UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
[X] Quarterly report under Section 13 or 15(d) of the
Securities Exchange Act of 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from __________ to __________
Commission File Number 0-29485
RESOLVE STAFFING, INC.
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(Exact Name of Small Business Issuer as Specified in Its Charter)
NEVADA
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(State or Other Jurisdiction of Incorporation or Organization)
33-0850639
(IRS Employer Identification No.)
3235 OMNI DRIVE
CINCINNATI, OH 45245
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(Address of Principal Executive Offices)
(800) 894-4250
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(Issuer's Telephone Number, Including Area Code)
N/A
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(Former Name, Former Address and Former Fiscal Year,
If changed since Last Report)
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of November 11, 2005, there were
outstanding 14,789,101 shares of common stock, par value $0.0001, and no shares
of preferred stock.
RESOLVE STAFFING, INC.
FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005
INDEX
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Consolidated balance sheets as of September 30, 2005 and
December 31, 2004 3
Consolidated statements of operations for the three and nine months
ended September 30, 2005 and 2004 4
Consolidated statements of cash flows for the nine months
ended September 30, 2005 and 2004 5
Notes to consolidated financial statements 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 16
ITEM 3. CONTROLS AND PROCEDURES 20
PART II OTHER INFORMATION
ITEM 4. CHANGES IN SECURITIES 21
ITEM 5. OTHER INFORMATION 21
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 21
2
RESOLVE STAFFING, INC.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2005 AND DECEMBER 31, 2004
ASSETS 2005 2004
----------- -----------
Current Assets
Cash and cash equivalents $ -- $ 75,356
Accounts receivable, net of allowance for bad
debts of $40,587 for 2005 and $7,390 for 2004 3,787,177 1,046,577
Prepaid and other assets 771,155 482,308
----------- -----------
Total current assets 4,555,332 1,604,241
Property and Equipment
Property and equipment 658,998 312,297
Less: Accumulated depreciation 224,898 162,342
----------- -----------
Net property and equipment 434,100 149,955
Other Assets
Goodwill 3,989,965 640,000
Non Compete Agreements 249,660 --
----------- -----------
Total other assets 4,239,625 640,000
----------- -----------
Total Assets $ 9,232,057 $ 2,394,196
=========== ===========
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current Liabilities
Bank Overdraft $ 181,938 $ 37,871
Accounts payable and accrued liabilities 444,699 300,241
Accrued salaries and payroll taxes 336,154 132,772
Line of credit 400,000
Notes payable 707,721 125,621
Notes payable - related party 1,136,063 924,033
----------- -----------
Total current liabilities 2,806,575 1,920,538
----------- -----------
Long Term Liabilities
Notes payable 3,313,453 393,556
Notes payable - related party 3,157,719 --
----------- -----------
Total long term liabilities 6,471,172 393,556
----------- -----------
Stockholders' (Deficit) Equity
Common stock, $.0001 par value, 50,000,000 shares authorized, issued and
outstanding: September 30, 2005 - 14,789,101 shares; December 31, 2004 -
13,000,000 shares
(restated) 1,479 1,300
Paid-in capital 1,144,518 989,698
Accumulated deficit (1,191,687) (910,896)
----------- -----------
Total stockholders' (deficit) equity (45,690) 80,102
----------- -----------
Total Liabilities and Stockholders'
(Deficit) Equity $ 9,232,057 $ 2,394,196
=========== ===========
See accompanying notes to these financial statements.
3
RESOLVE STAFFING, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
------------ ------------ ------------ ------------
Service Revenues $ 8,913,453 $ 1,141,676 $ 17,013,714 $ 2,154,453
Cost of Services 7,373,319 943,913 13,883,111 1,840,764
------------ ------------ ------------ ------------
Gross Margin 1,540,134 197,763 3,130,603 313,689
Operating Expenses
Legal & professional fees 26,524 28,366 123,974 35,084
Advertising/Promotion 71,872 4,288 141,317 8,751
Salaries and benefits 857,588 89,559 1,811,049 239,800
Taxes and Licenses 1,880 858 2,097 2,540
Rent & leases 104,159 10,428 225,030 22,179
Travel & entertainment 34,312 57 54,496 1,022
Administrative expenses 340,667 29,590 909,024 71,273
------------ ------------ ------------ ------------
Total operating expenses 1,437,002 163,146 3,266,987 380,649
------------ ------------ ------------ ------------
Income (Loss) From Operations 103,132 34,617 (136,384) (66,960)
Other Expenses
Interest expense (33,758) (1,138) (137,015) (1,138)
------------ ------------ ------------ ------------
Net other expenses (33,758) (1,138) (137,015) (1,138)
------------ ------------ ------------ ------------
Net Income (Loss) $ 69,374 $ 33,479 $ (273,401) $ ( 68,098)
============ ============ ============ ============
Net Loss Per Share
Basic $ .00 $ .00 $ (.02) $ (.01)
============ ============ ============ ============
Diluted $ .00 $ .00 $ (.02) $ (.01)
Weighted Average Number of Shares Outstanding
used to Calculate Income (Loss) Per Share
Basic 14,709,210 13,000,000 14,401,018 13,000,000
============ ============ ============ ============
15,560,530 13,000,000 14,401,018 13,000,000
Diluted ============
See accompanying notes to these financial statements.
