Registration No. 333-
As filed with the Securities and Exchange Commission on December 4, 2001.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
-----------------
TEAMSTAFF, INC.
(Exact name of Registrant as specified in charter)
New Jersey 22-1899798
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
300 Atrium Drive
Somerset, New Jersey 08873
(732) 748-1700
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-----------------
Donald W. Kappauf
President and Chief Executive Officer
300 Atrium Drive
Somerset, New Jersey 08873
(732) 748-1700
(Name and address, including zip code, and telephone number,
including area code, of agent for service)
-----------------
With copies to:
Brian C. Daughney, Esq.
Goldstein & DiGioia, LLP
369 Lexington Avenue
New York, New York 10017
Telephone (212) 599-3322
Facsimile (212) 557-0295
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plan, please check the following
box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933 other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ___________________.
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ] ___________________.
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE*
====================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Securities Amount to be Offering Price Aggregate Registration
Being Registered Registered per Share(1) Offering Price(1) Fee
- --------------------------------------------------------------------------------------------------------------------
Common Stock, $.001 par
value(2)................... 6,168,511 $5.80 $35,777,363 $8,551
- --------------------------------------------------------------------------------------------------------------------
Common Stock, $.001 par
value(3)................... 26,000 $5.80 $150,800 $36.00
- --------------------------------------------------------------------------------------------------------------------
Total...................... 6,194,511 $35,928,163 $8,587
====================================================================================================================
(1) Estimated solely for the purpose of determining the registration fee,
based on a share price of $5.80, the average of the high and low prices
as quoted by the Nasdaq National Stock Market on November 29, 2001.
(2) Shares of Common Stock to be sold by certain Selling Security Holders.
(3) Shares of Common Stock issuable upon exercise of outstanding Common
Stock Purchase Warrants held by certain Selling Security Holders.
Pursuant to Rule 416, there are also being registered such additional
number of shares of Common Stock as may become issuable pursuant to the
anti-dilution provisions of the Warrants.
---------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SECTION 8(a) MAY
DETERMINE.
Subject to Completion December 4, 2001
P R O S P E C T U S
6,194,511 Shares of Common Stock
TEAMSTAFF, INC.
We are registering for resale 6,168,511 shares of common stock, $.001
par value of TeamStaff, Inc., which shares are presently issued and outstanding
and held by certain of our shareholders and an additional 26,000 shares of
common stock which we will issue upon the exercise of outstanding common stock
purchase warrants held by the holders of outstanding warrants.
Our Common Stock is traded in the over-the-counter market and is
included in the National Market of the Nasdaq Stock Market under the symbol
"TSTF". On November 29, 2001, the high and low prices for the Common Stock as
reported by Nasdaq were $5.95 and $5.65, respectively. The closing price of the
Common Stock on November 29, 2001 was $5.70.
We will not receive any proceeds from the sale of the shares by the
selling security holders.
The shares may be sold from time to time by the selling security
holders, or by their transferees. No underwriting arrangements have been entered
into by the selling security holders. The distribution of the shares by the
selling security holders may be effected in one or more transactions that may
take place on the over the counter market, including ordinary brokers
transactions, privately negotiated transactions or through sales to one or more
dealers for resale of the shares as principals, at market prices prevailing at
the time of sale, at prices related to such prevailing market prices or at
negotiated prices. Usual and customary or specifically negotiated brokerage fees
or commissions may be paid by the selling security holders in connection with
such sales. The selling security holders and intermediaries through whom such
shares are sold may be deemed underwriters within the meaning of the Act, with
respect to the shares offered by them.
PLEASE SEE "RISK FACTORS" BEGINNING ON PAGE 11 TO READ ABOUT CERTAIN
FACTORS YOU SHOULD CONSIDER BEFORE BUYING SHARES OF COMMON STOCK.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is _________, 2001
TABLE OF CONTENTS
PAGE
----
AVAILABLE INFORMATION.............................................................................................1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...................................................................1
PROSPECTUS SUMMARY................................................................................................3
THE COMPANY.......................................................................................................3
THE OFFERING......................................................................................................9
SELECTED FINANCIAL DATA..........................................................................................11
RISK FACTORS.....................................................................................................12
SELLING SECURITY HOLDERS.........................................................................................22
PLAN OF DISTRIBUTION.............................................................................................24
REPORTS TO SHAREHOLDERS..........................................................................................24
LEGAL MATTERS....................................................................................................25
EXPERTS..........................................................................................................25
ADDITIONAL INFORMATION...........................................................................................25
FORWARD LOOKING STATEMENTS.......................................................................................25
AVAILABLE INFORMATION
Our company is subject to the informational reporting requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports and other information with the Securities
and Exchange Commission (the "Commission"). Reports, proxy and information
statements and other information filed by our company with the Commission
pursuant to the informational requirements of the Exchange Act may be inspected
and copied at the public reference facilities maintained by the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549 and at the following Regional
Offices of the Commission: New York Regional Office, 7 World Trade Center, 13th
Floor, New York, New York 10048; and Chicago Regional Office, 500 West Madison
Street, Room 1400, Chicago, Illinois 60661. Copies of such material may be
obtained from the public reference section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. You may obtain
information on the operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330. The SEC maintain an Internet site, http://www.sec.gov, that
contains reports, proxy and information statements and other information that we
file electronically with the SEC.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, heretofore filed by TeamStaff with the
Commission pursuant to the Exchange Act, are hereby incorporated by reference,
except as superseded or modified herein:
1. Our Annual Report on Form 10-K for the fiscal year ended
September 30, 2000, including information specifically
incorporated by reference into our Form 10-K from our
definitive Proxy Statement.
2. A description of our common stock contained in our
registration statement on Form 8-A filed April 27, 1990.
3. Our Form 8-K filed on September 7, 2001 and Amendment No.1 to
Form 8-K filed on October 2, 2001.
4. Our Form 10-Q for the quarter ended December 31, 2000.
5. Our Form 10-Q for the quarter ended March 31, 2001.
6. Our Form 10-Q for the quarter ended June 30, 2001.
Each document filed subsequent to the date of this Prospectus pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the
termination of this offering shall be deemed to be incorporated by reference in
this Prospectus and shall be part hereof from the date of filing of such
document.
All documents filed by the registrant after the date of filing the
initial registration statement on Form S-3 of which this prospectus forms a part
and prior to the effectiveness of such registration
1
statement pursuant to Section 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 shall be deemed to be incorporated by reference into this
prospectus and to be part hereof from the date of filing of such documents.
We will provide without charge to each person to whom a copy of this
Prospectus is delivered, upon the written or oral request of any such person, a
copy of any document described above (other than exhibits). Requests for such
copies should be directed to TeamStaff, Inc., 300 Atrium Drive, Somerset, New
Jersey 08873, telephone (732) 748-1700, attention Donald Kelly.
2
PROSPECTUS SUMMARY
The following summary is intended to set forth certain pertinent facts
and highlights from material contained in the our company's annual report on
Form 10-K for the fiscal year ended September 30, 2000 (the "Form 10-K") our
quarterly reports on Form 10-Q for the quarters ended December 31, 2000, March
31, 2001 and June 30, 2001 (the "Forms 10-Q"), and our other reports as filed
with the Securities and Exchange Commission, all of which are incorporated by
reference into this prospectus.
THE COMPANY
TeamStaff, Inc. (referred to as the "Company"), a New Jersey
Corporation, was founded in 1969 as a payroll service company and has evolved
into a leading provider of human resource management and professional employer
organization ("PEO") to a wide variety of industries in 50 states. TeamStaff's
wholly-owned subsidiaries include TeamStaff Solutions, Inc., DSI Staff
ConnXions-Northeast, DSI Staff ConnXions-Southwest, TeamStaff Rx, Inc.,
TeamStaff I, Inc., TeamStaff II, Inc., TeamStaff III, Inc., TeamStaff IV, Inc.,
TeamStaff V, Inc., TeamStaff VI, Inc., TeamStaff Insurance Services, Inc.,
TeamStaff VIII, Inc., Employee Support Services, Inc., TeamStaff IX, Inc.,
Digital Insurance Services, Inc., HR2, Inc. and BrightLane.com, Inc.
(collectively referred to, with TeamStaff, as the "Company").
The Company currently provides three types of services related to the
employee leasing, temporary staffing and payroll service businesses: (1)
professional employer organization services, such as payroll processing,
personnel and administration, benefits administration, workers' compensation
administration and tax filing; (2) employer administrative services, such as
payroll processing and tax filing; and (3) contract staffing, or the placement
of temporary and permanent employees. TeamStaff currently furnishes PEO
employees, payroll and contract staffing services to over 4,300 client
organizations with approximately 21,800 worksite employees, 2,600 staffing
employees and processing for approximately 30,000 payroll service employees and
believes that it currently ranks, in terms of revenues and worksite employees,
as one of the top professional employer organizations in the United States. The
Company's contract staffing business mainly places temporary help in hospitals
and clinics throughout the United States through its Clearwater, Florida and
Houston, Texas offices. The Company has six regional offices located in
Somerset, New Jersey; Houston and El Paso, Texas; Woburn, Massachusetts; and
Delray and Clearwater, Florida and seven sales service centers in New York, New
York; El Paso and Houston, Texas; Delray, and Clearwater, Florida; Woburn,
Massachusetts; and Somerset, New Jersey.
