Command Center, Inc. (Nasdaq: CCNI) (“Command Center” or the
“Company”), a national provider of on-demand and temporary staffing
solutions, today announced it has entered into a definitive
agreement (“Merger Agreement”) to merge with Hire Quest Holdings,
LLC (“Hire Quest”), operating as Trojan Labor and Acrux Staffing, a
privately-held provider of blue collar, light industrial and
administrative staffing, in an all-stock transaction. Rick
Hermanns, Chief Executive Officer of Hire Quest, has 29 years of
experience in the temporary staffing industry and will serve as
Chief Executive Officer of the combined entity.
As consideration for the ownership interests of Hire Quest,
Command Center will issue approximately 9.8 million common shares
to Hire Quest’s members. As a result, the current owners of Hire
Quest will own approximately 68% of Command Center, of which Hire
Quest will be a wholly-owned subsidiary, and Mr. Hermanns will
beneficially own approximately 39% of Command Center. At closing,
there will be approximately 14.5 million common shares issued and
outstanding, and Hire Quest will be acquired on a
cash-free/debt-free basis. In conjunction with the transaction the
Company also intends to commence a self-tender, as described below,
available exclusively to existing Command Center shareholders.
Rick Coleman, President and Chief Executive Officer of Command
Center stated, “This exciting transaction is the culmination of the
strategic review process initiated by the Company’s Board of
Directors (the “Board”) with the help of our investment banker,
D.A. Davidson. During this review, we identified an opportunity to
combine with Hire Quest, creating immediate scale and allowing us
to transition our existing branches to a franchise model. By
modeling Hire Quest’s success as a franchise operator, we will
create a system that is more customer- and employee-centric, more
decentralized, and one in which local franchise owners are
incentivized to achieve maximum results. Hire Quest has 93 branches
in 20 states, presenting a strategically ideal geographic footprint
with Command Center’s 67 branches in 22 states. Over the coming
weeks, we will thoughtfully evaluate our operations in the limited
areas of overlap and believe that all of our combined operations
will benefit from our significant economies of scale. If Hire Quest
revenue were determined on a similar basis as Command Center’s, as
if all locations were owned rather than most being franchises, then
estimated system-wide unaudited revenue for the year ended December
31, 2018 would have been approximately $189 million. Based on our
current projections, after some period of integration and
normalization, we believe the combined entities will produce annual
EBITDA in excess of $15 million, exclusive of growth
opportunities.” EBITDA represents earnings before interest income,
interest expense, income tax expense, depreciation and amortization
of intangible assets. EBITDA is a non-GAAP financial measure and
should not be considered in isolation or as a substitute for
financial information provided in accordance with U.S. GAAP.
The transaction is expected to close in the second quarter of
2019, or shortly thereafter, subject to standard closing
conditions, including approval by Command Center shareholders of i)
an amendment to our charter to increase authorized shares of
Company common stock, ii) a change in the name of the Company to
HireQuest, Inc., iii) the issuance of Company common stock pursuant
to the Merger Agreement and iv) the resulting change of control
pursuant to Nasdaq listing rules. Upon closing of the transaction,
Hire Quest will be merged with a subsidiary of Command Center to
become a wholly-owned subsidiary of the Company, and immediately
thereafter merge with and into a second wholly-owned subsidiary of
the Company. Command Center will discuss the potential financial
impact of the expected merger on its fourth quarter earnings call
scheduled for April 10, 2019. The Company will file with the
Securities and Exchange Commission (“SEC”) a proxy statement
containing full details of the proposed transaction, which will be
delivered to the Company’s shareholders following SEC review.
Hire Quest operates its business primarily on a franchise model,
which allows operating revenue from staffing services to stay at
the franchise location. We expect that as Command Center converts
its branches to independent franchises post-transaction, its
revenue will decrease but its operating margins and profitability
will increase.
Mr. Hermanns stated, “This transaction represents an exciting
path forward for Command Center and its shareholders. The merger
will create a strong national presence and meaningful scale,
helping us capture market share. More importantly, as we transition
to the franchise model, we expect to generate improved levels of
profitability and cash flow. We are excited to join with Command
Center and look forward to unlocking the benefits of a national
scaled platform.”
Tender Offer
In connection with the transaction, Command Center, Inc. intends
to commence a self-tender offer at $6.00 per share for up to
1,500,000 shares of its common stock that is contingent on the
closing of the merger described above. If the number of shares
properly tendered at the $6.00 per share purchase price and not
properly withdrawn prior to the expiration date of the tender offer
would result in the purchase of more than 1,500,000 shares, Command
Center will purchase shares tendered on a pro rata basis. The
tender offer will not be conditioned upon any minimum number of
shares being tendered.
