-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, D0YvEfsJCX6AHAB3aJAhOEqFQ5VpTMX131M8T6THEh1LnMJuQ44teG9MXjBmA/+f LNd65/ssuLpqYv/NJSjMIQ== 0000950138-98-000171.txt : 19981118 0000950138-98-000171.hdr.sgml : 19981118 ACCESSION NUMBER: 0000950138-98-000171 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19980930 FILED AS OF DATE: 19981116 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OUTSOURCING SOLUTIONS INC CENTRAL INDEX KEY: 0001027574 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 582197161 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867 FILM NUMBER: 98750376 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PAYCO AMERICAN CORP CENTRAL INDEX KEY: 0000076741 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-CONSUMER CREDIT REPORTING, COLLECTION AGENCIES [7320] IRS NUMBER: 391133219 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-05589 FILM NUMBER: 98750377 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CFC SERVICES CORP CENTRAL INDEX KEY: 0001029300 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 133866487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-01 FILM NUMBER: 98750378 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: A M MILLER & ASSOCIATES INC CENTRAL INDEX KEY: 0001029301 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 133866487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-02 FILM NUMBER: 98750379 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONTINENTAL ALLIANCE INC CENTRAL INDEX KEY: 0001029303 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 133866487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-03 FILM NUMBER: 98750380 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALASKA FINANCIAL SERVICES INC CENTRAL INDEX KEY: 0001029305 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 911329919 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-04 FILM NUMBER: 98750381 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SOUTHWEST CREDIT SERVICES INC CENTRAL INDEX KEY: 0001029306 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 860710975 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-05 FILM NUMBER: 98750382 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCOUNT PORTFOLIOS INC CENTRAL INDEX KEY: 0001029307 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 582195793 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-06 FILM NUMBER: 98750383 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCOUNT PORTFOLIOS LP CENTRAL INDEX KEY: 0001029308 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 133866487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-08 FILM NUMBER: 98750384 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PAYCO GENERAL AMERICAN CREDITS INC CENTRAL INDEX KEY: 0001029315 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 391314048 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-12 FILM NUMBER: 98750385 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONAL ACCOUNT SYSTEMS INC CENTRAL INDEX KEY: 0001029317 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 363006209 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-13 FILM NUMBER: 98750386 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNIVERSITY ACCOUNTING SERVICE INC CENTRAL INDEX KEY: 0001029318 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 391357406 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-14 FILM NUMBER: 98750387 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASSET RECOVERY & MANAGEMENT CORP CENTRAL INDEX KEY: 0001029319 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 391357406 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-15 FILM NUMBER: 98750388 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INDIANA MUTUAL CREDIT ASSOCIATION INC CENTRAL INDEX KEY: 0001029320 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 391357406 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-16 FILM NUMBER: 98750389 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FURST & FURST INC CENTRAL INDEX KEY: 0001029386 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 391758997 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-17 FILM NUMBER: 98750390 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: JENNIFER LOOMIS & ASSOCIATES INC CENTRAL INDEX KEY: 0001029387 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 953850888 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-18 FILM NUMBER: 98750391 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FM SERVICES CORP CENTRAL INDEX KEY: 0001029388 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 953850888 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-19 FILM NUMBER: 98750392 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: QUALINK INC CENTRAL INDEX KEY: 0001029389 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 953850888 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-20 FILM NUMBER: 98750393 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROFESSIONAL RECOVERIES INC CENTRAL INDEX KEY: 0001029390 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 953850888 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-21 FILM NUMBER: 98750394 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PAYCO AMERICAN INTERNATIONAL CORP CENTRAL INDEX KEY: 0001029391 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 953850888 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-22 FILM NUMBER: 98750395 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCOUNT PORTFOLIOS GP INC CENTRAL INDEX KEY: 0001029715 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-07 FILM NUMBER: 98750396 BUSINESS ADDRESS: STREET 1: 3300 NORTHEAST EXPRESSWAY STREET 2: BUILDING 1 STE M CITY: ATLANTA STATE: GA ZIP: 30341 BUSINESS PHONE: 7704514862 MAIL ADDRESS: STREET 1: 3300 NORTHEAST EXPRESSWAY STREET 2: BUILDING 1 STE M CITY: ATLANTA STATE: GA ZIP: 30341 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SHERMAN ACQUISITION CORP CENTRAL INDEX KEY: 0001051794 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-23 FILM NUMBER: 98750397 BUSINESS ADDRESS: STREET 1: C/O OUTSOURCING SOLUTIONS INC STREET 2: 390 SOUTH WOODS MILL ROAD CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: C/O OUTSOURCING SOLUTIONS INC STREET 2: 390 SOUTH WOODS MILL ROAD CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIED BOND & COLLECTION AGENCY INC CENTRAL INDEX KEY: 0001058618 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 223200628 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-24 FILM NUMBER: 98750398 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN CHILD SUPPORT SERVICE BUREAU INC CENTRAL INDEX KEY: 0001058619 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 232807100 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-25 FILM NUMBER: 98750399 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAPITAL CREDIT CORP CENTRAL INDEX KEY: 0001058620 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 232807100 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-26 FILM NUMBER: 98750400 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HIGH PERFORMANCE SERVICES INC CENTRAL INDEX KEY: 0001058621 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 593383407 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-27 FILM NUMBER: 98750401 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HIGH PERFORMANCE SERVICES OF FLORIDA INC CENTRAL INDEX KEY: 0001058622 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 593473475 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-28 FILM NUMBER: 98750402 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERACTIVE PERFORMANCE INC CENTRAL INDEX KEY: 0001058624 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 133861550 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-29 FILM NUMBER: 98750403 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERACTIVE PERFORMANCE OF FLORIDA INC CENTRAL INDEX KEY: 0001058625 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 593378200 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-30 FILM NUMBER: 98750404 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRANSWORLD SYSTEMS INC CENTRAL INDEX KEY: 0001058626 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 941728881 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-31 FILM NUMBER: 98750405 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UCO PROPERTIES INC CENTRAL INDEX KEY: 0001058627 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 941728881 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-32 FILM NUMBER: 98750406 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNION FINANCIAL SERVICES GROUP INC CENTRAL INDEX KEY: 0001058628 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 222630947 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-33 FILM NUMBER: 98750407 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN RECOVERY CO INC CENTRAL INDEX KEY: 0001058629 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 520937211 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-34 FILM NUMBER: 98750408 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CSN CORP CENTRAL INDEX KEY: 0001058630 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 251319485 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-35 FILM NUMBER: 98750409 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENAD CONNECTOR CORP CENTRAL INDEX KEY: 0001058631 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 042428227 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-36 FILM NUMBER: 98750410 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UCO MBA CORP CENTRAL INDEX KEY: 0001058632 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 231704744 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-16867-37 FILM NUMBER: 98750411 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNION SPECIAL STEEL CASTING CORP CENTRAL INDEX KEY: 0001058633 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 251154811 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-38 FILM NUMBER: 98750412 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PERIMETER CREDIT LLP CENTRAL INDEX KEY: 0001058634 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 510369044 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-39 FILM NUMBER: 98750413 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GULF STATE CREDIT LLP CENTRAL INDEX KEY: 0001058635 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 510369044 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-40 FILM NUMBER: 98750414 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERACTIVE PERFORMANCE OF GEORGIA INC CENTRAL INDEX KEY: 0001067124 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 593487654 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-41 FILM NUMBER: 98750415 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: C/O OUTSOURCING SOLUTIONS INC STREET 2: 390 SOUTH WOODS MILL RD STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTH SHORE AGENCY INC CENTRAL INDEX KEY: 0001067125 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 113399772 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-42 FILM NUMBER: 98750416 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: C/O OUTSOURCING SOLUTIONS INC STREET 2: 390 SOUTH WOODS MILL RD STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCELERATED BUREAU OF COLLECTIONS INC CENTRAL INDEX KEY: 0001067126 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 841438860 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-15867-43 FILM NUMBER: 98750417 BUSINESS ADDRESS: STREET 1: 390 SOUTH WOODS MILL RD STREET 2: STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 BUSINESS PHONE: 3145760022 MAIL ADDRESS: STREET 1: C/O OUTSOURCING SOLUTIONS INC STREET 2: 390 SOUTH WOODS MILL RD STE 350 CITY: CHESTERFIELD STATE: MO ZIP: 63017 10-Q 1 3RD QUARTER 10Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1998 ------------------ OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------------ ------------ Commission File Number 333-16867 --------- Outsourcing Solutions Inc. ----------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 58-2197161 - --------------------------------- ---------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 390 South Woods Mill Road, Suite 350 Chesterfield, Missouri 63017 - --------------------------------------- ---------------------- (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code: (314)576-0022 ------------- Indicate by checkmark whether the registrant: (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ---- ---- Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date. Outstanding at Class September 30, 1998 - ------------------------------------------ ------------------ Voting common stock 3,477,126.01 Class A convertible nonvoting common stock 391,740.58 Class B convertible nonvoting common stock 400,000.00 Class C convertible nonvoting common stock 1,040,000.00 ------------ 5,308,866.59 ============ Transitional Small Disclosure (check one): Yes [ ] No [ X ] ------- ---- ---- PAGE 2 OUTSOURCING SOLUTIONS INC. AND SUBSIDIARIES TABLE OF CONTENTS Part I. Financial Information Page ---- Item 1. Financial Statements Condensed Consolidated Balance Sheets September 30, 1998 (unaudited) and December 31, 1997 ............. 3 Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 1998 and 1997 (unaudited) ............................................. 4 Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 1998 and 1997 (unaudited) ........ 5 Notes to Condensed Consolidated Financial Statements (unaudited).. 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations......................................... 9 Part II. Other Information ................................................ 14 PAGE 3 OUTSOURCING SOLUTIONS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands except share and per share amounts)