4
RESOLVE STAFFING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
2005 2004
----------- -----------
Cash Flows From Operating Activities
Net loss $ (273,401) $ (68,098)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and Amortization 106,896 --
Common stock issued for services 15,000 --
Change in allowance for doubtful accounts 17,042 --
Amortization of intangibles 44,340 --
Decrease (increase) in current assets:
Accounts receivable (2,583,823) (461,724)
Prepaid and other assets (255,864) 2,659
Increase (decrease) in current liabilities: 45,311
Accounts payable and accrued liabilities (290,054)
Accrued salaries and payroll taxes 203,382 (953)
----------- -----------
Total adjustments (2,743,081) (414,707)
----------- -----------
Net cash used in operating activities (3,016,482) (482,805)
----------- -----------
Cash Flows From Investing Activities
Purchase of property and equipment (286,272) (2,023)
Goodwill and Noncompete Agreements (680,000) --
----------- -----------
Net cash used in investing activities (966,272) (2,023)
----------- -----------
Cash Flows From Financing Activities
Bank Overdraft 144,067 (16,137)
(Repayments) Proceeds from line of credit (400,000) 131,000
Proceeds from notes payable 2,809,879 --
Borrowings from (repayments to) stockholders -- 393,437
Proceeds from notes payable - related party 1,353,452
----------- -----------
Net cash provided by financing activities 3,907,398 508,300
----------- -----------
Net (Decrease) Increase in Cash and Cash Equivalents (75,356) 23,472
Cash and Cash Equivalents, Beginning of the Period 75,356 --
----------- -----------
Cash and Cash Equivalents, End of the Period $ -- $ 23,472
=========== ===========
5
RESOLVE STAFFING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
NON-CASH INVESTING AND FINANCING ACTIVITIES
In connection with the Combination on February 7, 2005, described below in the
Basis of Presentation section of the notes to consolidated financial statements,
ELS was deemed to be the acquiring company for accounting purposes and the
Combination was accounted for as a reverse acquisition under the purchase method
of accounting for business combinations in accordance with U.S. generally
accepted accounting principles generally accepted in the United States. In
conjunction with this transaction, Resolve issued 13,000,000 shares of
restricted common stock valued at $130,000 and a note payable in the amount of
$1,500,000 in exchange for 100% of the ownership interest in 3 entities with 10
staffing locations. The fair value of the assets and liabilities assumed, on the
date of acquisition were as follows:
Accounts receivable $ 30,457
Prepaid and other assets 48,483
Property and equipment 15,280
Goodwill 2,026,496
Accounts payable and accrued liabilities (71,472)
Notes payable (419,244)
-----------
$ 1,630,000
===========
During the nine months ended September 30, 2005, Resolve acquired various
entities in exchange for cash and the issuance of notes payable. The fair value
of the assets and liabilities assumed on the date of acquisition, in exchange
for notes payable totaling $1,370,000, were as follows:
Accounts receivable $ 135,252
Property and equipment 180,489
Goodwill 1,323,470
Non-compete agreements
294,000
Accounts payable and accrued expenses (363,040)
Notes payable (200,171)
-----------
$ 1,370,000
===========
See accompanying notes to these financial statements.
6
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE A - ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION
Organization and Nature of Operations
Resolve Staffing, Inc., ("Resolve" or the "Company") was organized under the
laws of the State of Nevada on April 9, 1998. Integra Staffing, Inc.,
("Integra") is a wholly owned subsidiary that was organized under the laws of
the State of Florida on August 16, 1999 (collectively referred to as "Resolve")
and acquired in 2001. The Company is a national provider of outsourced human
resource services with 43 offices reaching from California to New York. The
Company provides a full range of supplemental staffing and outsourced solutions,
including solutions for temporary, temporary-to-hire, or direct hire staffing in
the clerical, office administration, customer service, professional and light
industrial categories.
On January 24, 2005, Resolve acquired certain assets from Solaris Staffing, Inc.
These assets included the operations of certain temporary staffing offices
located in upstate New York. The aggregate purchase price was $125,000, of which
$90,000 has been paid to date.
On February 20, 2005, Resolve acquired SupportStaff Employment Services, a
full-service staffing firm located in Sebring, FL. The aggregate purchase price
was $75,000, which has been paid in full.
On April 1, 2005 Resolve opened a new temporary staffing location in Salisbury,
North Carolina.
On May 9, 2005, Resolve acquired certain assets from Pride Staffing, Inc. These
assets include a temporary staffing office located in Erie, PA.
On June 13, 2005 Resolved acquired The Arnold Group, a Southern California
staffing firm.
On June 20, 2005 Resolve acquired Taylor Personnel Services, a Buffalo, New York
staffing firm.
On August 22, 2005 Resolve acquired Truckers Plus, Inc., a thirteen location
truck driver staffing firm headquartered in Memphis, Tennessee.
On September 14, 2005 Resolve acquired Delta Staffing, a Southern California
staffing firm.
On September 30, 2005 Resolve acquired Midwest Staffing, a medical staffing firm
located in Oklahoma City, Oklahoma.
Acquisition of Entities from Related Parties
On February 7, 2005, Resolve Staffing, Inc., entered into an equity purchase
agreement ("Agreement"), to purchase ELS Personnel Services ("ELS") (the
"Combination") from Employee Leasing Services, Inc., ("ELS Inc."), a
privately-held company located in Cincinnati, Ohio. The Company's Chief
Executive Officer and director, Ronald Heineman, is a principal shareholder,
officer and director of ELS. Pursuant to the equity purchase agreement, Resolve
acquired the ownership interest in the group of companies which comprised ELS
Personnel Services, (ELSP Personnel Services, LLC, Five Star Staffing, Inc.,
Five Star Staffing (NY), Inc., and American Staffing Resources, Ltd.) comprising
a total of 10 temporary employee staffing locations. See Basis of Presentation
section for discussion of accounting treatment of the acquisition of ELS.
Employee Leasing Services, Inc., operated 3 locations and acquired the 7
temporary employee staffing locations throughout fiscal 2004. ELS Inc. acquired
3 locations from Five Star Staffing, Inc., in August 2004, 3 locations from Five
Star Staffing (NY), Inc., in November 2004 and 1 location from American Staffing
Resources, Ltd., in November 2004. Prior to ELS Inc.'s acquisition of these
entities, these entities were owned and operated by unrelated third parties in
various locations throughout Florida, New York and Ohio.
7
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE A - ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION
(CONTINUED)
In connection with the Combination on February 7, 2005, described below in the
Basis of Presentation section of these notes to consolidated financial
statements, ELS was deemed to be the acquiring company for accounting purposes
and the Combination was accounted for as a reverse acquisition under the
purchase method of accounting for business combinations in accordance with U.S.
generally accepted accounting principles generally accepted in the United
States.
