Labor Smart Inc (LTNC)

[DD2Gain]

I don't think he can reasonably expect to do that without draining the $300,000 cash first. I expect that to be reflected in the 10K rather than the next Q though, so he's got 3 months to figure out how to fluff through it before things get really ugly from a financial reporting perspective. I also expect defaults to be reported in the 10k possibly including the factoring account. Won't be long before litigations start flying around.

I would hold out more hope except for the $1 million delinquent payroll taxes and associated IRS lien. As long as that is on the books, there is not a chance in hell of anything but more toxic financing to keep the doors open. The more I think about it, the more it is apparent that the CEO is setting up his exit strategy to collect what he can before everything collapses. If that's the case, LaborSMART is gasping its last breaths and will die over the next 6 months. At this point, the priority is simply to make sure that loan is paid off to make sure Ryan Scahdel is not personally liable, which will be at a fatal sacrifice to the company.