September 30, December 31, 1998 1997 Unaudited Audited ------------ ------------ ASSETS CURRENT ASSETS: Cash and cash equivalents $ 9,356 $ 3,217 Cash and cash equivalents held for clients 24,392 20,762 Current portion of purchased loans and accounts receivable portfolios 41,063 42,915 Accounts receivable - trade, less allowance for doubtful 40,026 27,192 receivables of $1,276 and $538 Other current assets 7,573 2,119 -------- -------- Total current assets 122,410 96,205 PURCHASED LOANS AND ACCOUNTS RECEIVABLE PORTFOLIOS 24,769 19,537 PROPERTY AND EQUIPMENT, net 45,323 32,563 INTANGIBLE ASSETS, net 422,657 219,795 DEFERRED FINANCING COSTS, net 13,452 12,517 OTHER ASSETS 370 1,073 -------- -------- TOTAL $628,981 $381,690 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES: Accounts payable - trade $ 8,326 $ 6,977 Collections due to clients 24,392 20,762 Accrued compensation 15,610 8,332 Other current liabilities 46,957 26,131 Current portion of long-term debt 16,661 15,445 -------- -------- Total current liabilities 111,946 77,647 LONG-TERM DEBT 512,068 309,521 OTHER LONG-TERM LIABILITIES 23,160 -- STOCKHOLDERS' EQUITY (DEFICIT): 8% nonvoting cumulative redeemable exchangeable preferred stock; 12,167 11,699 authorized 1,000,000 shares,973,322.32 and 935,886.85 shares, respectively, issued and outstanding, at liquidation value of $12.50 per share Voting common stock; $.01 par value; authorized 7,500,000 shares, 35 35 3,477,126.01 shares issued and outstanding Class A convertible nonvoting common stock; $.01 par value; 4 4 authorized 7,500,000 shares, 391,740.58 shares issued and outstanding Class B convertible nonvoting common stock; $.01 par value; 4 4 authorized 500,000 shares, 400,000 shares issued and outstanding Class C convertible nonvoting common stock; $.01 par value; 10 10 authorized 1,500,000 shares, 1,040,000 shares issued and outstanding Paid-in capital 66,958 66,958 Retained deficit (97,371) (84,188) -------- -------- Total stockholders' equity (deficit) (18,193) (5,478) -------- -------- TOTAL $628,981 $381,690 ======== ======== The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
PAGE 4 OUTSOURCING SOLUTIONS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In thousands)
Three Months Ended Nine Months Ended September 30, September 30 -------------------- --------------------- 1998 1997 1998 1997 REVENUES $119,903 $67,537 $358,634 $197,663 EXPENSES: Salaries and benefits 58,050 32,218 171,203 97,018 Service fees and other operating and 35,130 16,314 105,100 49,882 administrative expenses Amortization of loans and accounts 12,840 13,138 35,198 31,174 receivable purchased Amortization of goodwill and other intangibles 4,045 5,293 11,588 21,269 Depreciation expense 3,486 2,558 9,963 7,615 ------- ------- --------- --------- Total expenses 113,551 69,521 333,052 206,958 ------- ------- --------- --------- OPERATING INCOME (LOSS) 6,352 (1,984) 25,582 (9,295) INTEREST EXPENSE - Net 13,164 7,153 37,554 20,950 ------- ------- --------- --------- LOSS BEFORE INCOME TAXES AND MINORITY INTEREST (6,812) (9,137) (11,972) (30,245) INCOME TAX BENEFIT -- (2,797) -- (9,626) MINORITY INTEREST -- -- 572 -- ------- ------- --------- --------- NET LOSS (6,812) (6,340) (12,544) (20,619) PREFERRED STOCK DIVIDEND REQUIREMENTS 162 266 639 686 ------- ------- --------- --------- NET LOSS TO COMMON STOCKHOLDERS $(6,974) $(6,606) $ (13,183) $ (21,305) ======= ======= ========= ========= The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
PAGE 5 OUTSOURCING SOLUTIONS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In thousands except share amounts)
Nine Months Ended September 30, -------------------------- 1998 1997 OPERATING ACTIVITIES: Net loss $(12,544) $(20,619) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 23,654 28,884 Amortization of loans and accounts receivable purchased 35,198 31,174 Deferred taxes -- (9,626) Minority interest 572 -- Change in assets and liabilities: Other current assets 5,256 (2,621) Accounts payable and other current liabilities (10,122) (10,773) -------- -------- Net cash provided by operating activities 42,014 16,419 -------- -------- INVESTING ACTIVITIES: Payments for acquisitions, net of cash acquired (167,305) (1,200) Purchase of loans and accounts receivable portfolios (38,030) (34,955) Acquisition of property and equipment (10,794) (5,729) -------- -------- Net cash used in investing activities (216,129) (41,884) -------- -------- FINANCING ACTIVITIES: Proceeds from term loans 225,469 -- Borrowings under revolving credit agreement 168,050 44,300 Repayments under revolving credit agreement (177,900) (16,900) Repayments of debt (32,327) (7,225) Deferred financing fees (3,038) (324) -------- -------- Net cash provided by financing activities 180,254 19,851 -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 6,139 (5,614) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 3,217 14,497 -------- -------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 9,356 $ 8,883 ======== ======== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during period for interest $ 28,407 $ 12,146 ======== ======== SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES - During the nine months ended September 30, 1998 and 1997, the Company paid preferred stock dividends of $468 and $883, respectively, through the issuance of 37,435.47 shares and 70,606.84 shares of preferred stock, respectively. The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
OUTSOURCING SOLUTIONS INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (In thousands) NOTE 1. BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 1998 are not necessarily indicative of the results that may be expected for the year ended December 31, 1998. For purposes of comparability, certain prior year and prior quarter amounts have been reclassified to conform to current quarter and year to date presentation. These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto contained in the Company's Form 10-K for the year ended December 31, 1997. NOTE 2. ACQUISITIONS On January 23, 1998, the Company acquired through a tender offer approximately 77% of the outstanding shares of The Union Corporation's ("Union") common stock for $31.50 per share. On March 31, 1998, the Company acquired the remaining outstanding shares of Union when Union merged with a wholly-owned subsidiary of the Company. The aggregate purchase price of the Union acquisition was approximately $230,000 including transaction fees, assumed liabilities, and certain adjustments to conform to the Company's accounting policies. The Company financed the acquisition primarily with funds provided by the Second Amended and Restated Credit Agreement (as defined herein). Union, through certain of its subsidiaries, furnishes a broad range of credit and receivables management outsourcing services as well as management and collection of accounts receivable. The acquisition was accounted for under the purchase method of accounting. Accordingly, the purchase price has been preliminarily allocated based upon the estimated fair value of the net assets acquired. This treatment resulted in approximately $214,025 of goodwill that will be amortized over 30 years using the straight-line method. Union's consolidated operating results have been included in the Company's consolidated results since January 23, 1998, recognizing the minority interest through the completion date of the acquisition. The unaudited proforma consolidated financial data presented below gives effect to the Union acquisition as well as the North Shore Agency and Accelerated Bureau of Collections acquisitions that occurred in the fourth quarter of 1997, as if such acquisitions had occurred as of the beginning of each period presented. The pro forma adjustments are based upon available information and certain assumptions that management believes are reasonable. The unaudited pro forma consolidated financial data does not purport to represent what the Company's financial position or results of operations would have been if consummation of the acquisitions of Union, North Shore Agency and Accelerated Bureau of Collections had occurred on the date indicated or what may be achieved in the future. Except for the elimination of costs associated with duplicative administrative functions and facilities based upon actions actually taken as of the close of the transactions, anticipated cost savings have not been reflected in this presentation. The unaudited pro forma consolidated financial data should be read in conjunction with the historical consolidated financial statements and accompanying notes for the Company, Union, North Shore Agency and Accelerated Bureau of Collections. For the three months For the nine months Ended September 30, Ended September 30, --------------------- ------------------- 1998 1997 1998 1997 ---- ---- ---- ---- Revenues $119,903 $115,663 $365,988 $343,984 ======== ======== ======== ======== Net loss $(6,812) $(7,570) $(13,665) $(23,490) ======= ======= ======== ======== NOTE 3. DEBT On January 26, 1998, the Company entered into a Second Amended and Restated Credit Agreement ("Agreement") with a group of banks in part to fund the Union acquisition. This Agreement amended the Company's existing credit agreement. The Agreement consists of a $412,422 term loan facility and a $58,000 revolving credit facility. The term loan facility consists of a term loan of $62,500 ("Term Loan A"), a term loan of $124,922 ("Term Loan B") and a term loan of $225,000 ("Term Loan C"), which mature on October 15, 2001, 2003 and 2004, respectively. The Company is required to make quarterly principal repayments on each term loan. Term Loan A bears interest, at the Company's option, (a) at a base rate equal to the greater of the federal funds rate plus 0.5% or the lender's customary base rate plus 1.5% or (b) at the reserve adjusted Eurodollar rate plus 2.5%. Term Loans B and C bear interest, at the Company's option, (a) at a base rate equal to the greater of the federal funds rate plus 0.5% or the lender's customary base rate plus 2.0% or (b) at the reserve adjusted Eurodollar rate plus 3.0%. The revolving credit facility has a term of five years and is fully revolving until October 15, 2001. The revolving credit facility bears interest, at the Company's option, (a) at a base rate equal to the greater of the federal funds rate plus 0.5% or the lender's customary base rate plus 1.5% or (b) at the reserve adjusted Eurodollar rate plus 2.5%. The obligations of the Company under the Agreement are guaranteed by all of the Company's present domestic subsidiaries and are secured by all of the stock of the Company's present domestic subsidiaries and by substantially all of the Company's domestic property assets. The Agreement contains certain covenants, the more significant of which limit dividends, asset sales, acquisitions and additional indebtedness, as well as requires the Company to satisfy certain financial performance ratios. NOTE 4. LITIGATION The Company and certain of its subsidiaries are subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the normal course of business and are routine to the nature of the Company's businesses. In addition, as a result of the Union acquisition, subsidiaries of the Company are a party to several on-going environmental remediation investigations by federal and state governmental agencies and clean-ups and, along with other companies, has been named a "potentially responsible party" for certain waste disposal sites. Each of these matters is subject to various uncertainties, and it is possible that some of these matters will be decided unfavorably against the Company. The Company has established, with input from environmental and legal experts, accruals for matters that are in its view probable and reasonably estimable. Based on information presently available, management believes that existing accruals are sufficient to satisfy any known environmental liabilities. NOTE 5. NEW ACCOUNTING PRONOUNCEMENT In June 1998, the Financial Accounting Standards Board issued the Statement of Financial Accounting Standard No. 133, "Accounting for Derivative Instruments and Hedging Activities," which is effective for fiscal periods beginning after June 15, 1999. The adoption of this statement is not expected to have a material effect on the financial statements. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations Three Months Ended September 30, 1998 Compared to Three Months Ended September 30, 1997 Revenues for the three months ended September 30, 1998 were $119.9 million compared with $67.5 million in the same period last year - an increase of 77.5%. The revenue increase of $52.4 million was primarily due to the acquisitions of Union, North Shore Agency and Accelerated Bureau of Collections. Revenues from fee services were $84.7 million for the three months ended September 30, 1998 compared to $39.0 million in the comparable period in 1997. The increase in fee revenues of 116.9% was primarily due to the three acquisitions. Revenues from purchased portfolios increased 1.3% to $19.3 million for the quarter ended September 30, 1998 compared to $18.9 million in 1997 due primarily from strategic sales of portfolios. The outsourcing revenue of $15.9 million compared favorably to prior year of $9.6 million due primarily to the Union acquisition. Operating expenses for the three months ended September 30, 1998 were $113.6 million compared to $69.5 million for the comparable period in 1997 - an increase of $44.1 million. Operating expenses, exclusive of amortization and depreciation charges, were $93.2 million for the three months ended September 30, 1998 and $48.5 million for the comparable period in 1997. The increase in operating expenses, exclusive of amortization and depreciation charges, resulted from the three acquisitions. Of the $113.6 million in operating expenses for the three months ended September 30, 1998, $20.4 million was attributable to amortization and depreciation charges compared to $21.0 million for the same period last year. The lower amortization and depreciation charges were due to no account placement inventory amortization in 1998 ($3.5 million in 1997) since account placement inventory was fully amortized as of December 31, 1997 offset partially by depreciation and amortization of goodwill related to the three acquisitions. As a result of the above, the Company generated operating income of $6.4 million for the three months ended September 30, 1998 compared to an operating loss of $2.0 million for the comparable period in 1997. Earnings before interest expense, taxes, depreciation and amortization (EBITDA) for the quarter ended September 30, 1998 was $26.7 million compared to $19.1 million for the same period in 1997. The increase of $7.6 million was attributable to the three acquisitions. Net interest expense for the three months ended September 30, 1998 was $13.2 million compared to $7.2 million for the comparable period in 1997. The increase was primarily due to additional indebtedness incurred to finance the Union, North Shore Agency and Accelerated Bureau of Collections acquisitions. Consistent with management's assessment made in the fourth quarter of 1997, the potential tax benefits generated by additional net operating loss carryovers or the future reversal of the net deductible temporary differences for the three months ended September 30, 1998 were fully offset by valuation allowance of $2.7 million. Due to the factors stated above and the fact that the Company recorded a $2.8 million tax benefit in the third quarter of 1997, the net loss for the quarter