The acquisition of the ELS entities was treated as a reverse acquisition for
financial accounting purposes and therefore the accompanying comparative
financial information is that of ELS rather than the historical financial
statements of Resolve Staffing, Inc.
In connection with the Combination on February 7, 2005, described below in the
Basis of Presentation section of the notes to consolidated financial statements,
ELS was deemed to be the acquiring company for accounting purposes and the
Combination was accounted for as a reverse acquisition under the purchase method
of accounting for business combinations in accordance with U.S. generally
accepted accounting principles generally accepted in the United States. In
conjunction with this transaction, Resolve issued 13,000,000 shares of
restricted common stock valued at $130,000 and a note payable in the amount of
$1,500,000 in exchange for 100% of the ownership interest in 3 entities with 10
staffing locations. The fair value of the assets and liabilities assumed, on the
date of acquisition were as follows:
Accounts receivable $ 30,457
Prepaid and other assets 48,483
Property and equipment 15,280
Goodwill 2,026,496
Accounts payable and accrued liabilities (71,472)
Notes payable (419,244)
-----------
$ 1,630,000
===========
Acquisition of Entities from Unrelated Parties
On various dates during the nine months ended September 30, 2005, Resolve
Staffing, Inc., entered into purchase agreements ("Agreements"), to acquire all
of the assets and/or ownership of various separate privately-held entities owned
and operated by unrelated parties located in Erie, Pennsylvania, Buffalo, New
York, upstate New York, Sebring, Florida, Memphis, Tennessee, Oklahoma City,
Oklahoma, and Southern California. Pursuant to the acquisition agreements,
Resolve acquired a total of 23 temporary employee staffing locations from the
newly acquired entities.
8
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE A - ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION
(CONTINUED)
Resolve paid cash and issued notes payable in the amount of $1,370,000 in
exchange for the assets and liabilities of the above staffing entities as
described below. The following table summarizes the estimated fair value, of the
assets acquired and liabilities assumed, on the date of acquisition of each
entity:
Accounts receivable $ 135,252
Property and equipment 180,489
Goodwill 1,323,470
Non-compete agreements
294,000
Accounts payable and accrued expenses (363,040)
Notes payable (200,171)
-----------
$ 1,370,000
===========
To date the books and records of the locations acquired from unrelated parties
during 2005 have not been audited, and therefore the allocation of the purchase
price is subject to refinement.
In conjunction with the acquisitions from all parties during 2005, approximately
$3,990,000 has been assigned to goodwill. Approximately $480,000 of the goodwill
is expected to be deductible for tax purposes.
The financial results of these acquired entities are included in the
consolidated financial statements from the date of acquisition.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions incorporated in
Regulation S-B, Item 310(b) of the Securities and Exchange Commission.
Accordingly, they do not include all the information and footnotes required by
accounting principles generally accepted in the United States of America for
complete financial statements. The financial statements are unaudited, but in
the opinion of management, all adjustments (consisting of normal recurring
adjustments and accruals) considered necessary for a fair presentation of the
Company's financial position, results of operations and cash flows for the nine
months ended September 30, 2005 and 2004 have been included.
These statements are not necessarily indicative of the results to be expected
for the full fiscal year. These statements should be read in conjunction with
the financial statements and notes thereto included in the Company's Form 10-KSB
for the year ended December 31, 2004 as filed with the Securities and Exchange
Commission.
Because the owners of ELS held approximately 90% of the Company's outstanding
common stock after the Combination, as well as the Company's analysis of the
other criteria used for determining which entity is the accounting acquirer
under SFAS No. 141, ELS is deemed to be the acquiring company for accounting
purposes and the Combination has been accounted for as a reverse acquisition
under the purchase method of accounting for business combinations in accordance
with U.S. generally accepted accounting principles generally accepted in the
United States. Accordingly, historical financial statements prior to the
Combination reflect those of ELS. The audited financial statements of Resolve
for each of the two years ended December 31, 2004 are included in the Resolve
Staffing, Inc. Annual Report on Form 10-KSB, filed with the Securities and
Exchange Commission (the "SEC"). The audited financial statements of the
entities which comprised the temporary staffing division of ELS, Inc. for the
two years ended December 31, 2004, or such time as the entity was under the
control of ELS, Inc. through December 31, 2004 will be included in Resolve
Staffing, Inc.'s Current Report on Form 8-K/A which the Company anticipates
filing with the SEC prior to December 10, 2005.
9
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE A - ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION
(CONTINUED)
Principles of Consolidation
The consolidated financial statements at September 30, 2005 include the accounts
of the Company and its subsidiaries: ELS Personnel Services, LLC, Five Star
Staffing, Inc., Five Star Staffing (NY), Inc., and American Staffing Resources,
Ltd, Solaris Staffing, Inc., SupportStaff Employment Services, The Arnold Group,
Pride Staffing, Inc., Taylor Personnel Services, Truckers Plus, Inc., Delta
Staffing, and Midwest Staffing. All significant inter-company accounts and
transactions have been eliminated in preparing the accompanying financial
statements.
Revenue Recognition
Staffing and managed service revenue and the related labor costs and payroll are
recorded in the period in which services are performed. The Company follows
Emerging Issues Task Force ("EITF") 99-19, "Reporting Revenue Gross as a
Principal versus Net as an Agent," in the presentation of revenues and expenses.
This guidance requires Resolve to assess whether it acts as a principal in the
transaction or as an agent acting on behalf of others. In situations where
Resolve is the principal in the transaction and has the risks and rewards of
ownership, the transactions are recorded gross in the consolidated statements of
operations.
Stock Based Employee Compensation:
Resolve accounts for and reports its stock-based employee compensation
arrangements using the intrinsic value method as prescribed in Accounting
Principles Board Opinion No. 25, Accounting for Stock Issued to Employees ("APB
25"), Financial Accounting Standards Board Interpretation No, 44, Accounting for
Certain Transactions Involving Stock Compensation ("FIN 44"), and Statement of
Financial Accounting Standards No. 148, Accounting for Stock-Based Compensation
- - Transition and Disclosure ("SFAS 148"). Accordingly, compensation cost for
stock options are measured as the excess, if any, of the fair value of the
Company's stock at the date of grant over the stock option exercise price.
