Document:

Exhibit 105

    

     

    

     

    AGREEMENT
      AND PLAN OF MERGER

     

    

     

    By
      and among

     

    

     

    RESOLVE
      STAFFING, INC.

     

    ELS
      ESI MERGER SUB LLC

     

    and

     

    ELS
      EMPLOYER SERVICES, INC.

     

    

     

    

    

     

    

     

    As
      of October 1, 2006

    

    TABLE
      OF
      CONTENTS

     

    ARTICLE
      I. THE MERGER

    Section
      1.01 Merger
      into ELS ESI.

    Section
      1.02 Effective
      Time and Effective Date

    Section
      1.03 Effects
      of the Merger

    Section
      1.04 Articles
      of Incorporation and Code of Regulations

    Section
      1.05 Directors

    Section
      1.06 Officers

    Section
      1.07 Rights
      and Obligations.

    ARTICLE
      II. CLOSING

    Section
      2.01 Closing

    Section
      2.02 Deliveries
      by Merger Sub to ELS ESI

    Section
      2.03 Deliveries
      by ELS ESI to Merger Sub

    Section
      2.04 Conversion
      of Equity.

    Section
      2.05 Surrender
      of Certificates.

    ARTICLE
      III. REPRESENTATIONS AND WARRANTIES OF ELS ESI

    Section
      3.01 Corporate
      Existence and Qualification: Corporate Documents.

    Section
      3.02 Capitalization
      and Ownership

    Section
      3.03 Preemptive
      Rights; Registration Rights

    Section
      3.04 No
      Defaults or Consents

    Section
      3.05 No
      Proceedings

    Section
      3.06 Absence
      of Certain Changes

    Section
      3.07 Insurance

    Section
      3.08 Patents,
      Trademarks, Service Marks and Copyrights.

    Section
      3.09 Title
      to Assets; Condition of Assets.

    Section
      3.10 Compliance
      with Laws

    Section
      3.11 Litigation;
      Default

    Section
      3.12 Other
      Transactions

    ARTICLE
      IV. REPRESENTATIONS AND WARRANTIES OF MERGER SUB AND RESOLVE

    Section
      4.01 Corporate
      Existence and Qualification; Corporate Documents

    Section
      4.02 Authority,
      Approval and Enforceability

    Section
      4.03 No
      Defaults or Consents

    Section
      4.04 No
      Proceedings

    Section
      4.05 Securities

    ARTICLE
      V. SURVIVAL

    Section
      5.01 Survival
      of Representations and Warranties

     ARTICLE
      VI. INDEMNIFICATION

    Section
      6.01 Obligation
      of ELS ESI to Indemnify

    Section
      6.02 Obligation
      of Merger Sub and Resolve to Indemnify

    Section
      6.03 Notice
      and Opportunity to Defend.

    Section
      6.04 Limitations
      on Indemnification

    ARTICLE
      VII. POST-CLOSING OBLIGATIONS

    Section
      7.01 Further
      Assurances

    Section
      7.02 Access
      to Records

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      VIII. MISCELLANEOUS 

    Section
      8.01 Brokers

    Section
      8.02 Costs
      and Expenses

    Section
      8.03 Notices

    Section
      8.04 Governing
      Law

    Section
      8.05 Entire
      Agreement, Amendments and Waivers

    Section
      8.06 Binding
      Effect and Assignment

    Section
      8.07 Remedies

    Section
      8.08 Exhibits
      and Schedules

    Section
      8.09 Multiple
      Counterparts

    Section
      8.10 References

    Section
      8.11 Survival

    ARTICLE
      IX. DEFINITIONS

    Section
      9.01 Affiliate

    Section
      9.02 Company
      Assets

    Section
      9.03 Governmental
      Authorities

    Section
      9.04 Knowledge

    Section
      9.05 Legal
      Requirements

    Section
      9.06 Material
      Adverse Change

    Section
      9.07 Material
      Adverse Effect

    Section
      9.08 Permits

    Section
      9.09 Properties

    Section
      9.10 Regulations

    Section
      9.11 Taxes
      or Tax

    Section
      9.12 Tax
      Returns

    Section
      9.13 Used

    

    
      
        
        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    

    This
      AGREEMENT AND PLAN OF MERGER (the “Agreement”)
      is
      made and entered into as of October 1, 2006, by and among Resolve Staffing,
      Inc., a Nevada corporation (“Resolve”),
      ELS
      Employer Merger Sub LLC, an Ohio limited liability company (“Merger
      Sub”)
      and
      ELS Employer Services, Inc., a Michigan corporation (“ELS
      ESI”).
      

