UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549


FORM
10-Q








x
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934


For
      the quarterly period ended March
      27, 2009





o
            TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
  ACT


For
      the transition period from _____________ to
  ___________.




Commission
      File Number: 000-53088




COMMAND CENTER,
      INC.


(Exact
      name of issuer as specified in its
charter)





Washington
              91-2079472(State
      or other jurisdiction of incorporation or organization)
              (IRS
      Employer Identification
Number)




3773
      West Fifth Avenue, Post Falls, Idaho
83854


(Address
      of principal executive offices)


(208)
      773-7450


(Issuer’s
      telephone number)





N.A.


(Former
      name, former address and former fiscal year, if changed since last
      report)





Indicate
by check mark whether the registrant: (1) has filed all reports required to be
filed by Section 13, or 15(d) of the Securities Exchange Act of 1934 during the
preceding twelve months, and (2) has been subject to such filing requirements
for the past ninety days.


Yes
xNoo





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a registrant.  See
definition of “large accelerated filer,” “accelerated filer,” and smaller
reporting company in Rule 12b-2 of the Exchange Act. (Check one):





Large
      accelerated filer o
              Accelerated
      filer oNon-accelerated
      filer o
              Smaller
      reporting company x(Do
      not check if registrant)





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


Yes  o         No
x





The
number of shares of common stock outstanding on May 15, 2009 was 36,474,797
shares.





10-Q
 Page
1





Command
Center, Inc.




Contents


FORM
10-Q




PART
      I
            
            PageItem
      1. Financial Statements (unaudited)Management
      Statement
            
            10-Q
      Page 3Balance
      Sheet at March 27, 2009 and December 26, 2008
            
            10-Q
      Page 4Statements
      of Operations for the thirteen week periodsended
      March 27, 2009 and March 28, 2008
            
            10-Q
      Page 5Statements
      of Cash Flows for the thirteen week periodsended
      March 27, 2009 and March 28, 2008
            
            10-Q
      Page 6Notes
      to Financial Statements
            
            10-Q
      Page 7Item
      2. Management’s Discussion and Analysis of FinancialCondition
      and Results of Operations
            
            10-Q
      Page 13Item
      3. Quantitative and Qualitative Disclosures about Market
    Risk
            
            10-Q
      Page 16Item
      4.  Controls and Procedures
            
            10-Q
      Page 16Part
      IIItem
      2  Unregistered Sales of Equity Securities
            
            10-Q
      Page 17Item
      6. Exhibits and Reports on Form 8-K
            
            10-Q
      Page 18Signatures
            
            10-Q
      Page 18Certifications
            
            10-Q
      Page 20 – 22




10-Q
 Page
2




PART
I





Item
1. Financial Statements.





MANAGEMENT
STATEMENT




The accompanying balance sheets of
Command Center, Inc. as of March 27, 2009 (unaudited) and December 26, 2008, and
the related statements of operations and cash flows for the thirteen week
periods ended March 27, 2009 and March 29, 2008 (unaudited) were prepared by
Management of the Company.





The accompanying financial statements
should be read in conjunction with the audited financial statements of Command
Center, Inc. (the “Company”) as of and for the 52 weeks ended December 26, 2008,
and the notes thereto contained in the Company’s annual report on Form 10-K for
the 52 weeks ended December 26, 2008, filed with the Securities and Exchange
Commission.





Management


Command
Center, Inc.


May 15,
2009





10-Q
 Page
3





Command
      Center, Inc.Balance
      Sheet
  Assets
                
                March
      27, 2009
                
                
                December
      26, 2008CURRENT
      ASSETS:
                
                UnauditedCash
                
                $
                705,754
                
                
                $
                2,174,960Accounts
      receivable trade, net of allowance for bad debts of
    $500,000at
      March 27, 2009 and December 26, 2008
                
                
                4,761,662
                
                
                
                5,223,113Other
      receivables - current
                
                
                284,244
                
                
                
                284,244Prepaid
      expenses, deposits, and other
                
                
                664,767
                
                
                
                975,909Current
      portion of workers' compensation risk pool deposits
                
                
                1,500,000
                
                
                
                1,500,000Total
      current assets
                
                
                7,916,427
                
                
                
                10,158,226PROPERTY
      AND EQUIPMENT, NET
                
                
                2,370,127
                
                
                
                2,589,201OTHER
      ASSETS:Workers'
      compensation risk pool deposits
                
                
                2,589,025
                
                
                
                2,729,587Goodwill
                
                
                2,500,000
                
                
                
                2,500,000Intangible
      assets - net
                
                
                458,485
                
                
                
                503,606Total
      other assets
                
                
                5,547,510
                
                
                
                5,733,193$
                15,834,064
                
                
                $
                18,480,620Liabilities
      and Stockholders' EquityCURRENT
      LIABILITIES:Accounts
      payable
                
                $
                1,479,163
                
                
                $
                1,080,735Line
      of credit facility
                
                
                2,273,609
                
                
                
                2,579,313Accrued
      wages and benefits
                
                
                737,948
                
                
                
                981,293Other
      current liabilities
                
                
                557,276
                
                
                
                195,566Current
      portion of note payable
                
                
                9,520
                
                
                
                9,520Short-term
      note payable, net of discount
                
                
                1,433,749
                
                
                
                1,868,748Workers'
      compensation and risk pool deposits payable
                
                
                74,137
                
                
                
                531,062Current
      portion of workers' compensation claims liability
                
                
                1,500,000
                
                
                
                1,500,000Total
      current liabilities
                
                
                8,065,402
                
                
                
                8,746,237LONG-TERM
      LIABILITIES:Note
      payable, less current portion
                
                
                73,808
                
                
                
                76,135Finance
      obligation
                
                
                1,125,000
                
                
                
                1,125,000Workers'
      compensation claims liability, less current portion
                
                
                3,100,000
                
                
                
                2,986,372Total
      long-term liabilities
                
                
                4,298,808
                
                
                
                4,187,507COMMITMENTS
      AND CONTINGENCIES (Notes 9 and 10)STOCKHOLDERS'
      EQUITY:Preferred
      stock - 5,000,000 shares, $0.001 par value, authorized;no
      shares issued and outstanding
                
                
                -
                
                
                
                -Common
      stock - 100,000,000 shares, $0.001 par value, authorized;36,398,130
      and 36,290,053 shares issued and outstanding, respectively
                
                
                36,398
                
                
                
                36,290Additional
      paid-in capital
                
                
                51,381,279
                
                
                
                51,370,627Accumulated
      deficit
                
                
                (47,947,823
                )
                
                
                (45,860,041
                )Total
      stockholders' equity
                
                
                3,469,854
                
                
                