Resolve accounts for stock issued to non-employees in accordance with the
provisions of Statement of Financial Accounting Standards No. 123, Accounting
for Stock-Based Compensation ("SFAS 123"). Under SFAS 123, stock option awards
issued to non-employees are accounted for at their fair value on the date
issued, where fair value is determined using the Black-Scholes option pricing
method.
There are no differences between the historical and pro-forma stock based
compensation value.
Recent Accounting Principles
Effective as of December 31, 2004, the Company adopted the revised
interpretation of Financial Accounting Standards Board (FASB) Interpretation No.
46 (FIN 46), "Consolidation of Variable Interest Entities," (FIN 46-R). FIN 46-R
requires that certain variable interest entities be consolidated by the primary
beneficiary of the entity if the equity investors in the entity do not have the
characteristics of a controlling financial interest or do not have sufficient
equity at risk for the entity to finance its activities without additional
subordinated financial support from other parties. The Company does not have any
investments in entities it believes are variable interest entities for which the
Company is the primary beneficiary.
10
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE A - ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION
(CONTINUED)
In December 2004, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based
Payment (SFAS No. 123R). FAS No. 123R revised SFAS No. 123, Accounting for
Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for
Stock Issued to Employees, and its related implementation guidance. SFAS No.
123R will require compensation costs related to share-based payment transactions
to be recognized in the financial statement (with limited exceptions). The
amount of compensation cost will be measured based on the grant-date fair value
of the equity or liability instruments issued. Compensation cost will be
recognized over the period that an employee provides service in exchange for the
award.
In April 2005, the Securities and Exchange Commission adopted a new rule that
amends the compliance dates for SFAS No. 123R. The Statement requires that
compensation cost relating to share-based payment transactions be recognized in
financial statements and that this cost be measured based on the fair value of
the equity or liability instruments issued. SFAS No. 123R covers a wide range of
share-based compensation arrangements including share options, restricted share
plans, performance-based awards, share appreciation rights, and employee share
purchase plans. The Company will adopt SFAS No. 123R on January 1, 2006 and is
currently evaluating the impact the adoption of the standard will have on the
Company's results of operations.
In March 2005, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin No. 107 ("SAB No. 107"), Share-Based Payment, providing
guidance on option valuation methods, the accounting for income tax effects of
share-based payment arrangements upon adoption of SFAS No. 123R, and the
disclosures in MD&A subsequent to the adoption. The Company will provide SAB No.
107 required disclosures upon adoption of SFAS No. 123R on January 1, 2006 and
is currently evaluating the impact the adoption of the SAB will have on the
Company's financial condition, results of operations, and cash flows.
In December 2004, FASB issued SFAS No. 153, Exchanges of Nonmonetary Assets- An
Amendment of APB Opinion No. 29. The guidance in APB Opinion No. 29, Accounting
for Nonmonetary Transactions, is based on the principle that exchanges of
nonmonetary assets should be measured based on the fair value of the assets
exchanged. The guidance in that Opinion, however, included certain exceptions to
that principle. SFAS No. 153 amends Opinion No. 29 to eliminate the exception
for nonmonetary exchanges of similar productive assets and replaces it with a
general exception for exchanges of nonmonetary assets that do not have
commercial substance. A nonmonetary exchange has commercial substance if the
future cash flows of the entity are expected to change significantly as a result
of the exchange. The provisions of SFAS No. 153 are effective for nonmonetary
asset exchanges occurring in fiscal periods beginning after June 15, 2005. Early
application is permitted and companies must apply the standard prospectively.
The adoption of this standard is not expected to have any effect on the
Company's results of operations or financial position.
In June 2005, the FASB issued SFAS No. 154, Accounting Changes and Errors
Corrections, a replacement of APB Opinion No. 20 and FAS No. 3. The Statement
applies to all voluntary changes in accounting principle, and changes the
requirements for accounting for and reporting of a change in accounting
principle. SFAS No. 154 requires retrospective application to prior periods'
financial statements of a voluntary change in accounting principle unless it is
impractical. APB Opinion No. 20 previously required that most voluntary changes
in accounting principle be recognized by including in net income of the period
of the change the cumulative effect of changing to the new accounting principle.
SFAS No.154 improves the financial reporting because its requirements enhance
the consistency of financial reporting between periods.
11
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE B - LIQUIDITY AND MANAGEMENT'S PLANS
As reflected in the accompanying financial statements, the Company has a net
working capital balance of $1,751,757 and a stockholder's deficit of $45,690, as
of September 30, 2005. Prior to the third quarter, the Company had incurred
losses and has been dependent upon the financial support of stockholders,
management and other related parties.
Management has successfully obtained additional financial resources, which the
Company believes will support operations. These financial resources include
financing from both related and non-related third parties, are discussed in the
accompanying footnotes to the financial statements. There can be no assurance
that management will be successful in continuing operations without additional
financing efforts. The financial statements do not reflect any adjustments that
may arise as a result of this uncertainty.
NOTE C - NOTES PAYABLE
Note Payable
During May and June 2002, the Company obtained loans from an unrelated
individual for a total of $40,000. The underlying notes payable bear interest at
12% per annum payable quarterly in arrears and are secured by the accounts
receivable of the Company. The maturities were extended to July 3, 2004, and
have subsequently been extended to be due on demand.
Revolving Note
On March 3, 2005, Resolve Staffing, Inc., secured a revolving note from Fifth
Third Bank for an amount of $2,900,000 with a maturity date of June 1, 2006.
