U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
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 No. 1-16025
HEADWAY CORPORATE RESOURCES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 75-2134871
(State of other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
317 Madison Avenue, 3rd Floor, New York, New York 10017
(Address of principal executive offices)
(212) 672-6500
(Registrant's telephone number)
850 Third Avenue, 11th Floor, New York, New York 10022
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during
the preceding 12 months (or for such shorter period that the issuer was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [ X ] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Sections 12, 13, or 15(d) of the
Exchange Act subsequent to the distribution of securities under a plan
confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: 11,432,561
shares of common stock.
FORM 10-Q
HEADWAY CORPORATE RESOURCES, INC. AND SUBSIDIARIES
INDEX
Page
PART I. Financial Information
Financial Statements
Consolidated Balance Sheets-
September 30, 2000 (Unaudited) and December 31, 1999 3
Unaudited Consolidated Statements of Income-
Three and Nine Months Ended September 30, 2000 and 1999 4
Unaudited Consolidated Statement of Stockholders' Equity-
Nine Months Ended September 30, 2000 5
Unaudited Consolidated Statements of Cash Flows-
Nine Months Ended September 30, 2000 and 1999 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
PART II. Other Information 13
Signatures 13
FORWARD-LOOKING STATEMENT NOTICE
When used in this report, the words "may," "will," "expect,"
"anticipate," "continue," "estimate," "project," "intend," and similar
expressions are intended to identify forward-looking statements within
the meaning of Section 27a of the Securities Act of 1933 and Section 21e
of the Securities Exchange Act of 1934 regarding events, conditions, and
financial trends that may affect the Company's future plans of
operations, business strategy, operating results, and financial position.
Persons reviewing this report are cautioned that any forward-looking
statements are not guarantees of future performance and are subject to
risks and uncertainties and that actual results may differ materially
from those included within the forward-looking statements as a result of
various factors. Such factors are discussed under the heading
"Management's Discussion and Analysis of Financial Condition and Results
of Operations," and also include general economic factors and conditions
that may directly or indirectly impact the Company's financial condition
or results of operations.
2
Headway Corporate Resources, Inc. and Subsidiaries
Consolidated Balance Sheets
(Dollars In Thousands)
September 30, December 31,
2000 1999
_____________________________
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 119 $ 1,867
Accounts receivable, trade- net 63,389 53,555
Prepaid expenses and other current assets 1,284 990
_____________________________
Total current assets 64,792 56,412
Property and equipment, net 5,923 5,601
Intangibles, net 89,335 83,872
Deferred financing costs 1,605 1,546
Other assets 1,117 988
_____________________________
Total assets $ 162,772 $ 148,419
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 3,285 $ 2,389
Accrued expenses 4,418 3,215
Accrued payroll 17,864 14,241
Capital lease obligations, current portion 391 435
Long-term debt, current portion - 152
Income taxes payable 1,072 533
Earnout payable 6,938 3,861
Other liabilities - 1,020
_____________________________
Total current liabilities 33,968 25,846
Capital lease obligations, less current portion 228 523
Long-term debt, less current portion 76,000 72,750
Deferred rent 1,169 1,246
Deferred income taxes 53 53
Stockholders' equity
Preferred stock---$.0001 par value, 5,000,000
shares authorized:
Series F, convertible preferred stock-$.0001
par value, 1,000 shares authorized, issued and
outstanding [aggregate liquidation value $20,000] 20,000 20,000
Common stock-$.0001 par value, 20,000,000 shares
authorized; 11,432,561 and 11,372,561 shares
issued and outstanding at September 30, 2000 and
December 31, 1999, respectively 1 1
Additional paid-in capital 19,963 19,820
Treasury stock at cost (3,211) (3,191)
Notes receivable (83) (126)
Deferred compensation (526) (440)
Retained earnings (loss) 15,381 11,929
Other comprehensive income (171) 8
______________________________
Total stockholders' equity 51,354 48,001
Total liabilities and stockholders' equity $ 162,772 $ 148,419
==============================
See accompanying notes
3
Headway Corporate Resources, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