                5,546,876$
                15,834,064
                
                
                $
                18,480,620
 See
accompanying notes to unaudited financial statements.
  10-Q
 Page
4
   Command
      Center, Inc.Statements
      of Operations (Unaudited)
  Thirteen
      Weeks EndedMarch
      27,
                  
                  
                  March
      28,REVENUE:
                  
                  2009
                  
                  
                  2008Revenue
      from services
                  
                  $
                  12,793,065
                  
                  
                  $
                  19,835,399Other
      income
                  
                  
                  30,238
                  
                  
                  
                  101,69012,823,303
                  
                  
                  
                  19,937,089COST
      OF SERVICES:Temporary
      worker costs
                  
                  
                  8,875,966
                  
                  
                  
                  13,023,601Workers'
      compensation costs
                  
                  
                  688,487
                  
                  
                  
                  1,753,694Other
      direct costs of services
                  
                  
                  150,782
                  
                  
                  
                  291,2419,715,235
                  
                  
                  
                  15,068,536GROSS
      PROFIT
                  
                  
                  3,108,068
                  
                  
                  
                  4,868,553SELLING,
      GENERAL, AND ADMINISTRATIVE EXPENSES:Personnel
      costs
                  
                  
                  2,261,119
                  
                  
                  
                  4,013,935Selling
      and marketing expenses
                  
                  
                  60,284
                  
                  
                  
                  306,025Transportation
      and travel
                  
                  
                  194,051
                  
                  
                  
                  408,212Office
      expenses
                  
                  
                  307,332
                  
                  
                  
                  259,672Legal,
      professional and consulting
                  
                  
                  318,891
                  
                  
                  
                  411,765Depreciation
      and amortization
                  
                  
                  210,780
                  
                  
                  
                  213,796Rents
      and leases
                  
                  
                  528,825
                  
                  
                  
                  601,917Rents
      and leases- closed store reserve
                  
                  
                  300,000
                  
                  
                  
                  -Other
      expenses
                  
                  
                  801,048
                  
                  
                  
                  1,095,1234,982,330
                  
                  
                  
                  7,310,445LOSS
      FROM OPERATIONS
                  
                  
                  (1,874,262
                  )
                  
                  
                  (2,441,892
                  )OTHER
      INCOME (EXPENSE):Interest
      expense
                  
                  
                  (213,519
                  )
                  
                  
                  (150,815
                  )Interest
      and other income
                  
                  
                  
                  
                  
                  
                  5,933(213,519
                  )
                  
                  
                  (144,882
                  )BASIC
      AND DILUTED NET LOSS
                  
                  $
                  (2,087,781
                  )
                  
                  $
                  (2,586,774
                  )BASIC
      AND DILUTED LOSS PER SHARE
                  
                  $
                  (0.06
                  )
                  
                  $
                  (0.07
                  )WEIGHTED
      AVERAGE COMMON SHARES OUTSTANDING
                  
                  
                  36,328,844
                  
                  
                  
                  35,729,137
  See
accompanying notes to unaudited financial statements.
  10-Q
 Page
5




Command
      Center, Inc.Statements
      of Cash Flows (Unaudited)
  Thirteen
      Weeks EndedMarch
      27,
                
                
                March
      28,Increase
      (Decrease) in Cash
                
                2009
                
                
                2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                
                $
                (2,087,781
                )
                
                $
                (2,586,774
                )Adjustments
      to reconcile net loss to net cashused
      by operating activities:Depreciation
      and amortization
                
                
                210,779
                
                
                
                213,796Write-off
      of fixed assets
                
                
                53,415
                
                
                
                -Amortization
      of note discount
                
                
                65,000
                
                
                
                -Closed
      stores reserve
                
                
                300,000
                
                
                
                -Common
      stock issued for rent and consulting
                
                
                10,759
                
                
                
                195,553Changes
      in assets and liabilities:Accounts
      receivable - trade
                
                
                461,451
                
                
                
                740,294Other
      current liabilities
                
                
                61,710
                
                
                
                (173,393
                )Prepaid
      expenses, deposits and other
                
                
                311,142
                
                
                
                593,997Workers'
      compensation risk pool deposits
                
                
                140,562
                
                
                
                639,409Accounts
      payable
                
                
                398,428
                
                
                
                (649,708
                )Accrued
      wages & benefits
                
                
                (243,344
                )
                
                
                (370,238
                )Workers'
      compensation insurance payable
                
                
                (456,925
                )
                
                
                -Workers'
      compensation claims liability
                
                
                113,628
                
                
                
                488,726Net
      cash used by operating activities
                
                
                (661,176
                )
                
                
                (908,338
                )CASH
      FLOWS FROM INVESTING ACTIVITIES:Purchases
      of property and equipment
                
                
                -
                
                
                
                (37,823
                )Collections
      on note receivable
                
                
                -
                
                
                
                74,209Net
      cash provided by investing activities
                
                
                -
                
                
                
                36,386CASH
      FLOWS FROM FINANCING ACTIVITIES:Stock
      Subscriptions receivable
                
                
                
                
                
                
                1,878,000Payments
      on line of credit facility, net
                
                
                (305,704
                )
                
                
                (152,895
                )Costs
      of common stock offering and registration
                
                
                -
                
                
                
                (116,576
                )Principal
      payments on notes payable
                
                
                (502,326
                )
                
                
                73,408Net
      cash provided (used) by financing activities
                
                
                (808,030
                )
                
                
                1,681,937NET
      INCREASE (DECREASE) IN CASH
                
                
                (1,469,206
                )
                
                
                809,985CASH,
      BEGINNING OF PERIOD
                
                
                2,174,960
                
                
                
                580,918CASH,
      END OF PERIOD
                
                $
                705,754
                
                
                $
                1,390,903




See
accompanying notes to unaudited financial statements.






10-Q
 Page
6




NOTE 1 — BASIS OF
PRESENTATION:





Organization.Command
Center, Inc. (referred to as “the Company”, “CCNI”, “us” or “we”) is a
Washington corporation initially organized in 2000.  We reorganized
the Company in 2005 and 2006 and now provide on-demand employees for manual
labor, light industrial, and skilled trades applications.  Our
customers are primarily small to mid-sized businesses in the construction,
transportation, warehousing, landscaping, light manufacturing, retail,
wholesale, and facilities industries.  We currently operate 51 stores
located in 20 states.  None of our customers currently make up a
significant portion of our revenue by geographic region or as a
whole.





Reclassifications.
Certain  financial statement amounts for the prior period have been
reclassified to conform to the current period presentation. These
reclassifications had no effect on the net income or accumulated deficit as
previously recorded.