ended September 30, 1998 was $6.8 million compared to $6.3 million for the comparable period in 1997. Nine Months Ended September 30, 1998 Compared to Nine Months Ended September 30, 1997 Revenues for the nine months ended September 30, 1998 were $358.6 million compared with $197.7 million in the same period last year - an increase of 81.4%. The revenue increase of $160.9 million was due primarily to increased fee services and portfolio revenues of $11.6 million - an increase of 5.9% over last year, and $152.3 million from the acquisitions of Union, North Shore Agency and Accelerated Bureau of Collections offset by lower outsourcing revenue of $3.0 million. Revenues from fee services were $255.2 million for the nine months ended September 30, 1998 compared to $116.2 million in the comparable period in 1997. The increase in fee revenues was due to a 4.0% increase in existing business and $134.3 million from the three acquisitions. Revenues from purchased portfolios increased to $59.1 million for the nine months ended September 30, 1998 compared to $52.1 million in 1997 - up 13.3%. The increased revenue resulted primarily from strategic sales of portfolios. The outsourcing revenue of $44.3 million compared favorably to prior year of $29.4 million due primarily to the Union acquisition. Operating expenses for the nine months ended September 30, 1998 were $333.1 million compared to $207.0 million for the comparable period in 1997. Operating expenses, exclusive of amortization and depreciation charges, were $276.3 million for the nine months ended September 30, 1998 and $146.9 million for the comparable period in 1997 - an increase of 88.1%. The increase in operating expenses, exclusive of amortization and depreciation charges, resulted primarily from the three acquisitions as well as higher collection-related expenses associated with the increased revenues. Of the $333.1 million in operating expenses for the nine months ended September 30, 1998, $56.8 million was attributable to amortization and depreciation charges compared to $60.1 million for the same period last year. The lower amortization and depreciation charges resulted from no account placement inventory amortization in 1998 ($15.6 million in 1997) since account placement inventory was fully amortized as of December 31, 1997, offset partially by additional depreciation and amortization of goodwill related to the three acquisitions and increased portfolio amortization resulting from increased portfolio revenue. As a result of the above, the Company generated operating income of $25.6 million for the nine months ended September 30, 1998 compared to an operating loss of $9.3 million for the comparable period in 1997. Earnings before interest expense, taxes, depreciation and amortization (EBITDA) for the nine months ended September 30, 1998 was $82.3 million compared to $50.8 million for the same period in 1997. The increase of $31.5 million consisted of $25.9 million as a result of the three acquisitions and $5.6 million primarily from the increased revenue from operations unrelated to the acquisitions of $8.6 million. Net interest expense for the nine months ended September 30, 1998 was $37.6 million compared to $21.0 million for the comparable period in 1997. The increase was primarily due to additional indebtedness incurred to finance the Union, North Shore Agency and Accelerated Bureau of Collections acquisitions. Consistent with management's assessment made in the fourth quarter of 1997, the potential tax benefits generated by additional net operating loss carryovers or the future reversal of the net deductible temporary differences for the nine months ended September 30, 1998 were fully offset by valuation allowance of $4.8 million. Minority interest in earnings in 1998 resulted from the Union acquisition. On January 23, 1998, the Company acquired approximately 77% of the outstanding common stock of Union through a tender offer. The acquisition of all remaining outstanding common stock of Union was completed on March 31, 1998. The Company recognized minority interest in earnings of Union during the period from January 23, 1998 to March 31, 1998. Due to the factors stated above, the net loss for the nine months ended September 30, 1998 was $12.5 million compared to $20.6 million for the comparable period in 1997 - an improvement of $8.1 million. Financial Condition, Liquidity and Capital Resources At September 30, 1998, the Company had cash and cash equivalents of $9.4 million. In addition, the Company has a $58.0 million revolving credit facility, which allows the Company to borrow for working capital, general corporate purposes and acquisitions, subject to certain conditions. As of September 30, 1998, the Company had outstanding $22.0 million under the revolving credit facility leaving $34.4 million, after outstanding letters of credit, available under the revolving credit facility. Since December 31, 1997, cash and cash equivalents increased $6.1 million primarily due to cash provided by operations and financing activities of $42.0 million and $180.3 million, respectively, offset primarily by cash utilized for the Union acquisition of $164.7 million, purchases of loans and accounts receivable portfolios of $38.0 million and capital expenditures of $10.8 million. The Company also held $24.4 million of cash for clients in restricted trust accounts at September 30, 1998. For the first nine months in 1998, the Company made capital expenditures of $10.8 million primarily for the replacement and upgrading of equipment and expansion of the Company's information services systems. The Company anticipates spending approximately $18.0 million for 1998. On October 29, 1998, the Company executed a warehouse financing arrangement that provides the Company with up to $100 million of off-balance sheet funding capacity for the purchase of account receivable portfolios over its five year term. Proceeds from this arrangement, funded by an insurance company sponsored commercial paper conduit, will allow the Company to finance substantially all of its portfolio purchasing activities without additional borrowings from its bank credit facility. Pursuant to this financing arrangement, the Company's Second Amended and Restated Credit Agreement was amended to limit borrowing available for future account portfolio purchases and to permit an initial investment in a new wholly-owned, non-consolidated bankruptcy-remote subsidiary. Year 2000 As the Year 2000 approaches, many corporate systems worldwide could malfunction or produce incorrect results because they cannot process date-related information properly. Dates play a key role in dependable functioning of the software applications, software systems, information technology infrastructure, and embedded technology (i.e., non-technical assets such as time clocks and building services) the Company relies upon in day-to-day operations for innumerable tasks. This includes any tasks requiring date-dependent arithmetic calculations, sorting and sequencing data, and many other functions. The Company identified this problem as a key focus during 1997 and as part of any subsequent due-diligence procedures related to acquisitions completed during 1998. The Company has assessed the impact of Year 2000 issues on the processing of date-related information for all of its information systems infrastructure (e.g., production systems) and significant non-technical assets. As the new millennium approaches, the Company has developed and implemented a Year 2000 program to deal with this important issue in an effective and timely manner. This problem has received significant senior management attention and resources. Management reviews have been held on this topic. During 1998 and 1999, the Company's Board of Directors has requested and will continue to receive quarterly presentations at each regular Board meeting regarding the Company's overall Year 2000 compliance status and readiness. An independent consulting firm has been retained to provide independent verification and testing of the production systems. Under the direction of the Company's Senior Vice President and Chief Information Officer, the Company has established a program management structure, a management process and methodology and proactive client and vendor management strategies to manage the Year 2000 risk. Because many of the Company's client relationships are supported through computer-system interfaces, it is critical that the Company works proactively with its clients to achieve Year 2000 compliance. The Company has established a proactive client management strategy focused on enabling the Company to work together with clients to assure Year 2000 compliance between respective computer systems. The implementation of the client management strategy has commenced in 1998. Letters have been sent to significant clients, inquiring about their Year 2000 compliance plans and status. The Company is working to establish a follow-up process with each key client, taking a proactive, customer-focused approach to achieving Year 2000 compliance with its customers. The Company has also communicated with its strategic suppliers and equipment vendors, including suppliers of non-technical assets, seeking assurances that they and their products will be Year 2000 ready. The Company's goal is to obtain as much detailed information as possible about its strategic suppliers and equipment vendors' Year 2000 plans to identify those companies which appear to pose any significant risk of failure to perform their obligations to the Company as a result of the Year 2000. The Company expects to have compiled detailed information regarding all of its strategic suppliers and equipment vendors by December 1998. This will be an ongoing process during the Year 2000 project. For those strategic suppliers and equipment vendors that do not respond as to their status or their response is not satisfactory, the Company intends to develop contingency plans to ensure that sufficient alternative resources are available to continue with business operations. The target date for completion of all production systems and significant non-production systems (e.g., predictive dialer systems, phone switches, wide area network hardware), including non-technical assets, is March, 1999, with testing to begin during the first quarter of 1999 with completion no later than mid-1999. Spending for modifications and updates are being expensed as incurred and is not expected to have a material impact on the results of operations or cash flows. The cost of the Company's Year 2000 project is being funded from cash flows generated from operations. The Company estimates that its total Year 2000 expenses will be in the range of $1.2 to $1.5 million. To date, the Company has expended approximately $0.8 million, primarily for contract programmers and consulting costs associated with the evaluation, assessment and remediation of computer systems. The Company is dependent upon its own internal computer technology and relies upon the timely performance of its suppliers and customers and their systems. A substantial part of the Company's day-to-day operations is dependent on power and telecommunications services, for which alternative sources of services may be limited. A large-scale Year 2000 failure could impair the Company's ability to provide timely performance results required by the Company's customers, thereby causing potential liability, lost revenues and additional expenses, the amounts which have not been estimated. The Company's Year 2000 project seeks to identify and minimize this risk and includes testing of its in-house applications, purchased software and hardware to ensure that all such systems will function before and after the Year 2000. The Company is continually refining its understanding of the risk the Year 2000 poses to its strategic suppliers and customers based upon information obtained through its surveys. This refinement will continue through the rest of 1998 and into 1999. The Company's Year 2000 project includes the development of contingency plans for business critical systems, as well as for strategic suppliers and customers to attempt to minimize disruption to its operations in the event of a Year 2000 failure. The Company will be formulating plans to address a variety of failure scenarios, including failures of its in-house applications, as well as failures of strategic suppliers and customers. The Company anticipates that it will complete Year 2000 contingency planning by mid-1999. The following statements in this document are or may constitute forward-looking statements made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995: (1) statements concerning the cost and successful implementation of the Company's Year 2000 initiatives, (2) statements concerning the anticipated costs and outcome of legal proceedings and environmental liabilities, (3) any statements preceded by, followed by or that include the word "believes," "expects," "anticipates," "intends," "should," "may," or similar expressions; and (4) other statements contained or incorporated by reference in this document regarding matters that are not historical facts. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to: (1) the demand for the Company's services, (2) the demand for accounts receivable management generally, (3) general economic conditions, (4) changes in interest rates, (5) competition, including but not limited to pricing pressures, (6) changes in governmental regulations including, but not limited to the federal Fair Debt Collection Practices Act and comparable state statutes, (7) the status and effectiveness of the Company's Year 2000 efforts, (8) legal proceedings, (9) environmental investigations and clean up efforts, (10) the Company's ability to rationalize operations of recent acquisitions, and (11) the Company's ability to generate cash flow or obtain financing to fund its operations, service its indebtedness and continue its growth and expand successfully into new markets and services. These forward-looking statements speak only as of the date they were made. These cautionary statements should be considered in connection with any written or oral forward-looking statements that the Company may issue in the future. The Company does not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect later events or circumstances or to reflect the occurrence of unanticipated events. PART II. OTHER INFORMATION Item 1. Legal Proceedings The Company is subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the normal course of business and are routine to the nature of the Company's business. Other information with respect to legal proceedings appears in the Company's Annual Report on Form 10-K for the year ended December 31, 1997, and the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 1998 and June 30, 1998. Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None Item 6. Exhibits and Reports on Form 8-K (a). Exhibits Exhibit 10.1 First Amendment to the Second Amended and Restated Credit Agreement, dated as of March 31, 1998 Exhibit 10.2 Second Amendment to the Second Amended and Restated Credit Agreement, dated as of August 5, 1998 Exhibit 10.3 Third Amendment to the Second Amended and Restated Credit Agreement, dated as of September 23, 1998 Exhibit 10.4 Employment Agreement dated as of March 1, 1997 between Outsourcing Solutions Inc. and Michael Meyer Exhibit 27 Financial Date Schedule (Unaudited) (b). Reports on Form 8-K There were no reports on Form 8-K filed for the three-month period ended September 30, 1998. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OUTSOURCING SOLUTIONS INC. (Registrant) /s/ TIMOTHY G. BEFFA ------------------------------------------------ Timothy G. Beffa President and Chief Executive Officer /s/ DANIEL J. DOLAN ------------------------------------------------ Daniel J. Dolan Executive Vice President and Chief Financial Officer /s/ DANIEL T. PIJUT ------------------------------------------------ Daniel T. Pijut Vice President, Corporate Controller and Chief Accounting Officer Date: November 13, 1998 EX-10 2 MATERIAL CONTRACTS OUTSOURCING SOLUTIONS INC. FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT This FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this "Amendment") is dated as of March 31, 1998 and entered into by and among OUTSOURCING SOLUTIONS INC., a Delaware corporation ("Company"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to herein as a "Lender" and collectively as the "Lenders"), GOLDMAN SACHS CREDIT PARTNERS L.P. and THE CHASE MANHATTAN BANK, as Co-Administrative Agents (in such capacities, "Co-Administrative Agents"), SUN TRUST BANK, ATLANTA, as Collateral Agent (in such capacity, "Collateral Agent"), and is made with reference to that certain Second Amended and Restated Credit Agreement dated as of January 26, 1998 (the "Credit Agreement"), by and among Company, the Lenders, Goldman Sachs Credit Partners L.P. and Chase Securities Inc., as Arranging Agents and Co-Administrative Agents and Collateral Agent (the Lenders party to the Credit Agreement, Co-Administrative Agents and Collateral Agent are each individually referred to herein as a "Lender Party" and collectively as the "Lender Parties"). Capitalized terms used herein without definition shall have the same meanings herein as set forth in the Credit Agreement. RECITALS WHEREAS, the parties to the Credit Agreement desire to amend the Credit Agreement to permit, subject to certain conditions, Company and its subsidiaries to enter into certain collection agency arrangements. NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows: SECTION 1. AMENDMENTS TO CREDIT AGREEMENT 1.1 Amendments to Section 1: Definitions A. Subsection 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Consolidated Maintenance Capital Expenditures" set forth therein and substituting the following therefor: "Consolidated Maintenance Capital Expenditures" means, for any period, all Consolidated Capital Expenditures for such period other than y) Consolidated Capital Expenditures expended to make Permitted Acquisitions or Permitted Portfolio Acquisitions and z)Consolidated Capital Expenditures made with respect to Portfolio Advances." B. Subsection 1.1 of the Credit Agreement is hereby further amended by adding the following definitions of "Agency Acquisition Contract" and "Portfolio Advances" which shall be inserted in appropriate alphabetical order: "Agency Acquisition Contract" means an agreement whereby Company and/or one or more of its Subsidiaries agrees to serve as agent for a third party for purposes of collecting debt owed to such third party and pursuant to which y) Company or any Subsidiary is obligated to make Portfolio Advances; provided that, the aggregate of all such amounts required to be advanced by Company and its Subsidiaries as Portfolio Advances, and not yet paid, at any time shall not exceed $10 million per calendar quarter and z) Company and/or any of its Subsidiaries is entitled to retain as compensation for its services thereunder substantially all of the amounts collected with respect to such debt." "Portfolio Advances" means, with respect to any Agency Acquisition Contract, all amounts required to be advanced or paid by Company or any of its Subsidiaries pursuant to such Agency Acquisition Contract other than amounts representing a portion of the recovery from third party debtors as payments made on the debt of such third party debtors." 1.2 Amendments to Section 7: Negative Covenants A. Subsection 7.4 of the Credit Agreement is hereby amended by adding a new subdivision (x) thereto as follows: "(x) Company and its Subsidiaries may become and remain liable with respect to Agency Acquisition Contracts." B. Subdivision (d) of subsection 7.7(v) of the Credit Agreement is hereby amended to read in its entirety as follows: "(d) the aggregate amount expended for Permitted Portfolio Acquisitions during any Fiscal Year, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced by Company and/or its subsidiaries as Portfolio Advances during such Fiscal Year shall not exceed $60,000,000;" SECTION 2. ACKNOWLEDGEMENT AND CONSENT Each Subsidiary Guarantor hereby acknowledges that it has reviewed the terms and provisions of this Amendment and consents to the amendment of the Credit Agreement effected pursuant to this Amendment. Each Subsidiary Guarantor hereby confirms that each Loan Document to which it is a party or otherwise bound and all Collateral encumbered thereby will continue to guaranty or secure, as the case may be, to the fullest extent possible, the payment and performance of all Obligations. Each Subsidiary Guarantor acknowledges and agrees that any of the Loan Documents to which it is a party or otherwise bound shall continue in full force and effect and that all of its Obligations thereunder shall be valid and enforceable and shall not be impaired or limited by the execution or effectiveness of this Amendment. SECTION 3. COMPANY'S REPRESENTATIONS AND WARRANTIES In order to induce Lenders to enter into this Amendment and to amend the Credit Agreement in the manner provided herein, Company represents and warrants to each Lender that the following statements are true, correct and complete: A. Corporate Power and Authority. Each Loan Party has all requisite corporate or partnership (as applicable) power and authority to enter into this Amendment and to carry out the transactions contemplated by, and perform its obligations under, the Credit Agreement as amended by this Amendment (the "Amended Agreement") and the other Loan Documents. B. Authorization of Agreements. The execution and delivery of this Amendment and the performance of the Amended Agreement and the other Loan Documents have been duly authorized by all necessary corporate or partnership (as applicable) action on the part of each Loan Party. C. No Conflict. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not (i) violate any provision of any law or any governmental rule or regulation applicable to Company or any of its Subsidiaries, the Certificate or Articles of Incorporation or Bylaws (or other analogous organizational document) of Company or any of its Subsidiaries or any order, judgment or decree of any court or other agency of government binding on Company or any of its Subsidiaries, (ii) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of Company or any of its Subsidiaries, (iii) result in or require the creation or imposition of any Lien upon any of the properties or assets of Company or any of its Subsidiaries (other than any Liens created under any of the Loan Documents in favor of Collateral Agent on behalf of Lenders), or (iv) require any approval of stockholders or partners or any approval or consent of any Person under any Contractual Obligation of Company or any of its Subsidiaries, except for such approvals or consents which will be obtained on or before the Second Amendment Effective Date and disclosed in writing to Lenders. D. Governmental Consents. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any federal, state or other governmental authority or regulatory body. E. Binding Obligation. This Amendment and the Amended Agreement have been duly executed and delivered by each Loan Party and are the legally valid and binding obligations of each Loan Party, enforceable against each of them in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors' rights generally or by equitable principles relating to enforceability. F. Incorporation of Representations and Warranties From Credit Agreement. The representations and warranties contained in Section 5 of the Credit Agreement are and will be true, correct and complete in all material respects on and as of the effective date of this Amendment to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case they were true, correct and complete in all material respects on and as of such earlier date. G. Absence of Default. No event has occurred and is continuing or will result from the consummation of the transactions contemplated by this Amendment that would constitute an Event of Default or a Potential Event of Default. SECTION 4. MISCELLANEOUS A. Reference to and Effect on the Credit Agreement and the Other Loan Documents. (i) On and after the date of effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment. (ii) Except as specifically amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. (iii) The execution, delivery and performance of this Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any Lender Party under, the Credit Agreement or any of the other Loan Documents. B. Headings. Section and subsection headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose or be given any substantive effect. C. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. D. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment shall become effective as of March 31, 1998 upon the execution of a counterpart hereof by Company, each Subsidiary Guarantor, and Requisite Lenders and receipt by Company and Co-Administrative Agents of written or telephonic notification of such execution and authorization of delivery thereof. [Remainder of page intentionally left blank] IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above. COMPANY: OUTSOURCING SOLUTIONS INC. By: --------------------------------------- Daniel J. Dolan Executive Vice President and Chief Financial Officer AGENTS AND LENDERS: GOLDMAN SACHS CREDIT PARTNERS L.P., individually and as a Co-Administrative Agent By: --------------------------------------- Authorized Signatory THE CHASE MANHATTAN BANK, individually and as a Co-Administrative Agent By: --------------------------------------- Name: Title: SUNTRUST BANK, ATLANTA, individually and as Collateral Agent By: --------------------------------------- Name: Title: By: --------------------------------------- Name: Title: AG CAPITAL FUNDING PARTNERS, LTD. By: --------------------------------------- Name: Title: ARCHIMEDES FUNDING, L.L.C. By: ING Capital Advisors, Inc., as Collateral Manager By: -------------------------------- Name: Title: ARES LEVERAGED INVESTMENT FUND By: --------------------------------------- Name: Title: BANK OF SCOTLAND By: --------------------------------------- Name: Title: BANKERS TRUST COMPANY By: --------------------------------------- Name: Title: CANADIAN IMPERIAL BANK OF COMMERCE By: --------------------------------------- Name: Title: THE FIRST NATIONAL BANK OF CHICAGO By: --------------------------------------- Name: Title: MERRILL LYNCH SENIOR FLOATING RATE FUND, INC. By: --------------------------------------- Name: Title: CREDITANSTALT - BANKVEREIN By: --------------------------------------- Name: Title: BANKBOSTON, N.A. By: --------------------------------------- Name: Title: FIRST DOMINION CAPITAL, L.L.C. By: --------------------------------------- Name: Title: HELLER FINANCIAL, INC. By: --------------------------------------- Name: Title: ING HIGH INCOME PRINCIPAL PRESERVATION FUND HOLDINGS, LDC By: ING Capital Advisors, Inc. as Investment Advisor By: --------------------------------------- Name: Title: LASALLE NATIONAL BANK By: --------------------------------------- Name: Title: ML CLO XII PILGRIM AMERICA By: --------------------------------------- Name: Title: PNC BANK, NATIONAL ASSOCIATION By: --------------------------------------- Name: Title: PUTNAM HIGH YIELD TRUST By: --------------------------------------- Name: Title: PUTNAM HIGH YIELD ADVANTAGE FUND By: --------------------------------------- Name: Title: PUTNAM VT HIGH YIELD TRUST By: --------------------------------------- Name: Title: ROYALTON COMPANY By: --------------------------------------- Name: Title: SOUTHERN PACIFIC BANK By: --------------------------------------- Name: Title: VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By: --------------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING II, LTD. By: INDOSUEZ CAPITAL LUXEMBOURG, as Collateral Manager By: -------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING III, LTD. By: INDOSUEZ CAPITAL LUXEMBOURG, as Collateral Manager By: -------------------------------- Name: Title: SENIOR DEBT PORTFOLIO By: BOSTON MANAGEMENT AND RESEARCH, as Investment Advisor By: -------------------------------- Name: Title: SPS SWAPS By: --------------------------------------- Name: Title: PILGRIM AMERICA PRIME RATE TRUST By: --------------------------------------- Name: Title: PACIFIC LIFE CBO 1998-1 LTD By: --------------------------------------- Name: Title: CYPRESS TREE BOSTON PARTNERS By: --------------------------------------- Name: Title: DELANO COMPANY By: Pacific Investment Management Company, as its Investment Advisor By: --------------------------------------- Name: Title: KZH HOLDING CORPORATION By: --------------------------------------- Name: Title: KZH-CRESCENT 2 CORPORATION By: --------------------------------------- Name: Title: KZH HOLDING CORPORATION III By: --------------------------------------- Name: Title: KZH IV CORPORATION By: --------------------------------------- Name: Title: SUBSIDIARY GUARANTORS: ALASKA FINANCIAL SERVICES, INC. CFC SERVICES CORP. THE CONTINENTAL ALLIANCE, INC. SOUTHWEST CREDIT SERVICES, INC. By: --------------------------------------- Name: Title: A.M. MILLER & ASSOCIATES, INC. ACCOUNT PORTFOLIOS G.P., INC. ACCOUNT PORTFOLIOS, INC. ASSET RECOVERY & MANAGEMENT CORP. FM SERVICES CORPORATION FURST AND FURST, INC. INDIANA MUTUAL CREDIT ASSOCIATION, INC. JENNIFER