(Dollars In Thousands)
Three months ended Nine months ended
September 30, September 30,
2000 1999 2000 1999
---------------------------------------
Revenues $ 91,678 $ 90,229 $284,648 $275,055
Operating expenses:
Direct costs 67,948 68,075 208,322 208,847
Selling, general and administrative 18,689 16,333 58,528 48,196
Termination of employment contract - - - 2,329
Depreciation and amortization 1,367 1,168 3,939 3,230
---------------------------------------
88,004 85,576 270,789 262,602
Operating income 3,674 4,653 13,859 12,453
Other (income) expenses:
Interest expense 2,010 1,626 5,908 4,662
Interest income (28) (58) (83) (88)
---------------------------------------
1,982 1,568 5,825 4,574
Income before income tax expense 1,692 3,085 8,034 7,879
Income tax expense 822 1,308 3,543 3,369
---------------------------------------
Net Income 870 1,777 4,491 4,510
Preferred dividend requirements (375) (275) (1,039) (825)
---------------------------------------
Net income available for
common stockholders $ 495 $ 1,502 $ 3,452 $ 3,685
=======================================
Basic earnings per common share: $ .05 $ .15 $ .33 $ .36
=======================================
Diluted earnings per common share: $ .05 $ .13 $ .32 $ .31
=======================================
See accompanying notes
4
Headway Corporate Resources, Inc. and Subsidiaries
Consolidated Statement of Stockholders' Equity
Nine Months Ended September 30, 2000
(Unaudited)
(Dollars in Thousands)
Series F
Convertible Additional
Preferred Stock Common Stock Paid-in Treasury Stock
Shares Amount Shares Amount Capital Shares Amount
- -------------------------------------------------------------------------------------------------
Balance - December 31, 1999 1,000 $20,000 11,372,561 $ 1 $ 19,820 (670,100) $(3,191)
Repayment of notes receivable - - - - - - -
Issuance of common stock for
Compensation - - 60,000 - 143 - -
Amortization of stock-based
Compensation - - - - - - -
Preferred stock dividends - - - - - - -
Purchase of treasury stock - - - - - (5,000) (20)
Translation adjustment - - - - - - -
Net income (loss) - - - - - - -
Comprehensive income - - - - - - -
- ---------------------------- ----- ------- ---------- ------ -------- -------- -------
Balance - September 30, 2000 1,000 $20,000 11,432,561 $ 1 $ 19,963 (675,100) $(3,211)
- ---------------------------- ----- ------- ---------- ------ -------- ------------------
Headway Corporate Resources, Inc. and Subsidiaries
Consolidated Statement of Stockholders' Equity, Continued
Nine Months Ended September 30, 2000
(Unaudited)
(Dollars in thousands)
Accumulated
Other Total
Notes Deferred Retained Comprehensive Stockholders'
Receivable Compensation Earnings Income Equity
- ----------------------------------------------------------------------------------------------
Balance - December 31, 1999 $ (126) $ (440) $ 11,929 $ 8 $ 48,001
Repayment of notes receivable 43 - - - 43
Issuance of common stock for
Compensation - (143) - - -
Amortization of stock-based
Compensation - 57 - - 57
Preferred stock dividends - - (1,039) - (1,039)
Purchase of treasury stock - - - - (20)
Translation adjustment - - - (179) (179)
Net income (loss) - - 4,491 - 4,491
Comprehensive income - - - - 4,312
- ---------------------------- ------ -------- -------- ------- ---------
Balance - September 30, 2000 $ (83) $ (526) $ 15,381 $ (171) $ 51,354
- ---------------------------- ------ -------- -------- ------- ---------
5
Headway Corporate Resources, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
(Dollars In Thousands)
Nine months ended September 30,
2000 1999
-------------------------------
Operating activities:
Net income $ 4,491 $ 4,510
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 3,939 3,230
Amortization of deferred financing costs 360 277
Provision for bad debt 254 472
Amortization of deferred compensation 57 -
Changes in assets and liabilities net of effect
of acquisitions:
Accounts receivable (10,088) (6,607)
Prepaid expenses and other assets (423) (90)
Accounts payable and accrued expenses 2,062 857
Accrued payroll 3,623 2,906
Income taxes payable 539 619
Deferred rent (77) -
----------------------
Net cash provided by operating activities 4,737 6,174
----------------------
Investing activities:
Expenditures for property and equipment (1,323) (1,401)
Repayment from notes receivable 43 33
Cash paid for acquisitions (5,287) (9,516)
----------------------
Net cash (used in) investing activities (6,567) (10,884)
----------------------
Financing activities:
Net proceeds from revolving credit line 3,250 3,200
Repayment of long-term debt (152) (157)