     

    Preliminary
      Statements

     

    A.  The
      issued and outstanding capital stock of ELS ESI is set forth on Exhibit
      A
      hereto;
      and

     

    B.  Resolve
      owns 100% of the issued and outstanding stock of Merger Sub; and

     

    C.  It
      is
      proposed that Merger Sub be merged with and into ELS ESI, with ELS ESI as the
      surviving corporation (the “Merger”),
      and
      that the presently issued and outstanding shares of common stock, without par
      value, of ELS ESI be converted into merger consideration as set forth herein;
      and

     

    D.  The
      Boards of Directors and shareholders of ELS ESI and the sole member of Merger
      Sub have each approved the Merger upon the terms and conditions set forth herein
      and have approved this Agreement; and

     

    E.  ELS
      ESI
      and Merger Sub desire to enter into and carry out the transactions contemplated
      by this Agreement in accordance with the terms hereof, and the provisions of
      the
      Ohio Revised Code and the Michigan Business Corporation Act; and

     

    F.  The
      parties intend that the Merger shall qualify as a reorganization within the
      meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended
      (the "Internal
      Revenue Code").

     

    Capitalized
      terms used herein but not defined herein shall have the respective meanings
      given such terms in Article IX hereof.

     

    Agreement

     

    In
      consideration of the premises, mutual covenants and agreements contained herein
      and the benefits to accrue to the parties hereto, and subject to the
      satisfaction or waiver of the conditions contained herein, the parties hereto
      hereby agree as follows:

     

    ARTICLE
      I.  

    THE
      MERGER

    Section
      1.01  Merger
      into ELS ESI.

     

    At
      the
      Effective Time on the Effective Date (each as hereinafter defined), Merger
      Sub
      shall be merged with and into ELS ESI, with ELS ESI (hereinafter sometimes
      called the “Surviving
      Corporation”)
      as the
      surviving corporation of the Merger. Following the Effective

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Time,
      the
      corporate existence of ELS ESI shall continue unaffected and unimpaired, and
      as
      the Surviving Corporation of the Merger, ELS ESI shall continue to be a
      corporation governed by the laws of the State of Michigan. On the Closing Date,
      ELS ESI and Merger Sub shall cause (a) a Certificate of Merger to be executed
      and filed with the Secretary of State of Ohio in form required by the Ohio
      Revised Code (the “Ohio
      Certificate of Merger”);
      and
      (b) a Certificate of Merger to be executed and filed with the Secretary of
      State
      of Michigan in form required by the Michigan Business Corporation Act (the
      “Michigan
      Certificate of Merger”).

     

    Section
      1.02  Effective
      Time and Effective Date

     

    .
      The
      effective date of the Merger shall be October 1, 2006 (the “Effective
      Date”),
      and
      the effective time of the Merger shall be 12:01 a.m. on October 1, 2006 (the
      “Effective
      Time”).

     

    Section
      1.03  Effects
      of the Merger

     

    . The
      Merger shall have the effects set forth in the Michigan Business Corporation
      Act, as amended.

     

    Section
      1.04  Articles
      of Incorporation and Code of Regulations

     

    . 

     

    (a)  The
      articles of incorporation of ELS ESI, as in effect immediately prior to the
      Effective Time, shall be the articles of incorporation of the Surviving
      Corporation until thereafter changed or amended as provided therein or by
      applicable law.

     

    (b)  The
      bylaws of ELS ESI as in effect immediately prior to the Effective Time shall
      be
      the code bylaws of the Surviving Corporation, until thereafter changed or
      amended as provided therein or by applicable law.

     

    Section
      1.05  Directors

     

    .
      The
      directors of the Surviving Corporation from and after the Effective Time, and
      until the earlier of their respective death, resignation or removal or until
      their respective successors are duly elected and qualified, as the case may
      be,
      shall be the directors of ELS ESI.

     

    Section
      1.06  Officers

     

    .
      The
      officers of the Surviving Corporation from and after the Effective Time, and
      until the earlier of their respective death, resignation or removal or until
      their respective successors are duly elected and qualified, as the case may
      be,
      shall be the officers of ELS
      ESI.

     

    Section
      1.07  Rights
      and Obligations.

