "Career ERISA Plan." No Career ERISA Plan is, and no Career Company has
or has ever had any obligation to contribute to or to provide security for, a
"defined benefit plan" (as defined in Section 414(j) of the Internal Revenue
Code) or a multiemployer plan within the meaning of Section 3(37) of ERISA.
(b) All Career Benefit Plans are in compliance with the applicable terms of
ERISA, the Internal Revenue Code, and any other applicable Laws, the breach or
violation of which are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Career. Each Career ERISA Plan which
is intended to be qualified under Section 401(a) of the Internal Revenue Code
has received a favorable determination letter from the Internal Revenue
Service, and Career is not aware of any circumstances likely to result in
revocation of any such favorable determination letter. No Career Company has
engaged in a transaction with respect to any Career
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Benefit Plan that, assuming the taxable period of such transaction expired as
of the date hereof, would subject any Career Company to a Tax imposed by
either Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA.
(c) Except as disclosed in Section 5.14 of the Career Disclosure Memorandum,
no Career Company has any Liability for retiree health and life benefits under
any of the Career Benefit Plans except as may be required under Section 4980B
of the Internal Revenue Code, Part 6 of Title I of ERISA or any related state
or local law or ordinance.
(d) Except as disclosed in Section 5.14 of the Career Disclosure Memorandum,
neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby will (i) result in any payment (including
severance, unemployment compensation, golden parachute, or otherwise) becoming
due to any director or any employee of any Career Company from any Career
Company under any Career Benefit Plan or otherwise, (ii) increase any benefits
otherwise payable under any Career Benefit Plan, or (iii) result in any
acceleration of the time of payment or vesting of any such benefit.
(e) The actuarial present values of all accrued deferred compensation
entitlements (including entitlements under any executive compensation,
supplemental retirement, or employment agreement) of employees and former
employees of any Career Company and their respective beneficiaries, other than
entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of
ERISA, have been fully reflected on the Career Financial Statements to the
extent required by and in accordance with GAAP.
5.15 MATERIAL CONTRACTS. Except as disclosed in Section 5.15 of the Career
------------------
Disclosure Memorandum or otherwise reflected in the Career Financial
Statements, none of the Career Companies, nor any of their respective Assets,
businesses, or operations, is a party to, or is bound or affected by, or
receives benefits under, (i) any employment, severance, termination,
consulting, or retirement Contract providing for aggregate payments to any
officer of Career and presidents of any operating divisions of any Career
Company in any calendar year in excess of $200,000, (ii) any Contract relating
to the borrowing of money by any Career Company or the guarantee by any Career
Company of any such obligation (other than Contracts evidencing trade payables
and Contracts relating to borrowings or guarantees made in the ordinary course
of business), (iii) any Contract which prohibits or restricts any Career
Company from engaging in any business activities in any geographic area, line
of business or otherwise in competition with any other Person, (iv) any
Contract between or among Career Companies, (v) any Contract involving
Intellectual Property (other than Contracts entered into in the ordinary
course with customers and "shrink-wrap" software licenses), (vi) any Contract
relating to the provision of data processing, network communication, or other
technical services to any Career Company which require payments by such Career
Company to any Persons of $250,000 or more in any year, (vii) any Contract
relating to the purchase or sale of any business, and (viii) any other
Contract or amendment thereto that would be required to be filed as an exhibit
to a Form 10-K filed by Career with the SEC as of the date of this Agreement
(together with all Contracts referred to in Sections 5.9 and 5.14(a), the
"Career Contracts"). With respect to each Career Contract and except as
disclosed in Section 5.15 of the Career Disclosure Memorandum: (i) the
Contract is in full force and effect, except where any failure of such a
Contract to be in full force and effect is not reasonably likely to have a
Material Adverse Effect on Career; (ii) no Career Company is in Default
thereunder, other than any such Default which is not reasonably likely to have
a Material Adverse Effect on Career; (iii) no Career Company has repudiated or
waived any material provision of any such Contract; and (iv) no other party to
any such Contract is, to the Knowledge of Career, in Default in any respect or
has repudiated or waived any material provision thereunder. All of the
indebtedness of any Career Company for money borrowed, other than the Career
Convertible Notes, is prepayable at any time by such Career Company without
penalty or premium.
5.16 LEGAL PROCEEDINGS. There is no Litigation instituted or pending, or, to
-----------------
the Knowledge of Career, threatened against any Career Company, or against any
director, employee or employee benefit plan of any Career Company, or against
any Asset, interest, or right of any of them, that is reasonably likely to
have,
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individually or in the aggregate, a Material Adverse Effect on Career, nor are
there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against any Career Company, except any
such Orders for which the failure to comply is not reasonably likely to have a
Material Adverse Effect on Career. Section 5.16 of the Career Disclosure
Memorandum contains a summary of all Litigation as of the date of this
Agreement to which any Career Company is a party and which names a Career
Company as a defendant or cross-defendant and for which either equitable
relief is sought or damages in excess of $200,000 are sought from such Career
Company.
5.17 REPORTS. Since January 1, 1993, or the date of organization if later,
-------
each Career Company has timely filed all reports and statements, together with
any amendments required to be made with respect thereto, that it was required
to file with Regulatory Authorities (except failures to file which are not
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Career). As of their respective dates, each of such reports
and documents, including the financial statements, exhibits, and schedules
thereto, complied in all respects with all applicable Laws, except where the
failure to comply is not reasonably likely to have a Material Adverse Effect
on Career. As of its respective date, each such report and document did not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading, except for untrue statements or omissions which are not reasonably
likely to have a Material Adverse Effect on Career.
5.18 STATEMENTS TRUE AND CORRECT. No statement, certificate, instrument, or
---------------------------
other writing furnished or to be furnished by any Career Company thereof to
AccuStaff pursuant to this Agreement or any other document, agreement, or
instrument referred to herein contains or will contain any untrue statement of
material fact or will omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. None of the information supplied or to be supplied in writing
by any Career Company thereof for inclusion in the Registration Statement to
be filed by AccuStaff with the SEC will, when the Registration Statement
becomes effective, be false or misleading with respect to any material fact,
or omit to state any material fact necessary to make the statements therein
not misleading. None of the information supplied or to be supplied in writing
by any Career Company thereof for inclusion in the Joint Proxy Statement to be
mailed to each Party's shareholders in connection with the Shareholders'
Meetings, and any other documents to be filed by a Career Company with the SEC
or any other Regulatory Authority in connection with the transactions
contemplated hereby, will, at the respective time such documents are filed,
and with respect to the Joint Proxy Statement, when first mailed to the
shareholders of Career and AccuStaff, be false or misleading with respect to
any material fact, or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Joint Proxy Statement or any amendment
thereof or supplement thereto, at the time of the Shareholders' Meetings, be
false or misleading with respect to any material fact, or omit to state any
material fact necessary to correct any statement in any earlier communication
with respect to the solicitation of any proxy for the Shareholders' Meetings.
All documents that any Career Company is responsible for filing with any
Regulatory Authority in connection with the transactions contemplated hereby
will comply as to form in all material respects with the provisions of
applicable Law.
5.19 ACCOUNTING, TAX AND REGULATORY MATTERS. No Career Company or, to
--------------------------------------
Career's Knowledge, any Affiliate thereof has taken or agreed to take any
action and Career does not have any Knowledge of any fact or circumstance that
is reasonably likely to (i) prevent the Merger from qualifying for pooling-of-
interests accounting treatment or as a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code, or (ii) materially impede or
delay receipt of any Consents of Regulatory Authorities referred to in Section
9.1(b) or result in the imposition of a condition or restriction of the type
referred to in the last sentence of such Section.
5.20 STATE TAKEOVER LAWS. Each Career Company has taken all necessary action
-------------------
to exempt the transactions contemplated by this Agreement from, or if
necessary to challenge the validity or applicability of, any applicable
"moratorium," "fair price," "business combination," "control share," or other
anti-takeover Laws (collectively, "Takeover Laws"), including Section 203 of
the DGCL.
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5.21 CHARTER PROVISIONS. Each Career Company has taken all action so that
------------------
the entering into of this Agreement and the consummation of the Merger and the
other transactions contemplated by this Agreement do not and will not result
in the grant of any rights to any Person under the Certificate of
Incorporation, Bylaws or other governing instruments of any Career Company or
restrict or impair the ability of AccuStaff or any of its Subsidiaries to
vote, or otherwise to exercise the rights of a shareholder with respect to,
shares of any Career Company that may be directly or indirectly acquired or
controlled by them.
5.22 OPINION OF FINANCIAL ADVISOR. Prior to the execution of this Agreement,
----------------------------
Career has received the opinion of Salomon Brothers Inc to the effect that, as
of the date of this Agreement, the consideration to be received by holders of
shares of Career Common Stock is fair to such holders from a financial point
of view.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF ACCUSTAFF
-------------------------------------------
AccuStaff hereby represents and warrants to Career as follows:
6.1 ORGANIZATION, STANDING, AND POWER. AccuStaff is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the State
of Florida, and has the corporate power and authority to carry on its business
as now conducted and to own, lease and operate its material Assets. AccuStaff
is duly qualified or licensed to transact business as a foreign corporation in
good standing in the States of the United States and foreign jurisdictions
where the character of its Assets or the nature or conduct of its business
requires it to be so qualified or licensed, except for such jurisdictions in
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on
AccuStaff.
6.2 AUTHORITY; NO BREACH BY AGREEMENT.
---------------------------------
(a) AccuStaff has the corporate power and authority necessary to execute,
deliver and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of AccuStaff, subject to the
approval of the issuance of the shares of AccuStaff Common Stock pursuant to
the Merger by a majority of the votes cast at the AccuStaff Shareholders'
Meeting (assuming for such purpose that the votes cast in respect of such
proposal represent a majority of the outstanding AccuStaff Common Stock),
which is the only shareholder vote required for approval of this Agreement and
consummation of the merger by AccuStaff. Subject to such requisite shareholder
approval and assuming this Agreement represents a valid and binding obligation
of Career, this Agreement represents a legal, valid, and binding obligation of
AccuStaff, enforceable against AccuStaff in accordance with its terms (except
in all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, conservatorship, moratorium, or
similar Laws affecting the enforcement of creditors' rights generally and
except that the availability of the equitable remedy of specific performance
or injunctive relief is subject to the discretion of the court before which
any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by AccuStaff, nor
the consummation by AccuStaff of the transactions contemplated hereby, nor
compliance by AccuStaff with any of the provisions hereof, will (i) conflict
with or result in a breach of any provision of AccuStaff's Articles of
Incorporation or Bylaws, or (ii) constitute or result in a Default under, or
require any Consent pursuant to, or result in the creation of any Lien on any
Asset of any AccuStaff Company under, any Contract or Permit of any AccuStaff
Company, except any such Default or Lien, or any failure to obtain any such
Consent, is not reasonably likely to have a Material Adverse Effect on
AccuStaff or, (iii) subject to receipt of the requisite Consents referred to
in Section 9.1(b), violate any Law or Order applicable to any AccuStaff
Company or any of their respective material Assets, except for any such
violation which is not reasonably likely to have a Material Adverse Effect on
AccuStaff.
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(c) Except as set forth in Section 6.2 of the AccuStaff Disclosure
Memorandum, and other than in connection or compliance with the provisions of
the Securities Laws, applicable state corporate and securities Laws, and rules
of the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit
plans, or under the HSR Act, no notice to, filing with, or Consent of, any
public body or authority is necessary for the consummation by AccuStaff of the
Merger and the other transactions contemplated in this Agreement.
6.3 CAPITAL STOCK.
-------------
(a) The authorized capital stock of AccuStaff consists of (i) 150,000,000
shares of AccuStaff Common Stock, of which 65,663,634 shares are issued and
outstanding as of the date of this Agreement, and (ii) 10,000,000 shares of
preferred stock, par value $.01 per share, none of which are issued and
outstanding. All of the issued and outstanding shares of AccuStaff Capital
Stock are, and all of the shares of AccuStaff Common Stock to be issued in
exchange for shares of Career Common Stock upon consummation of the Merger,
when issued in accordance with the terms of this Agreement, will be, duly and
validly issued and outstanding and fully paid and nonassessable under the
FBCA. None of the outstanding shares of AccuStaff Capital Stock has been, and
none of the shares of AccuStaff Common Stock to be issued in exchange for
shares of Career Common Stock upon consummation of the Merger will be, issued
in violation of any preemptive rights of the current or past shareholders of
AccuStaff.
(b) Except as set forth in Section 6.3(a), or as disclosed in Section 6.3 of
the AccuStaff Disclosure Memorandum, as of the date of this Agreement, there
are no shares of capital stock or other equity securities of AccuStaff
outstanding and no outstanding Rights created by AccuStaff or any AccuStaff
Company relating to the capital stock of AccuStaff.
6.4 SEC FILINGS; FINANCIAL STATEMENTS.
---------------------------------
(a) AccuStaff has timely filed and made available to Career all SEC
Documents required to be filed by AccuStaff since December 31, 1992 (the
"AccuStaff SEC Reports"). The AccuStaff SEC Reports (i) at the time filed,
complied or will comply in all material respects with the applicable
requirements of the Securities Laws and other applicable Laws and (ii) did
not, at the time they were filed (or, if amended or superseded by a filing
prior to the date of this Agreement, then on the date of such filing) contain
any untrue statement of a material fact or omit to state a material fact
required to be stated in such AccuStaff SEC Reports or necessary in order to
make the statements in such AccuStaff SEC Reports, in light of the
circumstances under which they were made, not misleading; provided, that any
pro forma financial statements contained in the AccuStaff SEC Reports are not
necessarily indicative of the consolidated financial position of the AccuStaff
Companies as of the respective dates thereof and the consolidated results of
operations and cash flows of the AccuStaff Companies for the periods
indicated. No AccuStaff Subsidiary is required to file any SEC Documents.
(b) Each of the AccuStaff Financial Statements (including, in each case, any
related notes) contained in the AccuStaff SEC Reports, including any AccuStaff
SEC Reports filed after the date of this Agreement until the Effective Time,
complied as to form in all material respects with the applicable published
rules and regulations of the SEC with respect thereto, was prepared in
accordance with GAAP (except to the extent required by changes in generally
accepted accounting principles, as may be indicated in the notes to such
financial statements or, in the case of unaudited interim statements, as
permitted by Form 10-Q of the SEC), and fairly presented in all material
respects the consolidated financial position of AccuStaff and its Subsidiaries
as at the respective dates and the consolidated results of operations and cash
flows for the periods indicated, except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which were not or are not expected to be material in amount or effect and that
any pro forma financial statements contained in the AccuStaff SEC Reports are
not necessarily indicative of the consolidated financial position of the
AccuStaff Companies as of the respective dates thereof and the consolidated
results of operations and cash flows of the AccuStaff Companies for the
periods indicated.
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6.5 ABSENCE OF UNDISCLOSED LIABILITIES. No AccuStaff Company has any
----------------------------------
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on AccuStaff, except Liabilities which
are accrued or reserved against in the consolidated balance sheets of
AccuStaff as of December 31, 1995 and June 30, 1996, included in the AccuStaff
Financial Statements delivered prior to the date of this Agreement or
reflected in the notes thereto. No AccuStaff Company has incurred or paid any
Liability since June 30, 1996, except for such Liabilities incurred or paid
(i) in the ordinary course of business consistent with past business practice
or (ii) in connection with the transactions contemplated by this Agreement.
6.6 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since June 30, 1996, except as
------------------------------------
disclosed in the AccuStaff Financial Statements delivered prior to the date of
this Agreement or as disclosed in Section 6.6 of the AccuStaff Disclosure
Memorandum, (i) there have been no events, changes or occurrences which have
had, or are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on AccuStaff, and (ii) the AccuStaff Companies have
not taken any action, or failed to take any action, prior to the date of this
Agreement, which action or failure, if taken after the date of this Agreement,
would represent or result in a material breach or violation of any of the
covenants and agreements of AccuStaff provided in Article 7.
6.7 TAX MATTERS.
-----------
(a) All Tax Returns required to be filed by or on behalf of any of the
AccuStaff Companies have been timely filed or requests for extensions have
been timely filed, granted, and have not expired, and all such Tax Returns
filed are complete and accurate in all material respects. All Taxes shown on
filed Tax Returns have been paid. As of the date of this Agreement, there is
no audit examination, deficiency, or refund Litigation with respect to any
Taxes, except as disclosed in Section 6.7 of the AccuStaff Disclosure
Memorandum. All Taxes and other Liabilities due with respect to completed and
settled examinations or concluded Litigation have been paid. There are no
Liens with respect to Taxes upon any of the Assets of the AccuStaff Companies,
except for any such Lien which is not reasonably likely to have a Material
Adverse Effect on AccuStaff.
(b) None of the AccuStaff Companies has executed an extension or waiver of
any statute of limitations on the assessment or collection of any Tax due
(excluding such statutes that relate to years currently under examination by
the Internal Revenue Service or other applicable taxing authorities) that is
currently in effect.
(c) The provision for any Taxes due or to become due for any of the
AccuStaff Companies for the period or periods through and including the date
of the respective AccuStaff Financial Statements that has been made and is
reflected on such AccuStaff Financial Statements is sufficient to cover all
such Taxes, except for any insufficiency of such provision which is not
reasonably likely to have a Material Adverse Effect on AccuStaff.
(d) Each of the AccuStaff Companies is in compliance with, and its records
contain all information and documents (including properly completed IRS Forms
W-9) necessary to comply with, all applicable information reporting and Tax
withholding requirements under federal, state and local Tax Laws, and such
records identify with specificity all accounts subject to backup withholding
under Section 3406 of the Internal Revenue Code, except for any such instance
of noncompliance or failure to so identify which is not reasonably likely to
have a Material Adverse Effect on Career.