NOTE
2 — RECENT AND ADOPTED ACCOUNTING PRONOUNCEMENTS:





Recent
Pronouncements





Emerging
Issues Task Force (“EITF”) 07-05, “Determining Whether an Instrument (or
Embedded Feature) Is Indexed to an Entity's Own Stock,” becomes effective for
fiscal years, including those interim periods, beginning after December 15,
2008. The EITF is applicable to all instruments outstanding at the beginning of
the period of adoption.  Companies holding instruments with these types of
provisions will recognize a cumulative effect for a change in accounting
principle adjustment in the year adopted.  The ratchet provisions of
warrants the Company has issued to short term debt holders will be subject to
the provisions of this EITF.





Adopted
Pronouncements





In
December 2007, the FASB issued SFAS No. 141 (R), “Business Combinations”
 (“SFAS 141(R)”).  SFAS 141 (R) requires an acquirer to
measure the identifiable assets acquired, the liabilities assumed and any
non-controlling interest in the acquiree at their fair values on the acquisition
date, with goodwill being the excess value over the net identifiable assets
acquired.  It is effective for financial statements issued for fiscal years
beginning after December 15, 2008.  The Company adopted SFAS 141
(R) on December 27, 2008 and will apply the new guidance prospectively to
business combinations completed on or after that date.





In
December 2007, the FASB issued SFAS No. 160 “Non Controlling Interests in
Consolidated Financial Statements - An Amendment of ARB No. 51,” (“SFAS 160”)
which is effective for fiscal years and interim periods within those years
beginning on or after December 15, 2008. SFAS 160 amends ARB 51 to establish
accounting and reporting standards for the non controlling ownership interest in
a subsidiary and for the deconsolidation of a subsidiary. The Company adopted
SFAS 160 on December 27, 2008. The Company does not expect this new guidance to
have a significant impact on our financial statements.





On March
19, 2008 the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments
and Hedging Activities” (“SFAS 161”).  SFAS 161 requires disclosures
of the fair value of derivative instruments and their gains and losses in a
tabular format, provides for enhanced disclosure of an entity’s liquidity by
requiring disclosure of derivative features that are credit-risk related, and
requires cross-referencing within footnotes to enable financial statement users
to locate information about derivative instruments.  The Company
adopted SFAS 160 on December 27, 2008. The adoption of this statement did not
have a material effect on the Company’s financial statements.





10-Q
 Page
7


NOTE
3 — EARNINGS PER SHARE:





The
Company accounts for its income (loss) per common share according to Statement
of Financial Accounting Standard No. 128, “Earnings Per Share” (“SFAS
128”).   Basic earnings per share is calculated by dividing net
income or loss available to common stockholders by the weighted average number
of common shares outstanding, and does not include the impact of any potentially
dilutive common stock equivalents. Diluted earnings per share reflects the
potential dilution that could occur from common shares issuable through stock
options, warrants, and other convertible securities.   The
Company had warrants for 7,762,803 and 6,762,803 shares of common stock
outstanding at March 27, 2009 and March 28, 2008, respectively.  The
company incurred losses in the thirteen week periods ended March 27, 2009 and
March 28, 2008.  Accordingly, the warrant shares are anti-dilutive and
only basic earnings per share is reported at March 27, 2009 and March 28,
2008.





NOTE
4 — RELATED-PARTY TRANSACTIONS:





The
Company has had the following transactions with related parties:





Van Leasing
Arrangements.  Glenn Welstad, our CEO, owns Alligator LLC
(Alligator), a vehicle leasing company.  Alligator currently provides
approximately 6 vans and van drivers to the Company for use in transporting
temporary workers to job sites at various locations within our sphere of
operations.  The Company provides fuel for the vehicles and pays
Alligator a lease payment for use of the vans plus reimbursement for the cost of
the drivers.  As of March 27, 2009 the Company owed Alligator $190,595
for lease payments and driver compensation.  The total expense for the
first quarter was $87,663.76. Amounts paid and payable to Alligator are
classified as transportation and travel in the statement of
operations.





NOTE
5 —LINE OF CREDIT FACILITY:





On May
12, 2006, we entered into an agreement with our principal lender for a financing
arrangement collateralized by eligible accounts receivable.  Eligible
accounts receivable are generally defined to include accounts that are not more
than sixty days past due.  The loan agreement includes limitations on
customer concentrations, accounts receivable with affiliated parties, accounts
receivable from governmental agencies in excess of 5% of the Company’s accounts
receivable balance, and when a customer’s aggregate past due account exceed 50%
of that customer’s aggregate balance due.  The lender will advance 85%
of the invoiced amount for eligible receivables.  The credit facility
includes a 1% facility fee payable annually, and a $1,500 monthly administrative
fee.  The financing bears interest at the greater of the prime rate
plus two and one half percent (prime +2.5%) or 6.25% per annum.  Prime
is defined by the Wall Street Journal, Money Rates Section.  Our line
of credit interest rate at March 27, 2009 was 6.764%.  The loan
agreement further provides that interest is due at the applicable rate on the
greater of the outstanding balance or $5,000,000.  In December, 2006,
the Company negotiated an increase in the maximum credit facility to
$9,950,000.  The loan agreement includes certain financial covenants
including a requirement that we maintain a working capital ratio of 1:1, that we
maintain positive cash flow, that we maintain a tangible net worth of
$3,500,000, and that we maintain a rolling average of 75% of projected
EBITDA.  At March, 2009, we were not in compliance with the working
capital ratio, cash flow, tangible net worth or EBITDA
requirements.  Our lender has waived compliance with the working
capital, cash flow, tangible net worth and EBITDA requirements at quarter end
and the loan was in good standing at March 27, 2009. The balance due our lender
at March 27, 2009 was $2,273,609.  The credit facility has been
recently renewed and now expires on April 7, 2010.We are currently negotiating
with our lender new financial covenants and other loan terms which are more
representative of our present business operations.





NOTE
6 —SHORT-TERM NOTE PAYABLE:





On June
24, 2008, the Company entered into an agreement with an unrelated third party to
borrow $2,000,000 against an unsecured Promissory Note. The Note bears interest
at 15% per annum with interest only payments through January,
2009.  The Note calls for monthly payments of $400,000 plus accrued
interest commencing on February 1, 2009. The note holder also received a warrant
to purchase 1,000,000 shares of common stock at $0.45 per share. The warrant was
valued at $260,000 using the Black-Sholes pricing model based on assumptions
about volatility, the risk free rate of return and the term of the warrants as
set out in the agreement.  The warrant value was recorded as note
discount, and is being amortized to interest expense using a straight line
method which approximates the interest method over the life of the
note.  The warrant expires on July 1, 2011. Amortization of the note
discount amounted to $65,000 in the 13 weeks ended March 27, 2009.  At
March 27, 2009, the Company was behind on the principal payments due under the
Note and was in active negotiations with the lender to extend the payment
schedule.  The extension agreement with revised payment and other
terms was finalized in the second quarter.  Currently, we are in
compliance with the terms of this loan, as revised. See Note 11, Subsequent
Events.