LOOMIS & ASSOCIATES, INC. NATIONAL ACCOUNT SYSTEMS, INC. PAYCO AMERICAN CORPORATION PAYCO AMERICAN INTERNATIONAL CORP. PAYCO-GENERAL AMERICAN CREDITS, INC. PROFESSIONAL RECOVERIES INC. QUALINK, INC. UNIVERSITY ACCOUNTING SERVICE, INC. ACCELERATED BUREAU OF COLLECTIONS, INC. NORTH SHORE AGENCY, INC. By: --------------------------------------- Name: Title: KZH-CRESCENT CORPORATION By: --------------------------------------- Name: Title: EX-10 3 MATERIAL CONTRACTS OUTSOURCING SOLUTIONS INC. SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT This SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this "Amendment") is dated as of August 5, 1998 and entered into by and among OUTSOURCING SOLUTIONS INC., a Delaware corporation ("Company"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to herein as a "Lender" and collectively as the "Lenders"), and GOLDMAN SACHS CREDIT PARTNERS L.P. and THE CHASE MANHATTAN BANK, as Co-Administrative Agents (in such capacities, "Co-Administrative Agents"), and is made with reference to that certain Second Amended and Restated Credit Agreement dated as of January 26, 1998, as heretofore amended, supplemented or otherwise modified (as so amended, supplemented or modified, the "Credit Agreement"), by and among Company, the Lenders, Goldman Sachs Credit Partners L.P. and Chase Securities Inc., as Arranging Agents, and Co-Administrative Agents. Capitalized terms used herein without definition shall have the same meanings herein as set forth in the Credit Agreement and in the amendments contained in Section 1 hereof. RECITALS WHEREAS, the parties to the Credit Agreement desire to amend the Credit Agreement as herein provided to provide for certain adjustments to certain covenants to permit Company to establish a special purpose subsidiary to finance the acquisition of receivables and to make certain other amendments as provided herein. NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows: SECTION 1. AMENDMENTS TO CREDIT AGREEMENT 1.1 Amendments to Section 1: Definitions A. Subsection 1.1 of the Credit Agreement is hereby amended by adding thereto the following definitions, which shall be inserted in proper alphabetical order: "API" means Account Portfolios, Inc., a Delaware corporation. "OSI Funding" means OSI Funding Corp., a Delaware corporation. "Plan of Correction" has the meaning assigned to that term in subsection 5.21. "Receivables Sale and Servicing Agreement" means that certain Sale and Servicing Agreement among Company, Gulf State Credit, L.L.C., OSI Funding, API and Triple-A One, in the form delivered to Co-Administrative Agents on or prior to the Second Amendment Effective Date and as such agreement may be amended, restated, supplemented or otherwise modified from time to time to the extent permitted under subsection 7.12A. "Second Amendment" means that certain Second Amendment to Credit Agreement dated as of August 5, 1998, by and among Company, Lenders and Co-Administrative Agents. "Second Amendment Effective Date" has the meaning assigned to that term in the Second Amendment. "Triple-A One" means Triple-A One Funding Corporation, a Delaware corporation. "Triple-A One Commercial Paper" means commercial paper issued by Triple-A One to fund advances made by Triple-A One to OSI Funding evidenced by the Variable Funding Notes. "Triple-A One Credit Agreement", means that certain Triple-A One Credit Agreement among OSI Funding, Triple-A One and MBIA Insurance Corporation, in the form delivered to Co-Administrative Agents on or prior to the Second Amendment Effective Date and as such agreement may be amended, restated, supplemented or otherwise modified from time to time to the extent permitted under subsection 7.12A. "Variable Funding Notes" means, collectively, the variable funding notes or certificates in an original aggregate principal amount of up to $100,000,000 issued by OSI Funding to Triple-A One to finance the purchase of receivables by OSI Funding pursuant to the Triple-A One Credit Agreement, as such variable funding notes or certificates may be amended, restated, supplemented or otherwise modified from time to time to the extent permitted under subsection 7.12A. "Year 2000 Problems" means limitations in the capacity or readiness to handle date information for the Year 1999 or years beginning January 1, 2000 of any of the hardware, firmware or software systems ("Systems") associated with information processing and delivery, operations or services (e.g., security and alarms, elevators, communications, and HVAC) operated by, provided to or otherwise reasonably necessary to the business or operations of Holdings and its Subsidiaries. B. Subsection 1.1 of the Credit Agreement is hereby further amended by deleting the definitions of "Consolidated Maintenance Capital Expenditures" and "Related Agreements" in their entirety and substituting therefor the following: "Consolidated Maintenance Capital Expenditures" means, for any period, all Consolidated Capital Expenditures for such period other than (x) Consolidated Capital Expenditures expended to make Permitted Acquisitions or Permitted Portfolio Acquisitions, (y) Consolidated Capital Expenditures made with respect to Portfolio Advances and (z) Consolidated Capital Expenditures expended to make acquisitions of receivables portfolios permitted under subsection 7.7(vii) or 7.7(viii). "Related Agreements" means the Subordinated Notes, the Subordinated Note Indenture, the other Subordinated Note Documents, the Payco Acquisition Agreement, the Articles of Merger, the Certificate of Merger, the NSA Acquisition Agreement, the Accelerated Acquisition Agreement, the Union Acquisition Documents, the Receivables Sale and Servicing Agreement, the Triple-A One Credit Agreement, the Variable Funding Notes, the Articles of Merger and the Certificate of Merger. C. Subsection 1.1 of the Credit Agreement is hereby further amended by adding at the end of the definition of "Asset Sale" contained therein the following sentence: "Notwithstanding anything to the contrary contained herein, any sale of a receivables portfolio to OSI Funding permitted under subsection 7.7(vii) shall not be deemed an Asset Sale hereunder." D. Subsection 1.1 of the Credit Agreement is hereby further amended by (i) deleting the "." at the end of the definition of "Subsidiary" contained therein and substituting therefor ";"; and (ii) adding at the end thereof the following proviso: "provided, however, that for purposes of subsections 6.9 and 6.14 and Sections 7 and 8 hereof, OSI Funding shall not be deemed a Subsidiary of Holdings or any of its Subsidiaries; provided further, however, that nothing contained herein shall limit the obligation of Company and its Subsidiaries to pledge OSI Funding's capital stock pursuant to the Collateral Documents." 1.2 Amendment to Section 5: Representations and Warranties Section 5 of the Credit Agreement is hereby amended by adding a new subsection 5.21 at the end thereof as follows: "5.21 Year 2000 Problems. Company and its Subsidiaries have (i) engaged in a process of assessment of the existence of the Year 2000 Problems reasonably appropriate to the scope and complexity of their respective Systems; (ii) adopted and are successfully implementing a plan of correction ("Plan of Correction") which Company reasonably believes will result in a substantial elimination of Year 2000 Problems before any processing failure of a System or of Systems due to Year 2000 Problems which might have a material effect on the business, operations or financial performance of Company and, in the case of all Systems critical to the business or operations of Company and its Subsidiaries, elimination in all material respects of Year 2000 Problems prior to any processing failure of a System or Systems due to Year 2000 Problems which migh have a material effect on the business, operations or financial performance of Company; (iii) adopted and are successfully implementing validation procedures calculated to test on an ongoing basis the sufficiency of the Plan of Correction, its implementation, and the correction of Year 2000 Problems in substantially all Systems and all Systems critical to the business or operations of Company and its Subsidiaries; (iv) adopted and are successfully implementing policies and procedures requiring regular reports to, and monitoring by, senior management of Company concerning the foregoing matters; and (v) provided Co-Administrative Agents true and correct copies of the written Plan of Correction, and related implementation budgets, reviewed and approved by Company's Board of Directors." 1.3 Amendment to Section 6: Affirmative Covenants Section 6 of the Credit Agreement is hereby amended by adding a new subsection 6.15 at the end thereof as follows: "6.15 Year 2000 Problems. Company shall (i) promptly advise Co-Administrative Agents of any material (A) disruption or delay in the implementation of the Plan of Correction, as the same may be updated from time to time, including any determination by Company, any senior manager of Company or any other Subsidiary of Company, or any consultant known to Company or any other Subsidiary of Company with respect to Year 2000 Problems ("Consultant") that there is or will be a failure to achieve any of the objectives specifically identified in subdivision (ii) of subsection 5.21, or (B) change in the written Plan of Correction or related implementation budget referred to in subdivision (v) of subsection 5.21, or any later version thereof furnished to Co-Administrative Agents; (ii) afford to Co-Administrative Agents and their representatives, upon three days' notice to Company, reasonable access to Company's and its Subsidiaries' properties, personnel, service providers, vendors and records for the purpose of enabling Co-Administrative Agents to assess the adequacy of, and the record of performance of Company and its Subsidiaries with respect to, the Plan of Correction, related financial performance and conformity of actual performance with related implementation budgets; and (iii) periodically report to Co-Administrative Agents, in such form as Co-Administrative Agents may reasonably request, on (a) the progress of Company and its Subsidiaries in implementing the Plan of Correction, (b) the budget for, and actual financial performance with respect to, implementation of the Plan of Correction and (c) the assessment of Company, any senior manager of Company or any other Subsidiary of Company, or any Consultant of the adequacy of the Plan of Correction or the related implementation budget." 1.4 Amendments to Section 7: Negative Covenants A. Subsection 7.3 of the Credit Agreement is hereby amended by (i)deleting the "and" at the end of clause (ix) thereof; (ii) deleting the "." at the end of clause (x) thereof and substituting therefor ";"; and (iii) adding new clauses (xi) and (xii) at the end thereof as follows: "(xi) Company may, on or after the Second Amendment Effective Date, (a) make a cash equity contribution of $2,500,000 to OSI Funding and (b) in the event that the average aggregate outstanding principal amount of Triple-A One Commercial Paper exceeds $25,000,000 for any 30-day period after the Second Amendment Effective Date, make an additional cash equity contribution of $2,500,000 to OSI Funding; and (xii) Company may make the Investments permitted under subsections 7.7(vii) and 7.7(viii)." B. Subsection 7.6D of the Credit Agreement is hereby amended by deleting the reference to "$18,000,000" contained therein and substituting therefor the following: "(x) $20,000,000 in Fiscal Year 1998 and (y) $18,000,000 in each Fiscal Year thereafter" C. Subsection 7.7(v) of the Credit Agreement is hereby amended by deleting clause (d) therefrom in its entirety and substituting therefor the following: "(d) the aggregate amount expended for Permitted Portfolio Acquisitions of receivables portfolios from Bally's Inc. shall not exceed $10,000,000 during any Fiscal Year, and the aggregate amount expended for all other Permitted Portfolio Acquisitions (1) during the period from the beginning of Fiscal Year 1998 to but excluding the Second Amendment Effective Date, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced and retained by Company and/or its Subsidiaries as Portfolio Advances during such period, shall not exceed $35,000,000, (2) during the period from the Second Amendment Effective Date through the end of Fiscal Year 1998, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced and retained by Company and/or its Subsidiaries as Portfolio Advances during such period, shall not exceed $10,000,000, and (3) during any Fiscal Year after 1998, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced and retained by Company and/or its Subsidiaries as Portfolio Advances during such Fiscal Year, shall not exceed $15,000,000;" D. Subsection 7.7 of the Credit Agreement is hereby amended by (i)deleting the "and" at the end of clause (v) thereof; (ii) deleting the "." at the end of clause (vi) thereof and substituting therefor ";"; and (iii) adding new clauses (vii), (viii) and (ix) at the end thereof as follows: "(vii) API may (a) make acquisitions of receivables portfolios which are, within 10 Business Days after the acquisition thereof (or, in the case of receivables portfolios purchased after July 1, 1998 but prior to the Second Amendment Effective Date, within 10 Business Days after the Second Amendment Effective Date), sold to OSI Funding pursuant to and in accordance with the terms of the Receivables Sale and Servicing Agreement, and (b) sell receivables portfolios to OSI Funding pursuant to and in accordance with the terms of the Receivables Sale and Servicing Agreement, provided that the consideration received by API from OSI Funding for any such receivables portfolio shall be no less than the consideration paid by API to acquire such receivables portfolio; (viii) API may (a) re-acquire (pursuant to the terms of the Receivables Sale and Servicing Agreement) from OSI Funding any receivables portfolios sold to OSI Funding pursuant to subsection 7.7(vii) and (b) re-sell such receivables portfolios to the Persons from whom such receivables portfolios originated, provided that the aggregate consideration paid by API to re-acquire such receivables portfolios minus the aggregate consideration received by API for any such receivables portfolios subsequently re-sold to any such Persons shall not exceed $2,500,000; and (ix) Company may create OSI Funding on or after the Second Amendment Effective Date; provided, however, that no change to the Certificate of Incorporation or Bylaws of OSI Funding after the Second Amendment Effective Date which would be adverse to Lenders may be made without the prior written consent of Co-Administrative Agents." E. Subsection 7.11 of the Credit Agreement is hereby amended by adding the following sentence at the end thereof: "Notwithstanding anything to the contrary contained herein, API shall not acquire and hold any receivables portfolio for more than 10 Business Days after the acquisition thereof (or, in the case of receivables portfolios purchased after July 1, 1998 but prior to the Second Amendment Effective Date, 10 Business Days after the Second Amendment Effective Date)." 