6.8 INTELLECTUAL PROPERTY. Except as disclosed in Section 6.8 of the
---------------------
AccuStaff Disclosure Memorandum, (i) each AccuStaff Company owns or has a
license to use all of the Intellectual Property used by such AccuStaff Company
in the course of its business, (ii) each AccuStaff Company is the owner of or
has a license to any Intellectual Property sold or licensed to a third party
by such AccuStaff Company in connection with such AccuStaff Company's business
operations, and such AccuStaff Company has the right to convey by sale or
license any Intellectual Property so conveyed, (iii) no AccuStaff Company is
in Default under any of its Intellectual Property licenses and (iv) no
proceedings have been instituted, or are pending or to the Knowledge of
AccuStaff threatened, which challenge the rights of any AccuStaff Company with
respect to Intellectual Property used, sold or licensed by such AccuStaff
Company in the course of its business, nor has any person claimed or alleged
any rights to such Intellectual Property, except for any failure to own or
license, Default or
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proceeding which is not reasonably likely to have a Material Adverse Effect on
AccuStaff. To the Knowledge of AccuStaff, the conduct of the business of the
AccuStaff Companies does not infringe any Intellectual Property of any other
Person.
6.9 ENVIRONMENTAL MATTERS.
---------------------
(a) Each of the AccuStaff Companies is in compliance with all Environmental
Laws and has obtained all necessary Permits required to be issued pursuant to
any Environmental Law, except where the failure to so comply or to obtain such
Permits, individually or in the aggregate, is not reasonably likely to have a
Material Adverse Effect on AccuStaff. None of the AccuStaff Companies has
received notice or communication from any Regulatory Authority with respect to
(i) any Hazardous Material relative to its operations, property or acts or
(ii) any investigation, demand or request pursuant to enforcing any
Environmental Law relating to it or its operations, and no such investigation
is pending or threatened in any case which is reasonably likely to have a
Material Adverse Effect on AccuStaff.
(b) During the period of (i) any AccuStaff Company's ownership or operation
of any of their respective current properties, (ii) any AccuStaff Company's
participation in the management of any Participation Facility, or (iii) any
AccuStaff Company's holding of a security interest in an Operating Property,
there have been no releases, discharges, spillages, or disposals of Hazardous
Material in, on, under, adjacent to, or affecting (or potentially affecting)
such properties, except for any such release, discharge, spillage, or disposal
which is not reasonably likely to have a Material Adverse Effect on Career.
Prior to the period of (i) any AccuStaff Company's ownership or operation of
any of their respective current properties, (ii) any AccuStaff Company's
participation in the management of any Participation Facility, or (iii) any
AccuStaff Company's holding of a security interest in an Operating Property,
to the Knowledge of AccuStaff, there were no releases, discharges, spillages,
or disposals of Hazardous Material in, on, under, or affecting any such
property, Participation Facility or Operating Property, except for any such
release, discharge, spillage, or disposal which is not reasonably likely to
have a Material Adverse Effect on Career.
6.10 COMPLIANCE WITH LAWS. Each AccuStaff Company has in effect all Permits
--------------------
necessary for it to own, lease or operate its material Assets and to carry on
its business as now conducted, except where the failure to so hold any such
Permit is not reasonably likely to have a Material Adverse Effect on
AccuStaff, and there has occurred no Default under any such Permit, except for
any such Default which is not reasonably likely to have a Material Adverse
Effect on AccuStaff. Except as disclosed in Section 6.10 of the AccuStaff
Disclosure Memorandum, none of the AccuStaff Companies:
(a) is in Default under its Articles of Incorporation or Bylaws (or other
governing instruments); or
(b) is in Default under any Laws, Orders or Permits applicable to its
business or employees conducting its business, except for any such Default
which is not reasonably likely to have a Material Adverse Effect on
AccuStaff; or
(c) since January 1, 1993, has received any notification or communication
from any agency or department of federal, state, or local government or any
Regulatory Authority or the staff thereof (i) asserting that any AccuStaff
Company is not in compliance with any of the Laws or Orders which such
governmental authority or Regulatory Authority enforces, where any such
noncompliance is reasonably likely to have a Material Adverse Effect on
AccuStaff, (ii) threatening to revoke any Permits, where any such
revocation is reasonably likely to have a Material Adverse Effect on
AccuStaff, or (iii) requiring any AccuStaff Company to enter into or
consent to the issuance of a cease and desist order, formal agreement,
directive, commitment or memorandum of understanding, or to adopt any Board
resolution or similar undertaking, which restricts materially the conduct
of its business, except for any such order, agreement, directive,
commitment, memorandum, resolution or undertaking which is not reasonably
likely to have a Material Adverse Effect on AccuStaff.
6.11 LABOR RELATIONS. Except as disclosed in Section 6.11 of the AccuStaff
---------------
Disclosure Memorandum, no AccuStaff Company is the subject of any Litigation
asserting that it or any other AccuStaff Company has
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committed an unfair labor practice (within the meaning of the National Labor
Relations Act or comparable state law) or seeking to compel it or any other
AccuStaff Company to bargain with any labor organization as to wages or
conditions of employment, nor is any AccuStaff Company party to any collective
bargaining agreement, nor is there any strike or other labor dispute involving
any AccuStaff Company, pending or threatened, or to the Knowledge of
AccuStaff, is there any activity involving any AccuStaff Company's employees
seeking to certify a collective bargaining unit or engaging in any other
organization activity.
6.12 EMPLOYEE BENEFIT PLANS.
----------------------
(a) AccuStaff has delivered or made or will make available to Career copies
of all pension, retirement, profit-sharing, deferred compensation, stock
option, employee stock ownership, severance pay, vacation, bonus, or other
incentive plan, all other written employee programs, arrangements, or
agreements, all medical, vision, dental, or other health plans, all life
insurance plans, and all other employee benefit plans or fringe benefit plans,
including "employee benefit plans" as that term is defined in Section 3(3) of
ERISA, currently adopted, maintained by, sponsored in whole or in part by, or
contributed to by any AccuStaff Company or ERISA Affiliate of an AccuStaff
Company for the benefit of employees, retirees, dependents, spouses,
directors, independent contractors, or other beneficiaries and under which
employees, retirees, dependents, spouses, directors, independent contractors,
or other beneficiaries are eligible to participate (collectively, the
"AccuStaff Benefit Plans"). Any of the AccuStaff Benefit Plans which is an
"employee pension benefit plan," as that term is defined in Section 3(2) of
ERISA, is referred to herein as a "AccuStaff ERISA Plan." No AccuStaff ERISA
Plan is, and no AccuStaff Company has or has ever had any obligation to
contribute to or to provide security for, a "defined benefit plan" (as defined
in Section 414(j) of the Internal Revenue Code) or a multiemployer plan within
the meaning of Section 3(37) of ERISA.
(b) All AccuStaff Benefit Plans are in compliance with the applicable terms
of ERISA, the Internal Revenue Code, and any other applicable Laws, the breach
or violation of which are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on AccuStaff. Except as disclosed in
Section 6.12 of the AccuStaff Disclosure Memorandum, each AccuStaff ERISA Plan
which is intended to be qualified under Section 401(a) of the Internal Revenue
Code has received a favorable determination letter from the Internal Revenue
Service, and AccuStaff is not aware of any circumstances likely to result in
revocation of any such favorable determination letter. No AccuStaff Company
has engaged in a transaction with respect to any AccuStaff Benefit Plan that,
assuming the taxable period of such transaction expired as of the date hereof,
would subject any AccuStaff Company to a Tax imposed by either Section 4975 of
the Internal Revenue Code or Section 502(i) of ERISA.
6.13 LEGAL PROCEEDINGS. Except as set forth in Section 6.13 of the AccuStaff
-----------------
Disclosure Memorandum, there is no Litigation instituted or pending, or, to
the Knowledge of AccuStaff, threatened against any AccuStaff Company, or
against any director, employee or employee benefit plan of any AccuStaff
Company, or against any Asset, interest, or right of any of them, that is
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on AccuStaff, nor are there any Orders of any Regulatory
Authorities, other governmental authorities, or arbitrators outstanding
against any AccuStaff Company, except any such Orders for which the failure to
comply is not reasonably likely to have a Material Adverse Effect on
AccuStaff.
6.14 REPORTS. Since January 1, 1993, or the date of organization if later,
-------
each AccuStaff Company has filed all reports and statements, together with any
amendments required to be made with respect thereto, that it was required to
file with Regulatory Authorities (except failures to file which are not
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on AccuStaff). As of their respective dates, each of such
reports and documents, including the financial statements, exhibits, and
schedules thereto, complied in all respects with all applicable Laws, except
where the failure to comply is not reasonably likely to have a Material
Adverse Effect on AccuStaff. As of its respective date, each such report and
document did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading, except for untrue statements or omissions which are not
reasonably likely to have a Material Adverse Effect on AccuStaff.
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<PAGE>
6.15 STATEMENTS TRUE AND CORRECT. No statement, certificate, instrument or
---------------------------
other writing furnished or to be furnished by any AccuStaff Company to Career
pursuant to this Agreement or any other document, agreement or instrument
referred to herein contains or will contain any untrue statement of material
fact or will omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. None of the information supplied or to be supplied in writing by
any AccuStaff Company for inclusion in the Registration Statement to be filed
by AccuStaff with the SEC, will, when the Registration Statement becomes
effective, be false or misleading with respect to any material fact, or omit
to state any material fact necessary to make the statements therein not
misleading. None of the information supplied or to be supplied in writing by
any AccuStaff Company for inclusion in the Joint Proxy Statement to be mailed
to each Party's shareholders in connection with the Shareholders' Meetings,
and any other documents to be filed by any AccuStaff Company with the SEC or
any other Regulatory Authority in connection with the transactions
contemplated hereby, will, at the respective time such documents are filed,
and with respect to the Joint Proxy Statement, when first mailed to the
shareholders of Career and AccuStaff, be false or misleading with respect to
any material fact, or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Joint Proxy Statement or any amendment
thereof or supplement thereto, at the time of the Shareholders' Meetings, be
false or misleading with respect to any material fact, or omit to state any
material fact necessary to correct any statement in any earlier communication
with respect to the solicitation of any proxy for the Shareholders' Meetings.
All documents that any AccuStaff Company is responsible for filing with any
Regulatory Authority in connection with the transactions contemplated hereby
will comply as to form in all material respects with the provisions of
applicable Law.
6.16 AUTHORITY OF SUB. Sub is a corporation duly organized, validly existing
----------------
and in good standing under the Laws of the State of Delaware as a wholly owned
Subsidiary of AccuStaff. The authorized capital stock of Sub shall consist of
1,000 shares of Sub Common Stock, all of which is validly issued and
outstanding, fully paid and nonassessable and is owned by AccuStaff free and
clear of any Lien. Sub has the corporate power and authority necessary to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
Sub. This Agreement represents a legal, valid, and binding obligation of Sub,
enforceable against Sub in accordance with its terms (except in all cases as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding may be brought).
AccuStaff, as the sole shareholder of Sub, has voted prior to the Effective
Time the shares of Sub Common Stock in favor of adoption of this Agreement, as
and to the extent required by applicable Law.
6.17 ACCOUNTING, TAX AND REGULATORY MATTERS. No AccuStaff Company or, to
--------------------------------------
AccuStaff's Knowledge, any Affiliate thereof has taken or agreed to take any
action and AccuStaff does not have any Knowledge of any fact or circumstance
that is reasonably likely to (i) prevent the Merger from qualifying for
pooling-of-interests accounting treatment or as a reorganization within the
meaning of Section 368(a) of the Internal Revenue Code, or (ii) materially
impede or delay receipt of any Consents of Regulatory Authorities referred to
in Section 9.1(b) or result in the imposition of a condition or restriction of
the type referred to in the last sentence of such Section.
ARTICLE 7
CONDUCT OF BUSINESS PENDING CONSUMMATION
----------------------------------------
7.1 AFFIRMATIVE COVENANTS OF CAREER. From the date of this Agreement until
-------------------------------
the earlier of the Effective Time or the termination of this Agreement, unless
the prior written consent of AccuStaff shall have been obtained, and except as
otherwise expressly contemplated herein, Career shall and shall cause each of
its
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Subsidiaries to (a) operate its business only in the usual, regular, and
ordinary course, (b) preserve intact its business organization and Assets and
maintain its rights and franchises, and (c) take no action which would (i)
materially adversely affect the ability of any Party to obtain any Consents
required for the transactions contemplated hereby without imposition of a
condition or restriction of the type referred to in the last sentence of
Section 9.1(b), or (ii) materially adversely affect the ability of any Party
to perform its covenants and agreements under this Agreement.
7.2 NEGATIVE COVENANTS OF CAREER. From the date of this Agreement until the
----------------------------
earlier of the Effective Time or the termination of this Agreement, unless the
prior written consent of AccuStaff shall have been obtained, and except as
otherwise expressly contemplated herein, Career covenants and agrees that it
will not do or agree or commit to do, or permit any of its Subsidiaries to do
or agree or commit to do, any of the following:
(a) amend the Articles or Certificate of Incorporation, Bylaws or other
governing instruments of any Career Company, or
(b) incur any additional debt obligation or other obligation for borrowed
money (other than indebtedness of a Career Company to another Career
Company) in excess of an aggregate of $500,000 (for the Career Companies on
a consolidated basis) except in the ordinary course of the business of
Career Subsidiaries consistent with past practice, or impose, or suffer the
imposition, on any Asset of any Career Company of any Lien or permit any
such Lien to exist (other than in connection with Liens in effect as of the
date hereof that are disclosed in the Career Disclosure Memorandum); or
(c) repurchase, redeem, or otherwise acquire or exchange (other than
exchanges in the ordinary course under employee benefit plans), directly or
indirectly, any shares, or any securities convertible into any shares, of
the capital stock of any Career Company, or declare or pay any dividend or
make any other distribution in respect of Career's capital stock; or
(d) except for this Agreement, or pursuant to the exercise of stock
options outstanding as of the date hereof and pursuant to the terms thereof
in existence on the date hereof, or pursuant to the Stock Option Agreement,
or as disclosed in Section 7.2(d) of the Career Disclosure Memorandum,
issue, sell, pledge, encumber, authorize the issuance of, enter into any
Contract to issue, sell, pledge, encumber, or authorize the issuance of, or
otherwise permit to become outstanding, any additional shares of Career
Common Stock or any other capital stock of any Career Company, or any stock
appreciation rights, or any option, warrant, or other Right; or
(e) adjust, split, combine or reclassify any capital stock of any Career
Company or issue or authorize the issuance of any other securities in
respect of or in substitution for shares of Career Common Stock, or sell,
lease, mortgage or otherwise dispose of or otherwise encumber (x) any
shares of capital stock of any Career Subsidiary (unless any such shares of
stock are sold or otherwise transferred to another Career Company) or (y)
any Asset having a book value in excess of $250,000 other than in the
ordinary course of business consistent with past practice for reasonable
and adequate consideration; or
(f) except for purchases of U.S. Treasury securities or U.S. Government
agency securities, which in either case have maturities of three years or
less, purchase any securities or make any material investment, either by
purchase of stock of securities, contributions to capital, Asset transfers,
or purchase of any Assets, in any Person other than a wholly owned Career
Subsidiary, or otherwise acquire direct or indirect control over any
Person, other than in connection with (i) foreclosures in the ordinary
course of business, (ii) the creation of new wholly owned Subsidiaries
organized to conduct or continue activities otherwise permitted by this
Agreement, or (iii) investments in connection with cash management
activities consistent with past practices; or
(g) grant any increase in compensation or benefits to the employees or
officers of any Career Company, except in the ordinary course of business
and consistent with past practice disclosed in Section 7.2(g) of the Career
Disclosure Memorandum or as required by Law; pay any severance or
termination pay or any bonus other than pursuant to written policies or
written Contracts in effect on the date of this Agreement and disclosed in
Section 7.2(g) of the Career Disclosure Memorandum; and enter into or amend
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<PAGE>
any severance agreements with officers of any Career Company; grant any
material increase in fees or other increases in compensation or other
benefits to directors of any Career Company except in accordance with past
practice disclosed in Section 7.2(g) of the Career Disclosure Memorandum;
or voluntarily accelerate the vesting of any stock options or other stock-
based compensation or employee benefits or other Rights; or
(h) enter into or amend any employment Contract between any Career
Company and any Person (if such employment Contract is, or if such
employment Contract had been entered into or amended prior to the date of
this Agreement, such employment Contract (as amended) would be, a Career
Contract) (unless such amendment is required by Law) that the Career
Company does not have the unconditional right to terminate without
Liability (other than Liability for services already rendered), at any time
on or after the Effective Time; or
(i) adopt any new employee benefit plan of any Career Company or
terminate or withdraw from, or make any material change in or to, any
existing employee benefit plans of any Career Company other than any such
change that is required by Law or that, in the opinion of counsel, is
necessary or advisable to maintain the tax qualified status of any such
plan, or make any distributions from such employee benefit plans, except as
required by Law, the terms of such plans or consistent with past practice;
or
(j) make any significant change in any Tax or accounting methods or
systems of internal accounting controls, except as may be appropriate to
conform to changes in Tax Laws or regulatory accounting requirements or
GAAP; or
(k) except as disclosed in Section 7.2(k) of the Career Disclosure
Memorandum, commence any Litigation other than in accordance with past
practice, settle any Litigation involving any Liability of any Career
Company for material money damages or restrictions upon the operations of
any Career Company; or
(l) except in the ordinary course of business, modify, amend or terminate
any Career Contract or waive, release, compromise or assign any material
rights or claims.