Essentially, we provide services that function as the personnel
department for small to medium sized companies. We believe that by offering
services that relieve small and medium size businesses of the ever increasing
administrative burden of employee related record keeping, payroll processing,
benefits administration, employment of temporary and permanent specialized
employees
3
and other human resource functions, we have positioned our company to
take advantage of a major growth opportunity during this decade and the next.
Recognizing the desire by many small businesses to be relieved of the
human resource administrative functions, the Company has formulated a strategy
of emphasizing PEO and "outsourcing" services. In PEO, a service provider
becomes a co-employer of the client company's employees and assigns these
employees to the client to perform their intended functions at the worksite.
Management has determined to emphasize the Company's future growth in
the PEO and outsourcing industry. The Company's expansion program will focus on
internal growth through the cross marketing of its PEO services to its entire
client base and the acquisition of compatible businesses strategically situated
in new areas or with a client base serviceable from existing facilities. As part
of its effort to expand its PEO business, management has expanded the services
of TeamStaff Rx, Inc., the Company's medical contract staffing subsidiary, to
include PEO, outsourcing and facilities management. While TeamStaff continues to
sell stand-alone employer services, such as payroll and tax filing, it will
emphasize the PEO component of its service offerings with a goal of becoming the
leading provider of PEO services in the United States. A major component of the
Company's growth strategy is the acquisition of well-situated, independent PEO
companies whose business can be integrated into the Company's operations.
However, there can be no assurance any such acquisition will be consummated by
the Company.
TeamStaff, Inc. was organized under the laws of the State of New Jersey
on November 25, 1969 and maintains its executive offices at 300 Atrium Drive,
Somerset, New Jersey 08873 where its telephone number is (732) 748-1700.
OUR SERVICES
Professional Employer Organization (PEO)
Our company's core business, and the area management will continue to
emphasize, is our PEO services. When a client utilizes our services, the client
administratively transfers all or some of its employees to us and we in turn
provide them back to the client. Our company thereby becomes a co-employer and
is responsible for all human resource functions, including payroll, benefits
administration, tax reporting and personnel record keeping. The client still
manages the employees and determines salary and duties in the same fashion as
any employer. The client is, however, relieved of reporting and tax filing
requirements and other administrative tasks. Moreover, because of economies of
scale, our company is able to negotiate favorable terms on workers' compensation
insurance, health benefits, retirement programs, and other valuable services.
The client company benefits because it can then offer its employees the same or
similar benefits as larger companies, enabling it to successfully compete in
recruiting highly qualified personnel, as well as build the morale and loyalty
of its staff.
4
As a PEO service provider, we can offer the following benefits to
employees:
COMPREHENSIVE MAJOR MEDICAL PLANS -- Management believes that medical
insurance costs have forced small employers to reduce coverage provided to its
employees and to increase employee contributions. We are able to leverage our
large employee base and offer the employees assigned to their clients a variety
of health coverage plans from traditional indemnity plans to Health Maintenance
Organizations (HMO), Preferred Provider Organizations (PPO), or a Point of
Service Plan (POS).
DENTAL AND VISION COVERAGE -- These types of benefits are generally
beyond the reach of most small groups. As a result of economies of scale
available, a client of our company can obtain these benefits for the assigned
employees.
LIFE INSURANCE -- Affordable basic coverage is available.
SECTION 125 PREMIUM CONVERSION PLAN -- Employees can pay for benefits
with pre-tax earnings, reduce their taxable income and FICA payments, and
increase their take-home pay.
401(K) RETIREMENT PLANS -- Management believes that most small
employers do not provide any significant retirement benefits due to the
administrative and regulatory requirements associated with the establishment and
maintenance of retirement plans. The company enables small business owners to
offer the assigned employees retirement programs comparable to those of major
corporations. Such plans can be used to increase morale, productivity and
promote employee loyalty.
CREDIT UNION -- Our company provides an opportunity for employees to
borrow money at lower interest than offered at most banks.
PAYROLL SERVICES -- Although ancillary to the PEO services, clients no
longer incur the expense of payroll processing either through in-house staff or
outside service. Our company's PEO services include all payroll and payroll tax
processing.
UNEMPLOYMENT COMPENSATION COST CONTROL -- Our company provides an
unemployment compensation cost control program to aggressively manage
unemployment claims.
HUMAN RESOURCES MANAGEMENT SERVICES -- Our company can provide clients
with expertise in areas such as personnel policies and procedures, hiring and
firing, training, compensation and performance evaluation.
WORKERS' COMPENSATION PROGRAM -- Our company has a national workers'
compensation policy which can provide our company with a significant advantage
in marketing its services, particularly in jurisdictions where workers'
compensation policies are difficult to obtain at reasonable costs. We also
provide our clients where applicable with independent safety analyses and risk
management services to reduce workers' injuries and claims.
5
Relieved of personnel administrative tasks, the client is able to focus
on its core business. The client is also offered a broader benefits package for
its assigned employees, a competitive rate in workers' compensation insurance,
and savings in time and paperwork previously required in connection with
personnel administration.
PAYROLL SERVICES
We were established as a payroll service firm in 1969, and continue to
provide basic payroll services to our clients. Historically, the payroll
division provided these services primarily to the construction industry and
currently 70% of our company's approximately 750 payroll service clients are in
the construction industry. Our company offers most, if not all, of what other
payroll services provide, including the preparation of checks, government
reports, W-2's (including magnetic tape filings), remote processing (via modem)
directly to the clients offices, and certified payrolls.
In addition, our company offers a wide array of tax reporting services
including timely deposit of taxes, impounding of tax payments, filing of
returns, distribution of quarterly and year-end statements and responding to
agency inquiries.
TEMPORARY STAFFING SERVICES
We provide temporary staffing services through two subsidiaries which
have, in the aggregate, more than 30 years of experience in placing permanent
and temporary employees with specialized skills and talents with regional,
national and international employers. Temporary staffing enables clients to
attain management and productivity goals by matching highly trained
professionals and technical personnel to specific project requirements.
TeamStaff focuses its temporary staffing services in two specific markets where
it places people on a temporary long term assignment, or on a permanent basis:
(1) radiologic technologist, diagnostic sonographers, cardiovascular
technologists, radiation therapist and other medical professionals with
hospitals, clinics and therapy centers throughout the 50 states and (2)
technical employees such as engineers, information systems specialists and
project managers primarily with Fortune 100 companies for specific projects.
Clients whose staffing requirements vary depending on the level of current
projects or business are able to secure the services of highly qualified
individuals on an interim basis.
Our company's temporary staffing services provide clients with the
ability to "rightsize"; that is, expand or reduce its workforce in response to
changing business conditions. Management believes that these services provide
numerous benefits to the client, such as saving the costs of salary and benefits
of a permanent employee whose services are not needed throughout the year. The
client also avoids the costs, uncertainty and delays associated with searches
for qualified interim employees. Our company also provides insurance bonding
where necessary and assumes all responsibility for payroll tax filing and
reporting functions, thereby saving the client administrative responsibility for
all payroll, workers' compensation, unemployment and medical benefits.
6
Management believes that its temporary staffing services provides an
employer with an increased pool of qualified applicants, since temporary
staffing employees have access to a wide array of benefits such as health and
life insurance, Section 125 premium conversion plans, and 401(k) retirement
plans. These benefits provide interim employees with the motivation of full-time
workers without additional benefit costs to the client. A client is also able to
temporarily rehire a retired employee for short-term or specialized projects
without jeopardizing their pension plan. We believe that we have attained the
position of being number one or two in the terms of gross revenues for firms
specializing in the placement of temporary medical imaging personnel.
RECENT EVENTS
Effective August 31, 2001, TeamStaff, Inc. completed its acquisition of
BrightLane.com, Inc. As a result of a reverse subsidiary merger with a
subsidiary of TeamStaff, BrightLane is now a wholly-owned subsidiary of
TeamStaff.