     

    At
      the
      Effective Time, the separate existence of Merger Sub shall cease, and in
      accordance with the terms of this Agreement, ELS ESI shall possess and be vested
      with all of the rights, privileges, franchises, immunities and powers and all
      property (real, personal or mixed) of Merger Sub, debts due to Merger Sub,
      choses in action and all other things belonging to Merger Sub, and ELS ESI
      shall
      be subject to all of the restrictions, liabilities, disabilities and duties
      of
      Merger Sub.

     

    The
      identity, existence, purposes, powers, objects, franchises, privileges, rights
      and immunities of ELS ESI shall continue unaffected and unimpaired by the
      Merger.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    CLOSING

     

    Section
      1.08  Closing

     

    .
      The
      closing of the transactions contemplated hereby (the “Closing”)
      shall
      be held as of 12:01 a.m., as of October 1, 2006 at the offices of Taft,
      Stettinius & Hollister LLP, 425 Walnut Street, Suite 1800, Cincinnati, Ohio
      45202, unless another date or place is agreed to in writing by the parties
      hereto. The date upon which the Closing occurs is hereinafter referred to as
      the
“Closing
      Date.”

     

    Section
      1.09  Deliveries
      by Merger Sub to ELS
      ESI

     

    .
      At the
      Closing, Merger Sub shall deliver to ELS ESI:

     

    (a)  the
      resignations of all officers and managers of Merger Sub;

     

    (b)  the
      stock
      books, stock ledgers or other records reflecting the ownership of all
      outstanding membership units, minute books and corporate seals, if any of Merger
      Sub;

     

    (c)  a
      certificate of the sole member of Merger Sub certifying, as complete and
      accurate as of the Closing, as to attached copies of the Articles of
      Organization of Merger Sub and all necessary action on behalf of Merger Sub
      approving its execution, delivery and performance of this
      Agreement;

     

    (d)  a
      certificate of good standing of Merger Sub issued by the Secretary of State
      of
      Ohio;

     

    (e)  a
      certificate of good standing of Resolve issued by the Secretary of State of
      the
      State of Nevada;

     

    (f)  certificates
      for shares of Resolve Common Stock (defined below) issued in accordance with
      Section 2.04; and

     

    (g)  a
      promissory note, duly executed by Resolve, in accordance with Section 2.04.
      

     

    Section
      1.10  Deliveries
      by ELS ESI to Merger
      Sub

     

    .
      At
      the
      Closing, ELS ESI shall deliver to Merger Sub:

     

    (a)  a
      certificate of the Secretary of ELS ESI certifying, as complete and accurate
      as
      of the Closing, as to attached copies of the Articles of Incorporation and
      Bylaws of ELS ESI and all necessary corporate action on behalf of ELS ESI
      approving its execution, delivery and
      performance of this Agreement; and

     

    (b)  a
      certificate of good standing of ELS ESI issued by the Secretary of State of
      the
      State of Michigan. 

     

    Section
      1.11  Conversion
      of Equity.

     

    (a)  At
      the
      Effective Time on the Effective Date, (i) all shares of common stock, par value
      $1.00 per share, of ELS ESI (“ELS
      ESI Common Stock”)
      issued
      and outstanding immediately prior thereto and owned by Stephen R. Roux shall
      be
      converted into the right to receive, collectively, 200,000 shares of common
      stock, par value $0.0001 per share, of Resolve (“Resolve
      Common Stock”)
      for
      all shares of ELS ESI Common Stock so converted; and (ii) all shares of ELS
      ESI
      Common Stock issued and outstanding immediately prior thereto and owned by
      William J. Walton shall be converted into the right to receive, collectively,
      for all shares of ELS ESI Common Stock so converted (A) a promissory note from
      Resolve in the principal amount of $105,000, and (B) 25,000 shares of Resolve
      Common Stock (collectively, the “ELS
      ESI Merger Consideration”).
      On
      the Closing Date, Resolve will send irrevocable instructions to its transfer
      agent to issue certificates to Stephen R. Roux and William J. Walton
      representing 200,000 and 25,000 shares of Resolve Common Stock, respectively,
      to
      be issued hereunder. For purposes of this Agreement, the shares of Resolve
      Stock
      being issued hereunder are valued at $2.00 per share.