7.3 COVENANTS OF ACCUSTAFF. From the date of this Agreement until the
----------------------
earlier of the Effective Time or the termination of this Agreement, unless the
prior written consent of Career shall have been obtained, and except as
otherwise expressly contemplated herein, AccuStaff covenants and agrees that
it shall (a) continue to conduct its business and the business of its
Subsidiaries in a manner designed in its reasonable judgment, to enhance the
long-term value of the AccuStaff Common Stock and the business prospects of
the AccuStaff Companies and to the extent consistent therewith use all
reasonable efforts to preserve intact the AccuStaff Companies' core businesses
and goodwill with their respective employees and the communities they serve,
and (b) take no action which would (i) materially adversely affect the ability
of any Party to obtain any Consents required for the transactions contemplated
hereby without imposition of a condition or restriction of the type referred
to in the last sentence of Section 9.1(b), or (ii) materially adversely affect
the ability of any Party to perform its covenants and agreements under this
Agreement; provided, that the foregoing shall not prevent any AccuStaff
Company from acquiring any Assets or other businesses or from discontinuing or
disposing of any of its Assets or business if such action is, in the judgment
of AccuStaff, desirable in the conduct of the business of AccuStaff and its
Subsidiaries. AccuStaff further covenants and agrees that it will not, without
the prior written consent of Career, (i) amend the Articles of Incorporation
or Bylaws of AccuStaff, in each case in any manner adverse to the holders of
Career Common Stock as compared to rights of holders of AccuStaff Common Stock
generally as of the date of this Agreement, or (ii) during any period used to
determine the Average Closing Price, repurchase, redeem, or otherwise acquire
or exchange (other than exchanges in the ordinary course under employee
benefit plans), directly or indirectly, any shares, or any securities
convertible into any shares, of AccuStaff Common Stock. AccuStaff further
covenants and agrees that it will not acquire direct or indirect control over
any Person where the consideration for such acquisition consists of AccuStaff
Common Stock having an aggregate market value as of the date of public
announcement of such acquisition of $300 million or more without the prior
written consent of the chief executive officer of Career, which consent shall
not be unreasonably withheld (provided that such consent shall be deemed to be
unreasonably withheld if such acquisition, in the good faith judgment of the
chief executive officer of AccuStaff when publicly announced, will be
accretive to AccuStaff's earnings per share in the first full year after
consummation of such acquisition.
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<PAGE>
7.4 ADVERSE CHANGES IN CONDITION. Each Party agrees to give written notice
----------------------------
promptly to the other Party upon becoming aware of the occurrence or impending
occurrence of any event or circumstance relating to it or any of its
Subsidiaries which (i) is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on it or (ii) would cause or constitute a
material breach of any of its representations, warranties, or covenants
contained herein, and to use all reasonable efforts to prevent or promptly to
remedy the same.
7.5 REPORTS. Each Party and its Subsidiaries shall file all reports required
-------
to be filed by it with Regulatory Authorities between the date of this
Agreement and the Effective Time and shall deliver to the other Party copies
of all such reports promptly after the same are filed. If financial statements
are contained in any such reports filed with the SEC, such financial
statements will fairly present the consolidated financial position of the
entity filing such statements as of the dates indicated and the consolidated
results of operations, changes in shareholders' equity, and cash flows for the
periods then ended in accordance with GAAP (subject in the case of interim
financial statements to normal recurring year-end adjustments that are not
material). As of their respective dates, such reports filed with the SEC will
comply in all material respects with the Securities Laws and will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Any financial statements contained in any other reports to another
Regulatory Authority shall be prepared in accordance with Laws applicable to
such reports.
ARTICLE 8
ADDITIONAL AGREEMENTS
---------------------
8.1 REGISTRATION STATEMENT; PROXY STATEMENT; SHAREHOLDER APPROVAL. AccuStaff
-------------------------------------------------------------
shall prepare and file the Registration Statement with the SEC, and shall use
all reasonable efforts to cause the Registration Statement to become effective
under the 1933 Act and take any action required to be taken under the
applicable state Blue Sky or securities Laws in connection with the issuance
of the shares of AccuStaff Common Stock upon consummation of the Merger.
Career shall cooperate in the preparation and filing of the Registration
Statement and shall furnish all information concerning it and the holders of
its capital stock as AccuStaff may reasonably request in connection with such
action. Career shall call a Shareholders' Meeting, to be held as soon as
reasonably practicable after the Registration Statement is declared effective
by the SEC in accordance with the rules of the NYSE, for the purpose of voting
upon adoption of this Agreement and such other related matters as it deems
appropriate. AccuStaff shall call a Shareholders' Meeting, to be held as soon
as reasonably practicable after the Registration Statement is declared
effective by the SEC, for the purpose of voting upon the issuance of shares of
AccuStaff Common Stock pursuant to the Merger and such other related matters
as it deems appropriate. The Parties shall use all reasonable efforts to cause
the Shareholders' Meetings to be held on the same day, unless the Parties
otherwise agree. In connection with the Shareholders' Meetings, (i) Career and
AccuStaff shall prepare and file with the SEC a Joint Proxy Statement and mail
such Joint Proxy Statement to their respective shareholders, (ii) the Parties
shall furnish to each other all information concerning them that they may
reasonably request in connection with such Joint Proxy Statement, (iii) the
Board of Directors of Career and AccuStaff shall recommend to their respective
shareholders the approval of the matters submitted for approval (subject to
the Board of Directors of Career, after having consulted with and considered
the advice of outside counsel, reasonably determining in good faith that the
making of such recommendation, or the failure to withdraw or modify its
recommendation, would not constitute a breach of fiduciary duties of the
members of such Board of Directors to Career's shareholders under applicable
law), and (iv) the Board of Directors and officers of Career and AccuStaff
shall use all reasonable efforts to obtain such shareholders' approval
(subject to the Board of Directors of Career, after having consulted with and
considered the advice of outside counsel, reasonably determining in good faith
that the taking of such actions would not constitute a breach of fiduciary
duties of the members of such Board of Directors to Career's shareholders
under applicable law). AccuStaff and Career shall make all necessary filings
with respect to the Merger under the Securities Laws.
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<PAGE>
8.2 EXCHANGE LISTING. AccuStaff shall take all action required to list,
----------------
prior to the Effective Time, on the Nasdaq National Market the shares of
AccuStaff Common Stock to be issued to the holders of Career Common Stock
pursuant to the Merger, and AccuStaff shall give all notices and make all
filings with the NASD required in connection with the transactions
contemplated herein.
8.3 APPLICATIONS; ANTITRUST NOTIFICATION. AccuStaff shall prepare and file,
------------------------------------
and Career shall cooperate in the preparation and, where appropriate, filing
of, applications with all Regulatory Authorities having jurisdiction over the
transactions contemplated by this Agreement seeking the requisite Consents
necessary to consummate the transactions contemplated by this Agreement. To
the extent required by the HSR Act, each of the Parties will promptly file
with the United States Federal Trade Commission and the United States
Department of Justice the notification and report form required for the
transactions contemplated hereby and any supplemental or additional
information which may reasonably be requested in connection therewith pursuant
to the HSR Act and will comply in all material respects with the requirements
of the HSR Act. The Parties shall deliver to each other copies of all filings,
correspondence and orders to and from all Regulatory Authorities in connection
with the transactions contemplated hereby.
8.4 FILINGS WITH STATE OFFICES. Upon the terms and subject to the conditions
--------------------------
of this Agreement, Career shall execute and file the Certificate of Merger
with the Secretary of State of the State of Delaware in connection with the
Closing.
8.5 AGREEMENT AS TO EFFORTS TO CONSUMMATE. Subject to the terms and
-------------------------------------
conditions of this Agreement, each Party agrees to use, and to cause its
Subsidiaries to use, all reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things necessary, proper, or
advisable under applicable Laws to consummate and make effective, as soon as
reasonably practicable after the date of this Agreement, the transactions
contemplated by this Agreement, including using all reasonable efforts to lift
or rescind any Order adversely affecting its ability to consummate the
transactions contemplated herein and to cause to be satisfied the conditions
referred to in Article 9; provided, that nothing herein shall preclude either
Party from exercising its rights under this Agreement. Without limiting the
generality of the foregoing, each Party agrees to use all reasonable efforts
to cause the Effective Time to occur not later than the second business day
following the last to occur of (i) the effective date (including expiration of
any applicable waiting period) of the last required Consent of any Regulatory
Authority having authority over and approving or exempting the Merger, and
(ii) the date on which the shareholders of Career and AccuStaff approve this
Agreement to the extent such approval is required by applicable Law or the
rules of the NYSE or NASD. Each Party shall use, and shall cause each of its
Subsidiaries to use, all reasonable efforts to obtain all Consents necessary
or desirable for the consummation of the transactions contemplated by this
Agreement.
8.6 INVESTIGATION AND CONFIDENTIALITY.
---------------------------------
(a) Prior to the Effective Time, each Party shall keep the other Party
advised of all material developments relevant to its business and to
consummation of the Merger and shall permit the other Party to make or cause
to be made such investigation of the business and properties of it and its
Subsidiaries and of their respective financial and legal conditions as the
other Party reasonably requests, provided that such investigation shall be on
reasonable notice during normal business hours and reasonably related to the
transactions contemplated hereby and shall not interfere unnecessarily with
normal operations. No investigation by a Party shall affect the
representations and warranties of the other Party contained herein.
(b) Each Party shall, and shall cause its advisers and agents to, maintain
the confidentiality of all confidential information furnished to it by the
other Party concerning its and its Subsidiaries' businesses, operations, and
financial positions and shall not use such information for any purpose except
in furtherance of the transactions contemplated by this Agreement. If this
Agreement is terminated prior to the Effective Time, each Party shall promptly
return or certify the destruction of all documents and copies thereof, and all
work papers containing confidential information received from the other Party.
All documents and information furnished pursuant to this Section 8.6 shall be
subject to the Confidentiality Agreement dated August 13, 1996, between the
Parties.
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(c) Career shall use all reasonable efforts to exercise its rights under
confidentiality agreements entered into with Persons which were considering an
Acquisition Proposal with respect to Career to preserve the confidentiality of
the information relating to the Career Companies provided to such Persons and
their Affiliates and Representatives.
8.7 PRESS RELEASES. Prior to the Effective Time, Career and AccuStaff shall
--------------
consult with each other as to the form and substance of any press release or
other public disclosure materially related to this Agreement or any other
transaction contemplated hereby; provided, that nothing in this Section 8.7
shall be deemed to prohibit any Party from making any disclosure which its
counsel deems necessary or advisable in order to satisfy such Party's
disclosure obligations imposed by Law.
8.8 CERTAIN ACTIONS. Except with respect to this Agreement and the
---------------
transactions contemplated hereby, no Career Company nor any Affiliate thereof
nor any Representatives thereof retained by any Career Company shall directly
or indirectly solicit any Acquisition Proposal by any Person. Except to the
extent the Board of Directors of Career, after having consulted with and
considered the advice of outside counsel, reasonably determines in good faith
that the failure to take such actions would constitute a breach of fiduciary
duties of the members of such Board of Directors to Career's shareholder under
applicable law, no Career Company or any Affiliate or Representative thereof
shall furnish any non-public information that it is not legally obligated to
furnish, negotiate with respect to, or enter into any Contract with respect
to, any Acquisition Proposal, but Career may communicate information about
such an Acquisition Proposal to its shareholders (including any statement
required pursuant to Rule 14e-2 of the 1934 Act) if and to the extent that it
is required to do so in order to comply with its legal obligations as advised
by outside counsel. Career shall notify AccuStaff orally as promptly as
practicable and in writing within 24 hours following the receipt of any
Acquisition Proposal and the details thereof, and advise AccuStaff of any
developments with respect to such Acquisition Proposal promptly upon the
occurrence thereof. Career shall (i) immediately cease and cause to be
terminated any existing activities, discussions or negotiations with any
Persons conducted heretofore with respect to any of the foregoing, and
(ii) direct and use all reasonable efforts to cause all of its Affiliates and
Representatives not to engage in any of the foregoing.
8.9 ACCOUNTING AND TAX TREATMENT. Each of the Parties undertakes and agrees
----------------------------
to use all reasonable efforts to cause the Merger, and to take no action which
would cause the Merger not, to qualify for treatment as a pooling of interests
for accounting purposes or as a "reorganization" within the meaning of Section
368(a) of the Internal Revenue Code for federal income tax purposes.
8.10 AGREEMENT OF AFFILIATES. Career has disclosed in Section 8.10 of the
-----------------------
Career Disclosure Memorandum all Persons whom it reasonably believes is an
"affiliate" of Career for purposes of Rule 145 under the 1933 Act. Career
shall use all reasonable efforts to cause each such Person to deliver to
AccuStaff not later than 30 days after the date of this Agreement, a written
agreement, substantially in the form of Exhibit 1. AccuStaff shall not be
required to maintain the effectiveness of the Registration Statement under the
1933 Act for the purposes of resale of AccuStaff Common Stock by such
affiliates.
8.11 EMPLOYEE BENEFITS AND CONTRACTS. Following the Effective Time,
-------------------------------
AccuStaff shall provide generally to officers and employees of the Career
Companies employee benefits under employee benefit and welfare plans (other
than stock option or other plans involving the potential issuance of AccuStaff
Common Stock), on terms and conditions which when taken as a whole are
substantially similar to those currently provided by the AccuStaff Companies
to their similarly situated officers and employees; provided, that, except to
the extent required by Law, AccuStaff shall, or shall cause the Career
Companies to, provide to officers and employees of the Career Companies
employee benefits under the existing medical and dental plans of the Career
Companies for a period of not less than six months following the Effective
Time. For purposes of participation, vesting and (except in the case of
AccuStaff retirement plans) benefit accrual under AccuStaff's employee benefit
plans, the service of the employees of the Career Companies prior to the
Effective Time shall be treated as service with an AccuStaff Company
participating in such employee benefit plans. AccuStaff also shall cause the
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Surviving Corporation and its Subsidiaries to honor in accordance with their
terms all employment, severance, consulting and other compensation Contracts
disclosed in Section 8.11 of the Career Disclosure Memorandum to AccuStaff
between any Career Company and any current or former director, officer, or
employee thereof, and all provisions for vested benefits or other vested
amounts earned or accrued through the Effective Time under the Career Benefit
Plans.
8.12 INDEMNIFICATION.
---------------
(a) AccuStaff shall, and shall cause the Surviving Corporation to,
indemnify, defend and hold harmless the present and former directors,
officers, employees and agents of the Career Companies (each, an "Indemnified
Party") against all Liabilities, losses, damages, claims or expenses
(including attorneys' fees or expenses), judgments or amounts paid in
settlement arising out of actions or omissions that are in whole or in part
based upon or arise out of the Indemnified Party's service or services as
directors, officers, employees or agents of any of the Career Companies or, at
Career's request, of another corporation, partnership, joint venture, trust or
other enterprise occurring at or prior to the Effective Time (including the
transactions contemplated by this Agreement) to the fullest extent permitted
under Delaware Law and by Career's Certificate of Incorporation and Bylaws as
in effect on the date hereof, including provisions relating to advances of
expenses incurred in the defense of any Litigation and whether or not any
AccuStaff Company is insured against any such matter. Without limiting the
foregoing, in any case in which approval by the Surviving Corporation is
required to effectuate any indemnification (including any advancement of
expenses), the Surviving Corporation shall direct, at the election of the
Indemnified Party, that the determination of any such approval shall be made
by independent counsel mutually agreed upon between AccuStaff and the
Indemnified Party.
(b) AccuStaff shall, or shall cause the Surviving Corporation to, use all
reasonable efforts (and Career shall cooperate prior to the Effective Time in
these efforts) to maintain in effect for a period of six years after the
Effective Time Career's existing directors' and officers' liability insurance
policy (provided that AccuStaff may substitute therefor (i) policies of at
least the same coverage and amounts containing terms and conditions which are
substantially no less advantageous or (ii) with the consent of Career given
prior to the Effective Time, any other policy) with respect to claims arising
from facts or events which occurred prior to the Effective Time and covering
persons who are currently covered by such insurance; provided, that neither
AccuStaff nor the Surviving Corporation shall be obligated to make aggregate
premium payments for such six-year period in respect of such policy (or
coverage replacing such policy) which exceed, for the portion related to
Career's directors and officers, 300% of the last annual premium payment on
Career's current policy in effect as of the date of this Agreement (the
"Maximum Amount"). If the amount of the premiums necessary to maintain or
procure such insurance coverage exceeds the Maximum Amount, AccuStaff shall
use all reasonable efforts to maintain the most advantageous policies of
directors' and officers' liability insurance obtainable for a premium equal to
the Maximum Amount.
(c) Any Indemnified Party wishing to claim indemnification under paragraph
(a) of this Section 8.12, upon learning of any such Liability or Litigation,
shall promptly notify AccuStaff thereof, provided that the failure of any
Indemnified Party so to notify shall not relieve AccuStaff or the Surviving
Corporation from any Liability it may have under this Section 8.12 except to
the extent that such failure substantially prejudiced AccuStaff or the
Surviving Corporation. In the event of any such Litigation (whether arising
before or after the Effective Time), (i) AccuStaff or the Surviving
Corporation shall have the right to assume the defense thereof and neither
AccuStaff nor the Surviving Corporation shall be liable to such Indemnified
Parties for any legal expenses of other counsel or any other expenses
subsequently incurred by such Indemnified Parties in connection with the
defense thereof, except that if AccuStaff or the Surviving Corporation elects
not to assume such defense or counsel for the Indemnified Parties advises that
there are substantive issues which raise conflicts of interest between
AccuStaff or the Surviving Corporation and the Indemnified Parties, the
Indemnified Parties may retain counsel satisfactory to them, and AccuStaff or
the Surviving Corporation shall pay all reasonable fees and expenses of such
counsel for the Indemnified Parties promptly as statements therefor are
received; provided, that AccuStaff and the Surviving Corporation shall be
obligated pursuant to this paragraph (c) to pay for only one
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firm of counsel for all Indemnified Parties in any jurisdiction, unless such
Indemnified Parties shall have been advised in writing by counsel that there
exist conflicts of interests among such Indemnified Parties that preclude one
firm of counsel from representing the interests of all such Indemnified
Parties, (ii) AccuStaff, the Surviving Corporation and the Indemnified Parties
will cooperate in the defense of any such Litigation, and (iii) neither
AccuStaff nor the Surviving Corporation shall be liable for any settlement
effected without its prior written consent, which consent shall not be
unreasonably withheld; and provided further that neither AccuStaff nor the
Surviving Corporation shall have any obligation hereunder to any Indemnified
Party when and if a court of competent jurisdiction shall determine, and such
determination shall have become final, that the indemnification of such
Indemnified Party in the manner contemplated hereby is prohibited by
applicable Law.