Interest is payable on the principal balance outstanding on a monthly basis, at
the bank's prime rate. Borrowings under this note are limited to 80% of the
Company's accounts receivable balance which have been outstanding for less than
90 days. On September 1, 2005 the note was increased to $3,250,000 with a
maturity date of February 1, 2007. The current interest rate is at prime for the
first $2,250,000 and prime plus one for the remaining $1,000,000. These amounts
fluctuate based on the Company's accounts receivable.
Term Note
On March 3, 2005, Resolve Staffing, Inc., secured a term note ("note") from
Fifth Third Bank for an amount of $465,000 with a maturity date of September 1,
2009. The outstanding balance of the Note is to be paid in 53 installments of
principal and interest, each in the amount of $9,845, commencing April 1, 2005.
Interest is payable on the principal balance outstanding at a rate of 6.6% per
annum.
12
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE D - NOTES PAYABLE - RELATED PARTY
Notes payable-related party includes aggregate borrowings totaling $91,500 to
William Brown, a director and shareholder of the Company. The underlying note
bears interest at 5% and was due on March 31, 2004. The Company has a verbal
agreement to extend the maturity on a month to month basis.
On December 8, 2003, the Company entered into a non-interest bearing short-term
credit agreement with ELS, Inc. that provides for borrowings of up to $200,000.
ELS, Inc. is a company owned by Ronald Heineman, the Company's Chief Executive
Officer. The underlying promissory note is secured by 400,000 shares of common
stock that were released to an escrow agent, but not issued for accounting or
reporting purposes. Balances due under the credit agreement were originally due
May 8, 2004. On September 30, 2005, the agreement was amended to extend the line
to a maximum of $3,200,000 due February 1, 2007. The line of credit bears
interest at 3.0%, and is payable monthly. If the Company becomes delinquent on
interest payments by more than 90 days, ELS Inc. has the option to call the note
and make it due immediately.
NOTE E - STOCKHOLDERS' EQUITY
On February 7, 2005, Resolve Staffing, Inc., entered into an equity purchase
agreement ("Agreement"), to purchase ELS Personnel Services ("ELS") (the
"Combination") from Employee Leasing Services, Inc., ("ELS Inc."), a
privately-held company located in Cincinnati, Ohio. The Company's Chief
Executive Officer and director, Ronald Heineman, is a principal shareholder,
officer and director of ELS. Pursuant to the equity purchase agreement, Resolve
acquired the ownership interest in the group of companies which comprised ELS,
(Five Star Staffing, Inc., Five Star Staffing (NY), Inc., and American Staffing
Resources, Ltd.) comprising a total of 10 temporary employee staffing locations.
See Basis of Presentation section for discussion of accounting treatment of the
acquisition of ELS.
The aggregate purchase price was $1,630,000, including 13,000,000 shares of the
Company's restricted common stock valued at $130,000 based on management's
estimate of the fair value of the restricted common stock, and a demand
promissory note in the principal amount of $1,500,000, which accrues interest at
the rate of 10% per annum. The agreement does not specify any contingent
payments, options or other commitments.
Common Stock Warrants
As of September 30, 2005 there were 851,320 stock warrants outstanding which are
due to expire on June 30, 2007. Each warrant has an exercise price of $.75 per
share price. All stock warrants are exercisable.
NOTE F - SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest during the nine months ended September 30, 2005 and 2004
amounted to $137,015 and $33,758 respectively.
NOTE G - NET INCOME (LOSS) PER SHARE
Net income (loss) per share is computed based upon the weighted outstanding
shares of the Company's common stock for each period presented. The weighted
average number of shares for the three months ended September 30, 2005 includes
851,320 common stock equivalents, representing principally warrants and stock
options.
13
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
NOTE H - SUBSEQUENT EVENTS
On October 31, 2005, Resolve acquired Project Solvers, located in New York, New
York, and Star Personnel, located in Ashland, Kentucky.
On or about September 26, 2005, Resolve received a comment letter from the
Securities and Exchange Commission ("Commission") subsequent to its review of
the Registrant's Form 8-K filed on February 9, 2005 disclosing certain business
acquisitions ("Acquisitions") made by the Registrant. The Registrant at the time
believed that the accounting treatment of the Acquisitions did not result in the
Registrant deeming the employee staffing division of ELS, Inc. as the accounting
acquirer under SFAS No. 141--Business Combinations. ELS Inc. is a large,
privately-held company that operated a separate employee staffing division,
(ELS) that complimented its other business segments, and it is ELS that has been
determined to be the accounting acquirer of the Acquisitions rather than the
Registrant. Although initially, the Registrant determined that the accounting
acquirer was the Registrant, upon further consideration and comment by the
Commission, ELS has been determined to be the accounting acquirer. Members of
the Board of Directors and officers of the Company have discussed this change as
well as all other items disclosed in the filing with the Registrant's auditors.
ELS Inc. is the seller in the Acquisitions.
On October 27, 2005, Resolve filed a Form 8-K regarding the letter from the
Commission. On November 7, 2005, the Commission issued comments to the
Registrant in connection with the Commission's review of the Form 8-K filed by
the Registrant on October 27, 2005. The Registrant then filed an amendment to
that Form 8-K, designed to make additional disclosures and address the
Commission's comments.
The Registrant's officers, with the concurrence of the board of directors,
determined that the financial statements contained in the Forms 10-QSB for the
periods ended March 31, 2005 and June 30, 2005 ("Reports"), should no longer be
relied upon because such Reports do not include the financial statement
disclosures and accurately present the financial results that are necessary and
required to report the acquisitions made by the Registrant, as discussed above.
Upon further consideration and additional interpretation of SFAS 141, as it
relates to the Acquisitions, the Registrant has determined that ELS is the
accounting acquirer. As a result of this determination, it is the Registrant's
intention to more fully comply with Item 310(c) of Regulation S-B by amending
the Form 8-K filed February 9, 2005 by including two years audited financial
statements of ELS (temporary staffing division) operated by ELS Inc. and the pro
forma financial information required by Item 310(C) of Regulation S-B.