     

    (b)  The
      shares of Resolve Common Stock to be issued as set forth in the above paragraph
      shall not be registered under state or federal securities laws but shall qualify
      as exempt from registration under Regulation D promulgated under the Securities
      Act of 1933 (“Act”)
      or
      other recognized exemptions from registration, and as such, shall be deemed
      to
      be restricted securities as defined in Rule 144(a)(3) of the Act. As such,
      the
      Resolve Common Stock shall include a customary form of restrictive legend which
      indicates that the shares may not be resold, transferred, pledged or
      hypothecated by the holder(s) thereof unless such shares are registered under
      the Act or in accordance with a legal opinion permitting such sale or transfer,
      which legal opinion shall be in form and substance acceptable to counsel for
      Resolve.

     

    (c)  All
      equity of Merger Sub outstanding at the Effective Time shall be cancelled as
      of
      the Effective Time.

     

    Section
      1.12  Surrender
      of Certificates.

     

    From
      and
      after the Effective Time, each holder of certificates representing shares of
      ELS
      ESI Common Stock converted by virtue of the Merger into the right to receive
      merger consideration, upon surrender of such certificates to Resolve (the
“Exchange
      Agent”),
      shall
      be entitled forthwith to receive in exchange therefor, respectively, only the
      ELS ESI Merger Consideration to which such holder is entitled pursuant to the
      terms of this Agreement. Such conversion shall be complete and effective at
      the
      Effective Time without regard to the date or dates upon which outstanding
      certificates of common stock are surrendered for the applicable merger
      consideration.

     

    ARTICLE
      II.  

    REPRESENTATIONS
      AND WARRANTIES OF ELS
      ESI

    Subject
      to the limitations of Section 6.04 hereof, ELS ESI represents and warrants
      to
      Merger Sub as of the Closing Date as set forth in this Article:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Corporate
      Existence and Qualification: Corporate Documents.

     

    (a)  ELS
      ESI
      is duly organized, validly existing and in good standing under the laws of
      its
      state of incorporation and is not required to be qualified to do business as
      a
      foreign corporation in any other jurisdiction where the failure to so qualify
      would have a material adverse effect on it. ELS ESI has all requisite corporate
      power and authority to own its Properties and carry on its business as presently
      conducted. The copies of the Articles of Incorporation and Bylaws of ELS ESI
      attached to the Secretary’s Certificate for ELS ESI delivered pursuant to
      Section 2.04(c) are complete and reflect all amendments thereto through the
      date
      hereof.

     

    (b)  The
      stock
      and minute books of ELS ESI have been made available to Merger Sub for review
      and contain a complete and accurate record of all shareholders of ELS ESI and
      all material actions of the shareholders and directors (and any committees
      thereof) taken at meetings of shareholders or directors of ELS ESI or by written
      consent.

     

    (c)  ELS
      ESI
      has no subsidiaries, participates in any partnership or joint venture, or owns
      any outstanding capital stock of any other entity.

     

    Section
      2.02  Capitalization
      and Ownership

     

    .
      As of
      the date of this Agreement, the entire authorized capital stock of ELS ESI
      is
      set forth on Exhibit
      A
      hereto,
      and all issued and outstanding shares of common stock of ELS ESI are owned
      of
      record and beneficially as set forth on Exhibit
      A
      hereto.
      All of the presently outstanding shares of common stock of ELS ESI have been
      validly authorized and issued and are fully paid and non-assessable. ELS ESI
      has
      not issued any other shares of its capital stock and there are no outstanding
      options, warrants, subscriptions or other rights or obligations to purchase
      or
      acquire any of such shares, nor any outstanding securities convertible into
      or
      exchangeable for such shares. Except as contemplated under this Agreement,
      or as
      set forth in Schedule
      3.02
      with
      respect to the Articles of Incorporation, By-Laws and certain Agreements, there
      are no agreements to which ELS ESI or its shareholders is a party regarding
      the
      issuance, registration, voting or transfer of its outstanding shares of its
      capital stock. No dividends are accrued but unpaid on any capital stock of
      ELS
      ESI.

     

    Section
      2.03  Preemptive
      Rights; Registration Rights

     

    .
      ELS
      ESI’s Articles of Incorporation do not afford pre-emptive rights to any
      shareholder. There have been no shares of ELS ESI issued to which preemptive
      rights accrued or are outstanding. There are no registration rights affecting
      the issuance or sale of capital stock of ELS ESI.