Other than payments for fractional shares, the shareholders of
BrightLane received an aggregate of 8,066,631 shares (less fractional shares) of
TeamStaff's Common Stock in exchange for their BrightLane Common Stock, Series A
Preferred, Series B Preferred and Series C Preferred stock. The exchange ratios
(rounded) and aggregate shares for the classes of BrightLane capital stock were
as follows:
Title of BrightLane Aggregate
Capital Stock Exchange Ratio TeamStaff Shares
------------------- -------------- ----------------
1,601,731
Common Stock 0.2314549 (less fractional shares)
Series A Preferred Stock 22.7740000 874,295
Series B Preferred Stock 1.9410000 3,334,117
Series C Preferred Stock 4.2050000 2,256,488
---------
8,066,631
TOTAL (less fractional shares)
As a result of issuance to the BrightLane shareholders in the
transaction, the former BrightLane shareholders will receive 8,066, 631 shares
(prior to reduction for fractional shares) and, assuming all such shares are
issued as of November 29, 2001, TeamStaff has approximately 16,156,184 shares
outstanding.
In connection with the transaction, persons holding BrightLane options
to acquire approximately 2,078,000 BrightLane shares (the equivalent of
approximately 481,000 TeamStaff shares ) exercised their options. TeamStaff made
recourse loans of approximately $1,150,000 principal amount to the holders of
these options to assist them in payment of tax obligations incurred
7
with exercise of the options. The loans are repayable upon the earlier of (i)
sale of the TeamStaff shares or (ii) three years.
First Union Corporation, through an affiliate held all of the
BrightLane Series B Preferred stock, and therefore owns 3,334,117 shares of
TeamStaff's Common Stock (approximately 20%). In addition, Nationwide Financial
Services, Inc. held all of the BrightLane Series C Preferred stock, and
therefore owns 2,256,488 shares of TeamStaff's Common Stock (approximately 14%).
The Registration Statement of which this Prospectus forms a part includes the
shares held by First Union Corporation, Nationwide Financial Services and Mr.
Stephen Johnson (including Mr. Johnson's spouse, Mary Johnson).
Under the terms governing the transaction, certain option holders were
restricted from selling TeamStaff shares acquired from the exercise of their
BrightLane options for a period of up to two years. T. Stephen Johnson and his
spouse, Mary Johnson, also a former director of BrightLane, were the only option
holders who exercised their options and who were subject to these lockup
provisions. Due to the recent significant rise in the Company's stock price and
the significant increase in the amount of the tax loans to be made to T. Stephen
Johnson and Mary Johnson, the Board of Directors of TeamStaff concluded it would
be more appropriate to allow Mr. and Mrs. Johnson to sell a portion of their
TeamStaff shares to cover their tax liability rather than carry a large loan
receivable on the Company's financial statements. The Board therefore agreed to
allow the sale of up to 40% of Mr. and Mrs. Johnson's option shares
(approximately 56,230 TeamStaff shares) as an exempt transaction under SEC Rule
16(b)(3).
In addition, three persons who served as directors of TeamStaff, namely
John H. Ewing, Rocco J. Marano and Charles R. Dees, Jr. agreed to step down as
directors upon consummation of the transaction with BrightLane. Effective
September 4, 2001, these persons resigned as directors. In connection with the
termination of their services, these individuals received 1,000 warrants for
each year of service on the TeamStaff Board of Directors ( an aggregate of
26,000 warrants). The registration statement of which this Prospectus forms a
part includes the shares of common stock underlying these warrants. The grant of
the warrants was approved by the Board of Directors as an exempt transaction
under SEC Rule 16(b)(3).
Under the terms of the agreements governing the BrightLane transaction,
TeamStaff agreed to register for resale shares obtained by former BrightLane
shareholders who would be deemed "affiliates" under SEC rules and regulations.
The registration statement of which this prospectus forms a part includes
6,096,946 shares of common stock owned by these persons.
8
THE OFFERING
Common Stock outstanding prior to
offering(1).................................................... 16,156,184
Shares being offered for
sale by selling security holders............................... 6,168,511 (2)
Shares underlying warrants being
offered for sale by selling security holders................... 26,000
Common Stock outstanding after the
offering ...................................................... 16,182,184 (2)
Risk Factors .................................................. This offering involves a high degree of risk. See
"Risk Factors."
Use of Proceeds (3)............................................ All of the proceeds of this offering will be paid to the
respective selling security holders and none of the proceeds
will be received by our company. We anticipate that proceeds
received from exercise of any warrants will be used for
working capital purposes. See "Use of Proceeds."
Nasdaq Market Symbol........................................... TSTF
- ----------------
(1) As of November 29, 2001. Does not include:
- - Options to purchase 1,714,286 Shares reserved for issuance under our
2000 Employee Stock Option Plan of which 635,000 are issued and
outstanding and options to purchase 21,550 Shares issued and
outstanding under our 1990 Employee Stock Option Plan, which expired in
April, 2000.
- - Options to purchase 207,290 Shares issued and outstanding under our
1990 Senior Management Plan, which expired in April, 2000.
- - Options to purchase 22,134 Shares issued and outstanding under our 1990
Non-Executive Director Plan, which expired in April, 2000 and options
to acquire 60,000 shares issuable and outstanding under our 2000
Non-Executive Director Stock Option Plan.
- - Up to approximately 109,569 Shares reserved for issuance upon exercise
of outstanding warrants of which 26,000 warrants are being included in
the registration statement of which this Prospectus forms a part.
9
(2) The 6,096,946 shares being offered by the Selling Security Holders have
been issued by the Company in connection with the acquisition of
BrightLane.com, Inc., and therefore are included in the 16,156,184
shares outstanding as of November 16, 2001.
(3) We will receive approximately $114,496 in proceeds if all of the
warrants being registered in this prospectus are exercised.
10
SELECTED FINANCIAL DATA
(amounts in thousands, except per share data)
The following table sets forth selected consolidated financial data of
our historical operations for each of the five years in the period ended
September 30, 2000 and for each of the nine month periods ended June 30, 2000
and 2001, respectively. The selected financial data related to (Loss) earnings
per share and weighted average shares outstanding have been restated for all
periods presented to consider the 3.5 for 1 reverse stock split that went into
effect on June 2, 2000.
Fiscal Year Ended September 30, Nine Months Ended June 30,
-------------------------------------------------------------------------- ---------------------------
1996 1997 1998 1999 2000 2000 2001
Revenues $100,927 $122,559 $139,435 $244,830 $447,743 $299,140 $487,497
Direct Expenses 92,490 113,894 129,747 228,294 426,987 284,134 466,891
Gross Profit 8,437 8,665 9,688 16,536 20,756 15,006 20,606
Selling, General and
Administrative Expenses
(includes Depreciation
and Amortization) 8,801 11,316 8,050 13,305 18,338 12,973 17,513
(Loss) Income From
Operations (364) (2,651) 1,638 3,231 2,418 2,033 3,093
Net (Loss) Income $(597) $(2,832) $2,703 $ 1,776 $ 951 936 1,360
(Loss) Earnings per share
(1)
Basic $(0.12) $(0.52) $0.49 $ 0.25 $ 0.12 $0.12 $0.17
Diluted $(0.12) $(0.52) $0.49 $ 0.25 $ 0.12 $0.12 $0.17
Weighted average shares
outstanding (1)
Basic 4,812 5,449 5,506 7,128 7,954 7,956 8,011
Diluted 4,812 5,449 5,544 7,145 7,991 8,008 8,171
As of September 30, As of June 30,
-------------------------------------------------------------------------- ---------------------------
BALANCE SHEET DATA: 1996 1997 1998 1999 2000 1999 2000
Assets $14,800 $14,163 $ 16,648 $36,382 $49,514 $44,829 $54,737
Liabilities 7,632 9,291 8,774 19,417 31,455 26,722 31,640
Long-Term Debt 100 89 2,981 4,502 6,222 6,703 3,487
Working Capital
(Deficiency) 286 (1,401) 3,319 2,968 3,065 3,616 5,038
Shareholders' Equity $7,168 $4,872 $7,874 $16,965 $18,059 $18,107 $23,097
- ----------------------------
1. In accordance with Statement of Accounting Standards 128, basic and
diluted earnings (loss) per share have replaced primary and diluted
earnings (loss) per share.
11
RISK FACTORS
An investment in the securities offered hereby involves a high degree
of risk. The following factors, in addition to those discussed elsewhere, should
be considered carefully in evaluating us and our business. An investment in the
securities is suitable only for those investors who can bear the risk of loss of
their entire investment.
WE MAY ACQUIRE ADDITIONAL COMPANIES WHICH MAY RESULT IN ADVERSE EFFECTS ON OUR
EARNINGS.
We may at times become involved in discussions with potential
acquisition candidates. Any acquisition that we may consummate may have an
adverse effect on our liquidity and earnings and may be dilutive to our
earnings. In the event that we consummate an acquisition or obtain additional
capital through the sale of debt or equity to finance an acquisition, our
shareholders may experience dilution in their shareholders' equity.
OUR FINANCIAL CONDITION MAY BE AFFECTED BY INCREASES IN HEALTH CARE AND WORKERS'
COMPENSATION INSURANCE COSTS.
