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Labor Smart, Inc (LTNC)

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Last Post: 8/30/2016 12:52:33 PM - Followers: 395 - Board type: Free - Posts Today: 5

Labor Smart, Inc

No 2015 10K
No 2016 First Quarter 10Q
Form 15 filed, so NO 2016 Second Quarter 10Q
LaborSMART has gone dark!


Company Overview:

Labor SMART, Inc. provides On-Demand temporary labor to a variety of industries. Their clients range from small businesses to fortune 100 companies. Labor SMART was founded to provide a reliable, dependable, and flexible resources for on-demand personnel to small and large businesses.
Every day they provide manpower for jobs in construction, manufacturing, hospitality, events, restoration, warehousing, retail, disaster relief and more. As one of the fastest growing temporary labor providers, their goal is to become a
nationwide resource and partner for their clients. Labor SMART takes pride in the belief that they can make a positive impact each and every day for the benefit of both their clients and temporary employees.


CEO Currently Owns: 2.185billion Shares

*Shortly before buying over 1 billion shares at or near no-bid in November 2015, Ryan Schadel gave himself a $220,000 cash bonus as revealed in the 2015 3rd quarter 10Q.
Since no further reports have been filed, it is unknown how much more cash he has given himself in the form of bonuses or increased salary.

Labor SMART Issues Open Letter to The Staffing Group CEO

Company Seeks to Form Strategic Alliance

ATLANTA, GA -- (Marketwired) -- 12/01/15 -- Labor SMART, Inc. (OTCQB: LTNC) (the "Company"), a leader in providing on-demand blue collar staffing primarily in the southeastern United States, today delivered via email the following open letter to the President and Chief Executive Officer of The Staffing Group, Ltd. (TSGL).

December 1, 2015
400 Poydras St., Suite 1165 
New Orleans La 70130
Delivered Via Email

RE: 13D Filing by Labor Smart, Inc.

Mr. McLoone,

As you are now aware, our purchase of 2,000,000 shares of The Staffing Group Ltd. common stock on November 30, 2015 was followed by a Schedule 13D filing with the SEC, due to our previously unannounced acquisition of 1,758, 618 shares of common stock in the open market and the nature of our intentions. The purpose of this letter to you today is to clearly state what those intentions are and seek common ground for a mutually beneficial discussion.

Having launched Labor SMART, Inc. as a publicly traded startup, I am sensitive to the challenges of building a sustainable business from scratch with the added fun of engaging the public markets and all that entails. I am quite familiar with the history of your company and we've had some discussions over the last two years regarding potential opportunities, business combinations, etc. I'm also aware of the burdens you were handed almost immediately upon becoming CEO of a public company. Given those challenges, I commend you for the successes you've been able to claim along the way. 

At this time, we have three separate, but related proposals that we would like to discuss with you in a formal setting.

Leveraging Synergies

In your Form 10-Q for the quarter ended June 30, 2015, you discuss improved gross margins after shedding some high volume business. This is a tough and gutsy decision to make for the long term health of the company, and again, I commend you for taking this action. Still, with gross profit margins under 19%, a lot of profitability is left on the table. As you may know, Labor SMART attained a large deductible workers compensation policy in 2014 that drastically reduced our cost of sales. A business combination with Labor SMART could unlock value and profits hidden behind the high cost of workers compensation you are incurring. I propose that we work together to prepare a detailed analysis of the potential gains that could be had with Labor SMART's strong workers compensation program as the backbone of a reduction in cost of sales. This analysis should start with an examination of your loss runs for the last three years. There may also be a number of synergies that could be obtained leveraging Labor SMART's corporate support structure and your company's footprint. Additionally, there are undoubtedly vertical sales opportunities given the combined size of our respective customer bases. 

Leveraging Experience

Having worked with you at WTS before it was sold to MDT (and subsequently TrueBlue), I know that you are a solid operator with a conservative approach to risk. It is my belief that our combined teams and their experience would offer much to our collective customers, shareholders, and employees. The first component of this proposal is that we work together to create a joint venture, or similar structure, to license the Labor SMART brand, processes, and methods in addition to a management service agreement whereby Labor SMART will provide the necessary infrastructure to facilitate an aggressive growth plan and The Staffing Group provides the day to day management. 