Payment of capital lease obligations (339) (300)
Payments of loan acquisition fees (419) (177)
Proceeds from exercise of options and warrants - 1,596
Payments of other loans (1,020)
Purchase of treasury stock (20) (2,221)
Cash dividends paid (1,039) (825)
----------------------
Net cash provided by financing activities 261 1,116
----------------------
Effect of exchange rate changes on cash
and cash equivalents (179) (5)
Decrease in cash and cash equivalents (1,748) (3,599)
Cash and cash equivalents at beginning of period 1,867 4,157
----------------------
Cash and cash equivalents at end of period $ 119 $ 558
======================
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest $ 5,195 $ 4,385
======================
Income taxes $ 2,902 $ 2,404
======================
6
HEADWAY CORPORATE RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2000
(1) BASIS OF PRESENTATION
Headway Corporate Resources, Inc. and its wholly owned subsidiaries
provide strategic staffing solutions and personnel worldwide. Its
operations include information technology staffing, temporary staffing,
contract staffing, permanent placement and executive search.
Headquartered in New York, the Company also has offices in California,
Connecticut, Florida, New Jersey, North Carolina, Virginia, and Texas.
The Company also has executive search offices in New York, Illinois,
Massachusetts, the United Kingdom, Japan, Hong Kong and Singapore. These
consolidated financial statements include the accounts of Headway
Corporate Resources, Inc. and its subsidiaries (collectively referred to
as the "Company").
The accompanying unaudited 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 nine months ended September 30, 2000 are not
necessarily indicative of the results that may be expected for the year
ended December 31, 2000.
The balance sheet at December 31, 1999 has been derived from the audited
financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.
For further information, refer to the consolidated financial statements
amendment no. 1 to the Company's Form 10-K for the year ended December
31, 1999
(2) INTANGIBLES
During the nine months ended September 30, 2000, additional purchase
price of $8,364,000 was recorded as goodwill upon the determination that
the earnouts had been met on certain acquisitions made in 1998 and 1999.
(3) TERMINATION OF EMPLOYMENT CONTRACT
In March 1999, the Company incurred costs of $2,329,000 associated with
the termination of an employment contract.
7
(4) EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted
earnings per share:
Three months ended Nine months ended
September 30, September 30,
2000 1999 2000 1999
---------------------------------------------------
Numerator:
Net income $ 870,000 $ 1,777,000 $ 4,491,000 $ 4,510,000
Preferred dividend requirements (375,000) (275,000) (1,039,000) (825,000)
----------- ----------- ----------- -----------
Numerator for basic earnings per share--net
income available for common stockholders 495,000 1,502,000 3,452,000 3,685,000
Effect of dilutive securities:
Preferred dividend requirements - 275,000 1,039,000 825,000
----------- ----------- ----------- -----------
Numerator for diluted earnings per share
- net income available for common
stockholders after assumed conversions $ 495,000 $ 1,777,000 $ 4,491,000 $ 4,510,000
=========== =========== =========== ===========
Denominator:
Denominator for basic earnings per share--
weighted average shares 10,603,113 10,108,813 10,582,715 10,208,778
Effect of dilutive securities:
Stock options and warrants 7,246 501,373 88,202 530,413
Convertible preferred stock - 3,584,299 3,584,299 3,584,299
----------- ----------- ----------- -----------
Dilutive potential common stock 7,246 4,085,672 3,672,501 4,114,712
Denominator for diluted earnings per share
-adjusted weighted-average shares and
assumed conversions 10,610,359 14,194,485 14,255,216 14,323,490
=========== =========== =========== ===========
Basic earnings per share $ .05 $ .15 $ .33 $ .36
=========== =========== =========== ===========
Diluted earnings per share $ .05 $ .13 $ .32 $ .31
=========== =========== =========== ===========
8
(5) BUSINESS SEGMENTS
The Company classifies its business into two fundamental areas, staffing
and executive search. Staffing consists of the placement and payrolling
of temporary and permanent office, clerical and information technology
professional personnel. Executive search focuses on placing middle to
upper level management positions. The Company evaluates performance
based on the segments' profit from operations before unallocated
corporate overhead.