Health care insurance premiums and workers' compensation insurance
coverage comprise a significant part of our operating expenses. Accordingly, we
use managed care procedures in an attempt to control these costs. Changes in
health care and workers' compensation laws or regulations may result in an
increase in our costs and we may not be able to immediately incorporate such
increases into the fees charged to clients because of our existing contractual
arrangements with clients. As a result, any such increases in these costs could
have a material adverse effect on our financial condition, results of operations
and liquidity.
OUR FINANCIAL CONDITION MAY BE AFFECTED BY RISKS ASSOCIATED WITH THE HEALTH AND
WORKERS' COMPENSATION CLAIMS EXPERIENCE OF OUR CLIENTS.
Although we utilize only fully-insured plans of health care and incur
no direct risk of loss under those plans, the premiums that we pay for health
care insurance are directly affected by the claims experience of our clients. If
the experience of the clients is unfavorable, the premiums that are payable by
us will increase. We may not be able to pass such increases onto our clients,
which may reduce our profit margin. Increasing health care premiums could also
place us at a disadvantage in competing for new clients. In addition, periodic
reassessments of workers' compensation claims of prior periods may require an
increase or decrease to our reserves, and therefore may also affect our present
and future financial condition.
OUR FINANCIAL CONDITION MAY BE AFFECTED BY INCREASES IN HEALTH INSURANCE
PREMIUMS, UNEMPLOYMENT TAXES AND WORKERS' COMPENSATION RATES.
Health insurance premiums, state unemployment taxes and workers'
compensation rates are in part determined by our claims experience and comprise
a significant portion of our direct costs.
12
If we experience a large increase in claim activity, our unemployment taxes,
health insurance premiums or workers' compensation insurance rates could
increase. Although we employ internal risk management procedures in an attempt
to manage our claims incidence, estimate claims expenses and structure our
benefits contracts to provide as much cost stability as possible, we may not be
able to prevent increases in claim activity, accurately estimate our claims
expenses or pass the cost of such increases on to our clients. Since our ability
to incorporate such increases into service fees to our clients is constrained by
contractual arrangements with clients, a delay could result before such
increases could be reflected in service fees. As a result, such increases could
have a material adverse effect on our financial condition or results of
operations.
SIGNIFICANT GROWTH THROUGH ACQUISITIONS MAY ADVERSELY AFFECT OUR MANAGEMENT AND
OPERATING SYSTEMS.
We completed three significant acquisitions during the past two
calendar years and intend to continue to pursue a strategy of acquiring
compatible businesses in the future. Our growth is making significant demands on
our management, operations and resources, including working capital. If we are
not able to effectively manage our growth, our business and operations will be
materially harmed. To manage growth effectively, we will be required to continue
to improve our operational, financial and managerial systems, procedures and
controls, hire and train new employees while managing our current operations and
employees. Historically, our cash flow from operations has been insufficient to
expand operations and sufficient capital may not be available in the future.
OUR PAYROLL BUSINESS MAY BE ADVERSELY AFFECTED IF THERE IS AN ECONOMIC DOWNTURN
IN THE CONSTRUCTION BUSINESS.
Although we have expanded our services to a number of industries, our
payroll service business continues to rely to a material extent on the
construction industry. During the last fiscal year, construction related
business accounted for approximately 70% of our payroll service business' total
customers. Accordingly, if there is a slowdown in construction activities, it
will affect our revenues and profitability. Management believes its reliance on
the construction business will continue to decline as its customer base expands
and becomes more diversified.
OUR BUSINESS MAY BE ADVERSELY AFFECTED TO DUE ECONOMIC CONDITIONS IN SPECIFIC
GEOGRAPHIC MARKETS.
While we have offices located in seven markets in five different
states, the majority of our revenues are derived through our Florida and Texas
operations. While we believe that our market diversification will eventually
lessen this risk in addition to generating significant revenue growth, we may
not be able to duplicate in other markets the revenue growth and operating
results experienced in our Florida and Texas markets.
13
UNFAVORABLE INTERPRETATIONS OF GOVERNMENT LAWS MAY HARM OUR OPERATIONS.
Our operations are affected by many federal, state and local laws
relating to labor, tax, insurance and employment matters and the provision of
managed care services. Many of the laws related to the employment relationship
were enacted before the development of alternative employment arrangements, such
as those that we provide, and do not specifically address the obligations and
responsibilities of non-traditional employers. The unfavorable resolution of
unsettled interpretive issues concerning our relationship could have a material
adverse effect on our results of operations, financial condition and liquidity.
Uncertainties arising under the Internal Revenue Code of 1986 include, but are
not limited to, the qualified tax status and favorable tax status of certain
benefit plans we and other alternative employers provide. In addition, new laws
and regulations may be enacted with respect to its activities which may also
have a material adverse effect on our business, financial condition, results of
operations and liquidity.
IF GOVERNMENT REGULATIONS REGARDING PEOS ARE IMPLEMENTED, OR IF CURRENT
REGULATIONS ARE CHANGED, OUR BUSINESS COULD BE HARMED.
Because many of the laws related to the employment relationship were
enacted prior to the development of professional employer organizations and
other staffing businesses, many of these laws do not specifically address the
obligations and responsibilities of non-traditional employers. Our operations
are affected by numerous federal, state and local laws and regulations relating
to labor, tax, insurance and employment matters. By entering into an employment
relationship with employees who work at client locations, we assume obligations
and responsibilities of an employer under these laws. Uncertainties arising
under the Internal Revenue Code of 1986, include, but are not limited to, the
qualified tax status and favorable tax status of certain benefit plans provided
by our company and other alternative employers. The unfavorable resolution of
these unsettled issues could have a material adverse effect on results of
operations and financial condition. While many states do not explicitly regulate
PEOs, approximately one-third of the states have enacted laws that have
licensing or registration requirements for PEOs, and several additional states
are considering such laws. Such laws vary from state to state but generally
provide for the monitoring of the fiscal responsibility of PEOs and specify the
employer responsibilities assumed by PEOS. There can be no assurance that we
will be able to comply with any such regulations which may be imposed upon us in
the future, and our inability to comply with any such regulations could have a
material adverse effect on our results of operations and financial condition. In
addition, there can be no assurance that existing laws and regulations which are
not currently applicable to us will not be interpreted more broadly in the
future to apply to our existing activities or that new laws and regulations will
not be enacted with respect to our activities. Either of these changes could
have a material adverse effect on our business, financial condition, results of
operations and liquidity.
WE MAY NOT BE ABLE TO OBTAIN ALL OF THE LICENSES AND CERTIFICATIONS THAT WE NEED
TO OPERATE.
State and federal authorities extensively regulate the managed health
care industry and some of our arrangements relating to specialty managed care
services or the maintenance or operation of
14
health care provider networks require us to satisfy operating, licensing or
certification requirements. Any further expansion of the range of specialty
managed care services that we offer is likely to require that we satisfy
additional licensing and regulatory requirements. In addition, certain states
require entities operating in the PEO business to be licensed. If we are unable
to obtain or maintain all of the required licenses or certifications that we
need, we could experience material adverse effects to our results of operations,
financial condition and liquidity.
HEALTH CARE OR WORKERS' COMPENSATION REFORM COULD IMPOSE UNEXPECTED BURDENS ON
OUR ABILITY TO CONDUCT OUR BUSINESS.
Regulation in the health care and workers' compensation fields
continues to evolve, and we cannot predict what additional government
regulations affecting our business may be adopted in the future. Changes in any
of these laws or regulations may adversely impact the demand for our services,
require that we develop new or modified services to meet the demands of the
marketplace, or require that we modify the fees that we charge for our services.
Any such changes may adversely impact our competitiveness and financial
condition.
IF WE LOSE OUR QUALIFIED STATUS FOR CERTAIN TAX PURPOSES, OUR BUSINESS WOULD BE
ADVERSELY AFFECTED.
The Internal Revenue Service established an Employee Leasing Market
Segment Group for the purpose of identifying specific compliance issues
prevalent in certain segments of the PEO industry. One issue that arose in the
course of these audits is whether PEOs should be considered the employers of
worksite employees under Internal Revenue Code provisions applicable to employee
benefit plans, which would permit PEOs to offer benefit plans that qualify for
favorable tax treatment to worksite employees. If the IRS concludes that PEOs
are not employers of worksite employees for purposes of the Internal Revenue
Code, we would need to respond to the following adverse implications:
- - the tax qualified status of our 401(k) plan could be revoked and our
cafeteria plan may lose its favorable tax status;
- - worksite employees would not be able to continue to participate in such
plans or in other employee benefit plans;
- - we may no longer be able to assume the client company's federal
employment tax withholding obligations;
- - if such a conclusion were applied retroactively, then employees' vested
account balances in the 401(k) plan would become taxable immediately,
we would lose our tax deduction to the extent contributions were not
vested, the plan trust would become a taxable trust and penalties, and
additional taxes for prior periods could be assessed.
15
In such a circumstance, we would face the risk of client
dissatisfaction as well as potential litigation, and our financial condition,
results of operations and liquidity could be materially adversely affected.