10-Q
 Page
8




NOTE
7 — WORKERS’ COMPENSATION INSURANCE AND RESERVES:





We
provide our temporary and permanent workers with workers’ compensation
insurance.  Currently, we maintain large deductible workers’
compensation insurance policies through AMS Staff Leasing II (“AMS”) and Arch
Insurance Group (“Arch”). The Arch policy covers our workers in the State of
California and South Dakota for the period from June 27, 2008 through June 27,
2009. The AMS policy covers all other states (except the monopolistic
jurisdictions of Washington and North Dakota) for the premium year from May 13,
2008 through May 12, 2009.    While we have primary
responsibility for all claims in non-monopolistic states, our insurance coverage
provides reimbursement for covered losses and expenses in excess of $250,000, on
a “per occurrence” basis.  This results in our being substantially
self-insured.  Prior to the inception of the AMS and Arch policies, we
were insured by American International Group (“AIG”).





Under the
policies, we make payments into a risk pool fund to cover claims within our
self-insured layer.  If our payments into the fund exceed our actual
losses over the life of the claims, we may receive a refund of the excess risk
pool payments.  Correspondingly, if our workers’ compensation reserve
risk pool deposits are less than the expected losses for any given policy
period, we may be obligated to contribute additional funds to the risk pool
fund.





Expected
losses will extend over the life of the longest lived claim which may be
outstanding for many years.  As a new temporary staffing company, we
have limited experience with which to estimate the average length of time during
which claims will be open.  As a result, our current actuarial
analysis is based largely on industry averages which may not be applicable to
our business.  If our average claims period is longer than industry
average, our actual claims losses could exceed our current
estimates.  Conversely, if our average claims period is shorter than
industry average, our actual claims could be less than current reserves. For
workers’ compensation claims originating in Washington and North Dakota (our
“monopolistic jurisdictions”) we pay workers’ compensation insurance premiums
and obtain full coverage under government administered programs.  We
are not the primary obligor on claims in these
jurisdictions.  Accordingly, our financial statements reflect only the
mandated workers’ compensation insurance premium liability for workers’
compensation claims in these jurisdictions.





Workers’
compensation expense for temporary workers is recorded as a component of our
cost of services and consists of the following components: self-insurance
reserves net of the discount; insurance premiums; and premiums paid in
monopolistic jurisdictions.  Workers’ compensation expense for our
temporary workers totaled $688,847 and $1,753,694 in the 13 weeks ended March
27, 2009 and March 28, 2008, respectively. Workers’ compensation expense in 2008
was impacted significantly by claims relating to the policy year from May 12,
2006 through May 12, 2007.  Our insurer has assigned higher than
anticipated future claims liabilities in connection with these
claims.   We anticipate that expected future claims liabilities
will moderate over time as we gain additional historical data regarding our
settlements of these claims.





As a
result of higher than expected claims liabilities for the policy years ending in
May 2007 and May 2008, our insurance carrier requested additional collateral
deposits.  We paid $1.4 million toward this request in 2008 and
recorded the payments as additional workers’ compensation
deposits.  When we changed our workers’ compensation carrier in
mid-2008, our insurance carrier requested additional collateral payments of
approximately $2.9 million dollars.  This figure does not take into
account the $1.4 million already paid, nor does it take into account the
settlement of nearly all open claims from the 2006-2007 policy year and many
open claims from the 2007-2008 policy year at substantially less than the
reserved amounts.  We believe that the request by our insurance
carrier for $2.9 million is unreasonable and is not supported by our most recent
claims history.  As a result, we have not made any additional
collateral deposits or premium payments.  To date, our insurance
carrier has not provided requested information to support their position and we
have not booked any additional liability for workers compensation premiums or
collateral deposits.  We do not believe that any amounts are currently
due.




10-Q
 Page
9





The
workers’ compensation risk pool deposits are classified as current and
non-current assets on the balance sheet based upon management’s estimate of when
the related claims liabilities will be paid.  The deposits have not
been discounted to present value in the accompanying financial
statements.





We have
discounted the expected liability for future losses to present value using a
discount rate of 3.5%, which approximates the risk free rate on US Treasury
instruments.  Our expected future liabilities are evaluated on a
quarterly basis and adjustments are made as warranted.





NOTE
8 — STOCKHOLDERS’ EQUITY:





Sales of Common Stock.In the
thirteen weeks ended March 27, 2009, we issued shares for several different
purposes as described below.  All shares issued for non-cash
consideration were valued based on the market price for our common stock at the
dates of issuance.





·
            48,077
      shares as interest on our finance obligation for our headquarters office
      building.  Aggregate value of the shares issued was
      $5,000.


·
            60,000
      shares for services.  Aggregate value of the shares issued was
      $5,760.




The
Company had 7,762,803 warrants to purchase Command Center, Inc. common stock
issued and outstanding on March 27, 2009.


NOTE
9 – EVERYDAY STAFFING LLC TAX LIABILITIES:





On June
30, 2006, the Company acquired three locations from Everyday Staffing LLC
(“Everyday Staffing”) in exchange for 579,277 shares of Command Center, Inc.
common stock.  At the time of the acquisitions, Michael Moothart,
controlling member of the LLC, represented that all tax liabilities of Everyday
Staffing had been paid.  As a result of the acquisitions, the Company
booked a note payable to Everyday Staffing in the amount of
$113,349.  In early 2008, the Company received notice from the State
of Washington that Everyday Staffing owed certain tax obligations to the State
that arose prior to the acquisition date.  The State requested that
the Company pay the amounts due under a theory of successor liability.
Subsequently, a second claim for successor liability was received by the
Company.  These two claims are described below.





The first
claim relates to business and occupations and excise tax obligations in the
approximate amount of $250,000.  Upon receipt of the notice, the
Company contacted Mr. Moothart and demanded that he resolve the tax obligations.
Mr. Moothart indicated that his legal counsel was working on the
matter.  While Mr. Moothart was pursuing the matter through his
counsel, and in order to forestall further action against Command Center, the
Company agreed to make payments on the debt in satisfaction of the Everyday
Staffing note payable amount.   In the 52 weeks ended December
26, 2008, the Company paid Everyday Staffing’s business and occupations and
excise tax obligations totaling approximately $231,139.  During this
time, Everyday took no apparent action to deal with its obligations to the
Company and the State of Washington.  At March 27, 2009, the total
amount remaining due from Everyday Staffing to the State of Washington for
business and occupation and excise taxes was $-0- and the receivable due Command
Center from Everyday Staffing was $132,500.