(d) If AccuStaff or the Surviving Corporation or any successors or assigns
shall consolidate with or merge into any other Person and shall not be the
continuing or surviving Person of such consolidation or merger or shall
transfer all or substantially all of its assets to any Person, then and in
each case, proper provision shall be made so that the successors and assigns
of AccuStaff or the Surviving Corporation shall assume the obligations set
forth in this Section 8.12.
(e) The provisions of this Section 8.12 shall survive the Effective Time and
are intended expressly to be for the benefit of each of the Indemnified
Parties.
8.13 AGREEMENT REGARDING CERTAIN ACQUISITIONS. If, prior to the earlier of
----------------------------------------
the Effective Time or the date of termination of this Agreement, Career
presents to AccuStaff a Qualifying Acquisition Proposal identified by Career
that AccuStaff fails to approve within a reasonable period of time following
presentation and the opportunity for AccuStaff to conduct a reasonable due
diligence investigation of the business subject to the Qualifying Acquisition
Proposal, AccuStaff agrees that through the end of the 12-month period
following the termination of this Agreement, none of the AccuStaff Companies
shall acquire such business, whether by way of merger, share exchange or
acquisition of all or substantially all of the stock or assets of such
business.
ARTICLE 9
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
-------------------------------------------------
9.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective obligations of
---------------------------------------
each Party to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by both Parties pursuant to Section 11.6:
(a) SHAREHOLDER APPROVAL. The shareholders of Career shall have adopted
--------------------
this Agreement as and to the extent required by Law, by the provisions of
any governing instruments, or by the rules of the NYSE. The shareholders of
AccuStaff shall have approved the issuance of shares of AccuStaff Common
Stock pursuant to the Merger, as and to the extent required by Law, by the
provisions of any governing instruments, or by the rules of the NASD.
(b) REGULATORY APPROVALS. All Consents of, filings and registrations
--------------------
with, and notifications to, all Regulatory Authorities required for
consummation of the Merger (other than Consents and filing, registration
and notice requirements (i) which are set forth in Section 5.2(c) of the
Career Disclosure Memorandum or (ii) which, if not obtained, made or
complied with, are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on either Party, which the Parties
agree are at the sole risk of AccuStaff ("Excluded Consents")) shall have
been obtained or made and shall be in full force and effect and all waiting
periods required by the HSR Act or by any other Law the failure to comply
with which is reasonably likely to have a Material Adverse Effect on either
Party shall have expired. No Consent obtained from any Regulatory Authority
(other than Excluded Consents) which is necessary to consummate the
transactions contemplated hereby shall be conditioned or restricted in a
manner (including requirements relating to the raising of additional
capital or the disposition of Assets) which in the reasonable judgment of
the Board of Directors of AccuStaff would so materially adversely impact
the economic or
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business benefits of the transactions contemplated by this Agreement that,
had such condition or requirement been known, such Party would not, in its
reasonable judgment, have entered into this Agreement.
(c) LEGAL PROCEEDINGS. No court or governmental or regulatory authority
-----------------
of competent jurisdiction shall have enacted, issued, promulgated, enforced
or entered any Law (other than Laws requiring the obtaining of Excluded
Consents) or Order (whether temporary, preliminary or permanent) or taken
any other action which prohibits, restricts (other than restrictions
imposed upon or relating to the business or operations of Career that are
the subject of the Excluded Consents) or makes illegal consummation of the
transactions contemplated by this Agreement.
(d) REGISTRATION STATEMENT. The Registration Statement shall be effective
----------------------
under the 1933 Act, no stop orders suspending the effectiveness of the
Registration Statement shall have been issued, no action, suit, proceeding
or investigation by the SEC to suspend the effectiveness thereof shall have
been initiated and be continuing, and all necessary approvals under state
securities Laws or the 1933 Act or 1934 Act relating to the issuance or
trading of the shares of AccuStaff Common Stock issuable pursuant to the
Merger shall have been received.
(e) EXCHANGE LISTING. The shares of AccuStaff Common Stock issuable
----------------
pursuant to the Merger shall have been approved for listing on the Nasdaq
National Market.
(f) TAX MATTERS. Each Party shall have received a written opinion of
-----------
counsel from Alston & Bird, in form reasonably satisfactory to such Parties
(the "Tax Opinion"), to the effect that (i) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, (ii) the exchange in the Merger of Career Common Stock for AccuStaff
Common Stock will not give rise to gain or loss to the shareholders of
Career with respect to such exchange (except to the extent of any cash
received), (iii) none of Career, Sub or AccuStaff will recognize gain or
loss as a consequence of the Merger (except for amounts resulting from any
required change in accounting methods and any income and deferred gain
recognized pursuant to Treasury regulations issued under Section 1502 of
the Internal Revenue Code), (iv) the aggregate tax basis of the AccuStaff
Common Stock received by a holder of Career Common Stock pursuant to the
Merger will be the same as the aggregate tax basis of the Career Common
Stock surrendered in exchange therefor (reduced by any amount allocable to
a fractional share interest for which cash is received), (v) the holding
period of the AccuStaff Common Stock received by a holder of Career Common
Stock pursuant to the Merger will include the holding period of the Career
Common Stock surrendered in exchange therefor, provided that the Career
Common Stock is held as a capital asset at the Effective Time, and (vi) the
assumption by AccuStaff of Career Options that are "incentive stock
options" will not constitute a modification, extension or renewal of such
options, within the meaning of Section 424(h) of the Internal Revenue Code.
In rendering such Tax Opinion, such counsel shall be entitled to rely upon
representations of officers of Career and AccuStaff reasonably satisfactory
in form and substance to such counsel.
(g) POOLING LETTERS. AccuStaff and Career shall have received letters,
---------------
dated as of the date of filing of the Registration Statement with the SEC
and as of the Effective Time, addressed to AccuStaff and Career, in form
and substance reasonably acceptable to AccuStaff and Career, from Coopers &
Lybrand, L.L.P. to the effect that the Merger will qualify for pooling-of-
interests accounting treatment.
9.2 CONDITIONS TO OBLIGATIONS OF ACCUSTAFF. The obligations of AccuStaff to
--------------------------------------
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following
conditions, unless waived by AccuStaff pursuant to Section 11.6(a):
(a) REPRESENTATIONS AND WARRANTIES. For purposes of this Section 9.2(a),
------------------------------
the accuracy of the representations and warranties of Career set forth in
this Agreement shall be assessed as of the date of this Agreement and as of
the Effective Time with the same effect as though all such representations
and warranties had been made on and as of the Effective Time (provided that
representations and warranties which are confined to a specified date shall
speak only as of such date). The representations and warranties set forth
in Section 5.3 shall be true and correct (except for inaccuracies which are
de minimis in amount). The representations and warranties set forth in
Sections 5.20, 5.21, 5.22 and 5.23 shall be true and correct
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in all material respects. There shall not exist inaccuracies in the
representations and warranties of Career set forth in this Agreement
(including the representations and warranties set forth in Sections 5.3,
5.20, 5.21, 5.22 and 5.23) such that the aggregate effect of such
inaccuracies has, or is reasonably likely to have, a Material Adverse
Effect on Career; provided that, for purposes of this sentence only, those
representations and warranties which are qualified by references to
"material" or "Material Adverse Effect" or to the "Knowledge" of any Person
shall be deemed not to include such qualifications.
(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of the
---------------------------------------
agreements and covenants of Career to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied
with in all material respects.
(c) CERTIFICATES. Career shall have delivered to AccuStaff (i) a
------------
certificate, dated as of the Effective Time and signed on its behalf by its
chief executive officer and its chief financial officer, to the effect that
the conditions set forth in Section 9.1 as relates to Career and in
Sections 9.2(a) and 9.2(b) have been satisfied, and (ii) certified copies
of resolutions duly adopted by Career's Board of Directors and shareholders
evidencing the taking of all corporate action necessary to authorize the
execution, delivery and performance of this Agreement, and the consummation
of the transactions contemplated hereby, all in such reasonable detail as
AccuStaff and its counsel shall request.
(d) ACCOUNTANT'S LETTERS. AccuStaff shall have received from Coopers &
--------------------
Lybrand, L.L.P. letters dated not more than five days prior to (i) the date
of the Joint Proxy Statement and (ii) the Effective Time, with respect to
certain financial information regarding Career, in form and substance
reasonably satisfactory to AccuStaff, which letters shall be based upon
customary specified procedures undertaken by such firm in accordance with
Statement of Auditing Standard No. 72.
(e) AFFILIATES AGREEMENTS. AccuStaff shall have received from each
---------------------
affiliate of Career the affiliates letter referred to in Section 8.10, to
the extent necessary to assure in the reasonable judgment of AccuStaff that
the transactions contemplated hereby will qualify for pooling-of-interests
accounting treatment.
9.3 CONDITIONS TO OBLIGATIONS OF CAREER. The obligations of Career to
-----------------------------------
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following
conditions, unless waived by Career pursuant to Section 11.6(b):
(a) REPRESENTATIONS AND WARRANTIES. For purposes of this Section 9.3(a),
------------------------------
the accuracy of the representations and warranties of AccuStaff set forth
in this Agreement shall be assessed as of the date of this Agreement and as
of the Effective Time with the same effect as though all such
representations and warranties had been made on and as of the Effective
Time (provided that representations and warranties which are confined to a
specified date shall speak only as of such date). The representations and
warranties of AccuStaff set forth in Section 6.3 shall be true and correct
(except for inaccuracies which are de minimis in amount). The
representations and warranties of AccuStaff set forth in Section 6.17 shall
be true and correct in all material respects. There shall not exist
inaccuracies in the representations and warranties of AccuStaff set forth
in this Agreement (including the representations and warranties set forth
in Sections 6.3 and 6.17) such that the aggregate effect of such
inaccuracies has, or is reasonably likely to have, a Material Adverse
Effect on AccuStaff; provided that, for purposes of this sentence only,
those representations and warranties which are qualified by references to
"material" or "Material Adverse Effect" or to the "Knowledge" of any Person
shall be deemed not to include such qualifications.
(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of the
---------------------------------------
agreements and covenants of AccuStaff to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied
with in all material respects.
(c) CERTIFICATES. AccuStaff shall have delivered to Career (i) a
------------
certificate, dated as of the Effective Time and signed on its behalf by its
chief executive officer and its chief financial officer, to the effect that
the conditions set forth in Section 9.1 as relates to AccuStaff and in
Sections 9.3(a) and 9.3(b) have been
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satisfied, and (ii) certified copies of resolutions duly adopted by
AccuStaff's Board of Directors and shareholders and Sub's Board of
Directors and sole shareholder evidencing the taking of all corporate
action necessary to authorize the execution, delivery and performance of
this Agreement, and the consummation of the transactions contemplated
hereby, all in such reasonable detail as Career and its counsel shall
request.
(d) ACCOUNTANT'S LETTERS. Career shall have received from Coopers &
Lybrand, L.L.P. letters dated not more than five days prior to (i) the date
of the Joint Proxy Statement and (ii) the Effective Time, with respect to
certain financial information regarding AccuStaff, in form and substance
reasonably satisfactory to Career, which letters shall be based upon
customary specified procedures undertaken by such firm in accordance with
Statement of Auditing Standard No. 72.
ARTICLE 10
TERMINATION
10.1 TERMINATION. Notwithstanding any other provision of this Agreement, and
-----------
notwithstanding the approval of this Agreement by the shareholders of Career
and AccuStaff or both, this Agreement may be terminated and the Merger
abandoned at any time prior to the Effective Time:
(a) By mutual consent of AccuStaff and Career; or
(b) By either Party (provided that the terminating Party is not then in
material breach of any representation, warranty, covenant, or other
agreement contained in this Agreement) in the event of a material breach by
the other Party of any representation or warranty contained in this
Agreement which cannot be or has not been cured within 15 days after the
giving of written notice to the breaching Party of such breach and which
breach is reasonably likely, in the opinion of the non-breaching Party, to
have, individually or in the aggregate, a Material Adverse Effect on the
breaching Party; or
(c) By either Party (provided that the terminating Party is not then in
material breach of any representation, warranty, covenant, or other
agreement contained in this Agreement) in the event of a material breach by
the other Party of any covenant or agreement contained in this Agreement
which cannot be or has not been cured within 15 days after the giving of
written notice to the breaching Party of such breach; or
(d) By either Party (provided that the terminating Party is not then in
material breach of any representation, warranty, covenant, or other
agreement contained in this Agreement) in the event (i) any Consent of any
Regulatory Authority required for consummation of the Merger (other than
Excluded Consents) and the other transactions contemplated hereby shall
have been denied by final nonappealable action of such authority or if any
action taken by such authority is not appealed within the time limit for
appeal, or (ii) the shareholders of Career or AccuStaff fail to approve by
the required vote the matters relating to this Agreement and the
transactions contemplated hereby at the Shareholders' Meetings where such
matters were presented to such shareholders for approval and voted upon; or
(e) By either Party in the event that the Merger shall not have been
consummated by December 31, 1996, if the failure to consummate the
transactions contemplated hereby on or before such date is not caused by
any breach of this Agreement by the Party electing to terminate pursuant to
this Section 10.1(e); or
(f) By either Party (provided that the terminating Party is not then in
material breach of any representation, warranty, covenant, or other
agreement contained in this Agreement) in the event that any of the
conditions precedent to the obligations of such Party to consummate the
Merger cannot be satisfied or fulfilled by the date specified in Section
10.1(e); or
(g) By Career, if prior to the adoption of this Agreement by an
affirmative vote of the holders of a majority of the outstanding shares of
Career Common Stock entitled to vote thereon at the Career Shareholders
Meeting, the Board of Directors of Career has (x) withdrawn or modified or
changed its recommendation or approval of this Agreement in a manner
adverse to AccuStaff in order to approve and permit Career to accept an
Acquisition Proposal, and (y) determined, based on the advice of outside
legal
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counsel to Career, that the failure to take such action as set forth in the
preceding clause (x) would result in breach of the Board of Directors'
fiduciary duties under applicable Law; provided, however, that (A) the
Board of Directors of Career shall have been advised by such outside
counsel that notwithstanding this Agreement, and notwithstanding any
concessions which may be offered by AccuStaff in negotiations entered into
pursuant to clause (B) below, such fiduciary duties would also require the
directors to terminate this Agreement as a result of such Acquisition
Proposal, (B) at least two business days prior to any such termination,
Career shall, and shall cause its advisors to, negotiate with AccuStaff to
make such adjustments in the terms and conditions of this Agreement as
would enable Career to proceed with the transactions contemplated herein on
such adjusted terms, and (C) Career shall have tendered to AccuStaff
payment in full of the amount specified in Section 11.2(d) concurrently
with delivery of notice of termination pursuant to this Section 10.1(g).
10.2 EFFECT OF TERMINATION. In the event of the termination and abandonment
---------------------
of this Agreement pursuant to Section 10.1, this Agreement shall become void
and have no effect, except that (i) the provisions of this Section 10.2 and
Article 11 and Section 8.6(b) shall survive any such termination and
abandonment, and (ii) the Parties shall be entitled to the remedies set forth
in Section 11.2.
10.3 NON-SURVIVAL OF REPRESENTATIONS AND COVENANTS. The respective
---------------------------------------------
representations, warranties, obligations, covenants, and agreements of the
Parties shall not survive the Effective Time except this Section 10.3 and
Articles 1, 2, 3, 4 and 11 and Sections 8.10, 8.11 and 8.12.
ARTICLE 11
MISCELLANEOUS
11.1 DEFINITIONS.
-----------
(a) Except as otherwise provided herein, the capitalized terms set forth
below shall have the following meanings:
"1933 ACT" shall mean the Securities Act of 1933, as amended.
"1934 ACT" shall mean the Securities Exchange Act of 1934, as amended.
"ACQUISITION PROPOSAL" shall mean any proposal for an Acquisition
Transaction (including any tender offer or exchange offer that, if
successful, would constitute or result in an Acquisition Transaction),
other than the transactions contemplated by this Agreement.
"ACQUISITION TRANSACTION" shall mean (A) a merger, consolidation or
similar transaction involving Career or any Career Subsidiaries, the Assets
of which constitute 25% or more of the consolidated assets of the Career
Companies (other than transactions solely between Career Companies), (B)
except as permitted pursuant to Section 7.1, the disposition, by sale,
lease, exchange or otherwise, of Assets of Career or any of its
Subsidiaries representing in either case 25% or more of the consolidated
assets of the Career Companies or (C) the issuance, sale or other
disposition (including by way of merger, consolidation, share exchange,
tender offer, exchange offer or any similar transaction) by any Career
Company or any other Persons of securities representing 25% or more of the
voting power of Career (including any securities previously acquired).
"AFFILIATE" of a Person shall mean: (i) any other Person directly, or
indirectly through one or more intermediaries, controlling, controlled by
or under common control with such Person; (ii) any officer, director,
partner, employer, or direct or indirect beneficial owner of any 10% or
greater equity or voting interest of such Person; or (iii) any other Person
for which a Person described in clause (ii) acts in any such capacity.
"AGREEMENT" shall mean this Agreement and Plan of Merger, including the
Exhibits delivered pursuant hereto and incorporated herein by reference.
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"ASSETS" of a Person shall mean all of the assets, properties, businesses
and rights of such Person of every kind, nature, character and description,
whether real, personal or mixed, tangible or intangible, accrued or
contingent, or otherwise relating to or utilized in such Person's business,
directly or indirectly, in whole or in part, whether or not carried on the
books and records of such Person, and whether or not owned in the name of
such Person or any Affiliate of such Person and wherever located.