WE ARE LIABLE FOR THE COSTS OF WORKSITE EMPLOYEE PAYROLL AND BENEFITS AND BEAR
THE RISK IF SUCH COSTS EXCEED THE FEES PAYABLE TO US BY OUR CLIENTS.
Under our standard client service agreement, we become a co-employer of
worksite employees and assume the obligations to pay the salaries, wages and
related benefit costs and payroll taxes of such worksite employees. We assume
these obligations as a principal, not merely as an agent of the client company.
If a client company does not pay us or if the costs of benefits provided to
worksite employees exceeds the fees paid by a client company, our ultimate
liability for worksite employee payroll and benefits costs could have a material
adverse effect on our financial condition or results of operations. Our
obligations include responsibility for
- - payment of the salaries and wages for work performed by worksite
employees, regardless of whether the client company makes timely
payment to us of the associated service fee; and
- - providing benefits to worksite employees even if the costs we incur to
provide those benefits exceed the fees paid by the client company.
WE BEAR THE RISK OF NONPAYMENT FROM OUR CLIENTS.
To the extent that any client experiences financial difficulty, or is
otherwise unable to meet its obligations as they become due, our financial
condition and results of operations could be adversely affected. For work
performed prior to the termination of a client agreement, we may be obligated,
as an employer, to pay the gross salaries and wages of the client's worksite
employees and the related employment taxes and workers' compensation costs,
whether or not our client pays us on a timely basis, or at all. We have in the
past incurred bad debt expense in connection with our contract staffing
business. In addition, in each payroll period we have a nominal number of
clients who fail to make timely payment prior to delivery of the payroll. A
significant increase in our uncollected account receivables may have a material
adverse effect on our earnings and financial condition.
WE MAY BE HELD LIABLE FOR THE ACTIONS OF OUR CLIENTS AND EMPLOYEES AND THEREFORE
INCUR UNFORESEEN LIABILITIES.
A number of legal issues with respect to the co-employment arrangements
among PEOs, their clients and worksite employees remain unresolved. These issues
include who bears the ultimate liability for violations of employment and
discrimination laws. As a result of our status as a co-employer, we may be
liable for violations of these or other laws despite contractual protections.
While our client service agreements generally provide that the client is to
indemnify us for any liability caused by the client's failure to comply with our
contractual obligations and the requirements
16
imposed by law, we may not be able to collect on such a contractual
indemnification claim and may then be responsible for satisfying such
liabilities. In addition, worksite employees may be deemed to be our agents,
which could make us liable for their actions.
OUR STAFFING OF HEALTHCARE PROFESSIONALS EXPOSES US TO POTENTIAL MALPRACTICE
LIABILITY.
Through our TeamStaff Rx subsidiary, we engage in the business of
contract staffing of temporary and permanent healthcare professionals. The
placement of such employees increases our potential liability for negligence and
professional malpractice of those employees. Although we are covered by
liability insurance which we deem reasonable under the circumstances, not all of
the potential liability we face will be fully covered by insurance. Any
significant adverse claim which is not covered by insurance may have a material
adverse effect on us.
WE MAY BE LIABLE FOR THE ACTIONS OF WORKSITE EMPLOYEES OR CLIENTS AND OUR
INSURANCE POLICIES MAY NOT BE SUFFICIENT TO COVER SUCH LIABILITIES.
Our client agreement establishes a contractual division of
responsibilities between our company and each client for various human resource
matters, including compliance with and liability under various governmental laws
and regulations. However, we may be subject to liability for violations of these
or other laws despite these contractual provisions, even if we do not
participate in such violations. Although such client agreements generally
provide that the client indemnify us for any liability attributable to the
client's failure to comply with its contractual obligations and to the
requirements imposed by law, we may not be able to collect on such a contractual
indemnification claim, and thus may be responsible for satisfying such
liabilities. In addition, worksite employees may be deemed to be our agents,
subjecting us to liability for the actions of such worksite employees. As an
employer, we, from time to time, may be subject in the ordinary course of our
business to a wide variety of employment-related claims such as claims for
injuries, wrongful death, harassment, discrimination, wage and hours violations
and other matters. Although we carry $3 million of general liability insurance,
with a $10,000 deductible, and carry employment practices liability insurance in
the amount of $1 million, with a $25,000 deductible, there can be no assurance
that any such insurance we carry will be sufficient to cover any judgments,
settlements or costs relating to any present or future claims, suits or
complaints. There also can be no assurance that sufficient insurance will be
available to us in the future and, if available, on satisfactory terms. If the
insurance we carry is not sufficient to cover any judgments, settlements or
costs relating to any present or future claims, suits or complaints, then our
business and financial condition could be materially adversely affected.
OUR CLIENTS MAY BE HELD LIABLE FOR EMPLOYMENT TAXES, WHICH COULD DISCOURAGE SOME
COMPANIES FROM TRANSACTING BUSINESS WITH US.
Pursuant to the client service agreement, we assume sole responsibility
and liability for the payment of federal employment taxes imposed under the
Internal Revenue Code with respect to wages and salaries paid to our worksite
employees. While the client service agreement provides that
17
we have the sole legal responsibility for making these tax contributions, the
Internal Revenue Service or applicable state taxing authority could conclude
that such liability cannot be completely transferred to us. Accordingly, in the
event that we fail to meet our tax withholding and payment obligations, the
client company may be held jointly and severally liable therefor. There are
essentially three types of federal employment tax obligations:
- - income tax withholding requirements;
- - obligations under the Federal Income Contribution Act; and
- - obligations under the Federal Unemployment Tax Act.
While this interpretive issue has not, to our knowledge, discouraged clients
from enrolling with us, it is possible that a definitive adverse resolution of
this issue would not do so in the future.
WE MAY NOT BE FULLY COVERED BY THE INSURANCE WE PROCURE.
Although we carry liability insurance, the insurance we purchase may
not be sufficient to cover any judgments, settlements or costs relating to any
present or future claims, suits or complaints. In addition, sufficient insurance
may not be available to us in the future on satisfactory terms or at all. If the
insurance we carry is not sufficient to cover any judgments, settlements or
costs relating to any present or future claims, suits or complaints, our
business, financial condition, results of operations and liquidity could be
materially adversely affected.
IF WE ARE NOT ABLE TO RENEW ALL OF THE INSURANCE PLANS WHICH COVER WORKSITE
EMPLOYEES, OUR BUSINESS WOULD BE ADVERSELY IMPACTED.
The maintenance of health and workers' compensation insurance plans
that cover worksite employees is a significant part of our business. If we are
unable to secure such renewal contracts, our business would be adversely
affected. The current health and workers' compensation contracts are provided by
vendors with whom we have an established relationship, and on terms that we
believe to be favorable. While we believe that renewal contracts could be
secured on competitive terms without causing significant disruption to our
business, there can be no assurance in this regard.
OUR BUSINESS WILL SUFFER IF OUR SERVICES ARE NOT COMPETITIVE.
Each of the payroll, temporary employee placement and the employee
leasing industries are characterized by vigorous competition. Since we compete
with numerous entities that have greater resources than us in each of our
business lines, our business will suffer if we are not competitive with respect
to each of the services we provide. We believe that our major competitors with
respect to our payroll and tax services are Automatic Data Processing, Inc.,
Ceridian Corp. and Paychex, Inc., and with respect to employee placement
(including temporary placements and employee leasing), Butler Arde, Tech Aid,
Inc., Comp Health, Staff Leasing, Inc. and Administaff, Inc. These
18
companies have greater financial and marketing resources than us. We also
compete with manual payroll systems and computerized payroll services provided
by banks, and smaller independent companies.
IF WE CANNOT OBTAIN SUFFICIENT LEVELS OF TEMPORARY EMPLOYEES, OUR BUSINESS MAY
BE AFFECTED.
Two of our subsidiaries, TeamStaff Solutions and TeamStaff Rx, are
temporary employment agencies which depend on a pool of qualified temporary
employees willing to accept assignments for our clients. The business of these
subsidiaries is materially dependent upon the continued availability of such
qualified temporary personnel. Our inability to secure temporary personnel would
have a material adverse effect on our business.
OUR CLIENT AGREEMENTS ARE SHORT TERM IN NATURE AND IF A SIGNIFICANT NUMBER OF
CLIENTS DO NOT RENEW THEIR CONTRACTS, OUR BUSINESS MAY SUFFER.
Our standard client agreement provides for successive one-year terms,
subject to termination by us or by the client upon 60 days' prior written
notice. A significant number of terminations by clients could have a material
adverse effect on our financial condition, results of operations and liquidity.
IF WE ARE UNABLE TO RENEW OR REPLACE CLIENT COMPANIES, OUR FINANCIAL CONDITION
AND RESULTS OF OPERATIONS WILL BE ADVERSELY AFFECTED.