The
second claim relates to Everyday Staffing liabilities for industrial insurance
taxes that the State of Washington asserts were not paid by Everyday
Staffing. The claims against the Company are based on the theory of
successor liability. The Department of Labor and Industries has estimated the
amount of the unpaid industrial insurance premiums at $1,203,948 plus interest.
The Company and Everyday Staffing have disputed the amount due and the Company
has referred the matter to counsel.  The amount claimed by the State
is based on an audit of Everyday Staffing in which the auditor appears to have
made unsupportable assignments of workers compensation job codes, hours worked
and other estimates of amounts due, all of which the Company believes to be
grossly misstated.  The Company’s review of Everyday Staffing
financial records shows that payments made to the State of Washington
approximate the amounts that Everyday Staffing indicates were owed for
industrial insurance.




10-Q
 Page
10





Based
upon the theory of successor liability, the Washington Department of Labor and
Industries (“the Department”) recently issued two Notices and Orders of
Assessment of Industrial Insurance Taxes (“Notice”) to Command
Center.   The first Notice claims and assesses taxes of $57,446
and the second Notice claims and assesses the amount of $900,858.  The
Company strongly disputes both the alleged successor liability and also the
monetary amount asserted by the Department.  The Company is pursuing
its administrative remedies in order to vigorously contest the assertions of
these Notices.  In strongly disputing the claims of the Department,
Management believes that the potential liability, if any, is not probable and is
not reasonably estimable at this time. Accordingly, no liability has been
established on the books of the Company for the amount claimed. Management
believes the Company’s liability, if any, from the claims and assessments of the
Department are not reasonably likely to have a material adverse impact on the
Company’s financial position, results of operations or cash flows in future
periods.





The Asset
Purchase Agreement signed in connection with the acquisition of assets from
Everyday Staffing requires that Everyday Staffing indemnify and hold harmless
Command Center for liabilities, such as the Washington assessments, that were
not expressly assumed.  In response to the state claims for payment of
Everyday Staffing liabilities, the Company has filed a lawsuit against Everyday
Staffing, LLC and Michael J. Moothart, seeking indemnification and monetary
damages.  The lawsuit was filed by the Company in Kootenai County
District Court in the State of Idaho and is pending. Everyday Staffing and
Moothart have appeared through legal counsel.  Recently, legal counsel
for Mothart and Everyday Staffing have withdrawn from further representation in
this case. The members of Everyday Staffing own approximately 1,400,000 shares
of Command Center, Inc. common stock.  The Company has placed stop
transfer instructions with the transfer agent to restrict transfer of these
shares pending resolution of the obligations.  Glenn Welstad, our CEO,
has a minority interest in Everyday Staffing.





NOTE
10 – COMMITMENTS AND CONTINGENCIES:





Finance
obligation.  Our finance obligation consists of debt owed to a
former officer and director upon the purchase of the Company’s
headquarters.  The terms of the agreement call for lease payments of
$10,000 per month commencing on January 1, 2006 for a period of three
years.  The Company has the option any time after January 1, 2008 to
purchase the building for $1,125,000 or continue to make payments of $10,000 for
another two years under the same terms. In November, 2008, the Company extended
the lease for an additional two years ending December 31, 2010 and continues to
hold a purchase option that may be exercised up until the lease
expiration.  The Company accounts for the lease payments as interest
expense.  The building is being depreciated over 30
years.





Contingent payroll and other tax
liabilities.  In May and June 2006, we acquired operating
assets for a number of temporary staffing stores.  The entities that
owned and operated these stores received stock in consideration of the
transaction.  As operating businesses prior to our acquisition, each
entity incurred obligations for payroll withholding taxes, workers’ compensation
insurance fund taxes, and other liabilities.  We structured the
acquisition as an asset purchase and agreed to assume only the liability for
each entity’s accounts receivable financing line of credit.  We also
obtained representations that liabilities for payroll taxes and other
liabilities not assumed by the Company would be paid by the
entities.





Since the
acquisitions, it has come to our attention that certain tax obligations incurred
on operations prior to our acquisitions have not been paid.  The
entities that sold us the assets (the “selling entities”) are primarily liable
for these obligations.  The owners of the entities may also be
liable.  In most cases, the entities were owned or controlled by Glenn
Welstad, our CEO.





Based on
the information currently available, we estimate that the total state payroll
and other tax liabilities owed by the selling entities is between $400,000 and
$600,000 and that total payroll taxes due to the Internal Revenue Service are
between $500,000 and $600,000.  Our outside legal counsel has advised
us that the potential for successor liability on the IRS claims is
remote.





We have
not accrued any amounts for these contingent payroll and other tax liabilities
at March 27, 2009.  The Asset Purchase Agreement governing these
transactions requires that the selling entities indemnify us for any liabilities
or claims we incur as a result of these predecessor tax
liabilities.  We have also secured the indemnification agreement of
Glenn Welstad with a pledge of our common stock.   We believe the
selling entities and their principals have adequate resources to meet these
obligations and have indicated through their actions to date that they fully
intend to pay the amounts due.  We understand that the responsible
parties have entered into payment agreements on many of the tax
obligations.





10-Q
 Page
11





Operating
leases.  The Company leases store facilities, vehicles and
equipment.  Most of our store leases have terms that extend over three
to five years.  Some of the leases have cancellation provisions that
allow us to cancel on ninety day notice, and some of the leases have been in
existence long enough that the term has expired and we are currently occupying
the premises on month-to-month tenancies.  Lease obligations for the
next five years as ofMarch 27, 2009
are:




2009
            $
            648,1322010
            
            453,4082011
            
            102,6062012
            
            37,7572013
            
            10,560





Leases on closed stores.Over
the last twelve months, the Company has closed a number of stores in response to
economic conditions and a general downturn in business opportunities in certain
markets.  Management continued to evaluate opportunities in those
markets and held out hope for a recovery that would allow us to reopen the
closed stores.  During the first quarter, management assessed the
likelihood of reopening the closed stores in the next twelve months as
remote.  As a result, Management began negotiating with landlords for
termination of the closed store leases.  We are also seeking
replacement tenants for the properties and are considering other options to
reduce the lease obligations on the closed stores.  With the
determination that store reopenings are unlikely, we have recorded a reserve for
closed store leases totaling $300,000.  This amount represents
Management’s best estimate of the amounts we are likely to pay in settlement of
the outstanding lease obligations on the closed stores.  Total lease
obligations on closed stores at March 27, 2009 were approximately $1,000,000 if
all leases went to term, no subtenants were found, and no rent concessions were
obtained from the landlords.  We believe it is likely that many of the
properties will be sublet and rent concessions will be available on many of the
properties and that a significant portion of the closed store rents will
ultimately not be paid by the Company.