"AVERAGE CLOSING PRICE" shall mean the average of the daily last sale
prices for the shares of AccuStaff Common Stock for the twenty (20)
consecutive trading days on which such shares are actually traded and
quoted on the Nasdaq National Market (as reported by The Wall Street
Journal or, if not reported thereby, any other authoritative source
mutually selected by AccuStaff and Career) ending at the close of trading
on the second trading day immediately preceding the Closing Date.
"ACCUSTAFF COMMON STOCK" shall mean the $.01 par value common stock of
AccuStaff.
"ACCUSTAFF COMPANIES" shall mean, collectively, AccuStaff and all
AccuStaff Subsidiaries.
"ACCUSTAFF DISCLOSURE MEMORANDUM" shall mean the written information
entitled "AccuStaff Incorporated Disclosure Memorandum" delivered prior to
the date of this Agreement to Career describing in reasonable detail the
matters contained therein and, with respect to each disclosure made
therein, specifically referencing each Section of this Agreement under
which such disclosure is being made. Information disclosed with respect to
one Section shall not be deemed to be disclosed for purposes of any other
Section not specifically referenced with respect thereto.
"ACCUSTAFF FINANCIAL STATEMENTS" shall mean (i) the consolidated balance
sheets (including related notes and schedules, if any) of AccuStaff as of
June 30, 1996, and as of December 31, 1995 and January 1, 1995, and the
related statements of income, stockholders' equity, and cash flows
(including related notes and schedules, if any) for the six months ended
June 30, 1996, and for each of the three fiscal years ended December 31,
1995, January 1, 1995 and January 1, 1994, as filed by AccuStaff in SEC
Documents, and (ii) the consolidated balance sheets of AccuStaff (including
related notes and schedules, if any) and related statements of income,
stockholders' equity, and cash flows (including related notes and
schedules, if any) included in SEC Documents filed with respect to periods
ended subsequent to June 30, 1996.
"ACCUSTAFF SUBSIDIARIES" shall mean the Subsidiaries of AccuStaff.
"CERTIFICATE OF MERGER" shall mean the Certificate of Merger to be
executed by Career and filed with the Secretary of State of the State of
Delaware relating to the Merger as contemplated by Section 1.1.
"CLOSING DATE" shall mean the date on which the Closing occurs.
"CONSENT" shall mean any consent, approval, authorization, clearance,
exemption, waiver, or similar affirmation by any Person pursuant to any
Contract, Law, Order, or Permit.
"CONTRACT" shall mean any written or oral agreement, arrangement,
authorization, commitment, contract, indenture, instrument, lease,
obligation, plan, practice, restriction, understanding, or undertaking of
any kind or character, or other document to which any Person is a party or
that is binding on any Person or its capital stock, Assets or business.
"DEFAULT" shall mean (i) any breach or violation of or default under any
Contract, Law, Order, or Permit, (ii) any occurrence of any event that with
the passage of time or the giving of notice or both would constitute a
breach or violation of or default under any Contract, Law, Order, or
Permit, or (iii) any occurrence of any event that with or without the
passage of time or the giving of notice would give rise to a right to
terminate or revoke, change the current terms of, or renegotiate, or to
accelerate, increase, or impose any Liability under, any Contract, Law,
Order, or Permit.
"DGCL" shall mean the Delaware General Corporation Law.
"ENVIRONMENTAL LAWS" shall mean all Laws relating to pollution or
protection of human health or the environment (including ambient air,
surface water, ground water, land surface, or subsurface strata) and which
are administered, interpreted, or enforced by the United States
Environmental Protection Agency and state and local agencies with
jurisdiction over, and including common law in respect of, pollution or
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<PAGE>
protection of the environment, including the Comprehensive Environmental
Response Compensation and Liability Act, as amended, 42 U.S.C. 9601 et seq.
("CERCLA"), the Resource Conservation and Recovery Act, as amended, 42
U.S.C. 6901 et seq. ("RCRA"), and other Laws relating to emissions,
discharges, releases, or threatened releases of any Hazardous Material, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of any Hazardous
Material.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"EXHIBIT" shall mean the Exhibit so marked, a copy of which is attached
to this Agreement. Such Exhibit is hereby incorporated by reference herein
and made a part hereof, and may be referred to in this Agreement and any
other related instrument or document without being attached hereto.
"FBCA" shall mean the Florida Business Corporation Act.
"GAAP" shall mean generally accepted accounting principles, consistently
applied during the periods involved.
"GOVERNMENT PROGRAM" shall mean Medicare and Medicaid programs under
Titles XVIII and XIX of the federal Social Security Act, as amended, and
other similar federal, state, or local reimbursement or governmental
programs for which an HHA is eligible to receive reimbursement.
"HAZARDOUS MATERIAL" shall mean (i) any hazardous substance, hazardous
material, hazardous waste, regulated substance, or toxic substance (as
those terms are defined by any applicable Environmental Laws) and (ii) any
chemicals, pollutants, contaminants, petroleum, petroleum products, or oil
(and specifically shall include asbestos requiring abatement, removal, or
encapsulation pursuant to the requirements of governmental authorities and
any polychlorinated biphenyls).
"HHA" shall mean any home health agency owned, operated or franchised by
a Career Company.
"HSR ACT" shall mean Section 7A of the Clayton Act, as added by Title II
of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder.
"INTELLECTUAL PROPERTY" shall mean copyrights, patents, trademarks,
service marks, service names, trade names, applications therefor,
technology rights and licenses, computer software (including any source or
object codes therefor or documentation relating thereto), trade secrets,
franchises, know-how, inventions, and other intellectual property rights.
"INTERNAL REVENUE CODE" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
"JOINT PROXY STATEMENT" shall mean the proxy statement used by Career and
AccuStaff to solicit the approval of their respective shareholders of the
transactions contemplated by this Agreement, which shall include the
prospectus of AccuStaff relating to the issuance of the AccuStaff Common
Stock to holders of Career Common Stock.
"KNOWLEDGE" as used with respect to a Person (including references to
such Person being aware of a particular matter) shall mean those facts that
are actually known or should reasonably have been known in the ordinary
course of business taking into account the nature of such Person's
responsibilities by the chairman, president, chief financial officer, chief
accounting officer, general counsel, or any senior, executive or other vice
president of such Person.
"LAW" shall mean any code, law (including common law), ordinance,
regulation, reporting or licensing requirement, rule, or statute applicable
to a Person or its Assets, Liabilities, or business, including those
promulgated, interpreted or enforced by any Regulatory Authority.
"LIABILITY" shall mean any direct or indirect, primary or secondary,
liability, indebtedness, obligation, penalty, cost or expense (including
costs of investigation, collection and defense), claim, deficiency,
guaranty or endorsement of or by any Person (other than endorsements of
notes, bills, checks, and drafts presented for collection or deposit in the
ordinary course of business) of any type, whether accrued, absolute or
contingent, liquidated or unliquidated, matured or unmatured, or otherwise.
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<PAGE>
"LIEN" shall mean any conditional sale agreement, default of title,
easement, encroachment, encumbrance, hypothecation, infringement, lien,
mortgage, pledge, reservation, restriction, security interest, title
retention or other security arrangement, or any adverse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for current property
Taxes not yet due and payable and (ii) Liens which do not materially impair
the use of or title to the Assets subject to such Lien.
"LITIGATION" shall mean any action, arbitration, cause of action, claim,
complaint, criminal prosecution, governmental or other examination or
investigation, hearing, administrative or other proceeding relating to or
affecting a Party, its business, its Assets (including Contracts related to
it), or the transactions contemplated by this Agreement.
"MATERIAL ADVERSE EFFECT" on a Party shall mean an event, change or
occurrence which, individually or together with any other event, change or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of such Party and its Subsidiaries,
taken as a whole, or (ii) the ability of such Party to perform its
obligations under this Agreement or to consummate the Merger or the other
transactions contemplated by this Agreement, provided that "Material
Adverse Effect" shall not be deemed to include the impact of (a) changes in
Laws of general applicability or interpretations thereof by courts or
governmental authorities, (b) changes in generally accepted accounting
principles or regulatory accounting principles, and (c) actions and
omissions of a Party (or any of its Subsidiaries) taken with the prior
informed written Consent of the other Party in accordance with the terms
hereof.
"MATERIAL" for purposes of this Agreement shall be determined in light of
the facts and circumstances of the matter in question; provided that any
specific monetary amount stated in this Agreement shall determine
materiality in that instance.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NASDAQ NATIONAL MARKET" shall mean the National Market System of the
National Association of Securities Dealers Automated Quotations System.
"NYSE" shall mean the New York Stock Exchange, Inc.
"OPERATING PROPERTY" shall mean any property owned, leased, or operated
by the Party in question or by any of its Subsidiaries or in which such
Party or Subsidiary holds a security interest or other interest (including
an interest in a fiduciary capacity), and, where required by the context,
includes the owner or operator of such property, but only with respect to
such property.
"ORDER" shall mean any administrative decision or award, decree,
injunction, judgment, order, quasi-judicial decision or award, ruling, or
writ of any federal, state, local or foreign or other court, arbitrator,
mediator, tribunal, administrative agency, or Regulatory Authority.
"PARTICIPATION FACILITY" shall mean any facility or property in which the
Party in question or any of its Subsidiaries participates in the management
and, where required by the context, said term means the owner or operator
of such facility or property, but only with respect to such facility or
property.
"PARTY" shall mean either Career or AccuStaff, and "PARTIES" shall mean
both Career and AccuStaff.
"PERMIT" shall mean any federal, state, local, and foreign governmental
approval, authorization, certificate, easement, filing, franchise, license,
notice, permit, or right to which any Person is a party or that is or may
be binding upon or inure to the benefit of any Person or its securities,
Assets, or business (and shall include any certification for participation
and reimbursement under any Government Program or Private Program).
"PERSON" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting
in a representative capacity.
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<PAGE>
"PRIVATE PROGRAM" shall mean any private non-governmental programs,
including any private insurance programs, under which any HHA directly or
indirectly is receiving payments.
"QUALIFYING ACQUISITION PROPOSAL" shall mean a bona fide written
acquisition proposal contained in a letter of intent executed by Career and
the authorized representative of a target staffing or related business
providing for an acquisition of such business by Career for cash; provided
that (i) such acquisition can be consummated without funding or other
financial accommodation by AccuStaff, and (ii) based on reasonable
assumptions without taking into account cost savings or other potential
synergies following the acquisition, such acquisition would be accretive on
an earnings per share basis to Career and to AccuStaff (in the case of
AccuStaff on a pro forma combined basis) for the 12-month period following
the acquisition.
"REGISTRATION STATEMENT" shall mean the Registration Statement on Form S-
4, or other appropriate form, including any pre-effective or post-effective
amendments or supplements thereto, filed with the SEC by AccuStaff under
the 1933 Act with respect to the shares of AccuStaff Common Stock to be
issued to the shareholders of Career in connection with the transactions
contemplated by this Agreement.
"REGULATORY AUTHORITIES" shall mean, collectively, the SEC, the NYSE, the
NASD, the Federal Trade Commission, the United States Department of
Justice, and all other federal, state, county, local or other governmental
or regulatory agencies, authorities (including self-regulatory authorities
and Persons administering Government Programs and Private Programs),
instrumentalities, commissions, boards or bodies having jurisdiction over
the Parties and their respective Subsidiaries.
"REPRESENTATIVE" shall mean any investment banker, financial advisor,
attorney, accountant, consultant, or other representative retained or
employed by a Person.
"RIGHTS" shall mean all arrangements, calls, commitments, Contracts,
options, rights to subscribe to, scrip, understandings, warrants, or other
binding obligations or restrictions of any character whatsoever relating
to, or securities or rights convertible into or exchangeable for, shares of
the capital stock of a Person or by which a Person is or may be bound to
issue additional shares of its capital stock or other Rights.
"SEC DOCUMENTS" shall mean all forms, proxy statements, registration
statements, reports, schedules, and other documents filed, or required to
be filed, by a Party or any of its Subsidiaries with any Regulatory
Authority pursuant to the Securities Laws.
"SECURITIES LAWS" shall mean the 1933 Act, the 1934 Act, the Investment
Company Act of 1940, as amended, the Investment Advisors Act of 1940, as
amended, the Trust Indenture Act of 1939, as amended, and the rules and
regulations of any Regulatory Authority promulgated thereunder.
"SHAREHOLDERS' MEETINGS" shall mean the respective meetings of the
shareholders of Career and AccuStaff to be held pursuant to Section 8.1,
including any adjournment or adjournments thereof.
"SUB COMMON STOCK" shall mean the $.01 par value common stock of Sub.
"SUBSIDIARIES" shall mean all those corporations, associations, or other
business entities of which the entity in question either (i) owns or
controls 50% or more of the outstanding equity securities either directly
or through an unbroken chain of entities as to each of which 50% or more of
the outstanding equity securities is owned directly or indirectly by its
parent (provided, there shall not be included any such entity the equity
securities of which are owned or controlled in a fiduciary capacity), (ii)
in the case of a partnership, serves as a general partner, (iii) in the
case of a limited liability company serves as a managing member, or (iv)
otherwise has the ability to elect a majority of the directors or managing
members thereof.
"CAREER COMMON STOCK" shall mean the $.01 par value common stock of
Career.
"CAREER COMPANIES" shall mean, collectively, Career and all Career
Subsidiaries.
"CAREER CONVERTIBLE NOTES" shall mean the 7% Convertible Senior Notes Due
2002 of Career.
"CAREER DISCLOSURE MEMORANDUM" shall mean the written information
entitled "Career Horizons, Inc. Disclosure Memorandum" delivered prior to
the date of this Agreement to AccuStaff describing in reasonable detail the
matters contained therein and, with respect to each disclosure made
therein, specifically
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<PAGE>
referencing each Section of this Agreement under which such disclosure is
being made. Information disclosed with respect to one Section shall not be
deemed to be disclosed for purposes of any other Section not specifically
referenced with respect thereto.
"CAREER FINANCIAL STATEMENTS" shall mean (i) the consolidated balance
sheets (including related notes and schedules, if any) of Career as of June
30, 1996, and as of December 31, 1995, June 30, 1995 and June 30, 1994, and
the related statements of income, changes in stockholders' equity, and cash
flows (including related notes and schedules, if any) for the six months
ended June 30, 1996, the six months ended December 31, 1995, and for each
of the three fiscal years ended June 30, 1995, 1994 and 1993, as filed by
Career in SEC Documents, and (ii) the consolidated balance sheets of Career
(including related notes and schedules, if any) and related statements of
income, changes in stockholders' equity, and cash flows (including related
notes and schedules, if any) included in SEC Documents filed with respect
to periods ended subsequent to June 30, 1996.
"CAREER INDENTURE" shall mean the Indenture, dated as of October 19,
1995, between Career and Chemical Bank, as Trustee, relating to the Career
Convertible Notes.
"CAREER STOCK PLANS" shall mean the existing stock option and other
stock-based compensation plans of Career designated as follows: the 1990
Terminal Value Stock Option Plan, as amended, the 1993 Stock Option and
Performance Award Plan, the Executive Deferred Compensation and Restricted
Stock Plan dated June 1, 1990, as amended, and the Executive Deferred
Compensation Plan.
"CAREER SUBSIDIARIES" shall mean the Subsidiaries of Career, which shall
include the Career Subsidiaries described in Section 5.4 and any
corporation or other organization acquired as a Subsidiary of Career in the
future and held as a Subsidiary by Career at the Effective Time.
"SURVIVING CORPORATION" shall mean Career as the surviving corporation
resulting from the Merger.
"TAX RETURN" shall mean any report, return, information return, or other
information required to be supplied to a taxing authority in connection
with Taxes, including any return of an affiliated or combined or unitary
group that includes a Party or its Subsidiaries.
"TAX" or "TAXES" shall mean any federal, state, county, local, or foreign
taxes, charges, fees, levies, imposts, duties, or other assessments,
including income, gross receipts, excise, employment, sales, use, transfer,
license, payroll, franchise, severance, stamp, occupation, windfall
profits, environmental, federal highway use, commercial rent, customs
duties, capital stock, paid-up capital, profits, withholding, Social
Security, single business and unemployment, disability, real property,
personal property, registration, ad valorem, value added, alternative or
add-on minimum, estimated, or other tax or governmental fee of any kind
whatsoever, imposes or required to be withheld by the United States or any
state, county, local or foreign government or subdivision or agency
thereof, including any interest, penalties, and additions imposed thereon
or with respect thereto.
"TRIGGERING EVENT" shall mean any of the following events subsequent to
the date of this Agreement:
(i) any Person (other than AccuStaff or any Subsidiary thereof) shall
have (A) made, or disclosed an intention to make, a bona fide proposal
to Career or its stockholders to engage in an Acquisition Transaction;
(B) commenced (as such term is defined in Rule 14d-2 under the 1934
Act) or filed a registration statement under the 1933 Act with respect
to a tender offer or exchange offer to purchase any shares of Career
Common Stock such that, upon consummation of such offer, such person
would own or control 25% or more of the then-outstanding shares of
Career Common Stock; or (C) filed, or disclosed an intention to file,
an application or notice, whether in draft or final form, under any
applicable federal or state Law (including a notice filed under the HSR
Act) seeking the Consent to an Acquisition Transaction from any federal
or state governmental or Regulatory Authority or agency; or
(ii) any Person (other than AccuStaff or any AccuStaff Subsidiary)
shall have acquired beneficial ownership (as such term is defined in
Rule 13d-3 promulgated under the 1934 Act) of or the right to acquire
beneficial ownership of, or any "group" (as such term is defined under
the 1934 Act), other
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than a group of which AccuStaff or any of its Subsidiaries is a member,
shall have been formed which beneficially owns or has the right to
acquire beneficial ownership of 20% or more of the then-outstanding
shares of Career Common Stock; or
(iii) Career shall have breached any of the provisions of Section
8.8.