Our standard client service agreement is subject to cancellation on 30
days notice by either us or the client. Accordingly, the short-term nature of
the client service agreement makes us vulnerable to potential cancellations by
existing clients, which could materially and adversely affect our financial
condition and results of operations. In addition, our results of operations are
dependent in part upon our ability to retain or replace our client companies
upon the termination or cancellation of the client service agreement. Clients
may determine to cancel their relationship with us for numerous reasons,
including economic factors. It is possible that the number of contract
cancellations will increase in the future.
SINCE WE HAVE NOT PAID DIVIDENDS ON OUR COMMON STOCK, YOU CANNOT EXPECT DIVIDEND
INCOME FROM AN INVESTMENT IN OUR COMMON STOCK.
We have not paid any dividends on our common stock since our inception
and do not contemplate or anticipate paying any dividends on our common stock in
the foreseeable future. Our lender prohibits us from paying dividends without
its prior consent. Therefore, holders of our common stock may not receive any
dividends on their investment in us. Earnings, if any, will be retained and used
to finance the development and expansion of our business.
19
WE HAVE SOLD RESTRICTED SHARES OF COMMON STOCK WHICH MAY DILUTE OUR STOCK PRICE
WHEN THEY ARE SELLABLE UNDER RULE 144.
Of the 16,156,184 issued and outstanding shares (assuming surrender of
all shares held by former BrightLane shareholders and the issuance of the
8,066,631 shares as contemplated in the transaction) of our common stock as of
the date of this prospectus, approximately 207,000 shares may be deemed
"restricted shares" (excluding the shares being registered in this projection)
and, in the future, may be sold in compliance with Rule 144 under the Act.
Possible or actual sales of our common stock by our present shareholders under
Rule 144 may, in the future, have a depressing effect on the price of our common
stock in the open market. Rule 144 provides that a person holding restricted
securities which have been outstanding for a period of one year after the later
of the issuance by our company or sale by an affiliate of our company, may sell
in brokerage transactions an amount equal to 1% of our outstanding common stock
every three months. A person who is a "non-affiliate" of our company and who has
held restricted securities for over two years is not subject to the aforesaid
volume limitations as long as the other conditions of the Rule are met. In
addition, during fiscal 2000, we registered 2,570,000 shares on behalf of
selling stockholders and have outstanding approximately 577,821 previously
registered shares under our stock option plans. The sale of any of these shares
may depress the trading price of our common stock.
WE MAY ISSUE PREFERRED STOCK WITH RIGHTS SENIOR TO OUR COMMON STOCK WHICH MAY
ADVERSELY IMPACT THE VOTING AND OTHER RIGHTS OF THE HOLDERS OF OUR COMMON STOCK.
Our certificate of incorporation authorizes the issuance of "blank
check" preferred stock with such designations, rights and preferences as may be
determined from time to time by our board of directors up to an aggregate of
5,000,000 shares of preferred stock. Accordingly, our board of directors is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting or other rights which would adversely affect the
voting power or other rights of the holders of our common stock. In the event of
issuance, the preferred stock could be utilized, under certain circumstances, as
a method of discouraging, delaying or preventing a change in control of our
company, which could have the effect of discouraging bids for our company and
thereby prevent stockholders from receiving the maximum value for their shares.
Although we have no present intention to issue any shares of our preferred
stock, in order to discourage or delay a change of control of our company, we
may do so in the future. In addition, we may determine to issue preferred stock
in connection with capital raising efforts.
ANTI-TAKEOVER PROVISIONS IN OUR ARTICLES OF INCORPORATION MAKE A CHANGE IN
CONTROL OF OUR COMPANY MORE DIFFICULT.
The provisions of our articles of incorporation and the New Jersey
Business Corporation Act, together or separately, could discourage potential
acquisition proposals, delay or prevent a change in control and limit the price
that certain investors might be willing to pay in the future for our common
stock. Among other things, these provisions:
20
- - require certain supermajority votes;
- - establish certain advance notice procedures for nomination of
candidates for election as directors and for shareholders' proposals to
be considered at shareholders' meetings; and
- - divide the board of directors into three classes of directors serving
staggered three-year terms.
Pursuant to our articles of incorporation, the board of directors has
authority to issue up to 5,000,000 preferred shares without further shareholder
approval. Such preferred shares could have dividend, liquidation, conversion,
voting and other rights and privileges that are superior or senior to our common
stock. Issuance of preferred shares could result in the dilution of the voting
power of our common stock, adversely affecting holders of our common stock in
the event of its liquidation or delay, and defer or prevent a change in control.
In certain circumstances, such issuance could have the effect of decreasing the
market price of our common stock. In addition, the New Jersey Business
Corporation Act contains provisions that, under certain conditions, prohibit
business combinations with 10% shareholders and any New Jersey corporation for a
period of five years from the time of acquisition of shares by the 10%
shareholder. The New Jersey Business Corporation Act also contains provisions
that restrict certain business combinations and other transactions between a New
Jersey corporation and 10% shareholders.
21
SELLING SECURITY HOLDERS
The following table sets forth certain information as of November 29,
2001 with respect to each selling security holder with respect to which we are
including shares for resale in the registration statement of which this
prospectus forms a part. The percentages reflected below assume the issuance of
8,066,631 shares in connection with the transaction with BrightLane.com, Inc.
and does not take into account (i) a reduction for fractional shares and that
not all BrightLane shareholders have returned their BrightLane shares for
exchange as of November 29, 2001. The transaction with BrightLane was
consummated on August 31, 2001. The common stock is the only voting securities
of TeamStaff.
SHARES PERCENT OF SHARES PERCENTAGE
OWNED PRIOR TEAMSTAFF OWNED OF SHARES
NAME AND ADDRESS OF TO OFFERING SHARES SHARES OWNED AFTER OWNED AFTER
SECURITY HOLDER (1)(2) OFFERED PRIOR TO OFFERING OFFERING OFFERING
First Union Private Capital(3)(4) 3,334,117 3,334,117 20.6% 0
Nationwide Financial Services(3)(4) 2,256,488 2,256,488 13.9% 0
T. Stephen Johnson and Mary
Johnson(3)(5) 286,785 286,785 1.7% 0 *
D. Alan Najjar (3)(6) 117,679 42,679 * 0 *
Vinson A. Brannon (3) 131,698 131,698 * 0 *
William James Stokes (3) 37,032 37,032 * 0 *
D. R. Grimes (3) 18,516 18,516 * 0 *
Thomas Heaps (3) 61,196 61,196 * 0 *
Rocco J. Marano (7) 12,856 2,000 * 10,856 *
John H. Ewing (7) 34,034 11,000 * 23,034 *
Charles R. Dees, Jr. (7) 14,381 3,000 * 11,381 *
Martin J. Delaney (8) 65,448 10,000 * 55,448 *
* denotes less than one percent (1%)
- ------------------------
1. Unless otherwise indicated in the footnotes, includes all shares as to
which the individual has sole or shared voting power or investment
power and also any shares that the individual has the right to acquire
within 60 days of the date of this prospectus through the exercise of
any stock option or other right. Unless otherwise indicated in the
footnotes, each individual has sole voting and investment power (or
shares such powers with his or her spouse) with respect to the shares
shown as beneficially owned).
2. See "Plan of Distribution."
22
3. Represents shares obtain in connection with the acquisition of
BrightLane.com, Inc. completed as of August 31, 2001 and as described
in the Company's SEC reports which have ben incorporated by reference.
4. The selling security holder has agreed to the terms of a lockup in
favor of the Company whereby the selling security holder may sell only
up to 50% of the shares held by him, her or it, as the case may be,
commencing on September 1, 2002 and the remaining 50% commencing on
September 1, 2003.
5. T. Stephen Johnson and Mary Johnson are husband and wife. Mr. Johnson
is the Chairman of the Company. Listed shares consists of (a) 111,221
shares owned by Mr. Johnson; (b) 120,016 shares owned by Ms. Johnson;
and (c) an aggregate of 27,774 held in custodial accounts for the
children and a grandchild of the listed holders.
6. Mr. Najjar is employed as President of BrightLane.com, Inc., a
wholly-owned subsidiary of TeamStaff. Shares offered does not include
75,000 options to purchase common stock issued to Mr. Najjar under his
employment agreement.
7. Listed shares include warrants to purchase Common Stock issued in
connection with the termination of the selling security holder's
service as director of TeamStaff effective September 4, 2001. The
warrants are exercisable at $5.1562 per share. The warrants and
underlying securities are intended to be issued in issuances determined
by the Board of Directors as exempt under Rule 16(b)3.
8. Mr. Delaney is a director of the Company. Listed shares include 10,000
warrants issued in December 2000. The warrants haven an exercise price
of $3.20 per share.