Three months ended Three months ended
Sept. 30, 2000 Sept. 30, 1999
------------------------------ ------------------------------
Staffing Executive Search Staffing Executive Search
--------------------------------------------------------------
Revenues $ 83,315,000 $ 8,363,000 $ 83,775,000 $ 6,454,000
Segment profit 1,038,000 522,000 1,200,000 985,000
Nine months ended Nine months ended
Sept. 30, 2000 Sept. 30, 1999
------------------------------ ------------------------------
Staffing Executive Search Staffing Executive Search
--------------------------------------------------------------
Revenues $255,601,000 $ 29,047,000 $253,895,000 $ 21,160,000
Segment profit 2,552,000 3,643,000 3,846,000 3,485,000
A reconciliation of combined segment profit to consolidated net income is
as follows:
Three months ended Nine months ended
Sept 30 Sept 30
2000 1999 2000 1999
-----------------------------------------------------
Total profit for
reportable segments $ 1,560,000 $ 2,185,000 $ 6,195,000 $ 7,331,000
Unallocated amounts:
- --------------------
Interest expense (396,000) (105,000) (589,000) (277,000)
Corporate overhead (879,000) (630,000) (2,460,000) (2,282,000)
Termination of
employment contact - - - (2,329,000)
Income tax benefit 585,000 327,000 1,345,000 2,067,000
-----------------------------------------------------
Net income $ 870,000 $ 1,770,000 $ 4,491,000 $ 4,510,000
-----------------------------------------------------
(6) LONG-TERM DEBT AND CREDIT FACILITIES
On August 25, 2000 the Company's lenders amended its Senior Credit
Facility. The amendment includes, among other changes, changes to
certain financial covenants, a reduction of the facility size from $100
million to $85 million and a change in the maturity date from March 18,
2003 to April 18, 2002.
9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Overview
The results for the third quarter reflect a very difficult recruiting
environment both in information technology and in the high-end executive
search practice and not a reduction in the demand for these types of
services. The traditional clerical staffing business posted solid growth
during the third quarter. The softness in the information technology
business is due primarily to the very limited supply of information
technology professionals with web-based applications experience. In July
2000, the Company announced the signing of a contract with Shanghai
Foreign Service Company Ltd., ("FSCO") to be the exclusive agent
representing information technology consultants from the People's
Republic of China to work in the United States. The Company believes
that this could potentially have a significant impact on the Company's
ability to solve the supply issue for its clients.
The executive search segment was softer than expected in the third
quarter as more candidates than usual received extremely aggressive
counter offers from current employers. In addition, the merger activity
in the financial services industry during the third quarter resulted in a
temporary slowdown as the industry sorted out the impact of these
mergers. The Company believes that it could benefit from the merger
activity as it could create additional supply of qualified candidates.
Consolidated
Revenues increased $1,449,000 or 1.6% to $91,678,000 for the three months
ended September 30, 2000, from $90,229,000 for the same period in 1999.
For the nine months ended September 30, 2000, revenues were $284,648,000,
an increase of 3.5% from $275,055,000 a year earlier. These increases
are attributable to the executive search acquisition completed in the
latter part of 1999, as well as internal growth. The only area of the
Company's business that did not experience growth was information
technology staffing for which the demand for qualified candidates is much
greater than the supply.
The executive search subsidiary, Whitney Partners, LLC (Whitney),
contributed $8,363,000 to consolidated revenues in the third quarter of
2000, an increase of $1,909,000 from $6,454,000 for the same period in
1999. For the nine months ended September 30, 2000, Whitney revenues
were $29,047,000, an increase of 37% from $21,160,000 a year earlier.