NOTE
11 – SUBSEQUENT EVENTS:





Agreement for modification
promissory note and warrants.  On April 13, 2009, the Company
entered into an agreement to extend the repayment term on its Short-Term
Note.  At the time of the agreement, the balance on the Note was
$1,500,000.  As extended, the note is now payable at increasing
bi-weekly payments.  Payments under the Note are $75,000 in April,
$100,000 in May, $100,000 in June, $150,000 in July, $250,000 in August,
$300,000 in September, and $525,000 in October.  The extension
agreement provides for an increase in the interest rate to 20% per annum with
interest payable bi-weekly, and an additional 3,000,000 warrants to purchase the
Company’s stock at $.15 per share subject to full ratchet anti-dilution rights.
(See Notes 6 and 2).





10-Q
 Page
12








FORM
10-Q





Part
I, Item 2. Management’s
Discussion and Analysis or Plan of Operations.





Command
Center is a provider of temporary employees to the light industrial,
construction, warehousing, transportation and material handling
industries.  We provide unskilled and semi-skilled workers to our
customers.  Generally, we pay our workers the same day they perform
the job.  In 2005 and 2006, we underwent a series of evolutionary
changes to convert our business from financial services to franchisor of
on-demand labor stores and finally to operator of on-demand labor
stores.  We accomplished these changes by rolling up a franchise and
software Company into the predecessor public corporation and then acquiring all
of our franchisees for stock.  We completed the rollup transactions in
the second quarter of 2006.





Our
vision is to be the preferred partner of choice for all on-demand employment
solutions by placing the right people in the right jobs every
time.  With the acquisition of the on-demand labor stores, we have
consolidated operations, established and implemented corporate operating
policies and procedures, and developed a unified branding strategy for all of
our stores.





The
following table reflects operating results in the 13 weeks ended March 27, 2009
compared to the thirteen weeks ended March 28, 2008.  Percentages
indicate line items as a percentage of total revenue.  The table
serves as the basis for the narrative discussion that follows.





2009
                
                
                2008REVENUE:
                
                $
                12,823,303
                
                
                
                
                
                $
                19,937,089COST
      OF SERVICES:Temporary
      worker costs
                
                
                8,875,966
                
                
                
                69.2
                %
                
                
                13,023,601
                
                
                
                65.3
                %Workers'
      compensation costs
                
                
                688,487
                
                
                
                5.4
                %
                
                
                1,753,694
                
                
                
                8.8
                %Other
      direct costs of services
                
                
                150,782
                
                
                
                1.2
                %
                
                
                291,241
                
                
                
                1.5
                %9,715,235
                
                
                
                75.8
                %
                
                
                15,068,536
                
                
                
                75.6
                %GROSS
      PROFIT
                
                
                3,108,068
                
                
                
                24.2
                %
                
                
                4,868,553
                
                
                
                24.4
                %SELLING,
      GENERAL, ANDADMINISTRATIVE
      EXPENSES:Personnel
      costs
                
                
                2,261,119
                
                
                
                17.6
                %
                
                
                4,013,935
                
                
                
                20.1
                %Selling
      and marketing expenses
                
                
                60,284
                
                
                
                0.5
                %
                
                
                306,025
                
                
                
                1.5
                %Transportation
      and travel
                
                
                194,051
                
                
                
                1.5
                %
                
                
                408,212
                
                
                
                2.0
                %Office
      expenses
                
                
                307,332
                
                
                
                2.4
                %
                
                
                259,672
                
                
                
                1.3
                %Legal,
      professional and consulting
                
                
                318,891
                
                
                
                2.5
                %
                
                
                411,765
                
                
                
                2.1
                %Depreciation
      and amortization
                
                
                210,780
                
                
                
                1.6
                %
                
                
                213,796
                
                
                
                1.1
                %Rents
      and leases
                
                
                528,825
                
                
                
                4.1
                %
                
                
                601,917
                
                
                
                3.0
                %Rents
      and leases - closed store reserve
                
                
                300,000
                
                
                
                2.3
                %
                
                
                -
                
                
                
                0.0
                %Other
      expenses
                
                
                801,048
                
                
                
                6.2
                %
                
                
                1,095,123
                
                
                
                5.5
                %4,982,330
                
                
                
                38.9
                %
                
                
                7,310,445
                
                
                
                36.7
                %LOSS
      FROM OPERATIONS
                
                
                (1,874,262
                )
                
                
                -14.6
                %
                
                
                (2,441,892
                )
                
                
                -12.2
                %OTHER
      INCOME (EXPENSE):
                
                
                (213,519
                )
                
                
                -1.7
                %
                
                
                (144,882
                )
                
                
                -0.7
                %NET
      LOSS
                
                $
                (2,087,781
                )
                
                
                -16.3
                %
                
                $
                (2,586,774
                )
                
                
                -13.0
                %


10
Q
 Page
13





Results
of Operations





13
Weeks Ended March 27, 2009





Operations
Summary.  Revenue fell in the 13 week period ended March 27,
2009 to $12.8 million from $19.9 million in the 13 week period ended March 28,
2008, a decline of 36%.  Economic conditions and store closures as a
result of economic conditions are the primary factors that drove the
decline.  The on-demand labor sector of the staffing industry is one
of the first sectors to feel the impact of an economic slowdown.





The
current business climate presents significant challenges to smaller on-demand
labor companies like Command Center. These challenges to Command Center came at
a time when we were particularly vulnerable to recessionary
pressures.  As a relatively unseasoned business with aggressive growth
plans, we had not yet established a stable base of operations in our existing
stores and, with the completion of our funding in late 2007, we were set to
embark on a plan to rapidly expand our business.  We spent much of
2007 putting infrastructure and control mechanisms in place to operate a
substantially larger business.  We expected to have at least 100
stores in operation by the end of 2008 and our corporate overhead reflected this
plan.  When revenue did not ramp up as expected, we had to take a
critical look at our financial position and growth plans and by mid-2008, we
were taking action to reverse our plans for growth and instead develop a plan
for contracting our business to ride out the recession.





Like many
other businesses, we did not fully anticipate the precipitous fall of the
economy or the severity of the impact that fall would have on our
revenue.





Store
Operations.At the end of 2008, we
were operating 57 stores.  During the first quarter, we closed a net
of six additional stores and ended the quarter with 51 stores in
operation.





In the
last half of 2008, we developed and have now implemented a sales program focused
on solution selling concepts and tracking of activity as a means of offsetting
the downward pressure on revenues.  The sales program has now been
rolled out to all branches and we believe it has allowed us to hold sales at
higher levels than if we had not implemented the program.  We also
believe that the sales program will have a positive impact on revenue growth
once the economy begins to recover.  Additionally, we have focused
more of our sales activity on those business sectors that are less impacted by
the economic downturn such as disaster recovery, event services, and other
non-traditional on-demand labor customers.