Any growth plan will require capital. I've encountered a number of challenges to raising capital as a publicly traded company. Raising startup capital itself is expensive and as our share structure indicates, extremely dilutive without a substantial amount of financial engineering from the beginning. I've raised a small amount of money for Labor SMART and we successfully grew our business to over $20 million in less than three years. I'm grateful that we were able to get funding to build the company, but I would do it differently knowing what I know now. I've expended the better part of 2015 playing defensive and trying to protect LaborSMART's shareholders from massive dilution. Fortunately, we have been able to renegotiate the mechanics of our convertible debt and believe we can repair the share structure now that we have better control of conversion rights, but the time lost can never be recovered. And that leads me to the second part of this specific proposal.

Should we reach mutually beneficial terms to have Labor SMART license its systems to The Staffing Group, I propose that we take a "fund from the ground up" approach. Crowd funding legislation is due to go in to affect next year. I believe there is an opportunity to crowd fund the startup capital for each new individual branch that's opened. Labor SMART will agree to be the lead investor with a minority ownership percentage of each branch opened under the licensing agreement, but with an option to acquire the branch at its discretion in the future for a predetermined multiple of earnings. This structure would insulate your shareholders from massive dilution and still allow for continued growth of the Labor SMART brand. For The Staffing Group, this structure offers a runway to ramp up sales and branch network in a meaningful way and an equity event as licensed branches are acquired by Labor SMART. 

Expand the Board

Lastly, we propose that The Staffing Group increase its Board of Directors from two directors to a total of five directors, two of whom will be appointed by Labor SMART, Inc. and a third by mutual agreement of Labor SMART and The Staffing Group. I do not expect that this request would be obliged without some consideration. We are open to exploring a number of different options to get this request effectuated in a swift manner. I believe you would agree that one of the most important tasks you currently face is getting your Form 10-Q filed for the period ended September 30, 2015. We do not wish to upend that process with added procedural burdens. To be clear, Labor SMART will take steps to protect its investment if necessary, but we do not have the intent of becoming a hostile suitor. Our industry is built on relationships and Labor SMART believes in creating partnerships and opportunity, not enemies. 

In summary, both companies can benefit greatly by engaging in a mutual partnership, even if the structure is somewhat different from the ones we have proposed. I believe it is in the best interest of The Staffing Group's shareholders, with Labor SMART, Inc. as one of the largest holders, to explore any and every opportunity that may be present to build value and sustainable profitability for the benefit of all. As two sizeable regional players in our industry, we must act boldly to create opportunities for the future. 

I look forward to scheduling a meeting with at your earliest convenience,


C. Ryan Schadel
President & CEO - Labor SMART, Inc.

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.

Source: Labor SMART, Inc. 


Unknown address for headquarters!
Ryan Schadel tweeted at the end of June 2016 that he moved to a more "cost effective location", but has not disclosed the location.