This increase is attributable to the Tyzack acquisition completed in the
latter part of 1999, very strong performance from the Company's existing
executive search practice in the United Kingdom, and growth in the
Company's e-commerce executive search practice in Chicago.
The staffing subsidiary, Headway Corporate Staffing Services, Inc. (HCSS)
contributed revenues of $83,315,000 to consolidated revenues in the third
quarter of 2000, a decrease of $460,000 from $83,775,000 for the third
quarter of 1999. For the nine months ended September 30, 2000, HCSS
revenues were $255,601,000, an increase of 0.7% from $253,895,000 a year
earlier. Revenues were only slightly ahead of 1999, as the very low
supply of information technology staffing candidates has resulted in the
Company's inability to meet its clients' demand. This is an industry
wide issue.
Total operating expenses increased $2,428,000 to $88,004,000 for the
three months ended September 30, 2000, from $85,576,000 for the same
period in 1999. For the three months ended September 30, direct costs
decreased as a percentage of revenues to 74.1% in 2000 from 75.4% in
1999. For the nine months, operating expenses increased $8,187,000 to
$270,789,000 from $262,602,000 for the same period in 1999. For the nine
months, direct costs decreased as a percentage of revenues to 73.2% in
2000 from 75.9% in 1999. The decrease in direct costs as a percentage of
revenues is a result of the Company's changing business mix.
Specifically, the executive search
10
business that has no direct costs is becoming a larger percentage of the
Company's total revenues. In addition, the Company experienced an
increase in the demand for permanent employees from its clients, which
also has no direct costs. Selling, general and administrative expenses
for the three months ended September 30, 2000 increased $2,356,000 to
$18,689,000 from $16,333,000 for the same period in 1999. For the nine
months, selling, general and administrative expenses increased
$10,332,000 to $58,528,000 from $48,196,000 in 1999. The increase is
primarily attributed to the Tyzack acquisition completed in the later
part of 1999 as well as higher commission expenses associated with higher
revenues generated from permanent placements.
Direct costs for HCSS increased slightly as a percentage of HCSS revenues
to 81.6% for the three months ended September 30, 2000, from 81.3% for
the same period in 1999. For the nine months, direct costs for HCSS
declined as a percentage of HCSS revenue to 81.5% from 82.3% last year.
The nine-month decrease in direct costs, as a percentage of revenues is a
result of the Company's mix of business, which was more heavily weighted
toward the higher margin permanent placements.
Consolidated selling, general and administrative expenses increased as a
percentage of revenues from 18.1% in the third quarter 1999 to 20.4% in
the third quarter 2000. For the nine months, consolidated selling,
general and administrative expenses increased as a percentage of revenues
from 17.5% in 1999 to 20.6% in 2000. The increase in selling, general
and administrative expenses is primarily attributable to the higher
commission expense associated with higher revenues generated from
permanent placements.
Included in operating expenses for the first quarter of 1999 is a special
charge of $2,329,000 paid in connection with the termination of an
employment agreement.
Whitney's selling, general and administrative expenses increased
$2,129,000 to $6,756,000 in the third quarter of 2000, from $4,627,000
for the same period last year. For the nine months of 2000, Whitney's
selling, general and administrative expenses increased $6,564,000 to
$21,419,000 in 2000 as compared to $14,855,000 in 1999. This increase is
primarily a result of higher compensation expense directly related to the
increase in revenue, as well as the operating expenses of Tyzack that was
acquired in the latter part of 1999.
Operating income decreased $979,000 to $3,674,000 for the three months
ended September 30, 2000, compared to $4,653,000 for the three months
ended September 30, 1999. For the nine month period ended September 30,
2000 operating income increased 11.3% or $1,406,000 to $13,859,000
compared to $12,453,000 for the comparable period in 1999. Included in
the 1999 nine month operating income is the $2,329,000 termination
payment paid in the first quarter. Excluding this payment, operating
income decreased $923,000 for the nine months ended September 30, 2000,
compared to the same period in 1999.