Cost of
Sales.  The cost of on-demand labor increased to 69.2% of
revenue in Q1 - 2009 compared to 65.3% in Q1 - 2008.  This increase
was offset by a reduction in workers compensation costs.  Looking
ahead, we believe we will be able to reduce the cost of on demand labor by
reducing pay rates.  We also expect on-demand labor costs to moderate
as a percentage of revenue as we enter our peak season and revenue
climbs.





Toward
the end of 2008 and continuing into 2009, we have been evaluating our on-demand
labor pay rates and where possible, implementing pay rate reductions in order to
increase margins to acceptable levels.





Worker’s
compensation costs in Q1 – 2009 decreased to 5.4% of revenue, compared to 8.8%
of revenue in Q1 - 2008.  The decrease is a function of two
forces.  In May of 2008, we changed our workers’ compensation
insurance carrier.  Our new carriers are much more aggressive in
evaluating and paying claims costs.  Our cost of worker’s compensation
as a percentage of revenue spiked up between the fourth quarter of 2007 and the
second quarter of 2008.  The efforts undertaken to control these costs
in late 2007 through the change in carriers in mid-2008 are now beginning to
bear fruit. As a result, we are beginning to see decreases in our workers’
compensation costs.  We expect this trend to continue in
2009.





Gross
Margin.  The factors impacting gross margin in Q1 - 2009 are
discussed under the cost of sales above.  In the aggregate, cost of
sales increased to 75.8% of revenue in 2009 compared to 75.6% of revenue in 2008
yielding margins of 24.2% in 2009 and 24.4% in 2008.    We
have taken steps to reduce pay rates, and to increase bill rates to account for
non-standard costs of providing services for large scale disaster recovery
projects, in an effort to increase margins.




10
Q
 Page
14




Selling, General
and Administrative Expenses.As a percentage of
revenue, selling, general and administrative expenses increased to 38.9% in Q1 -
2009 compared to 36.7 % in Q1 - 2008.  This represents a 2.2% increase
as a percentage of revenue and a monetary reduction of $2.3 million in Q1 - 2009
compared to Q1 - 2008.  The increase in selling, general and
administrative expenses is primarily the result of the precipitous drop in
revenue and provides a closed store reserve of $300,000.00.





Liquidity
and Capital Resources





At March
27, 2009, we had total current assets of 7.9 million and current liabilities of
$8.1 million.  Included in current assets are cash of $.7 million and
trade accounts receivable of $4.8 million (net of allowance for bad debts of
$500,000).   Our cash position continues to deteriorate as a
result of the trailing effect of cost reductions in the declining economy and
continuing losses.





Weighted
average aging on our trade accounts receivable at March 27, 2009, was 39
days.  Actual bad debt write-off expense as a percentage of total
customer invoices during Q1 - 2009 was 0.73%.    Our
accounts receivable are recorded at the invoiced amounts.  We
regularly review our accounts receivable for collectability.  The
allowance for doubtful accounts is determined based on historical write-off
experience and current economic data and represents our best estimate of the
amount of probable losses on our accounts receivable.  The allowance
for doubtful accounts is reviewed quarterly.  We typically refer
overdue balances to a collection agency at ninety days and the collection agent
pursues collection for another thirty days.  Most balances over 120
days past due are written off when it is probable the receivable will not be
collected.  As our business matures, we will continue to monitor and
seek to improve our historical collection ratio and aging experience with
respect to trade accounts receivable.  As we grow our historical
collection ratio and aging experience with respect to trade accounts receivable
will continue to be important factors affecting our liquidity.





We
currently operate under a $9,950,000 line of credit facility with our principal
lender for accounts receivable financing.  The credit facility is
collateralized with accounts receivable and entitles us to borrow up to 85% of
the value of eligible receivables.  Eligible accounts receivable are
generally defined to include accounts that are not more than sixty days past
due.  The line of credit agreement includes limitations on customer
concentrations, accounts receivable with affiliated parties, accounts receivable
from governmental agencies in excess of 5% of the Company’s accounts receivable
balance, and when a customer’s aggregate past due account exceeds 50% of that
customer’s aggregate balance due.  The credit facility includes a 1%
facility fee payable annually, and a $1,500 monthly administrative
fee.  The financing bears interest at the greater of 6.25% per annum
or the greater of the prime rate plus two and one half percent (prime + 2.5%)
or  the London Interbank Offered Rate (LIBOR) plus three percent
(LIBOR + 3.0%) per annum.  Prime and/or LIBOR are defined by the Wall
Street Journal, Money Rates Section.  Our line of credit interest rate
at March 27, 2009 was 6.764%.  The loan agreement further provides
that interest is due at the applicable rate on the greater of the outstanding
balance or $5,000,000.  The credit facility, originally due to expire
on April 7, 2009, was recently renewed for one year and now expires on April 7,
2010.   The balance due our lender at March 17, 2009 was
$2,273,609.  We expect that certain terms of the loan, including the
maximum credit facility and the minimum amount on which interest is calculated,
will be modified in the coming months to better reflect the current needs of the
Company





The line
of credit facility agreement contains certain financial covenants including a
requirement that we maintain a working capital ratio of 1:1, that we maintain
positive cash flow, that we maintain a tangible net worth of $3,500,000, and
that we maintain a rolling average EBITDA of 75% of our
projections.  At March 27, 2009, we were not in compliance with the
cash flow, tangible net worth and EBITDA requirements.  Our lender
waived compliance with the working capital, cash flow, tangible net worth and
EBITDA covenants and the line of credit was in good standing as of March,
2009.  As part of the recent renewal of our credit facility, we are
currently negotiating revised financial covenants with our lender that are more
representative of our present reduced level of business operations.





At March
27, 2009, we also owed a private investor $1.5 million on an unsecured
promissory note bearing interest at 15% per annum and calling for monthly
installment payments of $400,000 commencing February 2, 2009.  The
Company has negotiated an extension of the payment terms of this note to reduce
cash outflows through the end of the third quarter.  The extension
agreement was finalized early in April, 2009.





10
Q
 Page
15





As
discussed elsewhere in this report, in 2006, we acquired operating assets from a
number of entities that were previously our franchisees.  We have been
notified of the existence of payroll tax liabilities owed by the franchisees and
have included footnote disclosure in our financial statements of the potential
contingent liability that may exist. Based on the information currently
available, we estimate that the total state payroll and other tax liabilities
owed by the selling entities is between $400,000 and $600,000 and that total
payroll taxes due to the Internal Revenue Service is between $500,000 and
$600,000.  Our outside legal counsel has advised us that the potential
for successor liability on the IRS claims is remote.





