TSL Express Daily News

GEE Group Inc. (NYSEAmerican:JOB) ("GEE" or the "Company") a provider of professional staffing services and solutions, today announced that it has received and signed a commitment letter for a $20 million asset-based senior secured revolving credit facility (the "CIT Facility") from CIT, who will also serve as administrative and collateral agent and sole lead arranger. The CIT Facility will be collateralized by 100% of the assets of the Company and its subsidiaries who will act as co-borrowers and guarantors. The CIT Facility will have a term that matures at the earlier of 180 days prior to the maturity date of the existing term loan or any indebtedness that refinances such term loan and the fifth anniversary of the closing date. Once closed, the CIT Facility will replace the Company's current asset-based lending credit facility ("ABL").

Under the CIT Facility, advances will be subject to a borrowing base formula that will be computed based on 85% of eligible accounts receivable of GEE Group and subsidiaries in general and as further defined in the loan documents, and subject to certain other criteria, conditions and applicable reserves, including any additional eligibility requirements as determined by the administrative agent. The CIT Facility will be subject to usual and customary covenants and events of default for credit facilities of this type. The interest rate, at GEE Group's election, will be based on either the Base Rate, as defined, plus the applicable margin; or, the London Interbank Offering Rate ("LIBOR" or any successor thereto) for the applicable interest period, subject to a 1% floor, plus the applicable margin. Based upon the Company's anticipated amount of borrowings under the CIT Facility, the estimated effective interest rate is expected to be in the range of approximately 4% to approximately 5.25%, based on the three months LIBOR rate as of March 26, 2021. This compares to an approximately 11% interest rate currently paid on the Company's present ABL. In addition to interest costs on advances outstanding, the CIT Facility provides for an unused line fee ranging from 0.375% to 0.50% depending on the amount of undrawn credit, original issue discount and certain fees for diligence, implementation and administration.

Additional details regarding the CIT Facility, including the commitment letter, summary terms and conditions, interest rate schedule, summary of conditions to closing and fee letter can be found on the Company's Current Report on Form 8-K, expected to be filed today with the Securities and Exchange Commission. Closing of the CIT Facility is anticipated to occur in the fiscal quarter ending June 30, 2021 and is subject to completion of a satisfactory field examination and due diligence, compliance with the required closing conditions, execution of an acceptable inter-creditor agreement if term debt remains outstanding and finalization of definitive documentation.

Derek Dewan, GEE Group's Chairman and Chief Executive Officer, stated, "We are very pleased to receive the commitment for a $20 million asset-based senior secured revolving credit facility from CIT which reflects the confidence that they have regarding the strength of our business. With the anticipated completion and implementation of the CIT Facility in the next quarter, we expect that it will provide the Company with the liquidity and working capital necessary to meet its current and future needs in addition to substantially lowering interest expense on asset-based borrowings."

About GEE Group

GEE Group Inc. is a provider of specialized staffing solutions and is the successor to employment offices doing business since 1893. The Company operates in two industry segments, providing professional staffing services and solutions in the information technology, engineering, finance and accounting specialties and commercial staffing services through the names of Access Data Consulting, Agile Resources, Ashley Ellis, General Employment, Omni-One, Paladin Consulting and Triad. Also, in the healthcare sector, GEE Group, through its Scribe Solutions brand, staffs medical scribes who assist physicians in emergency departments of hospitals and in medical practices by providing required documentation for patient care in connection with electronic medical records (EMR). Additionally, the Company provides contract and direct hire professional staffing services through the following SNI brands: Accounting Now®, SNI Technology®, Legal Now®, SNI Financial®, Staffing Now®, SNI Energy®, and SNI Certes.

CONTACT:

GEE Group Inc.
Kim Thorpe
904.512.7504
invest@genp.com