(b) The terms set forth below shall have the meanings ascribed thereto in
the referenced sections:
<TABLE>
<S> <C>
Average Closing Price...................................... Section 3.1(c)
Base Exchange Ratio........................................ Section 3.1(c)
AccuStaff Benefit Plans.................................... Section 6.12
AccuStaff ERISA Plan....................................... Section 6.12
AccuStaff SEC Reports...................................... Section 6.4(a)
Certificates............................................... Section 4.1
Closing.................................................... Section 1.2
Conversion Obligations..................................... Section 3.5(b)
Effective Time............................................. Section 1.3
ERISA Affiliate............................................ Section 5.14(a)
Exchange Agent............................................. Section 4.1
Exchange Ratio............................................. Section 3.1(c)
Fee........................................................ Section 11.2(d)
Lower Threshold Price...................................... Section 3.1(c)
Maximum Amount............................................. Section 8.12
Maximum Exchange Ratio..................................... Section 3.1(c)
Merger..................................................... Section 1.1
Minimum Exchange Ratio..................................... Section 3.1(c)
Payment Event.............................................. Section 11.2(d)
Career Benefit Plans....................................... Section 5.14
Career Contracts........................................... Section 5.15
Career ERISA Plan.......................................... Section 5.14
Career Options............................................. Section 3.5
Career SEC Reports......................................... Section 5.5(a)
Supplemental Indenture..................................... Section 3.5(b)
Takeover Laws.............................................. Section 5.20
Tax Opinion................................................ Section 9.1(f)
Threshold Prices........................................... Section 3.1(c)
Upper Threshold Price...................................... Section 3.1(c)
</TABLE>
(c) Any singular term in this Agreement shall be deemed to include the
plural, and any plural term the singular. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed
followed by the words "without limitation."
11.2 EXPENSES.
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(a) Except as otherwise provided in this Section 11.2, each of the Parties
shall bear and pay all direct costs and expenses incurred by it or on its
behalf in connection with the transactions contemplated hereunder, including
filing, registration and application fees, printing fees, and fees and
expenses of its own financial or other consultants, investment bankers,
accountants, and counsel, except that each of the Parties shall bear and pay
one-half of the filing fees payable in connection with the Registration
Statement and the Joint Proxy Statement and printing costs incurred in
connection with the printing of the Registration Statement and the Joint Proxy
Statement and AccuStaff shall pay the HSR Act filing fee.
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<PAGE>
(b) Notwithstanding the foregoing,
(i) if this Agreement is terminated by AccuStaff pursuant to any of
Sections 10.1(b), 10.1(c), or 10.1(f) (but only on the basis of the failure
of Career to satisfy any of the conditions enumerated in Section 9.2(a) and
(b)), or by either Party pursuant to Section 10.1(d)(ii) (as relates to
approval of Career's shareholders), or
(ii) if the Merger is not consummated as a direct result of the failure
of Career to satisfy any of the conditions set forth in Section 9.2(a) and
(b),
then Career shall promptly (but not later than five business days after
receipt of notice from AccuStaff) pay to AccuStaff an amount equal to all
documented out-of-pocket fees and expenses incurred by AccuStaff (including,
without limitation, fees and expenses payable to investment bankers,
accountants and counsel) arising out of, in connection with or related to the
Merger or the transactions contemplated by this Agreement not to exceed
$2,500,000 in the aggregate, provided, that if such breach was a result of
intentional or willful misconduct or misrepresentation, Career shall pay such
additional amounts as AccuStaff may be entitled to receive at law or in
equity.
(c) Notwithstanding the foregoing,
(i) if this Agreement is terminated by Career pursuant to either of
Sections 10.1(b), 10.1(c), or 10.1(f) (but only on the basis of the failure
of AccuStaff to satisfy any of the conditions enumerated in Section 9.3(a)
and (b)), or by either Party pursuant to Section 10.1(d)(ii) (as relates to
approval of AccuStaff's shareholders), or
(ii) if the Merger is not consummated as a direct result of the failure
of AccuStaff to satisfy any of the conditions set forth in Section 9.3(a)
and (b),
then AccuStaff shall promptly (but not later than five business days after
receipt of notice from Career) pay to Career an amount equal to all documented
out-of-pocket fees and expenses incurred by Career (including, without
limitation, fees and expenses payable to investment bankers, accountants and
counsel) arising out of, in connection with or related to the Merger or the
transactions contemplated by this Agreement not to exceed $2,500,000 in the
aggregate, provided, that if such breach was a result of intentional or
willful misconduct or misrepresentation, AccuStaff shall pay such additional
amounts as Career may be entitled to receive at law or in equity.
(d) In addition to the foregoing, Career agrees to pay AccuStaff, subject to
the terms and conditions of this Section 11.2(d), a fee (the "Fee") of
$30,000,000, upon the occurrence of any of the following events:
(i) upon termination of this Agreement by Career in accordance with the
provisions of Section 10.1(g) (such Fee to be payable as set forth in
Section 10.1(g)); or
(ii) if, during the period beginning of the date of this Agreement and
ending six months after any termination of this Agreement by either Party
pursuant to Section 10.1(d)(ii) (as relates to approval of Career's
shareholders, but only if the Career Board of Directors shall have failed
to recommend, or shall have withdrawn or modified in any manner adverse to
AccuStaff their recommendation, that Career shareholders approve this
Agreement) or by AccuStaff pursuant to Section 10.1(c) or 10.1(f) (but only
on the basis of the failure of Career to satisfy any of the conditions set
forth in Section 9.2(b)) (or ending 12 months following any such
termination, if, prior to such termination, there shall have occurred a
Triggering Event), the Career Board of Directors shall authorize entry into
an agreement with any Person (other than AccuStaff or any AccuStaff
Subsidiary) providing for an Acquisition Transaction or shall recommend
acceptance of, or shall fail to recommend rejection of, a tender offer or
exchange offer that, if successful, would result in an Acquisition
Transaction, or an Acquisition Transaction shall have been consummated
(each, a "Payment Event") (such Fee to be payable by wire transfer of
immediately available funds within five business days following the
occurrence of such Payment Event); provided, that the amount of such Fee
shall be reduced by any amounts previously paid by Career to AccuStaff
pursuant to Section 11.2(b).
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(e) Nothing contained in this Section 11.2 shall constitute or shall be
deemed to constitute liquidated damages for the willful breach by a Party of
the terms of this Agreement; provided, that termination of this Agreement by
Career pursuant to Section 10.1(g) following a Triggering Event shall not
constitute a willful breach of this Agreement.
11.3 BROKERS AND FINDERS. Except for Salomon Brothers Inc as to Career and
-------------------
except for Robert W. Baird & Co. Incorporated as to AccuStaff, each of the
Parties represents and warrants that neither it nor any of its officers,
directors, employees, or Affiliates has employed any broker or finder or
incurred any Liability for any financial advisory fees, investment bankers'
fees, brokerage fees, commissions, or finders' fees in connection with this
Agreement or the transactions contemplated hereby. In the event of a claim by
any broker or finder based upon his or its representing or being retained by
or allegedly representing or being retained by Career or AccuStaff, each of
Career and AccuStaff, as the case may be, agrees to indemnify and hold the
other Party harmless of and from any Liability in respect of any such claim.
11.4 ENTIRE AGREEMENT. Except as otherwise expressly provided herein, this
----------------
Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral. Nothing in this
Agreement expressed or implied, is intended to confer upon any Person, other
than the Parties or their respective successors, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, other than
as provided in Section 8.12.
11.5 AMENDMENTS. To the extent permitted by Law, this Agreement may be
----------
amended by a subsequent writing signed by each of the Parties upon the
approval of each of the Parties, whether before or after shareholder approval
of this Agreement has been obtained; provided, that after any such approval by
the holders of Career Common Stock, there shall be made no amendment that
reduces or modifies in any material respect the consideration to be received
by holders of Career Common Stock; and further provided, that after any such
approval by the holders of AccuStaff Common Stock, the provisions of this
Agreement relating to the manner or basis in which shares of Career Common
Stock will be exchanged for shares of AccuStaff Common Stock shall not be
amended after the Shareholders' Meetings in a manner adverse to the holders of
AccuStaff Common Stock without any requisite approval of the holders of the
issued and outstanding shares of AccuStaff Common Stock entitled to vote
thereon.
11.6 WAIVERS.
-------
(a) Prior to or at the Effective Time, AccuStaff, acting through its Board
of Directors, chief executive officer or other authorized officer, shall have
the right to waive any Default in the performance of any term of this
Agreement by Career, to waive or extend the time for the compliance or
fulfillment by Career of any and all of its obligations under this Agreement,
and to waive any or all of the conditions precedent to the obligations of
AccuStaff under this Agreement, except any condition which, if not satisfied,
would result in the violation of any Law. No such waiver shall be effective
unless in writing signed by a duly authorized officer of AccuStaff.
(b) Prior to or at the Effective Time, Career, by action of its Board of
Directors, to the extent legally allowed, shall have the right to waive any
Default in the performance of any term of this Agreement by AccuStaff, to
waive or extend the time for the compliance or fulfillment by AccuStaff of any
and all of its obligations under this Agreement, and to waive any or all of
the conditions precedent to the obligations of Career under this Agreement. No
such waiver shall be effective unless in writing signed by a duly authorized
officer of Career.
(c) The failure of any Party at any time or times to require performance of
any provision hereof shall in no manner affect the right of such Party at a
later time to enforce the same or any other provision of this Agreement. No
waiver of any condition or of the breach of any term contained in this
Agreement in one or more instances shall be deemed to be or construed as a
further or continuing waiver of such condition or breach or a waiver of any
other condition or of the breach of any other term of this Agreement.
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<PAGE>
11.7 ASSIGNMENT. Except as expressly contemplated hereby, neither this
----------
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any Party hereto (whether by operation of Law or otherwise)
without the prior written consent of the other Party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the Parties and their respective successors and assigns.
11.8 NOTICES. All notices or other communications which are required or
-------
permitted hereunder shall be in writing and sufficient if delivered by hand,
by facsimile transmission (with receipt confirmed), by registered or certified
mail, postage pre-paid, or by courier or overnight carrier, to the persons at
the addresses set forth below (or at such other address as may be provided
hereunder), and shall be deemed to have been delivered as of the date so
delivered:
<TABLE>
<S> <C>
Career: Career Horizons, Inc.
177 Crossways Park Drive
Woodbury, New York 11797
Telecopy Number: (516) 496-3167
Attention: Walter W. Macauley
Copy to Counsel: Reid & Priest LLP
40 West 57th Street
New York, New York 10019-4097
Telecopy Number: (212) 603-2001
Attention: Leonard Gubar
AccuStaff: AccuStaff Incorporated
6440 Atlantic Boulevard
Jacksonville, Florida 32211
Telecopy Number: (904) 725-8513
Attention: Derek E. Dewan
Copy to Counsel: Alston & Bird
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Telecopy Number: (404) 881-7777
Attention: Jeffrey A. Allred
</TABLE>
11.9 GOVERNING LAW. This Agreement shall be governed by and construed in
-------------
accordance with the Laws of the State of Delaware, without regard to any
applicable conflicts of Laws.
11.10 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
11.11 CAPTIONS; ARTICLES AND SECTIONS. The captions contained in this
-------------------------------
Agreement are for reference purposes only and are not part of this Agreement.
Unless otherwise indicated, all references to particular Articles or Sections
shall mean and refer to the referenced Articles and Sections of this
Agreement.
11.12 INTERPRETATIONS. Neither this Agreement nor any uncertainty or
---------------
ambiguity herein shall be construed or resolved against any party, whether
under any rule of construction or otherwise. No party to this Agreement shall
be considered the draftsman. The parties acknowledge and agree that this
Agreement has been reviewed, negotiated, and accepted by all parties and their
attorneys and shall be construed and interpreted according to the ordinary
meaning of the words used so as fairly to accomplish the purposes and
intentions of all parties hereto.
11.13 SEVERABILITY. Any term or provision of this Agreement which is invalid
------------
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
A-44
<PAGE>
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf as of the day and year first above written.
ACCUSTAFF INCORPORATED
By: /s/ Derek E. Dewan
---------------------------------
President
SUNRISE MERGER CORPORATION
By: /s/ Derek E. Dewan
---------------------------------
President
CAREER HORIZONS, INC.
By: /s/ Walter W. Macauley
---------------------------------
President
A-45
<PAGE>
Exhibit 1
to Agreement and
Plan of Merger
FORM OF AFFILIATE AGREEMENT
Gentlemen:
The undersigned is a holder of shares of Common Stock, par value $0.01 per
share ("Career Common Stock"), of Career Horizons, Inc., a Delaware
corporation ("Career"), or may become a holder of shares of Career Common
Stock prior to the effective time of the Merger (as hereinafter defined) upon
exercise of certain options held by the undersigned to purchase shares of
Career Common Stock. As such, the undersigned will be entitled to receive in
connection with the merger (the "Merger") of Sunrise Merger Corporation, a
Delaware corporation and a subsidiary of AccuStaff Incorporated, a Florida
corporation ("AccuStaff"), with and into Career, shares of Common Stock, par
value $.01 per share, of AccuStaff (the "Securities") in exchange for any such
shares of Career Common Stock held by the undersigned prior to the effective
time of the Merger.
The undersigned acknowledges that the undersigned may be deemed an
"affiliate" of Career within the meaning of Rule 145 ("Rule 145") promulgated
under the Securities Act of 1933, as amended (the "Act"), and/or as such term
is used in and for purposes of Accounting Series Releases 130 and 135, and
amended, of the Securities and Exchange Commission (the "Commission"),
although nothing contained herein shall be construed as an admission of such
status.
If in fact the undersigned were an affiliate of Career under the Act, the
undersigned's ability to sell, assign or transfer any Securities received by
the undersigned in exchange for any shares of Career Common Stock pursuant to
the Merger may be restricted unless such transaction is registered under the
Act or an exemption from such registration is available. The undersigned
understands that such exemptions are limited and the undersigned has obtained
advice of counsel as to the nature and conditions of such exemptions,
including instruction with respect to the applicability to the sale of such
Securities of Rules 144 and 145(d) promulgated under the Act.
The undersigned hereby represents to and covenants to AccuStaff that the
undersigned will not sell, assign or transfer any Securities received by the
undersigned in exchange for shares of Common Stock pursuant to the Merger
except (i) pursuant to an effective registration statement under the Act, (ii)
by a transaction in conformity with the volume and other limitations of Rule
145 or Rule 144 under the Act ("Rule 144"), to the extent applicable, or any
other applicable rules promulgated by the Commission or (iii) in a transaction
which, in the opinion of independent counsel reasonably satisfactory to
Career, or as described in a "no-action" or interpretative letter from the
Staff of the Commission, is not required to be registered under the Act.
In the event of a sale of Securities pursuant to Rule 145, or, if
applicable, Rule 144, the undersigned will supply AccuStaff with evidence of
compliance with such Rule, in the form of customary seller's and broker's Rule
145 or, if applicable, Rule 144, representation letters or as AccuStaff may
otherwise reasonably request. The undersigned understands that AccuStaff may
instruct its transfer agent to withhold the transfer of any Securities
disposed of by the undersigned in a manner inconsistent with this letter.
The undersigned acknowledges and agrees that appropriate legends will be
placed on certificates representing Securities received by the undersigned in
the Merger or held by a transferee thereof, which legends will be removed (i)
by delivery of substitute certificates upon receipt of an opinion in form and
substance reasonably satisfactory to AccuStaff to the effect that such legends
are no longer required for the purposes of the Act and the rules and
regulations of the Commission promulgated thereunder or (ii) in the event of a
sale of the Securities which has been registered under the Act.
A-46
<PAGE>
The undersigned further represents to, and covenants with Career and
AccuStaff that the undersigned will not, during the 30 days prior to the
effective time of the Merger sell, transfer or otherwise dispose of, or reduce
any risk relative to, any shares of Common Stock, and the undersigned will not
sell, transfer or otherwise dispose of, or reduce any risk relative to, the
Securities received by the undersigned in the Merger or any other shares of
the capital stock of AccuStaff until after such time as results covering at
least 30 days of operations of AccuStaff (including the combined operations of
Career) have been published by AccuStaff in the form of a quarterly earnings
report, or an annual report on Form 10-K, if such 30 day period includes the
end of AccuStaff's fiscal year, an effective registration statement filed with
the Commission, a report to the Commission on Form 10-K, 10-Q, or 8-K, or any
other public filing or announcement which includes such results of operations.
The undersigned acknowledges that it has carefully reviewed this letter and
understands the requirements hereof and the limitations imposed upon the
distribution, sale, transfer or other disposition of Securities. Nothing
contained herein shall be deemed to limit any registration rights granted to
the undersigned pursuant to or any agreement between the undersigned and
Career or AccuStaff, as the case may be.
Very truly yours,
-------------------------------------
Dated: ________________________, 1996
As an inducement to the above individual to deliver this letter, AccuStaff
agrees that for so long and to the extent necessary to permit such individual
to sell the Securities pursuant to Rule 145 and, to the extent applicable,
Rule 144 under the Act, AccuStaff shall use all reasonable efforts to file, on
a timely basis, all reports and data required to be filed by it with the
Commission pursuant to Section 13 of the Securities and Exchange Act of 1934.
Very truly yours,
ACCUSTAFF INCORPORATED
By: _________________________________
Name:
Title:
A-47
<PAGE>
ANNEX B
OPINION OF SALOMON BROTHERS INC
August 25, 1996
Board of Directors
Career Horizons, Inc.