Founded 5/31/2011





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Current Price
Bid Ask Day's Range
LTNC News: Termination of Registration of a Class of Security Under Section 12(g) (15-12g) 06/27/2016 02:27:46 PM
LTNC News: Statement of Changes in Beneficial Ownership (4) 06/13/2016 04:52:55 PM
LTNC News: Court Dismisses Fraud Claims Against Labor SMART, Inc. 05/31/2016 10:45:56 AM
LTNC News: National Council on Compensation Insurance Improves Labor SMART, Inc. RatingsSignificant Improvement in Gross Profit Margins 05/03/2016 09:30:00 AM
LTNC News: Labor SMART, Inc. First Quarter 2016 Revenue Jumps $304,100 04/28/2016 11:00:00 AM
#66569  Sticky Note Fraud suit against LaborSMART back on track! DD2Gain 08/25/16 12:41:40 AM
#66551  Sticky Note $LTNC will see .001 then .004 onto .01+ OTC Curtis 08/24/16 11:51:14 AM
#66531  Sticky Note Motion for Leave to File Amended Complaint by I-Glow 08/23/16 08:13:41 PM
#66286  Sticky Note LTNC NEWS OUT: MIKEY501 08/16/16 01:29:28 PM
#65374  Sticky Note Excellent DD - Scott Stoner forgot about the I-Glow 07/14/16 03:28:22 PM
#47868  Sticky Note Please stay on topic. The only topic to IH Admin [Dan] 02/14/16 12:22:26 AM
#66626   Calling bs on shady's latest tweets. He's agribusiness72 08/30/16 12:52:33 PM
#66625   Yes! It can now trade 5 digit, we'll #1 PATRIOTS_RSOX FAN 08/30/16 10:03:11 AM
#66624   Where does .000097 come from when we can't Get2U 08/30/16 09:56:56 AM
#66623   No, I don't think there's a solution out GreenHarvest 08/30/16 09:46:23 AM
#66622   Can they make solution out of these? Addiecaps 08/30/16 02:53:17 AM
#66621   Very interesting that the boards and for the agribusiness72 08/29/16 08:16:24 PM
#66618   How about the picture this ticker is @ #1 PATRIOTS_RSOX FAN 08/29/16 10:08:21 AM
#66617   Well, this is Schadel's tweet about shareholders: DD2Gain 08/29/16 10:01:44 AM
#66616   LOL Ryan must think his followers are idiots cpw13154 08/29/16 08:12:35 AM
#66615   Schadel will do time. Trust me it's coming.... jp_12 08/27/16 08:03:16 PM
#66614   Schadel is setting a record at a losing I-Glow 08/27/16 01:58:12 PM
#66613   Look at the screen grab of the ml Walleye24 08/26/16 08:11:21 PM
#66611   Is this a quadruple zero stock today? I TRLRPRK-TRADER 08/26/16 07:01:02 PM
#66609   LTNC @ 0.000097 LOL! Pinky Buster 08/26/16 04:49:44 PM
#66608   LOL no sir. Gee I think we all cpw13154 08/26/16 01:10:53 PM
#66607   Lol.. Yes sir $$$LTNC Prime-Time 08/26/16 12:14:55 PM
#66606   Are these all buys today? Truthbible 08/26/16 12:02:03 PM
#66605   I wonder how all the Co Owners feel agribusiness72 08/26/16 10:50:38 AM
#66604   Yeah he is good at hiding things. Auditors cpw13154 08/26/16 09:32:13 AM
#66603   Amazing that Schadel never disclosed in the financials I-Glow 08/26/16 09:08:13 AM
#66602   Yeah is sure is wheeling and dealing. Almost cpw13154 08/26/16 06:35:20 AM
#66601   I guess he reads IHUB because he started agribusiness72 08/25/16 08:54:49 PM
#66600   I don't think so. Schadel's still wheelin and biglued1 08/25/16 08:36:37 PM
#66599   No one, absolutely no one, is buying that agribusiness72 08/25/16 08:09:44 PM
#66598   LOL just like the past 3 years theres cpw13154 08/25/16 06:50:14 PM
#66597   No new tweets since the 23rd and only agribusiness72 08/25/16 04:18:36 PM
#66593   Maybe it was a confused message and the #1 PATRIOTS_RSOX FAN 08/25/16 01:45:00 PM
#66592   THere hasn't been a power hour in LTNC cpw13154 08/25/16 01:42:27 PM
#66591   Power hour could be big today! $LTNC Prime-Time 08/25/16 01:29:57 PM
#66590   $20 Figures 08/25/16 01:15:25 PM
#66589   1-50000 reveres split, sounds about right for this #1 PATRIOTS_RSOX FAN 08/25/16 01:13:14 PM
#66588   $5.00 next stop Figures 08/25/16 01:11:47 PM
#66587   That would be one huge RS to get #1 PATRIOTS_RSOX FAN 08/25/16 12:57:29 PM
#66586   Ryan can no longer tweet optimistic news. Figures 08/25/16 12:53:03 PM
#66585   $1.00 next target Figures 08/25/16 12:48:59 PM
#66584   Can't have big profits if you get rid cpw13154 08/25/16 12:28:29 PM
#66583   Hope to see those days again soon! Restructuring Prime-Time 08/25/16 12:08:44 PM
#66582   Weeeeeee Figures 08/25/16 12:01:35 PM
#66581   NO Bid, and to think I use to RookieStockPicker 08/25/16 11:15:12 AM
#66580   Correction, he failed to raise the PPS 5x GreenHarvest 08/25/16 11:10:00 AM
#66578   The value posters keep referencing Ryan for is GreenHarvest 08/25/16 10:10:16 AM
#66577   LOL so the man who ran up 13 cpw13154 08/25/16 10:03:40 AM
#66576   This litigation is Steve Maese loosing and pulling dheminger 08/25/16 10:02:43 AM
#66575   So, if the CEO owns 2.1 billion shares, TigerCloud 08/25/16 09:58:50 AM
#66573   Ryan can be repackaged and send back out.ltnc cattbell1952 08/25/16 08:38:11 AM
#66572   Only runs LTNC will show is Ryan running Sound Judgement 08/25/16 07:32:21 AM
#66571   The volume is picking up nicely. Waiting for Addiecaps 08/25/16 04:36:10 AM
#66570   Has anyone else looked into initiating a class DD2Gain 08/25/16 12:46:41 AM
#66569   Fraud suit against LaborSMART back on track! DD2Gain 08/25/16 12:41:40 AM
#66567   I agree it is entertaining as hell. ArchibaldCampbell 08/24/16 04:38:00 PM