23
PLAN OF DISTRIBUTION
The common stock covered by this prospectus, including the shares
underlying the warrants which will be issued by TeamStaff upon the exercise by
the holders of the warrants, may be offered and sold from time to time by the
selling security holders, and pledgees, donees, transferees or other successors
in interest selling shares received after the date of this prospectus from the
selling security holders as a pledge, gift or other non-sale related transfer,
including in one or more of the following transactions:
- on the over the counter market;
- in transactions other than on the over the counter market such
as private resales;
- in connection with short sales;
- by pledge to secure debts and other obligations;
- in connection with the writing of options, in hedge
transactions, and in settlement of other transactions in
standardized or over-the-counter options;
- in a combination of any of the above transactions; or
- pursuant to Rule 144 under the Securities Act, assuming the
availability of an examination from registration.
The selling security holders may sell their shares at market prices
prevailing at the time of sale, at prices related to prevailing market prices,
at negotiated prices, or at fixed prices.
Broker-dealers that are used to sell shares will either receive
discounts or commissions from the selling shareholders, or will receive
commissions from the purchasers for whom they acted as agents.
The selling security holders and intermediaries through whom shares are
sold may be deemed underwriters within the meaning of the Securities Act with
respect to the shares offered.
There can be no assurance that the selling security holders will sell
all or any of the common stock.
We have agreed to keep this prospectus effective for a period expiring
on the earlier of the date on which all of the selling security holders' shares
have been sold or the date on which all such shares are eligible for sale
pursuant to Rule 144 under the Securities Act.
The selling shareholders and us have agreed to customary
indemnification obligations with respect to the sale of common stock by use of
this prospectus.
REPORTS TO SHAREHOLDERS
Our company distributes annual reports to its stockholders, including
financial statements examined and reported on by independent public accountants,
and will provide such other reports as management may deem necessary or
appropriate to keep stockholders informed of our company's operations.
24
LEGAL MATTERS
The legality of the offering of the shares will be passed upon for us
by Goldstein & DiGioia, LLP, 369 Lexington Avenue, New York, New York 10017.
EXPERTS
The audited financial statements and schedules incorporated by
reference in this prospectus and elsewhere in the registration statement
pertaining to TeamStaff, Inc., have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in giving said reports.
The financial statements of BrightLane.com, Inc. (a development stage
company) as of December 31, 1999 and 2000 and for the periods May 7, 1999 (Date
of Inception) through December 31, 1999 and the year ended December 31, 2000 and
the period May 7, 1999 (Date of Inception) through December 31, 2000,
incorporated by reference in this prospectus have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report with respect
thereto, and have been so incorporated in reliance upon the report of such firm
given upon their authority as experts in accounting and auditing.
ADDITIONAL INFORMATION
Our company has filed a Registration Statement under the Act with the
Securities and Exchange Commission, with respect to the securities offered by
this prospectus. This prospectus does not contain all of the information set
forth in the registration statement. For further information with respect to our
company and such securities, reference is made to the registration statement and
to the exhibits and schedules filed therewith. Each statement made in this
prospectus referring to a document filed as an exhibit to the registration
statement is qualified by reference to the exhibit for a complete statement of
its terms and conditions. The registration statement, including exhibits
thereto, may be inspected without charge to anyone at the office of the
Commission, and copies of all or any part thereof may be obtained from the
Commission's principal office in Washington, D.C. upon payment of the
Commission's charge for copying.
FORWARD LOOKING STATEMENTS
Certain statements contained herein constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "1995 Reform Act"). TeamStaff, Inc. desires to avail itself of
certain "safe harbor" provisions of the 1995 Reform Act and is therefore
including this special note to enable the Company to do so. Forward-looking
statements included in this report involve known and unknown risks,
uncertainties, and other factors which could cause the Company's actual results,
performance (financial or operating) or achievements to differ from the future
results, performance (financial or operating) achievements expressed or implied
by such forward-looking statements. Such future results are based upon
management's best estimates based upon current conditions and the most recent
results of operations. These risks include, but are not limited to, risks
associated with the Company's risks of current as well as future
25
acquisitions, risks from potential workers compensation claims and required
payments, risks associated with payroll and employee related taxes which may
require unanticipated payments by the Company, liabilities associated with the
company's status under certain federal and state employment laws as a
co-employer, effects of competition and technological changes and dependence
upon key personnel.
26
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Expenses in connection with the issuance and distribution of the
securities being registered herein are estimated.
Amount
------
Securities and Exchange Commission
Registration Fee................................................................................ $ 8,587
--------
Printing and Engraving Expenses.................................................................. $ 0
--------
Accounting Fees and Expenses..................................................................... $ 20,000*
--------
Legal Fees and Expenses.......................................................................... $ 25,000*
--------
Blue Sky Fees and Expenses....................................................................... $ 0 *
--------
Transfer Agent and Registrar Fees................................................................ $ 500*
--------
Miscellaneous Fees and Expenses.................................................................. $ 1,000*
--------
Total................................................................. $ 55,087*
========
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our company's By-Laws require us to indemnify, to the full extent
authorized by Section 14A:3-5 of the New Jersey Business Corporation Act, any
person with respect to any civil, criminal, administrative or investigative
action or proceeding instituted or threatened by reason of the fact that he, his
testator or intestate is or was a director, officer or employee of our company
or any predecessor of our company is or was serving at the request of our
company or a predecessor of our company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise.
Section 14A:3-5 of the New Jersey Business Corporation Act authorized
the indemnification of directors and officers against liability incurred by
reason of being a director or officer and against expenses (including attorneys
fees) in connection with defending any action seeking to establish such
liability, in the case of third-party claims, if the officer or director acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation and if such officer or director shall not
have been adjudged liable for negligence or misconduct, unless a court otherwise
determines. Indemnification is also authorized with respect to any criminal
action or proceeding where the officer or director had no reasonable cause to
believe his conduct was unlawful.
In accordance with Section 14A:2-7 of the New Jersey Business
Corporation Act, our company's Certificate of Incorporation eliminates the
personal liability of officers and directors to our company and to stockholders
for monetary damage for violation of a director's duty owed to our company or
our shareholders, under certain circumstances.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, or persons controlling our
company pursuant to the foregoing provisions, our company
27
has been informed that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in such Act and is
therefore unenforceable.
ITEM 16. EXHIBITS
The exhibits designated with (*) are filed herewith. The exhibits
designated with (**) have previously been filed and, pursuant to 17 C.F.R. Secs.
20l.24 and 240.12b-32, are incorporated by reference to the document referenced
in brackets following the descriptions of such exhibits. This exhibits
designated with (***) will be filed upon amendment.
Exhibit
No. Description
--- -----------
2.1** Plan and Agreement of Merger and Reorganization dated
as of October 29, 1998 among the Company, the Merger
Corporations, the TeamStaff Entities and certain
individuals and trusts as shareholders of the
TeamStaff Entities (filed as Exhibit A to Proxy
Statement of Digital Solutions, Inc, dated November
12, 1998).
2.2** Form of Asset Purchase Agreement dated as of April 7, 2000 by
and between TeamStaff Inc., TeamStaff V, Inc., Outsource
International, Inc. and Synadyne I, Inc., Synadyne II, Inc.,
Synadyne III, Inc., Synadyne IV, Inc., Synadyne V, Inc.,
Guardian Employer East LLC and Guardian Employer West LLC.
(Filed as Exhibit 3.1 to Form 8-K dated April 19, 2000).
2.3** Agreement and Plan of Merger by and among TeamStaff, Inc.,
TeamSub, Inc. and BrightLane.com, Inc., dated as of March 6,
2001, as amended by Amendment No. 1 dated as of March 21, 2001
and Amendment No. 2 dated as of April 6, 2001 (filed as
Appendix A to the proxy statement/prospectus filed on August
7, 2001, SEC File No. 333-61730, as part of Registrant's
Registration Statement on Form S-4).
3.1** Amended and Restated Certificate of Incorporation of
Registrant (Filed as Exhibit A to Definitive Proxy Material
dated July 20, 1990).
3.1.1** Form of Amendment to Amended and Restated Certificate
of Incorporation (filed as Exhibit G to our company's
Proxy Statement dated November 12, 1998 as filed with
the Securities and Exchange Commission).
3.1.2** Amended and Restated Certificate of Incorporation
(filed as Exhibit A to Definitive Proxy Statement
dated May 1, 2000 as filed with the Securities and
Exchange Commission).
3.2** Amended By-Laws of Registrant adopted as of January 25, 1999
(filed as Exhibit 3.2 to the Registration Statement on Form
S-4 SEC File No. 333-61730).
3.3** Form of Form of Certificate of Designation of Series A
Preferred Stock (filed as Exhibit 3.1 to Form 8-K dated April
6, 2001).
28
3.4** Amended By-Laws of Registrant adopted as of May 15, 2001
(filed as Exhibit 3.4 to the Registration Statement on Form
S-4 SEC File No. 333-61730).