177 Crossways Park Drive
Woodbury, New York 11797
Members of the Board:
You have requested our opinion as to the fairness, from a financial point of
view, to the holders of common stock, par value $.01 per share ("Company
Common Stock"), of Career Horizons, Inc. (the "Company"), of the consideration
to be received by such holders in connection with the proposed merger (the
"Merger") of the Company with Sunrise Merger Corporation ("Sub"), a wholly
owned subsidiary of AccuStaff Incorporated ("Parent"), pursuant to an
Agreement and Plan of Merger, dated as of August 25, 1996 (the "Merger
Agreement"), among Parent, Sub and the Company. Upon the effectiveness of the
Merger, each issued and outstanding share of Company Common Stock (other than
shares owned by Parent, Sub or any other subsidiary of Parent and shares owned
by the Company or any subsidiary of the Company) will be converted into and
represent the right to receive 1.53, subject to adjustment as described in the
Merger Agreement (the "Exchange Ratio"), shares of common stock, par value
$.01 per share ("Parent Common Stock"), of Parent. We understand that the
Merger will qualify as a tax-free reorganization under the Internal Revenue
Code of 1986, as amended, and that, for accounting purposes, the Merger will
be accounted for as a pooling of interests in accordance with generally
accepted accounting principles as described in Accounting Principles Board
Opinion Number 16.
In connection with rendering our opinion, we have reviewed certain publicly
available information concerning the Company and Parent and certain other
financial information concerning the Company and Parent, including financial
forecasts, that were provided to us by the Company and Parent, respectively.
We have discussed the business operations and financial condition of the
Company and Parent as well as other matters we believe relevant to our
inquiry, including matters relating to the obtaining of regulatory approvals
for the Merger, with certain officers and employees of the Company and Parent,
respectively. We also considered such other information, financial studies,
analyses, investigations and financial, economic and market criteria that we
deemed relevant.
In our review and analysis and in arriving at our opinion, we have assumed
and relied upon the accuracy and completeness of the financial and other
information (including information relating to the obtaining of regulatory
approvals for the Merger) reviewed by us, and we have not assumed any
responsibility for independent verification of such information. With respect
to the financial forecasts of the Company and Parent, we have assumed that
they have been reasonably prepared on bases reflecting the best currently
available estimates and judgments of the respective managements of the Company
or Parent as to the future financial performance of the Company or Parent,
respectively, and we express no opinion with respect to such forecasts or the
assumptions on which they are based. We have not made or obtained or assumed
any responsibility for making or obtaining any independent evaluations or
appraisals of any of the assets (including properties and facilities) or
liabilities of the Company or Parent.
Our opinion is necessarily based upon conditions as they exist and can be
evaluated on the date hereof. Our opinion as expressed below does not imply
any conclusion as to the likely trading range for the Parent Common Stock
following the consummation of the Merger, which may vary depending upon, among
other factors, changes in interest rates, dividend rates, market conditions,
general economic conditions and other factors that generally influence the
price of securities. Our opinion does not address the Company's underlying
business decision to effect the Merger. Our opinion is directed only to the
fairness, from a financial point of view, of the
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<PAGE>
Exchange Ratio to holders of Company Common Stock and does not constitute a
recommendation concerning how holders of Company Common Stock should vote with
respect to the Merger Agreement or the acquisition of the Company. In
rendering our opinion, we have assumed that no restrictions will be imposed by
any regulatory authority that would have a material adverse effect on the
contemplated benefits of the Merger to Parent following the Merger.
We have acted as financial advisor to the Company in connection with the
Merger and will receive a fee for our services, part of which is payable upon
our having completed the work appropriate for the initial delivery of this
fairness opinion and part of which is contingent upon consummation of the
Merger. In the ordinary course of business, we may actively trade the
securities of the Company and Parent for our own account and for the accounts
of customers and, accordingly, may at any time hold a long or short position
in such securities. Also, we have previously rendered certain investment
banking and financial advisory services to the Company and Parent for which we
have received customary compensation.
Based upon and subject to the foregoing, it is our opinion that, as of the
date hereof, the Exchange Ratio is fair to the holders of Company Common Stock
from a financial point of view.
Very truly yours,
SALOMON BROTHERS INC
B-2
<PAGE>
ANNEX C
OPINION OF ROBERT W. BAIRD & CO. INCORPORATED
INVESTMENT BANKING
August 25, 1996
PERSONAL & CONFIDENTIAL
Board of Directors
AccuStaff Incorporated
6440 Atlantic Boulevard
Jacksonville, Florida 32211
Ladies and Gentlemen:
AccuStaff Incorporated (the "Company") proposes to enter into an Agreement
and Plan of Merger (the "Agreement") with Career Horizons, Inc. ("Career") and
Sunrise Merger Corporation, a direct wholly-owned subsidiary of the Company
("Merger Sub"). Pursuant to the Agreement, at the Effective Time (as defined
in the Agreement), Merger Sub will be merged with and into Career (the
"Merger") and each outstanding share of common stock, par value $.01 per share
("Career Common Stock"), of Career (other than shares held by the Company,
Career or any of their respective subsidiaries) will be converted solely into,
the right to receive the number of shares of common stock, par value $.01 per
share ("Company Common Stock"), of the Company equal to the Exchange Ratio (as
hereinafter defined).
The "Exchange Ratio" means 1.53 shares of Company Common Stock; provided
that in the event the Average Closing Price (as hereinafter defined) is
greater than $31.60 (the "Upper Limit Price"), the Exchange Ratio shall mean
that number of shares of Company Common Stock (rounded to the nearest ten
thousandth of a share) equal to the greater of (x) the quotient of (A) the
product of 1.53 and the Upper Limit Price over (B) the Average Closing Price
and (y) 1.2444; provided further that in the event the Average Closing Price
is less than $21.07 (the "Lower Threshold Price"), the Exchange Ratio shall
mean that number of shares of Company Common Stock (rounded to the nearest ten
thousandth of a share) equal to the lesser of (x) the quotient of (A) the
product of 1.53 and the Lower Threshold Price over (B) the Average Closing
Price and (y) 1.8006. The "Average Closing Price" means the average of the
daily last sales prices of the Company Common Stock for the twenty consecutive
trading days on which such shares are actually traded and quoted on the
National Market System of the National Association of Securities Dealers
Automated Quotation System (as reported by The Wall Street Journal or, if not
reported thereby, any other authoritative source mutually selected by the
Company and Career) ending on the second trading day immediately preceding the
closing date of the Merger.
You have requested our opinion as to the fairness, from a financial point of
view, to the Company of the Exchange Ratio.
Robert W. Baird & Co. Incorporated ("Baird"), as part of its investment
banking business, is engaged in the evaluation of businesses and their
securities in connection with mergers and acquisitions, negotiated
underwritings, competitive biddings, secondary distributions of listed and
unlisted securities, private placements, and valuations for estate, corporate
and other purposes.
In conducting our investigation and analysis and in arriving at our opinion,
we have reviewed such information and taken into account such financial and
economic factors as we have deemed relevant under the circumstances. In that
connection, we have, among other things: (i) reviewed certain internal
information, primarily financial in nature, including projections, concerning
the business and operations of Career furnished to us for purposes of our
analysis, as well as publicly available information including but not limited
to Career's recent filings with the Securities and Exchange Commission (the
"SEC") and equity analyst research reports prepared by various investment
banking firms including Baird; (ii) reviewed certain internal information,
C-1
<PAGE>
primarily financial in nature, including projections, concerning the business
and operations of the Company furnished to us by or on behalf of the Company
for purposes of our analysis, as well as publicly available information
including but not limited to the Company's recent filings with the SEC and
equity analyst research reports prepared by various investment banking firms
including Baird; (iii) reviewed the draft of the Agreement in the form
presented to the Company's Board of Directors on the date hereof; (iv)
compared the historical market prices and trading activity of the Company
Common Stock and the Career Common Stock with those of certain other publicly
traded companies we deemed relevant; (v) compared the financial position and
operating results of the Company and Career with those of other publicly
traded companies we deeded relevant; (vi) reviewed, to the extent publicly
available, the financial terms of certain other business combinations we
deemed relevant; and (vii) reviewed the potential pro forma effects of the
Merger on the Company. We have held discussions with certain members of the
Company's and Career's senior management concerning the Company's and Career's
respective historical and current financial condition and operating results,
as well as the future prospects of the Company and Career, respectively. We
have also considered such other information, financial studies, analysis and
investigations and financial, economic and market criteria which we deeded
relevant for the preparation of this opinion.
In arriving at our opinion, we have assumed and relied upon the accuracy and
completeness of all of the financial and other information provided us by or
on behalf of the Company and Career, or publicly available, and have not
attempted independently to verify any such information. We have also assumed,
with your consent, that (i) the Merger will be accounted for as a pooling of
interests; (ii) all material assets and liabilities (contingent or otherwise,
known or unknown) of the Company and Career are as set forth in the
consolidated financial statements of the Company and Career, respectively; and
(iii) the Merger will be consummated in accordance with the terms of the
Agreement, without any amendment thereto and without waiver by the Company or
Career of any of the conditions to their respective obligations thereunder. We
have assumed that the financial forecasts examined by us were reasonably
prepared on bases reflecting the best available estimates and good faith
judgments of the senior managements of the Company and Career, respectively,
as to future performance of their respective companies. In conducting our
review, we have not made nor obtained an independent evaluation or appraisal
of any of the assets or liabilities (contingent or otherwise) of the Company
or Career nor have we made a physical inspection of the properties or
facilities of the Company or Career. Our opinion necessarily is based upon
economic, monetary and market conditions as they exist and can be evaluated on
the date hereof, and does not predict or take into account any changes which
may occur, or information which may become available, after the date hereof.
Our opinion has been prepared solely for the information of the Company's
Board of Directors, and shall not be used for any other purpose or disclosed
to or relied upon by any other party without the prior written consent of
Baird; provided, however, that this letter may be reproduced in full in the
Proxy Statement/Prospectus to be provided to the Company's stockholders in
connection with the Merger. This opinion does not address the relative merits
of the Merger and any other potential transactions or business strategies
considered by the Company's Board of Directors, and does not constitute a
recommendation to any shareholder of the Company as to how any such
shareholder should vote with respect to the Merger or the related issuance of
Company Common Stock. In addition, we are expressing no opinion as to the
price at which the Company Common Stock will trade at any time. Baird will
receive a fee for rendering this opinion. In the past, we have provided
investment banking services to both the Company and Career, including acting
as (i) co-manager in connection with the Company's 1994 initial public
offering, (ii) co-manager in connection with the Company's 1995 public
offering of Company Common Stock, (iii) lead manager in connection with the
Company's 1996 public offering of the Company Common Stock, (iv) co-manager in
connection with Career's 1994 initial public offering, (v) co-manager in
connection with Career's 1995 public offering of its 7% Convertible Senior
Notes Due 2002 and (vi) co-manager in connection with Career's 1996 public
offering of Career Common Stock. Baird received customary compensation for the
above-mentioned services.
In the ordinary course of our business, we may from time to time trade the
securities of the Company or Career for our own account or the accounts of our
customers and, accordingly, may at any time hold long or short positions in
such securities.
C-2
<PAGE>
Based upon and subject to the foregoing, we are of the opinion that, as of
the date hereof, the Exchange Ratio is fair, from a financial point of view, to
the Company.
Very truly yours,
ROBERT W. BAIRD & CO. INCORPORATED
C-3
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article 10 of the Registrant's Bylaws requires the Registrant to indemnify a
present or former director of the Registrant for liabilities, including legal
expenses, arising by reason of service in such capacity if such person shall
have acted in good faith and in a manner be reasonably believed to be in or
not opposed to the best interests of the corporation, and in any criminal
proceeding if such person had no reasonable cause to believe his conduct was
unlawful. However, under the Florida Business Corporation Act no
indemnification may be made with respect to any matter as to which the actions
of such director shall have been adjudged to constitute (i) a violation of
criminal law unless the individual had reasonable cause to believe his conduct
was lawful or had no reason to believe his conduct was unlawful; (ii) a
transaction from which the individual derived an improper personal benefit;
(iii) a circumstance under which the liability provisions of Section 607.0834
of the Florida Business Corporation Act, which related to unlawful
distribution of company assets, as presently or hereinafter enacted, are
applicable; or (iv) willful misconduct or conscious disregard of the best
interests of the corporation in certain proceedings. Moreover, in the case of
actions brought by or in the right of the corporation, indemnification may be
made if the person acted in good faith, and in a manner that such person
reasonably believed to be in, or not opposed to, the best interests of the
corporation; provided, however, that no indemnification may be made for any
claim, issue or matter as to which such person shall have been adjudged to be
liable, unless, and only to the extent that, the court in which the judgment
was made or another court of competent jurisdiction determines that such
person is entitled to indemnification.
The Registrant has also entered into agreements with each of its current
directors and executive officers pursuant to which it is obligated to
indemnify those persons to the fullest extent authorized by law and to advance
payments to cover defense costs against an unsecured obligation to repay such
advances if it is ultimately determined that the recipient of the advance is
not entitled to indemnification. The indemnification agreements provide that
no indemnification or advancement of expenses shall be made (a) if a final
adjudication establishes that the indemnification actions or omissions were
material to the cause of certain adjudicated and constitute (i) a violation of
criminal law (unless the indemnitee had reasonable cause to believe that his
actions were lawful), (ii) a transaction from which the indemnitee derived an
improper personal benefit, (iii) an unlawful distribution or dividend when the
Florida Business Corporation Act, or (iv) willful misconduct or a conscious
disregard for the joint interests of the Registrant in a derivative or
shareholder action, (b) for liability under Section 16(b) of the Securities
Exchange Act of 1934, as amended, or (c) if a final decision by a court having
jurisdiction in the matter determines that indemnification is not lawful.
In addition, pursuant to the authority of Florida law, the Articles of
Incorporation of the Registrant also eliminates the monetary liability of
directors to the fullest extent permitted under Florida law.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers or persons
controlling the Registrant pursuant to the foregoing provisions, the
Registrant has been informed 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.
II-1
<PAGE>
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
------- -----------------------
<C> <S>
2.1 Agreement and Plan of Merger, dated as of August 25, 1996, by and
among AccuStaff, Career, and Sub (included as Annex A to the Joint
Proxy Statement/Prospectus and incorporated by reference herein).
3.1 Articles of Incorporation, as amended, incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended December
31, 1995. (File No. 0-24484).
3.2 Bylaws, as amended, incorporated by reference to the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1996
(File No. 0-24484).
4.1 See Exhibits 3(a) and 3(b) for provisions of the Articles of
Incorporation and Bylaws of the Registrant defining rights of holders
of Common Stock of the Registrant.
5.1 Opinion of Alston & Bird.*
8.1 Opinion of Alston & Bird.*
11.1 Statement regarding computation of per share earnings (included as
Exhibit 11 to the Registrant's Form 10-Q for the six months ended June
30, 1996, previously filed with the Commission and incorporated by
reference herein).
23.1 Consent of Alston & Bird.*
23.2 Consent of Coopers & Lybrand L.L.P.
23.3 Consent of Coopers & Lybrand L.L.P.
23.4 Consent of Salomon Brothers Inc.
23.5 Consent of Robert W. Baird & Co. Incorporated.
23.6 Consent of Walter W. Macauley.
23.7 Consent of Ernst & Young LLP.
23.8 Consent of KPMG Peat Marwick LLP.
23.9 Consent of McGladrey & Pullen, LLP.
23.10 Consent of Bertram, Vallez, Kaplan and Talbot, LTD.
23.11 Consent of Stadtler, Rosenblum & Saris.
23.12 Consent of Nyhan & Mazza, P.C.
23.13 Consent of BDO Seidman, LLP.
23.14 Consent of Dorfman, Abrams, Music & Co.
23.15 Consent of Levine, Hughes & Mithuen, Inc.
23.16 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.17 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.18 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.19 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.20 Consent of Dennis I. Berner, C.P.A.
23.21 Consent of Beers & Cutler PLLC.
23.22 Consent of Ernst & Young LLP.
23.23 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.24 Consent of Dubois & Bornstein, P.C.
24.1 Powers of Attorney*
99.1 Form of Proxy for holders of AccuStaff Common Stock.*
99.2 Form of Proxy for holders of Career Common Stock.*
99.3 Employment Agreement between AccuStaff Incorporated and Walter W.
Macauley dated as of August 25, 1996.*
</TABLE>
- --------
* Previously filed with the Company's Registration Statement on Form S-4 (Reg.
No. 333-12207) filed September 18, 1996.
(b) Financial Statement Schedules
Schedules are omitted because they are not required or are not applicable,
or the required information is shown in the financial statements or notes
thereto.
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<PAGE>
ITEM 22. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers for sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement 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.
(c) 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 Registrant's Certificate of Incorporation or
Bylaws, 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 Securities Act of 1933 and is, therefor,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment for 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 Securities Act of 1933 and will be
governed by the final adjudication of such issue.
(d) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Items 4, 10(b), 11, or 13 of Form S-4, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through
the date of responding to the request.
(e) The undersigned registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
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<PAGE>
(f) The undersigned Registrant hereby undertakes as follows: that prior to
any public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this registration statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c)
promulgated pursuant to the Securities Act, the issuer undertakes that such
reoffering prospectus will contain the information called for by the
applicable registration form with respect to reofferings by persons who may be
deemed underwriters, in addition to the information called for by the other
items of the applicable form.
(g) The Registrant undertakes that every prospectus (i) that is filed
pursuant to paragraph (f) immediately preceding, or (ii) that purports to meet
the requirements of Section 10(a)(3) of the Securities Act and is used in
connection with an offering of securities subject to Rule 415 promulgated
pursuant to the Securities Act, will be filed as a part of an amendment to the
registration statement and will not be used until such amendment is effective,
and that, for purposes of determining any liability under the Securities Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offering therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment to its registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Jacksonville, State of Florida, on October 4, 1996.
ACCUSTAFF INCORPORATED
By: /s/ Derek E. Dewaan
-----------------------------------
DEREK E. DEWAN
CHAIRMAN, PRESIDENT AND CHIEF
EXECUTIVE OFFICER
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on October 4, 1996.
