Re: Third Amended and Restated Credit Agreement, dated as of August 29, 2007

Exhibit 10.1

FIRST AMENDMENT TO FORBEARANCE AGREEMENT

Dated as of October 17, 2008

Butler Service Group, Inc.
110 Summit Avenue
Montvale, NJ 07645

Attn: Ed Kopko

Ladies and Gentlemen:

         Capitalized terms used in this letter (hereafter referred to as this “ Amendment ”) and not otherwise defined or limited herein shall have the meanings attributed to such terms in the Forbearance Agreement, dated as of September 29, 2008, among Butler Service Group, Inc., the other Credit Parties signatory thereto and General Electric Capital Corporation, as a Lender and Agent for Lenders (the “ Forbearance Agreement ”).

          Section A.1 of the Forbearance Agreement is hereby amended as of the Effective Date (as defined below) by deleting the date “October 17, 2008” set forth in clause (a) thereof and substituting in lieu thereof the date “November 7, 2008”.

          Annex A of the Credit Agreement is hereby amended as of the Effective Date by amending and restating the definition of “ Referenced Accounts ” in its entirety by deleting such definition in its entirety and substituting in lieu thereof the following new definition:

As of October 17, 2008
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         Borrower and the other Credit Parties hereby, jointly and severally agree to pay to Agent, for the ratable benefit of the Lenders, a forbearance fee in the aggregate amount equal to $10,000, which shall be fully earned, due and payable in immediately available funds on the Effective Date (the “ Forbearance Fee ”).

         This Amendment shall become effective as of the date first set forth above (the “ Effective Date ”) upon Agent’s receipt of (a) four (4) fully-executed copies of this Amendment, duly executed and delivered by the Agent, Requisite Lenders, Borrower and Guarantors and (b) the Forbearance Fee.

         In consideration of the limited agreement of the Agent and the Lenders to forbear from the exercise of their rights and remedies as set forth above, each Credit Party hereby represents and warrants to the Agent and the Lenders, as of the date hereof, as follows:

         1.          The execution, delivery and performance of this Amendment by such Credit Party: (a) is within its organizational power; (b) has been duly authorized by all necessary or proper corporate and shareholder action; (c) does not contravene any provision of such Credit Party’s charter or bylaws or equivalent organizational documents; (d) does not violate any law or regulation, or any order or decree of any court or Governmental Authority; (e) does not conflict with or result in the breach or termination of, constitute a default under or accelerate or permit the acceleration of any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which such Credit Party is a party or by which such Credit Party or any of its property is bound; (f) does not result in the creation or imposition of any Lien upon any of the property of such Credit Party other than those in favor of Agent pursuant to the Loan Documents; and (g) does not require the consent or approval of any Governmental Authority or any other Credit Party.

         2.          All Loan Documents, including without limitation, this Amendment, the Forbearance Agreement, the Credit Agreement and the Guaranties, constitute legal, valid and binding obligations of each Credit Party party thereto enforceable against each such Credit Party in accordance with the terms thereof. Each Credit Party hereby ratifies and confirms each of the Loan Documents to which such Credit Party is party to and the rights granted thereunder in favor of the Agent and the Lenders, including its liability for the Obligations as defined therein.

         3.          This Amendment has been duly executed and delivered by or on behalf of each of Borrower and the other Credit Parties.

FIRST AMENDMENT TO FORBEARANCE AGREEMENT

As of October 17, 2008
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          4.          No Default or Event of Default (other than the Specified Events of Default) has occurred and is continuing after giving effect to the Forbearance Agreement and this Amendment.

          5.          The representations and warranties of Borrower and the other Credit Parties contained in the Credit Agreement and each other Loan Document shall be true and correct on and as of the date hereof with the same effect as if such representations and warranties had been made on and as of such date, except that any such representation or warranty which is expressly made only as of a specified date need be true only as of such date.

          6.