In addition, once the Form 8-K is amended to include the accounting treatment of
the Acquisitions, the Registrant intends to further amend its Reports filed for
the periods ended March 31, 2005 and June 30, 2005. As a result, the financial
statements contained in the Reports should not be relied upon until such
amendments are filed, which the Registrant anticipates will be completed within
approximately 45 days from the date of the 8-K filing.
NOTE I - PROFORMA INFORMATION
The interim financial statements for the nine months ended September 30, 2005
are presented in accordance with accounting principles generally accepted in the
United States (GAAP), which requires that the financial results of these
acquired entities (as detailed in Footnote A) are included in the consolidated
financial statements from the date of acquisition. As a result, the consolidated
statement of operations does not include the activity of the acquired companies,
including the acquisition of Resolve which has been recorded a reverse
acquisition, for the period from January 1, 2005 to the respective dates of
acquisition.
14
RESOLVE STAFFING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
Presented below is the unaudited pro forma statement of operations for the nine
months ended September 30, 2005 as if the acquisition of Resolve from related
parties (Note A) had been acquired January 1, 2005.
Pro-forma adjustments for
-------------------------------------------------------------
Actual nine
months ended Resolve Adjusted
September 30, September 30,
2005 Staffing, Inc. 2005
------------ ------------ ------------ ------------ ------------
Service Revenues $ 17,013,714 $ 45,069 $ 17,058,783
Cost of Services 13,883,111 -- 13,883,111
------------ ------------ ------------ ------------ ------------
Gross Margin 3,130,603 45,069 3,175,672
------------ ------------ ------------ ------------ ------------
Operating Expenses
Legal and professional fees 123,974 25,964 149,938
Advertising/Promotion 141,317 -- 141,317
Salaries and benefits 1,811,049 -- 1,811,049
Taxes & licences 2,097 -- 2,097
Rent & leases 225,030 1,183 226,213
Travel & entertainment 54,496 -- 54,496
Administrative expenses 909,024 36,520 945,544
------------ ------------ ------------ ------------ ------------
Total operating expenses 3,266,987 63,667 3,330,654
Profit (Loss) From Operation (136,384) (18,598) (154,982)
Other Expenses
Interest expense (137,016) (400) (137,416)
------------ ------------ ------------ ------------ ------------
Net other expenses (137,016) (400) (137,416)
Net Loss $ (273,400) $ (18,998) $ (292,398)
------------ ------------ ------------ ------------ ------------
Pro-forma earnings per share information
for the nine months ended September 30, 2005:
Basic weighted average shares outstanding: 14,609,614
Pro forma basic net loss per common share: $ (.02)
The Company has been unable to obtain the necessary information to present
pro-forma financial information reflecting the combined operations of Resolve
Staffing, Inc, and the various acquired staffing locations from unrelated
parties, for the period ended September 30, 2005. This current Report on Form
10-QSB will be supplemented by amendment to provide the necessary comparative
pro-form information as soon as the information becomes available.
15
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This report and other reports, as well as other written and oral statements made
or released by us, may contain forward-looking statements. Forward-looking
statements are statements that describe, or that are based on, our current
expectations, estimates, projections and beliefs. Forward-looking statements are
based on assumptions made by us, and on information currently available to us.
Forward-looking statements describe our expectations today of what we believe is
most likely to occur or may be reasonably achievable in the future, but such
statements do not predict or assure any future occurrence and may turn out to be
wrong. You can identify forward-looking statements by the fact that they do not
relate strictly to historical or current facts. The words "believe,"
"anticipate," "intend," "expect," "estimate," "project", "predict", "hope",
"should", and "may", other words and expressions that have similar meanings, and
variations of such words and expressions, among others, usually are intended to
help identify forward-looking statements.
Forward-looking statements are subject to both known and unknown risks and
uncertainties and can be affected by inaccurate assumptions we might make.
Risks, uncertainties and inaccurate assumptions could cause actual results to
differ materially from historical results or those currently anticipated.
Consequently, no forward-looking statement can be guaranteed. The potential
risks and uncertainties that could affect forward looking statements include,
but are not limited to the ability to raise needed financing, increased
competition, extent of the market demand for and supply of goods and services of
the types provided by the Company, governmental regulation, performance of
information systems, and the ability of the Company to hire, train and retain
qualified employees. In addition, other risks, uncertainties, assumptions, and
factors that could affect the Company's results and prospects have been and may
further be described in the Company's prior and future filings with the
Securities and Exchange Commission and other written and oral statements made or
released by the Company.
We caution you not to place undue reliance on any forward-looking statements,
which speak only as of the date of this document. The information contained in
this report is current only as of its date, and we assume no obligation to
update any forward-looking statements.
The financial information set forth in the following discussion should be read
in conjunction with, and qualified in its entirety by, the Company's unaudited
consolidated financial statements and notes included herein. The results
described below are not necessarily indicative of the results to be expected in
any future period. Certain statements in this discussion and analysis, including
statements regarding our strategy, financial performance and revenue sources,
are forward-looking information based on current expectations and entail various
risks and uncertainties that could cause actual results to differ materially
from those expressed in the forward-looking statements. Readers are referred to
our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004.
RESULTS OF OPERATIONS
COMPARISON OF CONSOLIDATED OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30,
2005 AND 2004.
As discussed above, the Company entered into a reverse acquisition transaction
between ELS and Resolve on February 7, 2005. Prior period amounts presented in
the consolidated balance sheets, statements of operations and cashflows reflect
the balances of ELS only as ELS is deemed to be the acquirer for accounting
purposes.
16
Our net income increased from $33,479 for the three months ended September 30,
2004 to $69,374 for the three months ended September 30, 2005. A line-by-line
discussion of our results of operations is as follows:
Revenues for the three months ended September 30, 2004 compared to 2005
increased from $1,141,676 to $8,913,453 or a 681% increase. This increase is
attributable to the acquisition, and opening, of several new locations in 2005.
Resolve has grown to a total of 36 locations. The Company has been unable to
obtain the necessary information to present pro-forma financial information
reflecting the combined operations of Resolve Staffing, Inc, and its acquired
staffing locations, for the period ended September 30, 2004 and for certain
locations acquired during the nine months ended September 30, 2005. This current
Report on Form 10-QSB will be supplemented by amendment to provide the necessary
comparative pro-forma information as soon as the information becomes available.