SIGNATURE TITLE
/s/ Derek E. Dewan Chairman, President and Chief
- ------------------------------------- Executive Officer (principal
DEREK E. DEWAN executive officer)
/s/ Michael D. Abney Senior Vice President, Chief
- ------------------------------------- Financial Officer and Assistant
MICHAEL D. ABNEY Secretary (principal financial
officer)
Controller (principal accounting
* officer)
- -------------------------------------
SEAN D. MANN
Director
*
- -------------------------------------
T. WAYNE DAVIS
Director
- -------------------------------------
STEPHEN A. HOFFMAN
Director
*
- -------------------------------------
DELORES P. KESLER
Director
*
- -------------------------------------
WILLIAM H. THUMEL, JR.
*_____/s/ Derek E. Dewan
- -------------------------------------
ATTORNEY-IN-FACT
II-5
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
2.1 Agreement and Plan of Merger, dated as of August 25, 1996, by and
among AccuStaff, Career, and Sub (included as Annex A to the Proxy
Statement/Prospectus and incorporated by reference herein).
3.1 Certificate of Incorporation, as amended, incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended December
31, 1995 (File No. 0-24484).
3.2 Bylaws, as amended, incorporated by reference to the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1996
(File No. 0-24484).
4.1 See Exhibits 3(a) and 3(b) for provisions of the Certificate of
Incorporation and Bylaws of the Registrant defining rights of holders
of Common Stock of the Registrant.
5.1 Opinion of Alston & Bird.*
8.1 Opinion of Alston & Bird.*
11.1 Statement regarding computation of per share earnings (included as
Exhibit 11 to the Registrant's Form 10-Q for the six months ended June
30, 1994, previously filed with the Commission and incorporated by
reference herein).
23.1 Consent of Alston & Bird.*
23.2 Consent of Coopers & Lybrand L.L.P.
23.3 Consent of Coopers & Lybrand L.L.P.
23.4 Consent of Salomon Brothers Inc.
23.5 Consent of Robert W. Baird & Co. Incorporated.
23.6 Consent of Walter W. Macauley.
23.7 Consent of Ernst & Young LLP.
23.8 Consent of KPMG Peat Marwick LLP.
23.9 Consent of McGladrey & Pullen, LLP.
23.10 Consent of Bertram, Vallez, Kaplan and Talbot, LTD.
23.11 Consent of Stadtler, Rosenblum & Saris.
23.12 Consent of Nyhan & Mazza, P.C.
23.13 Consent of BDO Seidman, LLP.
23.14 Consent of Dorfman, Abrams, Music & Co.
23.15 Consent of Levine, Hughes & Mithuen, Inc.
23.16 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.17 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.18 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.19 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.20 Consent of Dennis I. Berner, C.P.A.
23.21 Consent of Beers & Cutler PLLC.
23.22 Consent of Ernst & Young LLP.
23.23 Consent of Coopers & Lybrand L.L.P. (included as part of Exhibit 23.2
hereto).
23.24 Consent of Dubois & Bornstein, P.C.
24.1 Powers of Attorney*
99.1 Form of Proxy for holders of AccuStaff Common Stock.*
99.2 Form of Proxy for holders of Career Common Stock.*
99.3 Employment Agreement between AccuStaff Incorporated and Walter W.
Macauley dated as of August 25, 1996.*
</TABLE>
- --------
* Previously filed with the Company's Registration Statement on Form S-4 (Reg.
No. 333-12207) filed September 18, 1996
<PAGE>
EXHIBIT 23.2
CONSENT OF COOPERS & LYBRAND L.L.P.
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in Amendment No. 1 to the
registration statement of AccuStaff Incorporated on Form S-4 (Reg. No. 333-
12207) of:
. our report dated March 15, 1996, except for the last paragraph of Note 6
and the last paragraph of NOte 11, as to which the date is March 27, 1996
and, except for the basis of presentation section of Note 2 and the
resulting effects on the consolidated financial statements and notes
thereto as to which the date is September 16, 1996, on our audits of the
consolidated financial statements of AccuStaff Incorporated and
Subsidiaries as of December 31, 1995 and January 1, 1995 and for each of
the three years in the period ended December 31, 1995, which report is
included in Form 8-K, dated September 16, 1996;
. our report dated August 1, 1995, on our audits of the financial statements
of Matthews Professional Employment Specialists, Inc. as of December 31,
1994 and 1993 and for each of the three years in the period ended December
31, 1994, which report is included in Form 8-K/A, dated July 2, 1995;
. our report dated August 8, 1995, on our audit of the financial statements
of Bogard Temps, Inc. as of December 31, 1994 and for the year then ended,
which report is included in Form 8-K/A, dated July 2, 1995;
. our report dated August 16, 1995, on our audits of the combined financial
statements of Special Assistants, Inc., Special Counsel, Inc. and Special
Counsel International, Inc. (collectively, "Special Counsel
International") as of December 31, 1994 and 1993 and for each of the two
years in the period ended December 31, 1994, which report is included in
Form 8-K/A, dated July 2, 1995;
. our report dated December 7, 1995, on our audits of the combined financial
statements of the McKinley Group as of September 30, 1995 and 1994 and for
the years then ended, which report is included in Form 8-K, dated June 19,
1996;
. our report dated January 19, 1996, on our audits of the financial
statements of PTA International, Inc. as of December 31, 1995 and 1994 and
for each of the two years in the period ended December 31, 1995, which
report is included in Form 8-K/A, dated January 2, 1996;
. our report dated March 27, 1996, on our audit of the combined financial
statements of Excel Temporary Services as of December 31, 1995 and for the
year then ended; which report is included in Form 8-K/A, dated February
19, 1996;
. our report dated April 12, 1996 on our audit of the financial statements
of HNS Software, Inc. as of December 31, 1995 and for the year then ended,
which report is included in Form 8-K, dated September 16,1 996.
. our report dated June 19, 1996 on our audit of the financial statements of
Openware Technologies, Inc. as of December 31, 1995 and for the year then
ended, which report is included in Form 8-K, dated September 16, 1996;
. our report dated September 12, 1996 on our audit of the financial
statements of DataCorp Business Systems, Inc. as of December 31, 1995 and
for the year then ended, which report is included in Form 8-K, dated
September 16, 1996; and
. our report dated September 13, 1996 on our audit of the financial
statements of Staffware, Inc. as of December 31, 1995 and for the year
ended, which report is included in Form 8-K, dated September 16, 1996.
We also consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Jacksonville, Florida
October 4, 1996
<PAGE>
EXHIBIT 23.3
CONSENT OF COOPERS & LYBRAND L.L.P.
We consent to the incorporation by reference herein of our reports as
follows:
. our report dated February 16, 1996 on our audits of the consolidated
financial statements of Career Horizons, Inc. and Subsidiaries as of
December 31, 1995 and June 30, 1995 and 1994, and for the six months
ended December 31, 1995 and for each of the three years in the period
ended June 30, 1995.
. our report dated August 17, 1995, on our audits of the consolidated
financial statements of Career Horizons, Inc. and Subsidiaries as of June
30, 1995 and 1994, and for each of the three years in the period ended
June 30, 1995.
We also consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
October 3, 1996
New York, New York
<PAGE>
EXHIBIT 23.4
CONSENT OF SALOMON BROTHERS INC
We hereby consent to the use of our name and to the description of our
opinion letter dated August 25, 1996, under the caption "THE MERGER--Opinions
of Salomon and Baird" in, and to the inclusion of such opinion letter as Annex
B to, the Joint Proxy Statement/Prospectus of Career Horizons, Inc. and
AccuStaff Incorporated, which supplement to the Joint Proxy
Statement/Prospectus is part of the Amendment No. 1 to the Registration
Statement on Form S-4 of AccuStaff Incorporated. By giving such consent we do
not thereby admit that we are experts with respect to any part of such
Registration Statement within the meaning of the term "expert" as used in, or
that we come within the category of persons whose consent is required under,
the Securities Act of 1933 or the rules and regulations of the Securities and
Exchange Commission promulgated thereunder.
SALOMON BROTHERS INC
New York, New York
October 4, 1996
<PAGE>
EXHIBIT 23.5
CONSENT OF ROBERT W. BAIRD & CO. INCORPORATED
Robert W. Baird & Co. Incorporated ("Baird") hereby consents to the
inclusion in the Joint Proxy Statement-Prospectus of AccuStaff Incorporated
and Career Horizons, Inc., filed as a part of this Registration Statement
(Reg. No. 333-12207) on Form S-4 of AccuStaff Incorporated, of its opinion
dated August 25, 1996, and to the references made to Baird in the "Summary"
and "Opinion of Salomon and Baird" sections of such Joint Proxy Statement-
Prospectus. In giving such consent, we do not thereby admit that we come
within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933 or the rules and regulations of the Securities and
Exchange Commission promulgated thereunder.
ROBERT W. BAIRD & CO. INCORPORATED
October 3, 1996
<PAGE>
EXHIBIT 23.6
CONSENT OF WALTER W. MACAULEY
The undersigned hereby consents, pursuant to Rule 438 promulgated pursuant
to the Securities Act of 1933, as amended, to the reference to him under the
captions "Summary" and "The Merger" in the Joint Proxy Statement/Prospectus,
which is a part of this Amendment No. 1 to the Registration Statement on Form
S-4 of AccuStaff Incorporated.
WALTER W. MACAULEY
Woodbury, New York
October 4, 1996
<PAGE>
EXHIBIT 23.7
CONSENT OF ERNST & YOUNG LLP
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-4 No. 333-12207) of
AccuStaff Incorporated and related Joint Proxy Statement/Prospectus of
AccuStaff Incorporated and Career Horizons, Inc. and to the incorporation by
reference therein of our report dated March 22, 1995, with respect to the
financial statements of Programming Enterprises, Inc. dba Mini-Systems
Associates included in Career Horizons, Inc.'s Amended Current Report on Form
8-K/A dated December 20, 1995, filed with the Securities and Exchange
Commission.
/s/ ERNST & YOUNG LLP
Los Angeles, California
October 3, 1996
<PAGE>
EXHIBIT 23.8
CONSENT OF KPMG PEAT MARWICK LLP
We hereby consent to the incorporation by reference in the Joint Proxy
Statement/Prospectus constituting a part of the Registration Statement (Form
S-4 No. 333-12207) of AccuStaff Incorporated of our report dated June 16, 1995
relating to the financial statements of Management Search, Inc. which are in
the Current Report on Form 8K, dated May 5, 1996, of Career Horizons, Inc.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ KPMG Peat Marwick LLP
-------------------------------------
KPMG Peat Marwick LLP
Atlanta, Georgia
October 1, 1996
<PAGE>
EXHIBIT 23.9
CONSENT OF MCGLADREY & PULLEN, LLP
CONSENT OF INDEPENDENT AUDITOR
We consent to the incorporation by reference in this Registration Statement
of AccuStaff Incorporated on Form S-4 (Reg. No. 333-12207) and related
Prospectus of our report dated November 29, 1995 (relating to the financial
statements of Computer Professionals, Inc.), included in the Current Report on
Form 8-K/A of AccuStaff Incorporated dated October 31, 1995. We also consent
to the reference to our Firm under the caption "Experts."
/s/ McGladrey & Pullen, LLP
Charlotte, North Carolina
October 4, 1996
<PAGE>
EXHIBIT 23.10
CONSENT OF BERTRAM, VALLEZ, KAPLAN & TALBOT, LTD.
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion of our report dated November 28, 1995 (relating
to the Advance/Possis Technical Services, Inc. Financial Statements for the
years ended September 30, 1995 and 1994), included in the Current Report on
Form 8-K of AccuStaff Incorporated dated December 13, 1995 in the Registration
Statement and related Prospectus of AccuStaff Incorporated on Form S-4.
We also consent to the reference to our firm under the caption "Experts."
/s/ BERTRAM, VALLEZ, KAPLAN & TALBOT,
LTD.
Minneapolis, Minnesota
October 4, 1996
<PAGE>
EXHIBIT 23.11
CONSENT OF STADTLER, ROSENBLUM & SARIS
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion of our reports dated March 1, 1996 and December
15, 1995 (relating to the combined financial statement of Goldfarb-Wasson
Associates, Inc. & GW Temporaries, Inc. dba GW Consulting, as of December 31,
1995 and for the nine months in the period ended December 31, 1995 and March
31, 1995 and 1994 and for each of the two years in the period ended March 31,
1995), included in the Current Report on Form 8-K of AccuStaff Incorporated
dated January 2, 1996 in the Registration Statement Reg. No. 333-12207 and
related Prospectus of AccuStaff Incorporated on Form S-4.
We also consent to the reference to our firm under the caption "Experts."
/s/ Stadtler, Rosenblum & Saris
Stadtler, Rosenblum & Saris
October 3, 1996
<PAGE>
EXHIBIT 23.12
CONSENT OF NYHAN & MAZZA, P.C.
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion of our report dated March 27, 1996 relating to
Additional Technical Support, Inc. and Affiliates for the years ended July 31,
1995 and July 31, 1994, included in the Current Report on Form 8-K of
AccuStaff Incorporated dated February 20, 1996 in the Registration Statement
(Reg. No. 333-12207) and related Prospectus of AccuStaff Incorporated on Form
S-4.
We also consent to the reference to our firm under the caption "Experts".
/s/ Nyhan & Mazza, P.C.
Nyhan & Mazza, P.C.
October 3, 1996
<PAGE>
EXHIBIT 23.13
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
Programming Enterprises, Inc.
dba Mini-Systems Associates
We hereby consent to the incorporation by reference in the Joint Proxy
Statement/Prospectus constituting a part of the Registration Statement on Form
S-4 of AccuStaff Incorporated of our report dated July 29, 1994, relating to
the financial statements of Programming Enterprises, Inc. dba Mini-Systems
Associates (balance sheet as of December 24, 1993, and the related statements
of income and retained earnings, and cash flows for the 52 week period ended
December 24, 1993) appearing in the Amended Current Report on Form 8-K/A of
Career Horizons, Inc. dated December 20, 1995.
We also consent to the reference to us under the caption "Experts" in the
Joint Proxy Statement/Prospectus.
/s/ BDO Seidman, LLP
-------------------------------------
BDO SEIDMAN, LLP
Los Angeles, California
October 3, 1996
<PAGE>
EXHIBIT 23.14
CONSENT OF DORFMAN, ABRAMS, MUSIC & CO.
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Amendment No. 1 to the
Registration Statement on Form S-4 of AccuStaff Incorporated and the Joint
Proxy Statement/Prospectus of AccuStaff Incorporated and Career Horizons, Inc.
included therein of our report dated March 10, 1995, with respect to the
financial statements of Zeitech, Inc. as of December 31, 1993 and 1994 and for
the years ended December 31, 1993 and 1994, which is contained in the Amended
Current Report on Form 8-K/A dated December 20, 1995 of Career Horizons, Inc.
and to the reference of our firm under the heading "Experts" in such Joint
Proxy Statement/Prospectus.
/s/ Dorfman, Abrams, Music & Co.
Glen Rock, New Jersey
October 4, 1996
<PAGE>
EXHIBIT 23.15
CONSENT OF LEVINE HUGHES & MITHUEN, INC.
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in the Joint Proxy
Statement/Prospectus constituting a part of the Registration Statement (Form
S-4 No. 333-12207) of AccuStaff Incorporated of our report dated April 18,
1996 relating to the consolidated financial statements of Daedalian Group,
Inc. and Subsidiaries, which are contained in the Current Report on Form 8-K
dated August 28, 1996, of Career Horizons, Inc.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ LEVINE, HUGHES & MITHUEN, INC.
Englewood, Colorado
October 3, 1996
<PAGE>
EXHIBIT 23.20
CONSENT OF DENNIS I. BERNER, C.P.A.
CONSENT OF INDEPENDENT ACCOUNTANTS
I consent to the incorporation by reference in the registration statement of
AccuStaff incorporated on Form S-4 (Reg. No. 333-12207) of my report dated
January 26, 1996, on my audit of the financial statements of Career
Enhancement International, Inc. as of December 31, 1995 and for the year then
ended included in the Current Report on Form 8-K of AccuStaff Incorporated
dated September 16, 1996.
I also consent to the reference to my name under the caption "Experts."
/s/ DENNIS I. BERNER
Winter Park, Florida
October 4, 1996
<PAGE>
EXHIBIT 23.21
CONSENT OF BEERS & CUTLER PLLC
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement
of AccuStaff incorporated on Form S-4 (Reg. No. 333-12207) of our report dated
February 20, 1996, on our audit of the financial statements of Perspective
Technology Corporation as of December 31, 1995 and for the year then ended
included in the Current Report on Form 8-K of AccuStaff Incorporated dated
September 16, 1996. .
We also consent to the reference to our firm under the caption "Experts."
/s/ Beers & Cutler PLLC
Washington, D.C.
October 3, 1996
<PAGE>
EXHIBIT 23.22
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-4 No. 333-12207) and
related Joint Proxy Statement/Prospectus of AccuStaff Incorporated for
registration of shares of AccuStaff common stock and to the incorporation by
reference therein of our report dated March 28, 1996 (except for Note 1, as to
which the date is April 29, 1996) with respect to the combined financial
statements of Century Temporary Services, Inc. and Grant Management Company,
included in Career Horizons Inc.'s Current Report on Form 8-K dated May 1,
1996, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Cleveland, Ohio
October 4, 1996
<PAGE>
EXHIBIT 23.24
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the Incorporation by reference in the Joint Proxy
Statement/Prospectus constituting a part of the Registration Statement (Form
S-4 No. 333-12207) of AccuStaff Incorporated of our report dated February 5,
1996 relating to the financial statements of TSG Professional Services, Inc.,
which are contained in the Current Report on Form 8-k dated September 16,
1996, of Career Horizons, Inc.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ Dubois & Bornstein
Professional Corporation
Manchester, New Hampshire
October 4, 1996