1.5 Amendment to Section 8: Events of Default Section 8 of the Credit Agreement is hereby amended by adding a new subsection 8.16 at the end thereof as follows: "8.16 Termination as Servicer. API or any other subsidiary of Company shall be terminated as servicer under the Receivables Sale and Servicing Agreement and Company or any other Subsidiary of Company shall not concurrently succeed such terminated servicer as successor servicer thereunder;" SECTION 2. CONDITIONS TO EFFECTIVENESS Section 1 of this Amendment shall become effective only upon the satisfaction of all of the following conditions precedent (the date of satisfaction of such conditions being referred to herein as the "Second Amendment Effective Date"): A. On or before the Second Amendment Effective Date, Company shall deliver to Lenders (or to Chase Co-Administrative Agent for Lenders with sufficient originally executed copies, where appropriate, for each Lender and its counsel) the following, each, unless otherwise noted, dated the Second Amendment Effective Date: (i) Certified copies of its Certificate of Incorporation, together with a good standing certificate from the Secretary of State of the State of Delaware, each dated a recent date prior to the Second Amendment Effective Date; (ii) Copies of its Bylaws, certified as of the Second Amendment Effective Date by its corporate secretary or an assistant secretary; (iii) Resolutions of its Board of Directors approving and authorizing the execution, delivery, and performance of this Amendment, certified as of the Second Amendment Effective Date by its corporate secretary or an assistant secretary as being in full force and effect without modification or amendment; (iv) Signature and incumbency certificates of its officers executing this Amendment; and (v) Copies of this Amendment executed by Company and each Subsidiary Guarantor. B. On or before the Second Amendment Effective Date, Co-Administrative Agents shall have received certified copies of the Certificate of Incorporation and Bylaws of OSI Funding and copies of the Receivables Sale and Servicing Agreement, the Variable Funding Notes, the Triple-A One Credit Agreement and other documentation (collectively, the "Securitization Documents") relating to the formation of OSI Funding, the issuance of the Variable Funding Notes and the guarantees issued by MBIA Insurance Corporation in connection therewith, which Securitization Documents shall be in form and substance reasonably satisfactory to Co-Administrative Agents. SECTION 3. ACKNOWLEDGEMENT AND CONSENT Each Subsidiary Guarantor hereby acknowledges that it has reviewed the terms and provisions of this Amendment and consents to the amendment of the Credit Agreement effected pursuant to this Amendment. Each Subsidiary Guarantor hereby confirms that each Loan Document to which it is a party or otherwise bound and all Collateral encumbered thereby will continue to guaranty or secure, as the case may be, to the fullest extent possible, the payment and performance of all Obligations. Each Subsidiary Guarantor acknowledges and agrees that any of the Loan Documents to which it is a party or otherwise bound shall continue in full force and effect and that all of its obligations thereunder shall be valid and enforceable and shall not be impaired or limited by the execution or effectiveness of this Amendment. SECTION 4. COMPANY'S REPRESENTATIONS AND WARRANTIES In order to induce Lenders to enter into this Amendment and to amend the Credit Agreement in the manner provided herein, Company represents and warrants to each Lender that the following statements are true, correct and complete: A. Corporate Power and Authority. Each Loan Party has all requisite corporate or partnership (as applicable) power and authority to enter into this Amendment and to carry out the transactions contemplated by, and perform its obligations under, the Credit Agreement as amended by this Amendment (the "Amended Agreement") and the other Loan Documents. B. Authorization of Agreements. The execution and delivery of this Amendment and the performance of the Amended Agreement and the other Loan Documents have been duly authorized by all necessary corporate or partnership (as applicable) action on the part of each Loan Party. C. No Conflict. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not (i) violate any provision of any law or any governmental rule or regulation applicable to Company or any of its Subsidiaries, the Certificate or Articles of Incorporation or Bylaws (or other analogous organizational document) of Company or any of its Subsidiaries or any order, judgment or decree of any court or other agency of government binding on Company or any of its Subsidiaries, (ii) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of Company or any of its Subsidiaries, (iii) result in or require the creation or imposition of any Lien upon any of the properties or assets of Company or any of its Subsidiaries (other than any Liens created under any of the Loan Documents in favor of Collateral Agent on behalf of Lenders), or (iv) require any approval of stockholders or partners or any approval or consent of any Person under any Contractual Obligation of Company or any of its Subsidiaries, except for such approvals or consents which will be obtained on or before the Second Amendment Effective Date and disclosed in writing to Lenders. D. Governmental Consents. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any federal, state or other governmental authority or regulatory body. E. Binding Obligation. This Amendment and the Amended Agreement have been duly executed and delivered by each Loan Party and are the legally valid and binding obligations of each Loan Party, enforceable against each of them in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors' rights generally or by equitable principles relating to enforceability. F. Incorporation of Representations and Warranties From Credit Agreement. The representations and warranties contained in Section 5 of the Credit Agreement are and will be true, correct and complete in all material respects on and as of the Second Amendment Effective Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case they were true, correct and complete in all material respects on and as of such earlier date. G. Absence of Default. No event has occurred and is continuing or will result from the consummation of the transactions contemplated by this Amendment that would constitute an Event of Default or a Potential Event of Default. SECTION 5. AUTHORIZATION OF COLLATERAL AGENT Each undersigned Lender hereby (i) authorizes Collateral Agent to enter an amendment to the Security Agreement in substantially the form attached hereto as Annex A and (ii) authorizes Collateral Agent to execute and deliver partial release statements and other documents which Collateral Agent deems necessary to evidence the release of Collateral Agent's security interest in receivables portfolios sold by API pursuant to subsection 7.7(vii) of the Amended Agreement. SECTION 6. MISCELLANEOUS A. Reference to and Effect on the Credit Agreement and the Other Loan Documents. (i) On and after the Second Amendment Effective Date, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment. (ii) Except as specifically amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. (iii) The execution, delivery and performance of this Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any Agent or Lender under, the Credit Agreement or any of the other Loan Documents. B. Headings. Section and subsection headings in this Amendment are included herein for convenience of reference only and not constitute a part of this Amendment for any other purpose or be given any substantive effect. C. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. D. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment (other than the provisions of Section 1 hereof) shall become effective upon the execution of a counterpart hereof by Company, each Subsidiary Guarantor and Requisite Lenders and receipt by Company and Co-Administrative Agents of written or telephonic notification of such execution and authorization of delivery thereof. [Remainder of page intentionally left blank] IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above. COMPANY: OUTSOURCING SOLUTIONS INC. By: /s/ Daniel Dolan --------------------------------------- Name: Daniel Dolan Title: Executive Vice President & Chief Financial Officer AGENTS AND LENDERS: GOLDMAN SACHS CREDIT PARTNERS L.P., individually and as a Co-Administrative Agent By: /s/ Stephen B. King --------------------------------------- Name: Stephen B. King Title: Authorized Signatory THE CHASE MANHATTAN BANK, individually and as a Co-Administrative Agent By: /s/ Gail Weiss --------------------------------------- Name: Gail Weiss Title: Vice President SUNTRUST BANK, ATLANTA, individually and as Collateral Agent By: /s/ Dennis H. James, Jr. --------------------------------------- Name: Dennis H. James, Jr. Title: Vice President By: /s/ Susan M. Hall --------------------------------------- Name: Susan M. Hall Title: Vice President AG CAPITAL FUNDING PARTNERS, L.P. By: Angelo, Gordon & Co., L.P. as Investment Advisor By: /s/ Jeffrey H. Aronson --------------------------------------- Name: Jeffrey H. Aronson Title: Managing Director AG CAPITAL FUNDING PARTNERS, L.P. By: /s/ Jeff Moore --------------------------------------- Name: Jeff Moore Title: Principal ARCHIMEDES FUNDING, L.L.C. By: ING Capital Advisors, Inc., as Collateral Manager By: /s/ Michael D. Hatley --------------------------------------- Name: Michael D. Hatley Title: Senior Vice President ARES LEVERAGED INVESTMENT FUND, L.P. By: /s/ Jeff Moore --------------------------------------- Name: Jeff Moore Title: Principal CANADIAN IMPERIAL BANK OF COMMERCE By: --------------------------------------- Name: Title: CAPTIVA FINANCE III, LTD. By: --------------------------------------- Name: Title: CREDIT SUISSE FIRST BOSTON By: /s/ Barry A. Zamore --------------------------------------- Name: Barry A. Zamore Title: Vice President By: /s/ Claire M. McCarthy --------------------------------------- Name: Claire M. McCarthy Title: Managing Director THE FIRST NATIONAL BANK OF CHICAGO By: /s/ William J. Oleferchik --------------------------------------- Name: William J. Oleferchik Title: Vice President MERRILL LYNCH SENIOR FLOATING RATE FUND, INC. By: --------------------------------------- Name: Title: ML DEBT STRATEGIES FUND II, INC. By: --------------------------------------- Name: Title: ML INCOME STRATEGIES PORTFOLIO By: --------------------------------------- Name: Title: CREDITANSTALT CORPORATE FINANCE, INC. By: /s/ Carl G. Drake --------------------------------------- Name: Carl G. Drake Title: Vice President By: /s/ John Taylor --------------------------------------- Name: John Taylor Title: Senior Associate BANKBOSTON, N.A. By: /s/ Richard D. Hill, Jr. --------------------------------------- Name: Richard D. Hill, Jr. Title: Managing Director FIRST DOMINION FUNDING I By: --------------------------------------- Name: Title: FRANKLIN FLOATING RATE TRUST By: --------------------------------------- Name: Title: HELLER FINANCIAL, INC. By: /s/ Linda W. Wolf --------------------------------------- Name: Linda W. Wolf Title: Senior Vice President ING HIGH INCOME PRINCIPAL PRESERVATION FUND HOLDINGS, LDC By: ING Capital Advisors, Inc. as Investment Advisor By: /s/ Michael D. Hatley -------------------------------- Name: Michael D. Hatley Title: Senior Vice President LASALLE NATIONAL BANK By: /s/ Young J. Park --------------------------------------- Name: Young J. Park Title: Vice President PNC BANK, NATIONAL ASSOCIATION By: /s/ Robert A. Krasnow --------------------------------------- Name: Robert A. Krasnow Title: Senior Vice President PUTNAM VT HIGH YIELD TRUST By: --------------------------------------- Name: Title: PUTNAM HIGH YIELD TRUST By: --------------------------------------- Name: Title: ROYALTON COMPANY By: --------------------------------------- Name: Title: SOUTHERN PACIFIC BANK By: /s/ Cheryl A. Wasilewski --------------------------------------- Name: Cheryl A. Wasilewski Title: Vice President TORONTO DOMINION BANK By: --------------------------------------- Name: Title: VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By: /s/ Jeffrey W. Maillet --------------------------------------- Name: Jeffrey W. Maillet Title: Senior Vice President & Director VAN KAMPEN AMERICAN CAPITAL SENIOR FLOATING RATE FUND By: /s/ Jeffrey W. Maillet --------------------------------------- Name: Jeffrey W. Maillet Title: Senior Vice President & Director SENIOR DEBT PORTFOLIO By: BOSTON MANAGEMENT AND RESEARCH, as Investment Advisor By: -------------------------------- Name: Title: SPS SWAPS By: --------------------------------------- Name: Title: PILGRIM AMERICA PRIME RATE TRUST By: Pilgrim America Investments, Inc., as its Investment Manager By: /s/ Charles E. LeMieux -------------------------------- Name: Charles E. LeMieux Title: Assistant Vice President DELANO COMPANY By: Pacific Investment Management Company, as its Investment Advisor By: -------------------------------- Name: Title: KZH-CRESCENT 2 CORPORATION By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent KZH HOLDING CORPORATION III By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent KZH-CYPRESS TREE-1 CORPORATION By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent KZH-CRESCENT CORPORATION By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent KZH-ING-2 CORPORATION By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent VAN KAMPEN CLO II, LIMITED By: /s/ Jeffrey W. Maillet --------------------------------------- Name: Jeffrey W. Maillet Title: Senior Vice President & Director INDOSUEZ CAPITAL FUNDING IIA, LTD. By: INDOSUEZ CAPITAL, as Portfolio Advisor By: /s/ Daniel H. Smith --------------------------------------- Name: Daniel H. Smith Title: First Vice President INDOSUEZ CAPITAL FUNDING III, LTD. By: INDOSUEZ CAPITAL, as Portfolio Advisor By: /s/ Daniel H. Smith --------------------------------------- Name: Daniel H. Smith Title: First Vice President CREDIT LYONNAIS By: --------------------------------------- Name: Title: KZH-IV CORPORATION By: /s/ Virginia Conway --------------------------------------- Name: Virginia Conway Title: Authorized Agent SUBSIDIARY GUARANTORS: CFC SERVICES CORP. THE CONTINENTAL ALLIANCE, INC. By: /s/ Daniel Dolan --------------------------------------- Name: Daniel Dolan Title: Vice President A.M. MILLER & ASSOCIATES, INC. ACCOUNT PORTFOLIOS, INC. ASSET RECOVERY & MANAGEMENT CORP. GRABLE, GREINER & WOLFF, INC. INDIANA MUTUAL CREDIT ASSOCIATION, INC. JENNIFER LOOMIS & ASSOCIATES, INC. NATIONAL ACCOUNT SYSTEMS, INC. PAYCO AMERICAN CORPORATION PAYCO AMERICAN INTERNATIONAL CORP. PAYCO-GENERAL AMERICAN CREDITS, INC. PROFESSIONAL RECOVERIES INC. QUALINK, INC. UNIVERSITY ACCOUNTING SERVICE, INC. NORTH SHORE AGENCY, INC. By: /s/ Richard Hoffman --------------------------------------- Name: Richard Hoffman Title: Assistant Secretary ACCELERATED BUREAU OF COLLECTIONS, INC. By: /s/ Daniel Dolan --------------------------------------- Name: Daniel Dolan Title: Assistant Secretary PERIMETER CREDIT, L.L.C. GULF STATE CREDIT, L.L.C. ALLIED BOND & COLLECTION AGENCY, INC. AMERICAN CHILD SUPPORT SERVICE BUREAU, INC. CAPITAL CREDIT CORPORATION TRANSWORLD SYSTEMS INC. UCO PROPERTIES, INC. UNION FINANCIAL SERVICES GROUP, INC. HIGH PERFORMANCE SERVICES, INC. HIGH PERFORMANCE SERVICES OF FLORIDA, INC. INTERACTIVE PERFORMANCE, INC. INTERACTIVE PERFORMANCE OF FLORIDA, INC. AMERICAN RECOVERY COMPANY, INC. C.S.N. CORP. GENERAL CONNECTOR CORPORATION U.C.O.