4.1** Form of Common Stock Certificate (Exhibit 4.1 to Registration
Statement on Form S-18, File No. 33-46246-NY)
4.2** 2000 Employee Stock Option Plan (filed as Exhibit B to the
Proxy Statement dated as of March 8, 2000 with respect to the
Annual meeting of Shareholders held on April 13, 2000).
4.3** 2000 Non-Executive Director Stock Option Plan (filed as
Exhibit B to the Proxy Statement dated as of March 8, 2000
with respect to the Annual meeting of Shareholders held on
April 13, 2000).
5.1*** Opinion of Goldstein & DiGioia, LLP re: Legality of Shares.
10.1** Form of Employment Agreement between TeamStaff, Inc. and
Donald Kappauf dated as of April 2, 2001.
10.2** Form of Employment Agreement between TeamStaff, Inc. and
Donald Kelly dated as of April 2, 2001.
10.3** Form of Employment agreement between TeamStaff, Inc. and
Kenneth Jankowski dated as of February 16, 2000.
10.4** Lease dated May 30, 1997 for office space at 300 Atrium,
Somerset, New Jersey (Exhibit 10.6.1 to Form 10-K for the
fiscal year ended September 30, 1997).
10.5** Seventh Amended Loan Agreement between Registrant and Summit
Bank and sixth amended Promissory Note (Exhibit 10.16.1 to
Form 10-K for the fiscal year ended September 30, 1997).
10.6** Loan and Security Agreement dated April 28, 1998 among Digital
Solutions, Inc. and FINOVA Capital Corporation (Filed as
Exhibit 10.17 to Form 10-K filed January 12, 1999).
10.7** Secured Promissory Note in the principal amount of $2,500,000
dated April 28, 1998 in favor of FINOVA Capital Corporation
(Filed as Exhibit 10.18 to Form 10-K filed January 12, 1999).
10.8** Stock Pledge Agreement (Security Agreement) dated
April 28, 1998 between FINOVA Capital Corporation and
Digital Solutions, Inc. (Filed as Exhibit 10.19 to
Form 10-K filed January 12, 1999).
10.9** Employment Agreement between our company and Kirk Scoggins
dated January 25, 1999 (Filed as Exhibit 10.1 to Form 8-K
dated January 25, 1999).
29
10.10** Registration Rights Agreement between our company and
certain former shareholders of the TeamStaff
Companies dated as of January 25, 1999 (Filed as
Exhibit 10.2 to Form 8-K dated January 25, 1999).
10.11** Amended and Restated Loan and Security Agreement
between our company and FINOVA Capital Corporation
dated January 25, 1999 (Filed as Exhibit 10.3 to Form
8-K dated January 25, 1999).
10.12** Amended and Restated Note in the principal amount of
$2,166,664 dated January 25, 1999 (Filed as Exhibit
10.4 to Form 8-K dated January 25, 1999).
10.13** Secured Note in the amount of $2,500,000 in favor of
FINOVA Capital Corporation dated January 25, 1999
(Filed as Exhibit 10.5 to Form 8-K dated January 25,
1999).
10.14** Secured Note in the amount of $750,000 in favor of
FINOVA Capital Corporation dated January 25, 1999
(Filed as Exhibit 10.6 to Form 8-K dated January 25,
1999).
10.15** Schedule to Amended and Restated Loan Agreement dated
January 25, 1999 with FINOVA Capital Corporation
(Filed as Exhibit 10.7 to Form 8-K dated January 25,
1999).
10.16** Form of Agreement between TeamStaff and Donald & Co.
Securities, Inc. (Filed as Exhibit 10.27 to Form S-3/A dated
June 28, 2000).
10.17** First Amendment to the Amended and Restated Schedule
to the Amended and Restated Loan and Security
Agreement among TeamStaff, Inc. and its Subsidiaries
as Co-Borrowers and FINOVA Capital Corporation dated
April 7, 2000 (Filed as Exhibit 10.1 to Form 8-K
dated April 19, 2000).
10.18** Second Amended and Restated Secured Promissory Note A
dated April 7, 2000 in the principal amount of
$1,541,659 payable to FINOVA Capital Corporation
(Filed as Exhibit 10.2 to Form 8-K dated April 19,
2000).
10.19** Amended and Restated Secured Promissory Note B dated
April 7, 2000 in the principal amount of $1,899,996
payable to FINOVA Capital Corporation (Filed as
Exhibit 10.3 to Form 8-K dated April 19, 2000).
10.20** Secured Promissory Note C dated April 7, 2000 in the
principal amount of $4,000,000 payable to FINOVA
Capital Corporation (Filed as Exhibit 10.4 to Form
8-K dated April 19, 2000).
10.21** Employment Agreement dated October 1, 1999 between
our company and Donald Kappauf (Filed as Exhibit
10.32 to Form S-3/A dated June 28, 2000).
10.22** Employment Agreement dated October 1, 1999 between
our company and Donald Kelly (Filed as Exhibit 10.33
to Form S-3/A dated June 28, 2000).
30
10.23** Form of Stock Purchase Agreement dated as of April 6,
2001 between TeamStaff, Inc. and BrightLane.com, Inc.
with respect to purchase of Series A Preferred Stock
(filed as Exhibit 10.1 to Form 8-K dated April 6,
2001).
10.24** Form of Registration Rights Agreement dated as of
April 6, 2001 between TeamStaff, Inc. and BrightLane.
com, Inc. (filed as Exhibit 10.2 to Form 8-K dated
April 6, 2001).
10.25** Form of Marketing Agreement dated as of April 11, 2001 between
First Union Corporation and TeamStaff, Inc.
10.31** Form of Voting Agreement provided by BrightLane Shareholders
as provided in the Agreement and Plan of Merger by and among
TeamStaff, Inc., TeamSub, Inc. and BrightLane.com, Inc., dated
as of March 6, 2001, as amended by Amendment No. 1 dated as of
March 21, 2001 and Amendment No. 2 dated as of April 6, 2001.
10.32*** Form of Escrow Agreement between TeamStaff Inc. and
BrightLane Shareholders with respect to the placement
of 150,000 shares into escrow by the BrightLane
shareholders (filed as Appendix B to the proxy
statement/prospectus forming a part of this
Registration Statement).
23.1* Consent of Arthur Andersen LLP.
23.2** Consent of Goldstein & DiGioia, LLP, contained in Exhibit 5.1.
23.3* Consent of Deloitte & Touche LLP.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
A. (1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the registration statement (or the
most recent post-effective amendment thereto) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement;
31
provided, however, that paragraphs (a)(1)(i) -
(a)(1)(iii) do not apply if the information required to be
included in a post-effective amendment by such clauses is
contained in periodic reports filed with and furnished to the
Commission by the Company pursuant to Section 13 or Section
15(d) of the Exchange Act of 1934 that are incorporated by
reference in this Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) For purposes of determining any liability under the
Securities Act of 1933, each filing of our company's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
B. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
32
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized on the 30th day of November, 2001.
TEAMSTAFF, INC.
By: /s/ Donald W. Kappauf
-------------------------
Donald W. Kappauf
President, Chief Executive Officer and Director
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below substitutes and appoints Donald W. Kappauf or Donald
Kelly as his true and lawful attorney-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be don in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent or his substitute, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed below by the following
persons in the capacities and on the dates indicated:
Signature Capacity Date
--------- -------- ----
/s/Donald W. Kappauf President, Chief Executive November 30, 2001
- ------------------------ Officer and Director
Donald W. Kappauf
/s/Karl W. Dieckmann Chairman of the Board November 30, 2001
- ------------------------
Karl W. Dieckmann
Director November 30, 2001
- ------------------------
David Carroll
/s/Martin J. Delaney Director November 30, 2001
- ------------------------
Martin J. Delaney
/s/T. Stephen Johnson Director November 30, 2001
- ------------------------
T. Stephen Johnson
Director November 30, 2001
- ------------------------
Donald MacLeod
33
/s/William J. Marino Director November 30, 2001
- ------------------------
William J. Marino
Director November 30, 2001
- ------------------------
Susan Wolken
/s/Donald T. Kelly Chief Financial Officer and November 30, 2001
- ------------------------ Principal Accounting Officer
Donald T. Kelly
34
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To TeamStaff, Inc.
As independent public accountants, we hereby consent to the incorporation
by reference in this Form S-3 registration statement of our report dated
December 29, 2000, included in TeamStaff, Inc.'s Form 10-K for the year
ended September 30, 2000, and to all references to our Firm included in
this registration statement.
November 30, 2001
/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement on
Form S-3 of TeamStaff, Inc., dated December 4, 2001, of our report dated March
2, 2001, related to the financial statements of BrightLane.com, Inc. (a
development stage company) and contained in Registration Statement No. 333-61730
of TeamStaff, Inc. on Form S-4.
We also consent to the reference to us under the heading "Experts" in such
Registration Statement.
/s/ DELOITTE & TOUCHE LLP
Atlanta, Georgia
November 30, 2001
