Labor SMART, Inc. to Explore Sale of Six Branch Locations to The
Staffing Group
Company to Announce Live Stream Q and A
Atlanta, GA, United States, via NUZINET CORP., 02/12/2016 - -
Labor SMART, Inc. (OTCQB:
LTNC) (the "Company"), a leader in providing on-demand blue
collar staffing primarily in the southeastern United States, today
announced that it is exploring the sale of six Labor SMART branch
locations to The Staffing Group, Ltd., (TSGL) a publicly traded
company controlled by Labor SMART, Inc.
The proposed arms-length transaction would be structured as an
asset sale in which Labor SMART, Inc. would receive $1.3 million in
cash, $1.3 million in restricted stock of TSGL, and $1 million in a
senior secured convertible debenture with a maturity date 24 months
from the closing date of the transaction. Labor SMART, Inc. would
retain its open accounts receivable at time of close and would
continue to operate its remaining branch locations. The six branch
locations included in the sale would continue to operate under the
laborSMART brand and no staff changes would be necessary.
Ryan Schadel, President and CEO of Labor
SMART, Inc. commented, Executing a transaction with this
structure allows Labor SMART to monetize some of its operating
assets while still participating in the upside performance of those
assets via our equity stake in The Staffing Group as well as
consolidated financials. All cash received in the transaction would
be used to eliminate our remaining convertible debt.
I believe consummating this transaction would unlock hidden
value on our balance sheet and provide some clarity and certainty
to Labor SMART shareholders (co-owners) that we have the desire,
resources and financial ability to clean up our balance sheet and
share structure. Furthermore, this transaction would allow us to
invest ongoing resources into the development and launch our
Skillcorps platform and seek revenue growth from the remaining
Labor SMART locations without the heavy weight of toxic debt on our
balance sheet.
As The Staffing Group, Ltd. executes its recently announced
acquisition strategy, Labor SMART stands to gain much from its
equity position, which can later be monetized or distributed to
shareholders through a share dividend of TSGL. A stock dividend of
$1.3 million would be an excellent way of rewarding the co-owners
that have seen the Labor SMART vision and remained faithful during
the difficult last two years.
In the interest of shareholder value, fairness, and avoidance of
doubt, Labor SMART will entertain competitive bids for these assets
before executing definitive documents for the sale of these six
branch locations to The Staffing Group, Ltd.
The Company is requesting feedback on the proposed transaction
from all shareholders and requests that questions and comments be
emailed to shareholders@laborsmart.com. A
live stream Q & A via Periscope.tv will be announced in
the coming days.
About Labor SMART, Inc.
Labor SMART, Inc. provides On-Demand temporary labor to a
variety of industries. The Company's clients range from small
businesses to Fortune 100 companies. Labor SMART was founded to
provide reliable, dependable and flexible resources for on-demand
personnel to small and large businesses in areas that include
construction, manufacturing, hospitality, event-staffing,
restoration, warehousing, retailing, disaster relief and cleanup,
demolition and landscaping. Labor SMART believes it can make a
positive contribution each and every day for the benefit of its
clients and temporary employees. The Company's mission is to be the
provider of choice to its growing portfolio of customers with a
service-focused approach that enables Labor SMART to be seen as a
resource and partner to its clients.
Follow us on Twitter: @laborsmart
Investor Relations: @laborSMART_LTNC
CEO - Ryan Schadel: @CRyanSchadel
Safe Harbor Statement
This release contains statements that constitute forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. These statements appear in a number of places
in this release and include all statements that are not statements
of historical fact regarding the intent, belief or current
expectations of Labor SMART, Inc., its directors or its officers
with respect to, among other things: (i) financing plans; (ii)
trends affecting its financial condition or results of operations;
(iii) growth strategy and operating strategy. The words "may",
"would", "will", "expect", "estimate", "can", "believe",
"potential", and similar expressions and variations thereof are
intended to identify forward-looking statements. Investors are
cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and
uncertainties, many of which are beyond Labor SMART, Inc.'s ability
to control, and that actual results may differ materially from
those projected in the forward-looking statements as a result of
various factors. More information about the potential factors that
could affect the business and financial results is and will be
included in Labor SMART, Inc.'s filings with the U.S. Securities
and Exchange Commission.
Contact:
Labor SMART, Inc.
shareholderrelations@laborsmart.com