-M.B.A. CORPORATION UNION-SPECIALTY STEEL CASTING CORPORATION INTERACTIVE PERFORMANCE OF GEORGIA, INC. By: /s/ Richard Hoffman --------------------------------------- Name: Richard Hoffman Title: Assistant Secretary THE UNION CORPORATION By: /s/ Richard Hoffman --------------------------------------- Name: Richard Hoffman Title: Secretary EX-10 4 MATERIAL CONTRACTS OUTSOURCING SOLUTIONS INC. THIRD AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT This THIRD AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this "Amendment") is dated as of September 23, 1998 and entered into by and among OUTSOURCING SOLUTIONS INC., a Delaware corporation ("Com pany"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to herein as a "Lender" and collectively as the "Lend ers"), and GOLDMAN SACHS CREDIT PARTNERS L.P. and THE CHASE MANHAT TAN BANK, as Co-Administrative Agents (in such capacities, "Co-Administrative Agents"), and is made with reference to that certain Second Amended and Restated Credit Agreement dated as of January 26, 1998, as heretofore amended, supplemented or otherwise modified (as so amended, supplemented or modified, the "Credit Agreement"), by and among Company, the Lenders, Goldman Sachs Credit Partners L.P. and Chase Securities Inc., as Arranging Agents and Co-Administrative Agents. Capitalized terms used herein without definition shall have the same meanings herein as set forth in the Credit Agreement and in the amendments contained in Section 1 hereof. RECITALS WHEREAS, the parties to the Credit Agreement desire to amend the Credit Agreement to provide for certain adjustments to the covenants restricting Permitted Portfolio Acquisitions and Portfolio Advances. NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows: SECTION 1. AMENDMENT TO CREDIT AGREEMENT 1.1 Amendments to Section 7: Negative Covenants A. Subsection 7.7(v) of the Credit Agreement is hereby amended by deleting clause (d) therefrom in its entirety and substituting therefor the following: "(d) the aggregate amount expended for Permitted Portfolio Acquisitions of receivables portfolios from Bally's Inc. shall not exceed $10,000,000 during any Fiscal Year, and the aggregate amount expended for all other Permitted Portfolio Acquisitions(1) during Fiscal Year 1998, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced and retained by Company and/or its Subsidiaries as Portfolio Advances during such period, shall not exceed $55,000,000, and (2) during any Fiscal Year after 1998, together with the aggregate amount of all Investments made pursuant to subsection 7.3(v)(c) and the aggregate amount advanced and retained by Company and/or its Subsidiaries as Portfolio Advances during such Fiscal Year, shall not exceed $15,000,000;" SECTION 2. ACKNOWLEDGMENT AND CONSENT Each Subsidiary Guarantor hereby acknowledges that it has reviewed the terms and provisions of this Amendment and consents to the amendment of the Credit Agreement effected pursuant to this Amendment. Each Subsidiary Guarantor hereby confirms that each Loan Document to which it is a party or otherwise bound and all Collateral encumbered thereby will continue to guaranty or secure, as the case may be, to the fullest extent possible, the payment and performance of all Obligations. Each Subsidiary Guarantor acknowledges and agrees that any of the Loan Documents to which it is a party or otherwise bound shall continue in full force and effect and that all of its obligations thereunder shall be valid and enforceable and shall not be impaired or limited by the execution or effectiveness of this Amendment. SECTION 3. COMPANY'S REPRESENTATIONS AND WARRANTIES In order to induce Lenders to enter into this Amendment and to amend the Credit Agreement in the manner provided herein, Company represents and warrants to each Lender that the following statements are true, correct and complete: A. Corporate Power and Authority. Each Loan Party has all requisite corporate or partnership (as applicable) power and authority to enter into this Amendment and to carry out the transactions contemplated by, and perform its obligations under, the Credit Agreement as amended by this Amendment (the "Amended Agreement") and the other Loan Documents. B. Authorization of Agreements. The execution and delivery of this Amendment and the performance of the Amended Agreement and the other Loan Documents have been duly authorized by all necessary corporate or partnership (as applicable) action on the part of each Loan Party. C. No Conflict. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not (i) violate any provision of any law or any governmental rule or regulation applicable to Company or any of its Subsidiaries, the Certificate or Articles of Incorporation or Bylaws (or other analogous organizational document) of Company or any of its Subsidiaries or any order, judgment or decree of any court or other agency of government binding on Company or any of its Subsidiaries, (ii) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of Company or any of its Subsidiaries, (iii) result in or require the creation or imposition of any Lien upon any of the properties or assets of Company or any of its Subsidiaries (other than any Liens created under any of the Loan Documents in favor of Collateral Agent on behalf of Lenders), or (iv) require any approval of stockholders or partners or any approval or consent of any Person under any Contractual Obligation of Company or any of its Subsidiaries, except for such approvals or consents which will be obtained on or before the Third Amendment Effective Date and disclosed in writing to Lenders. D. Governmental Consents. The execution and delivery by each Loan Party of this Amendment and the performance by each Loan Party of the Amended Agreement and the other Loan Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any federal, state or other governmental authority or regulatory body. E. Binding Obligation. This Amendment and the Amended Agreement have been duly executed and delivered by each Loan Party and are the legally valid and binding obligations of each Loan Party, enforceable against each of them in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors' rights generally or by equitable principles relating to enforceability. F. Incorporation of Representations and Warranties From Credit Agreement. The representations and warranties contained in Section 5 of the Credit Agreement are and will be true, correct and complete in all material respects on and as of the Third Amendment Effective Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case they were true, correct and complete in all material respects on and as of such earlier date. G. Absence of Default. No event has occurred and is continuing or will result from the consummation of the transactions contemplated by this Amendment that would constitute an Event of Default or a Potential Event of Default. SECTION 4. MISCELLANEOUS A. Reference to and Effect on the Credit Agreement and the Other Loan Documents. (i) On and after the Third Amendment Effective Date, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment. (ii) Except as specifically amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. (iii) The execution, delivery and performance of this Amendment shall not, except as expressly provided herein, constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any Agent or Lender under, the Credit Agreement or any of the other Loan Documents. B. Headings. Section and subsection headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose or be given any substantive effect. C. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGA TIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. D. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment shall become effective (the date of effectiveness being referred to herein as the "Third Amendment Effective Date") upon the execution of a counterpart hereof by Company, each Subsidiary Guarantor and Requisite Lenders and receipt by Company and Co-Administrative Agents of written or telephonic notification of such execution and authorization of delivery thereof. Notwithstanding the date of effectiveness of the Second Amendment to the Credit Agreement, the provisions of this Amendment with respect to subsection 7.7 (v)(d) of the Credit Agreement shall be controlling on and after the Third Amendment Effective Date. [Remainder of page intentionally left blank] IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above. COMPANY: OUTSOURCING SOLUTIONS INC. By: /s/ Daniel J. Dolan --------------------------------------- Name: Daniel J. Dolan Title: EVP, Chief Financial Officer AGENTS AND LENDERS: GOLDMAN SACHS CREDIT PARTNERS L.P., individually and as a Co-Administrative Agent By: --------------------------------------- Authorized Signatory THE CHASE MANHATTAN BANK, individually and as a Co-Administrative Agent By: --------------------------------------- Name: Title: SUNTRUST BANK, ATLANTA, individually and as Collateral Agent By: --------------------------------------- Name: Title: By: --------------------------------------- Name: Title: AG CAPITAL FUNDING PARTNERS, L.P. By: --------------------------------------- Name: Title: ARCHIMEDES FUNDING, L.L.C. By: ING Capital Advisors, Inc., as Collateral Manager By: -------------------------------- Name: Title: ARES LEVERAGED INVESTMENT FUND, L.P. By: --------------------------------------- Name: Title: CANADIAN IMPERIAL BANK OF COMMERCE By: --------------------------------------- Name: Title: CAPTIVA FINANCE III, LTD. By: --------------------------------------- Name: Title: THE FIRST NATIONAL BANK OF CHICAGO By: --------------------------------------- Name: Title: MERRILL LYNCH SENIOR FLOATING RATE FUND, INC. By: --------------------------------------- Name: Title: ML DEBT STRATEGIES FUND II, INC. By: --------------------------------------- Name: Title: ML INCOME STRATEGIES PORTFOLIO By: --------------------------------------- Name: Title: CREDITANSTALT - BANKVEREIN By: --------------------------------------- Name: Title: BANKBOSTON, N.A. By: --------------------------------------- Name: Title: FIRST DOMINION FUNDING I By: --------------------------------------- Name: Title: FRANKLIN FLOATING RATE TRUST By: --------------------------------------- Name: Title: HELLER FINANCIAL, INC. By: --------------------------------------- Name: Title: ING HIGH INCOME PRINCIPAL PRESERVATION FUND HOLDINGS, LDC By: ING Capital Advisors, Inc. as Investment Advisor By: -------------------------------- Name: Title: LASALLE NATIONAL BANK By: --------------------------------------- Name: Title: PNC BANK, NATIONAL ASSOCIATION By: --------------------------------------- Name: Title: PUTNAM VT HIGH YIELD TRUST By: --------------------------------------- Name: Title: PUTNAM HIGH YIELD TRUST By: --------------------------------------- Name: Title: ROYALTON COMPANY By: --------------------------------------- Name: Title: SOUTHERN PACIFIC BANK By: --------------------------------------- Name: Title: TORONTO DOMINION BANK By: --------------------------------------- Name: Title: VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By: --------------------------------------- Name: Title: VAN KAMPEN AMERICAN CAPITAL SENIOR FLOATING RATE FUND By: --------------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING II, LTD. By: INDOSUEZ CAPITAL LUXEMBOURG, as Collateral Manager By: -------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING III, LTD. By: INDOSUEZ CAPITAL LUXEMBOURG, as Collateral Manager By: -------------------------------- Name: Title: SENIOR DEBT PORTFOLIO By: BOSTON MANAGEMENT AND RESEARCH, as Investment Advisor By: -------------------------------- Name: Title: SPS SWAPS By: --------------------------------------- Name: Title: PILGRIM AMERICA PRIME RATE TRUST By: --------------------------------------- Name: Title: PILGRIM HIGH INCOME INVESTMENTS Ltd. By: --------------------------------------- Name: Title: DELANO COMPANY By: Pacific Investment Management Company, as its Investment Advisor By: -------------------------------- Name: Title: KZH CRESCENT-2 LLC By: --------------------------------------- Name: Title: KZH III LLC By: --------------------------------------- Name: Title: KZH CYPRESSTREE-1 LLC By: --------------------------------------- Name: Title: KZH CRESCENT LLC By: --------------------------------------- Name: Title: KZH ING-2 LLC By: --------------------------------------- Name: Title: VAN KAMPEN CLO II, LIMITED By: --------------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING IIA, LTD. By: INDOSUEZ CAPITAL, as Portfolio Advisor By: -------------------------------- Name: Title: INDOSUEZ CAPITAL FUNDING III, LTD. By: INDOSUEZ CAPITAL, as Portfolio Advisor By: -------------------------------- Name: Title: CREDIT LYONNAIS By: --------------------------------------- Name: Title: SUBSIDIARY GUARANTORS: ALASKA FINANCIAL SERVICES, INC. CFC SERVICES CORP. CONTINENTAL CREDIT SERVICES, INC. By: /s/ DanielJ. Dolan --------------------------------------- Name: Daniel J. Dolan Title: Treasurer A.M. MILLER & ASSOCIATES, INC. ACCOUNT PORTFOLIOS, INC. ASSET RECOVERY & MANAGEMENT CORP. FURST AND FURST, INC. INDIANA MUTUAL CREDIT ASSOCIATION, INC. JENNIFER LOOMIS & ASSOCIATES, INC. NATIONAL ACCOUNT SYSTEMS, INC. PAYCO AMERICAN CORPORATION PAYCO AMERICAN INTERNATIONAL CORP. PAYCO-GENERAL AMERICAN CREDITS, INC. PROFESSIONAL RECOVERIES INC. QUALINK, INC. UNIVERSITY ACCOUNTING SERVICE, INC. ACCELERATED BUREAU OF COLLECTIONS, INC. NORTH SHORE AGENCY, INC. By: /s/ DanielJ. Dolan --------------------------------------- Name: Daniel J. Dolan Title: Treasurer PERIMETER CREDIT, L.L.C. GULF STATE CREDIT, L.L.C. SHERMAN ACQUISITION CORPORATION THE UNION CORPORATION ALLIED BOND & COLLECTION AGENCY, INC. AMERICAN CHILD SUPPORT SERVICE BUREAU, INC. CAPITAL CREDIT CORPORATION TRANSWORLD SYSTEMS INC. UCO PROPERTIES, INC. UNION FINANCIAL SERVICES GROUP, INC. HIGH PERFORMANCE SERVICES, INC. HIGH PERFORMANCE SERVICES OF FLORIDA, INC. INTERACTIVE PERFORMANCE, INC. INTERACTIVE PERFORMANCE OF FLORIDA, INC. AMERICAN RECOVERY COMPANY, INC. C.S.N. CORP. GENERAL CONNECTOR CORPORATION U.C.O.