Our cost of services increased from $943,913 for the three months ended
September 30, 2004 to $7,373,319 for the three months ended September 30, 2005.
This increase was largely due to the increased revenues as noted above. However,
as a percentage of revenue, our cost of services remained relatively unchanged
at 83%.
For the three months ended September 30, 2005 and 2004 the major categories of
expenses, as a percent of revenue were as follows:
2005 2004
-----------------
Legal & professional 0% 2%
Advertising & promotion 1% 0%
Salaries & benefits 10% 8%
Taxes & licenses 0% 0%
Rent & leases 1% 1%
Travel & entertainment 0% 0%
Administrative expenses 4% 3%
Legal & professional expense decreased from $28,366 in 2004 to $26,524 in 2005,
remaining relatively unchanged.
Advertising and promotion expense increased from $4,288 in 2004 to $71,872 in
2005, reflecting an increased level of outside advertising and promotion. This
increase is attributable to the additional locations. Advertising and promotion
expense was relatively unchanged, as a percent of total sales.
Salaries and benefits increased from $89,559 in 2004 to $857,588 in 2005,
reflecting an increase in administrative and management compensation required to
operate the increased number of locations. As a percent of sales, this
represents an increase from 8% in 2004 to 10% in 2005.
Taxes & licenses increased slightly from $858 in 2004 to $1,880 in 2005,
reflecting an increase of costs associated with licensing in multiple states.
Rent & leases expense increased from $10,428 in 2004 to $104,159 in 2005,
reflecting an increase in the total locations being operated as a result of the
recent acquisitions. Resolve has increased from one location in 2004 to a total
of 36 locations in 2005. Rent and lease expense was relatively unchanged, as a
percent of sales.
Travel & entertainment increased from $57 in 2004 to $34,312 in 2005, reflecting
the increased effort by our staff to market our services on a national basis.
Administrative expenses increased from $29,590 in 2004 to $340,667 in 2005. This
increase reflects increased expenses associated with operating multiple staffing
locations. These changes include increased cost of various administrative
expenses, which include, but are not limited to printing, postage, shipping,
computer support, and other various public company expenses.
Interest expense increased from $1,138 in 2004 to $33,758 in 2005. The change
was due to additional borrowing on the credit line and other notes payable
associated with our recent acquisitions.
17
COMPARISON OF CONSOLIDATED OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
2005 AND 2004.
Our net loss increased from $68,098 for the nine months ended September 30, 2004
to $273,401 for the nine months ended September 30, 2005. A line-by-line
discussion of our results of operations is as follows:
Revenues for the nine months ended September 30, 2004 compared to 2005 increased
from $2,154,453 to $17,013,714 or a 690% increase. This increase is attributable
to the acquisitions, and opening of multiple new locations in 2005. Resolve has
grown to a national staffing firm with 36 locations. The Company has been unable
to obtain the necessary information to present pro-forma financial information
reflecting the combined operations of Resolve Staffing, Inc, and its acquired
staffing locations, for the period ended September 30, 2004 and for certain
locations acquired during the quarter ended September 30, 2005. This current
Report on Form 10-QSB will be supplemented by amendment to provide the necessary
comparative pro-forma information as soon as the information becomes available.
Our cost of services increased from $1,840,764 for the nine months ended
September 30, 2004 to $13,883,111 for the nine months ended September 30, 2005.
This increase was largely due to the increased revenues as noted above. However,
as a percentage of revenue, our cost of services decreased from 85% to 82%.
For the nine months ended June 30, 2005 and 2004 the major categories of
expenses, as a percent of revenue were as follows:
2005 2004
-----------------
Legal & professional 1% 2%
Advertising & promotion 1% 0%
Salaries & benefits 11% 11%
Taxes & licenses 0% 0%
Rent & leases 1% 1%
Travel & entertainment 0% 0%
Administrative expenses 5% 3%
Legal & professional increased from $35,084 in 2004 to $123,974 in 2005. As a
percent of Sales, legal expenses decreased slightly from 2% in 2004 to 1% in
2005. The increase in legal expenses is attributed to the multiple acquisitions
Resolve has made.
Advertising and promotion expense increased from $8,751 in 2004 to $141,317 in
2005, reflecting an increased level of outside advertising and promotion. This
increase is attributable to the additional locations. Advertising and promotion
expense was relatively unchanged, as a percent of total sales.
Salaries and benefits increased from $239,800 in 2004 to $1,811,049 in 2005,
reflecting an increase in administrative and management compensation required to
operate the increased number of locations. As a percent of sales, this
represents a total of 11% in both 2004 and 2005.
Taxes & licenses decreased slightly from $2,540 in 2004 to $2,097 in 2005.
Rent & leases expense increased from $22,179 in 2004 to $225,030 in 2005,
reflecting an increase in the total locations being operated as a result of the
recent acquisitions. Resolve has increased from one location in 2004 to a total
of 36 locations in 2005. Rent and lease expense was relatively unchanged, as a
percent of sales.
Travel & entertainment increased from $1,022 in 2004 to $54,496 in 2005,
reflecting the increased effort by our staff to market our services on a
national basis.
18
Administrative expenses increased from $71,273 in 2004 to $909,024 in 2005. This
increase reflects increased expenses associated with operating multiple staffing
locations. These changes include increased cost of various administrative
expenses, which include, but are not limited to printing, postage, shipping,
computer support, and other various public company expenses.
Interest expense increased from $1,138 in 2004 to $137,016 in 2005. The change
was due to additional borrowing on the credit line and other notes payable
associated with our recent acquisitions.
LIQUIDITY AND CAPITAL RESOURCES
As reflected in the accompanying financial statements, the Company has a net
working capital balance of $1,751,757 and a stockholder's deficit of $45,690, as
of September 30, 2005. Prior to the third quarter, the Company had incurred
losses and has been dependent upon the financial support of stockholders,
management and other related parties.