We have
not accrued any amounts for these contingent payroll and other tax liabilities
at March 27, 2009.  We have obtained indemnification agreements from
the selling entities and their principal members for any liabilities or claims
we incur as a result of these predecessor tax liabilities.   We
believe the selling entities and their principal members have adequate resources
to meet these obligations and have indicated through their actions to date that
they fully intend to pay the amounts due. We understand that the responsible
parties have or are working on payment agreements for the substantial majority
of the tax obligations and expect to resolve these debts in full within the next
twelve months.





Our
current liquidity could be impacted if we are considered to be a successor to
these payroll tax obligations.  Liability as a successor on these
payroll tax obligations may also constitute a default under our line of credit
facility agreement with our principal lender creating a further negative impact
on our liquidity.





We expect
that additional capital will be required to fund operations during fiscal year
2009.  Our capital needs will depend on store operating performance,
our ability to control costs, and the continued impact on our business from the
general economic slowdown and/or recovery cycle.  We currently have
approximately 10.8 million warrants outstanding which may offer a source of
additional capital at a future date upon exercise.  Management will
continue to evaluate capital needs and sources of capital as we execute our
business plan in 2009.





If we
require additional capital in 2009 or thereafter, no assurances can be given
that we will be able to find additional capital on acceptable
terms.  If additional capital is not available, we may be forced to
scale back operations, lay off personnel, slow planned growth initiatives, and
take other actions to reduce our capital requirements, all of which will impact
our profitability and long term viability.




Item
3. Quantitative and Qualitative Disclosures about Market Risk.





We do not
believe that our business is currently subject to material exposure from the
fluctuation in interest rates.





Item 4. Controls and
Procedures.





Management
conducted an evaluation of the effectiveness of our internal control over
financial reporting based on a general framework developed by management with
reference to general business, accounting and financial reporting
principles.





Based
upon this evaluation, we determined that there were no material weaknesses
affecting our internal controls over financial reporting but that there were
deficiencies in our disclosure controls and procedures as of March 27, 2009. The
deficiencies noted below are being addressed through our remediation initiatives
which are also described below.  We believe that our financial
information, notwithstanding the internal control deficiencies noted, accurately
and fairly presents our financial condition and results of operations for the
periods presented.





·
            As
      a young Company, we continue to face challenges with hiring and retaining
      qualified personnel in the finance department.  Limitations in
      both the number of personnel currently staffing the finance department,
      and in the skill sets employed by such persons, create difficulties in the
      segregation of duties essential for sound internal
    controls.




10
Q
 Page
16




·
            Documentation
      of proper accounting procedures is not yet complete and some of the
      documentation that exists has not yet been reviewed or approved by
      management, or has not been properly communicated and made available to
      employees responsible for portions of the internal control
      system.





Management’s Remediation
Initiatives





We made
substantial progress on our internal control processes during 2008 and through
the first quarter of 2009.  The accounting and information technology
departments are working closely to identify and address system interface
issues.  We have implemented new reconciliation procedures to ensure
that information is properly transferred to the accounting system.  We
have also made a concerted effort to hire and retain qualified personnel in the
accounting department.    We have retained experts when
necessary to address complex transactions are entered
into.  Management believes that actions taken and the follow-up that
will occur during 2009 collectively will effectively eliminate the above
deficiencies.





During
the remainder of 2009, we plan to conduct quarterly assessments of our controls
over financial reporting using criteria established in “Internal
Control-Integrated Framework” issued by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”).  In connection with
these assessments, we will document all significant accounting procedures and
determine whether they are designed effectively and are operating as
designed.  Our assessment of internal controls over financial
reporting will be subject to audit for the fifty-two week period ending December
25, 2009.





Our
management and Board of Directors does not expect that our disclosure
controls and procedures or internal control over financial reporting will
prevent all errors or all instances of fraud. A control system, no matter how
well designed and operated, can provide only reasonable, not absolute, assurance
that the control system’s objectives will be met. Further, the design of a
control system must reflect the fact that there are resource constraints, and
the benefits of controls must be considered relative to their costs. Because of
the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control gaps and instances of fraud have
been detected. These inherent limitations include the realities that judgments
in decision-making can be faulty, and that breakdowns can occur because of
simple errors or mistakes. Controls can also be circumvented by the individual
acts of some persons, by collusion of two or more people, or by management
override of the controls. The design of any system of controls is based in part
upon certain assumptions about the likelihood of future events, and any design
may not succeed in achieving its stated goals under all potential future
conditions.




Changes in internal control over
financial reporting.




Except as
noted above, there have been no changes during the quarter ended March 27,
2009 in the Company’s internal controls over financial reporting that have
materially affected, or are reasonably likely to materially affect, internal
controls over financial reporting.





PART
II





Item
2.  Unregistered Sales of Equity Securities.





In the
thirteen week period ended on March 27, 2009, the Company issued an aggregate of
108,077 shares of Common Stock.  The shares of Common Stock were
issued for payment of interest and services valued at $10,760.  All of
these sales of unregistered securities were made in reliance on exemptions from
registration afforded by Section 4(2) of the Securities Act of 1933, as amended
(the “Act”), Rule 506 of Regulation D adopted under the Act, and various state
blue sky exemptions.  In each instance, the investors acquired the
securities for investment purposes only and not with a view to
resale.  The certificates representing the shares bear a restrictive
stock legend and were sold in private transactions without the use of
advertising or other form of public solicitation.





10
Q
 Page
17





Item
6.  Exhibits and Reports on Form 8-K.




Exhibit No.
              
              Description
              
              Page #31.1
              
              Certification
      of Glenn Welstad, Chief Executive Officer of Command Center, Inc. pursuant
      to Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002.
              
              10-Q,
      Page 1931.2
              
              Certification
      of Ralph Peterson, Chief Financial Officer of Command Center, Inc.
      pursuant to Rule 13a-14(a) as adopted pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002.
              
              10-Q,
      Page 2032.1
              
              Certification
      of Glenn Welstad, Chief Executive Officer of Command Center, Inc. pursuant
      to 18 U.S.C. Section 1350, as adopted in Section 906 of the Sarbanes-Oxley
      Act of 2002.
              
              10-Q,
      Page 2132.1
              
              Certification
      of Ralph Peterson, Chief Financial Officer of Command Center, Inc.
      pursuant to 18 U.S.C. Section 1350, as adopted in Section 906 of the
      Sarbanes-Oxley Act of 2002.
              
              10-Q,
      Page 22




10
Q
 Page
18





SIGNATURES





Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized.




COMMAND
CENTER, INC.







/s/Glenn
      Welstad
              
              President
      and CEO
              
              Glenn
      Welstad
              
              May
      15, 2009Signature
              
              Title
              
              Printed
      Name
              
              Date/s/Ralph
      Peterson
              
              CFO,
      Principal Financial Officer
              
              Ralph
      Peterson
              
              May
      15, 2009Signature
              
              Title
              
              Printed
      Name
              
              Date
 Page
19