Net income decreased $907,000 to $870,000 for the three months ended
September 30, 2000, compared to $1,777,000 for the same period in 1999.
Net income decreased $19,000 to $4,491,000 for the nine months ended
September 30, 2000, compared to $4,510,000 for the same period in 1999.
This decrease includes the termination payment in the first quarter of
1999, which had an after tax effect of $1,351,000. Excluding this item,
net income decreased 23.4% to $4,491,000 for the nine months ended
September 30, 2000, compared to $5,861,000 for the same period in 1999.
The decrease in net income was attributable to higher interest expense as
a result of the increase in debt and higher interest rates.
Liquidity and Capital Resources
Cash provided by operations during the nine months ended September 30,
2000 was $4,737,000 compared with cash provided by operations of
$6,174,000 for the comparable period in 1999. The cash provided in 2000
was primarily attributable to an increase in accounts payable, accrued
payroll, income taxes payable and depreciation and amortization, offset
by an increase in accounts receivable.
For the nine months ended September 30, 2000, the Company used $6,567,000
in investing activities compared to
11
$10,884,000 for the same period in 1999. The cash used for investing
activities in 2000 and in 1999 related primarily to payments for
acquisitions completed during 1997, 1998 and 1999 as well as capital
expenditures.
Total net cash provided from financing activities was $261,000 for the
nine months ended September 30, 2000, compared to net cash provided by
financing activities of $1,116,000 for the same period in 1999. The cash
generated in 2000 was a result of additional borrowings under the
Company's senior credit facility offset by repayments of notes payables,
capital lease obligations, payments for loan acquisition fees and cash
dividends. The cash generated in 1999 was a result of additional
borrowings under the Company's senior credit facility and proceeds from
the exercise of options and warrants, offset by purchases of treasury
stock, repayments of notes payables, capital lease obligations and cash
dividends.
The Company's working capital improved to $30,824,000 at September 30,
2000, from $30,566,000 at December 31, 1999. Management expects that the
Company's working capital position will be sufficient to meet all of the
working capital needs for the remainder of the year. In addition, at
September 30, 2000, the Company had approximately $19,000,000 available
under its senior credit facility.
Year 2000 Compliance
In prior years, Headway discussed the nature of its plans related to Year
2000 compliance. As a result of those planning efforts, Headway
experienced no significant disruptions in mission critical information
technology and non-information technology systems and believes those
systems successfully responded to the Year 2000 date change. The costs
associated with Year 2000 compliance were nominal. Headway is not aware
of any material problems resulting from Year 2000 issues with its
internal systems or the services of third parties. Headway will continue
to monitor its mission critical computer applications and those of its
supplier and vendors throughout the year to ensure that any latent Year
2000 matters that may arise are addressed properly.
12
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Annual Meeting of stockholders held on November 9, 2000, the
stockholders elected G. Chris Andersen and Richard B. Salomon as Class 3
Directors of Headway to serve for a term of three years. E. Garrett
Bewkes, III and Ehud D. Laska continue to serve as Class 2 directors
through the Annual Meeting in 2001. Gary S. Goldstein, Barry S. Roseman,
and Bruce R. Ellig continue to serve as Class 1 directors through the
Annual Meeting in 2002. The stockholders also ratified at the Annual
Meeting the appointment of Ernst & Young LLP as independent auditors of
Headway for 2000.
The number of vote's cast on the foregoing items is as follows:
For Against Abstain
Election of Directors
G. Chris Andersen 7,847,422 15,778 166,686
Richard B. Salomon 7,847,097 16,103 166,686
Appointment of Ernst &
Young LLP 7,959,714 67,372 2,800
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
EXHIBITS: Attached only to the electronic filing by the Company with the
Securities and Exchange Commission is the Financial Data Schedule,
Exhibit Reference Number 27, in accordance with Item 601(c) of Regulation
S-K.
REPORTS ON FORM 8-K: None
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
HEADWAY CORPORATE RESOURCES, INC.
Date: November 14, 2000 By: /s/ Barry S. Roseman,
President and Chief Operating Officer
(Duly Authorized and Principal Financial Officer)
13