Neither Command Center nor its Board is making any
recommendation whether stockholders should tender or refrain from
tendering their shares. Command Center is not making a
recommendation as to whether stockholders should tender shares into
the offer because it believes that stockholders should make their
own decisions based on their views as to the value of Command
Center’s shares and its prospects, as well as stockholders’
liquidity needs, investment objectives and other individual
considerations. Stockholders must decide whether to tender their
shares and, if so, how many shares to tender. Stockholders should
discuss whether to tender their shares with their broker or other
financial or tax advisor.
Command Center was advised by D.A. Davidson & Co. and Olshan
Frome Wolosky LLP on the transaction while Hire Quest was advised
by Raymond James and Hill Ward Henderson.
Important Information for Shareholders
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such
jurisdiction.
Certain Information Regarding Participants
Command Center, and its directors and executive officers may be
considered participants in the solicitation of proxies in
connection with the proposed transaction. Information about the
directors and executive officers of Command Center will be set
forth in its Annual Report on Form 10-K for the fiscal year ended
December 28, 2018, which will be filed with the SEC when it becomes
available, and its proxy statement, which will be filed with the
SEC when it becomes available. You may obtain these documents (when
they become available) free of charge through the website
maintained by the SEC at http://www.sec.gov.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
including statements regarding the merger with Hire Quest and the
tender offer, and the expected benefits from such transactions,
including economies of scale, increased profitability and cash
flows and the ability to capture additional market share. All
statements other than statements of historical facts contained
herein, including the statements identified in the preceding
sentence and other statements regarding our future financial
position and results of operations (such as expected annual
EBITDA), liquidity, business strategy and plans and objectives of
management for future operations, are forward-looking statements.
The words “believe,” “may,” “estimate,” “continue,” “anticipate,”
“intend,” “should,” “plan,” “could,” “target,” “potential,” “is
likely,” “will,” “expect” and similar expressions, as they relate
to us or Hire Quest, are intended to identify forward- looking
statements. We have based these forward-looking statements largely
on our current expectations and projections about future events and
financial trends that we believe may affect our financial
condition, results of operations, business strategy and financial
needs as a combined company.
Important factors that could cause actual results to differ from
those in the forward-looking statements include: the possibility
that the merger and/or the tender offer will not close; the
possibility that anticipated benefits from the Merger will not be
realized, or will not be realized within the expected time period;
the possibility that the Merger does not close, including, but not
limited to, due to the failure to satisfy the closing conditions
including the failure of the Company to obtain the Required
Approvals pursuant to the Merger; the risk that the Company and
Hire Quest businesses will not be integrated successfully and
disruption from the Merger making it more difficult to maintain
business and operational relationships; the possibility that only a
fraction of the shares covered by the tender offer will be
tendered; and the possibility that the tender offer price of $6.00
per share will not reflect the fair market value of the shares.
Further information on risks we face is contained in our filings
with the SEC, including our Form 10-K for the fiscal year ended
December 28, 2018, and will be contained in our SEC filings in
connection with the merger and the tender offer. Any
forward-looking statement made by us herein speaks only as of the
date on which it is made. Factors or events that could cause our
actual results to differ may emerge from time to time, and it is
not possible for us to predict all of them. We undertake no
obligation to publicly update any forward-looking statement,
whether as a result of new information, future developments or
otherwise, except as may be required by law.
About Hire Quest LLC
Hire Quest is a trusted name in temporary staffing. Hire Quest
provides the back-office support team for Trojan Labor and Acrux
Staffing franchised branch locations across the United States.
Trojan Labor provides temporary staffing services which includes
general labor, industrial, and construction personnel. Acrux
Staffing provides temporary staffing services which includes
skilled, semi-skilled and general labor industrial personnel, as
well as clerical and secretarial personnel.
About Command Center
Command Center provides flexible on-demand employment solutions
to businesses in the United States, primarily in the areas of light
industrial, hospitality and event services. Through 67 field
offices in 22 states, the company provides employment annually for
approximately 32,000 field team members working for over 3,600
clients. For more information about Command Center, go to
commandonline.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190408005786/en/
Company
Contact:Command Center, Inc.Cory Smith, CFO(866)
464-5844Email: cory.smith@commandonline.comInvestor Relations Contact:Hayden
IRBrett Maas646-536-7331Email: brett@haydenir.com
Command Center (NASDAQ:CCNI)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Command Center (NASDAQ:CCNI)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024