Management has successfully obtained additional financial resources, which the
Company believes will support operations. These financial resources include
financing from both related and non-related third parties, are discussed in the
accompanying footnotes to the financial statements. There can be no assurance
that management will be successful in continuing operations without additional
financing efforts. The financial statements do not reflect any adjustments that
may arise as a result of this uncertainty.
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005
For the nine months ended September 30, 2005 we incurred a net loss of $273,401.
Of this loss, $151,236 was for depreciation and amortization and did not
represent the use of cash. Changes in accounts receivable, prepaid and other
expenses, offset by increases in accounts payable, payroll, salary, and other
accruals brought the total cash used by operations to $3,016,482.
Our average monthly revenue for the first nine months of 2004 was $239,384, and
has increased to a monthly average of $1,890,413 for the first nine months of
2005 and an average of $2,971,151 for the third quarter of 2005. Although we
have seen our average monthly revenues and business activity increase and
achieved profitability in the third quarter, we still have a net loss for the
first nine months.
We expect our operating expenses to continue to increase in the near future as
we attempt to build our brand and expand our customer base. We hope our expenses
will be funded from operations and short-term loans from officers, shareholders
or others; however, our operations may not provide such funds and we may not be
able obtain short-term loans from officers, shareholders or others. Our officers
and shareholders are under no obligation to provide additional loans to the
company.
19
ITEM 3. CONTROLS AND PROCEDURES
As required by Rule 13a-14 under the Securities Exchange Act of 1934, as of the
end of the period covered by this report, Resolve carried out an evaluation of
the effectiveness of the design and operation of Resolve's disclosure controls
and procedures. This evaluation was carried out under the supervision and with
the participation of Resolve's management, including Resolve's Chief Executive
Officer, who concluded that Resolve's disclosure controls and procedures are
effective. There have been no significant changes in Resolve's internal controls
or in other factors, which could significantly affect internal controls
subsequent to the date Resolve carried out its evaluation.
Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in Resolve's
reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the Securities and
Exchange Commission's rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed in Resolve's reports filed under the
Exchange Act is accumulated and communicated to management, including Resolve's
Chief Executive Officer, to allow timely decisions regarding required
disclosure.
20
PART II - OTHER INFORMATION
ITEM 4. CHANGES IN SECURITIES
On August 20, 2004, the Board of Directors, with a written consent of
shareholders, approved a one for five reverse split of the Company's common
stock. An Information Statement was mailed on or about November 30, 2004 to the
holders of record at the close of business on November 25, 2004, of the common
stock, $.0001 par value per share (the "Common Stock") of Resolve Staffing, Inc.
(the "Company"), in connection with action by written consent to authorize and
approve the filing of an amendment to the Company's Articles of Incorporation
for the purpose of effecting:(i) a reverse stock split of the outstanding shares
of the Company's Common Stock on a one-for-five basis, with no fractional shares
to issue for any uneven or odd number of shares. The Reverse Split shall be
accomplished by using rounding up principals rather than issuing any fractional
shares of common stock or cash in lieu of fractional shares; (ii) maintaining
the par value of the Company's Common Stock at $.0001; and (iii) maintaining the
current number of shares of Common Stock the Company is authorized to issue at
50,000,000. Members of the Board of Directors and three shareholders owned or
had voting authority represents approximately 73% of the total outstanding votes
of all issued and outstanding shares of Common Stock of the Company and such
votes were sufficient to approve the action on the record date of November 25,
2004. The reverse split took place on December 28, 2004.
On February 7, 2005, Resolve Staffing, Inc., entered into an equity purchase
agreement ("Agreement"), to purchase ELS Personnel Services ("ELS") from
Employee Leasing Services, Inc., ("ELS Inc."), a privately-held company located
in Cincinnati, Ohio. Resolve issued a total of 13,000,000 shares of common stock
as part of the payment for the acquisition. See Item 5. Other Information for
additional information. In accordance with SFAS No. 141 - Business Combinations,
the transaction has been recorded as a reverse acquisition whereby ELS is
considered the accounting acquirer.
On May 25, 2005, Resolve Staffing, Inc. issued 100,000 shares to certain
individuals as part of their compensation.
On August 18, 2005, Resolve issued 50,000 shares to certain employees as part of
their compensation and 100,000 shares as per an employment agreement with
certain shareholders and employees of Truckers Plus.
ITEM 5. OTHER INFORMATION
April 21, 2005, William Walton joined the Board of Directors of Resolve
Staffing.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 31.1 Certification by Ronald Heineman, Chief Executive
Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
Exhibit 32.1 Certification by Ronald Heineman, Chief Executive
Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
(b) Reports on Form 8-K
We filed the following reports on Form 8-K during the first nine
months of 2005:
Form 8-K, January 13, 2005, Item 5 - Change in Registrants Officers;
Reporting the Resignation of Michael Knox as an Officer.
21
Form 8-K, February 9, 2005, Item 1 - Entry into a Material
Definitive Agreement; Reporting the acquisition of ELS Inc.'s
Staffing Division.
Form 8-K, April 21, 2005, Item 5- Change in Registrants Directors;
Reporting the addition of William Walton to the Board of Directors.
Form 8-K, August 24, 2005, Item 1 - Entry into a Material Definitive
Agreement; Reporting the acquisition of Truckers Plus.
Form 8-K, October 27, 2005, Item 4 - Non-Reliance on Previously
Issued Financial Statements; Reporting the non-reliance on financial
statements contained in the Forms 10QSB for the periods ended March
31, 2005 and June 30, 2005.
Form 8-K/A, November 14, 2005, Item 4 - Non-Reliance on Previously
Issued Financial Statements; Reporting changes to the previously
filed 8-K, filed on October 27, 2005.
22
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.
RESOLVE STAFFING, INC.
Dated: November 21, 2005 /s/ Ronald Heineman
----------------------------------
By: Ronald Heineman
Chief Executive Officer(principal
executive officer, director)
23