-M.B.A. CORPORATION UNION-SPECIALTY STEEL CASTING CORPORATION INTERACTIVE PERFORMANCE OF GEORGIA, INC. By: /s/ DanielJ. Dolan --------------------------------------- Name: Daniel J. Dolan Title: Treasurer EX-10 5 MATERIAL CONTRACTS EMPLOYMENT AGREEMENT This Agreement is made as of the 1st day of March, 1997 between Outsourcing Solutions Inc., a Delaware corporation, with offices at 390 South Woods Mill Road, Suite 150, Chesterfield, Missouri 63017 (the "Company"), and Michael G. Meyer, an individual residing in the State of Missouri (the "Employee"). RECITALS WHEREAS, the Company desires to secure the services and employment of the Employee on behalf of the Company, and the Employee desires to enter into employment with the Company, upon the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the parties hereto, each intending to be legally bound hereby, agree as follows: 1. Employment. The Company hereby employs the Employee as Senior Vice President, Chief Information Officer of the Company, and the Employee accepts such employment for the term of the employment specified in Section 3 below. During the Employment Term (as defined below), the Employee shall serve as the Senior Vice President, Chief Information Officer of the Company, performing such duties as shall be reasonably required of such an employee of the Company, and shall have such other powers and perform such other additional executive duties as may from time to time be assigned to him by the Board of Directors of the Company. The Employee's primary place of employment shall be St. Louis, Missouri. 2. Performance. The Employee will serve the Company faithfully and to the best of his ability and will devote substantially all of his time, energy, experience and talents during regular business hours and as otherwise reasonably necessary to such employment, to the exclusion of all other business activities. 3. Employment Term. The employment term shall begin on the date of this Agreement and continue until the first anniversary date of this Agreement, unless earlier terminated pursuant to Section 7 below (the "Employment Term"). The Employment Term may be extended by mutual agreement of the Company and the Employee in accordance with Section 7 below. 4. Compensation. (a) Salary. During the Employment Term, the Company shall pay the Employee a base salary, payable in equal semimonthly installments, subject to withholding and other applicable taxes, at an annual rate of One Hundred Ninety Thousand Dollars ($190,000.00). (b) Bonus. The Company shall pay the Employee a signing bonus, subject to withholding and other applicable taxes, of $75,000, payable on or before March 7, 1997. Commencing for the 1997 calendar year, the Employee shall be eligible for an annual bonus of up to 50% of his base salary. Such annual bonus shall be based on the satisfaction of performance targets established by the Board of Directors on or before December 31 of each year for the next succeeding year. (c) Stock Options. The Company shall grant to the Employee options to purchase 25,000 shares of the Company's common stock at an exercise price of $25.00 per share pursuant to the Company's 1995 Stock Option and Stock Award Plan (the "Plan"). Such options shall vest upon the satisfaction of performance and liquidity targets as set forth in the Plan and any award agreement pursuant to which such options are granted. (d) Medical and Dental Health Benefits. During the Employment Term, the Employee shall be entitled to medical and dental health benefits in accordance with the Company's established practices with respect to its key employees. (e) Vacation; Sick Leave. During the Employment Term, the Employee shall be entitled to vacation and sick leave in accordance with the Company's established practices with respect to its key employees. 5. Expenses. The Employee shall be reimbursed by the Company for all reasonable expenses incurred by him in connection with the performance of his duties hereunder in accordance with policies established by the Board from time to time and upon receipt of appropriate documentation. 6. Secret Processes and Confidential Information. For the Employment Term and thereafter, (a) the Employee will not divulge, transmit or otherwise disclose (except as legally compelled by court order, and then only to the extent required, after prompt notice to the Company of any such order), directly or indirectly, other than in the regular and proper course of business of the Company, any confidential knowledge or information with respect to the operations or finances of the Company or with respect to confidential or secret processes, services, techniques, customers or plans with respect to the Company and (b) the Employee will not use, directly or indirectly, any confidential information for the benefit of anyone other than the Company; provided, however, that the Employee has no obligation, express or implied, to refrain from using or disclosing to others any such knowledge or information which is or hereafter shall become available to the public other than through disclosure by the Employee. All new processes, techniques, know-how, inventions, plans, products, patents and devices developed, made or invented by the Employee, alone or with others, while an employee of the Company, shall be and become the sole property of the Company, unless released in writing by the Company, and the Employee hereby assigns any and all rights therein or thereto to the Company. During the term of this Agreement and thereafter, Employee shall not take any action to disparage or criticize to any third parties any of the services of the Company or to commit any other action that injures or hinders the business relationships of the Company. During the term of this Agreement and thereafter, Employee shall not employ, solicit for employment or otherwise contract for the services of any employee of the Company or any of its Affiliates (as defined below) at the time of this Agreement or who shall subsequently become an employee of the Company or any of its Affiliates. All files, records, documents, memorandums, notes or other documents relating to the business of Company, whether prepared by Employee or otherwise coming into his possession in the course of the performance of his services under this Agreement, shall be the exclusive property of Company and shall be delivered to Company and not retained by Employee upon termination of this Agreement for any reason whatsoever. 7. Termination. The employment of the Employee hereunder shall automatically terminate at the end of the Employment Term, unless the parties hereto mutually agree otherwise in writing, at least 30 days prior to expiration of the Employment Term. The employment of the Employee hereunder may also be terminated at any time by the Company with or without "cause". For purposes of this Agreement, "cause" shall mean: (i) embezzlement, theft or other misappropriation of any property of the Company or any subsidiary, (ii) gross or willful misconduct resulting in substantial loss to the Company or any subsidiary or substantial damage to the reputation of the Company or any subsidiary, (iii) any act involving moral turpitude which results in a conviction for a felony involving moral turpitude, fraud or misrepresentation, (iv) gross neglect of his assigned duties to the Company or any subsidiary, (v) gross breach of his fiduciary obligations to the Company or any subsidiary, or (vi) any chemical dependence which materially affects the performance of his duties and responsibilities to the Company or any subsidiary; provided that in the case of the misconduct set forth in clauses (iv) and (vi) above, such misconduct shall continue for a period of 30 days following written notice thereof by the Company to the Employee. 8. Severance; Non-Competition Covenant. If the Employee's employment is terminated by the Company without "cause", the Employee shall be entitled to receive an amount equal to his base salary for the year preceding the Employee's termination, payable, at the Company's option, in a lump sum on the date of termination or ratably over the one year period following the date of termination. If the Employee's employment is terminated by the Company "for cause", the Employee shall not be entitled to severance compensation. The Employee covenants and agrees that he will not, during the one year period following the termination of the Employee's employment by the Company, within any jurisdiction or marketing area in which the Company or any of its Affiliates (as defined below) is doing business or is qualified to do business, directly or indirectly own, manage, operate, control, be employed by or participate in the ownership, management, operation or control of, or be connected in any manner with, any business of the type and character engaged in and competitive with that conducted by the Company or any of its Affiliates at the time of such termination; provided, however, that ownership of securities of 2% or less of any class of securities of a public company shall not be considered to be competition with the Company or any of its Affiliates. For the purposes of this Section 8, the term "Affiliate" shall mean, with respect to the Company, any person or entity which, directly or indirectly, owns or is owned by, or is under common ownership with, the Company. The term "own" (including, with correlative meanings, "owned by" and "under common ownership with") shall mean the ownership of 50% or more of the voting securities (or their equivalent) of a particular entity. 9. Notice. Any notices required or permitted hereunder shall be in writing and shall be deemed to have been given when personally delivered or when mailed, certified or registered mail, postage prepaid, to the following addresses: If to the Employee: Michael G. Meyer 1981 Rule St. Louis, Missouri 63043 If to the Company: Outsourcing Solutions Inc. 390 South Woods Mill Road, Suite 150 Chesterfield, Missouri 63017 Attention: President and Chief Executive Officer 10. General. (a) Governing Law; Jurisdiction. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Missouri applicable to contracts executed and to be performed entirely within said State. Any judicial proceeding brought against any of the parties to this Agreement or any dispute arising out of this Agreement or any matter related hereto may be brought in the courts of the State of Missouri or in the United States District Court for the Eastern District of Missouri, and, by execution and delivery of this Agreement, each of the parties to this Agreement accepts the jurisdiction of said courts, and irrevocably agrees to be bound by any judgment rendered thereby in connection with this Agreement. The foregoing consent to jurisdiction shall not be deemed to confer rights on any person other than the respective parties to this Agreement. (b) Assignability. The Employee may not assign his interest in or delegate his duties under this Agreement. Notwithstanding anything else in this Agreement to the contrary, the Company may assign this Agreement to and all rights hereunder shall inure to the benefit of any person, firm or corporation succeeding to all or substantially all of the business or assets of the Company by purchase, merger or consolidation. (c) Enforcement Costs. In the event that either the Company or the Employee initiates an action or claim to enforce any provision or term of this Agreement, the costs and expenses (including attorney's fees) of the prevailing party shall be paid by the other party, such party to be deemed to have prevailed if such action or claim is concluded pursuant to a court order or final judgment which is not subject to appeal, a settlement agreement or dismissal of the principle claims. (d) Binding Effect. This Agreement is for the employment of Employee, personally, and for the services to be rendered by him must be rendered by him and no other person. This Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns. (e) Entire Agreement; Modification. This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and may not be modified or amended in any way except in writing by the parties hereto. (f) Duration. Notwithstanding the term of employment hereunder, this Agreement shall continue for so long as any obligations remain under this Agreement. (g) Survival. The covenants set forth in Sections 6 and 7 of this Agreement shall survive and shall continue to be binding upon Employee notwithstanding the termination of this Agreement for any reason whatsoever. The covenants set forth in Sections 6 and 8 of this Agreement shall be deemed and construed as separate agreements independent of any other provision of this Agreement. The existence of any claim or cause of action by Employee against Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by Company of any or all covenants. It is expressly agreed that the remedy at law for the breach or any such covenant is inadequate and that injunctive relief shall be available to prevent the breach or any threatened breach thereof. IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have hereunto executed this Agreement the day and year first written above. OUTSOURCING SOLUTIONS INC. By /s/ Timothy G. Beffa --------------------------------------- Timothy G. Beffa, President and Chief Executive Officer EMPLOYEE /s/ Michael G. Meyer --------------------------------------- Michael G. Meyer EX-27 6 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the Form 10-Q for the Quarter Ended September 30, 1998 and is qualified in its entirety by reference to such financial statements. 0001027574 Outsourcing Solutions, Inc. 1,000 9-MOS DEC-31-1998 JAN-01-1998 SEP-30-1998 33,748 0 41,302 1,276 41,063 122,410 87,847 42,524 628,981 111,946 0 0 12,167 53 0 628,981 0 358,634 0 333,052 0 0 37,554 (11,972) 0 (11,972) 0 0 (572) (12,544) 0 0
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