     

    Section
      2.04  No
      Defaults or Consents

     

    .
      Neither
      the execution and delivery of this Agreement nor the carrying out of the
      transactions contemplated hereby will:

     

    (i)  violate
      or conflict with any of the terms, conditions or provisions of the Articles
      of
      Incorporation or Bylaws of ELS ESI;

     

    (ii)  violate
      in any material respect any Legal Requirements applicable to ELS
      ESI;

     

    (iii)  result
      in
      the creation of any lien, charge or other encumbrance on the shares of capital
      stock or any Property of ELS ESI; or

     

    (iv)  require
      ELS ESI to obtain or make any waiver, consent, action, approval or authorization
      of, or registration, declaration, notice or filing with, any private
      non-governmental third party or any Governmental Authority except where the
      failure to so obtain or make would not have a Material Adverse
      Effect.

     

    Section
      2.05  No
      Proceedings

     

    .
      No
      suit, action or other proceeding is pending or, to the Knowledge of ELS ESI,
      threatened before any Governmental Authority seeking to restrain ELS ESI or
      prohibit its entry into this Agreement or prohibit the Closing, or seeking
      damages against ELS ESI or its Properties, as a result of the consummation
      of
      the transactions contemplated by this Agreement.

     

    Section
      2.06  Absence
      of Certain Changes

     

    .
      Since
      August 31, 2006, ELS ESI has not:

     

    (a)  suffered
      any Material Adverse Change;

     

    (b)  contracted
      for the purchase of any capital assets having a cost in excess of $10,000 or
      paid any capital expenditures in excess of $10,000, except in the ordinary
      course of business consistent with past practice;

     

    (c)  incurred
      any indebtedness for borrowed money or issued or sold any debt securities,
      except in the ordinary course of business consistent with past
      practice;

     

    (d)  incurred
      or discharged any material liabilities or obligations except in the ordinary
      course of business consistent with past practice;

     

    (e)  paid
      any
      amount on any indebtedness prior to the due date, forgiven or canceled any
      material debts or claims or released or waived any material rights or claims,
      except in the ordinary course of business consistent with past
      practice;

     

    (f)  mortgaged,
      pledged or subjected to any security interest, lien, lease or other charge
      or
      encumbrance any of its Properties or Company Assets;

     

    (g)  suffered
      any damage or destruction to or loss of any Company Assets (whether or not
      covered by insurance) that has materially adversely affected its
      business;

     

    (h)  acquired
      or disposed of any material Company Assets except in the ordinary course of
      business consistent with past practice;

     

    (i)  made
      any
      payments to any person or entity except in the ordinary course of business
      consistent with past practice or loaned any money to any person or entity that
      is not reflected in the Financial Statements;

     

    (j)  formed
      or
      acquired or disposed of any interest in any corporation, partnership, joint
      venture or other entity;

     

    (k)  redeemed,
      purchased or otherwise acquired, or sold, granted or otherwise disposed of,
      directly or indirectly, any of its capital stock or securities or any rights
      to
      acquire such capital stock or securities, or agreed to change the terms and
      conditions of any such rights or paid any dividends or made any distribution
      to
      the holders of its capital stock;

     

    (l)  entered
      into or terminated any material agreement with any person or group, or modified
      or amended in any material respect the terms of any existing agreement except
      in
      the ordinary course of business consistent with past practice;

     

    (m)  received
      any indication from any customer or supplier that it intends to discontinue
      or
      change the terms of its relationship with ELS ESI;

     

    (n)  materially
      changed its accounting methods; or

     

    (o)  entered
      into any agreement (written or oral) to do any of the foregoing.

     

    Section
      2.07  Insurance

     

    .
      ELS ESI
      has previously made available to Resolve a list of all insurance policies
      (including self insurance arrangements) with respect to the property, assets
      and
      operations of ELS ESI’s business and a summary of the loss experience of ELS
      ESI. All such insurance policies and arrangements are in full force and effect.
      There are no pending claims by ELS ESI relating to its business under such
      insurance policies as to which the insurers listed thereon have denied
      liability.

     

    Section
      2.08  Patents,
      Trademarks, Service Marks and Copyrights.

     

    (a)  ELS
      ESI
      owns all material patents, trademarks, service marks and copyrights
      (collectively “Proprietary
      Rights”),
      if
      any, necessary to conduct its business, or possesses adequate licenses or other
      rights (except for licenses for the use of non-customized software), if any,
      therefor, without conflict with the rights of others. 

     

    (b)  To
      its
      knowledge, ELS ESI has the sole and exclusive right to use the Proprietary
      Rights without infringing or violating the rights of any third parties. To
      its
      knowledge, use of the Proprietary Rights does not require the consent of any
      other person and the Proprietary Rights are freely transferable. No claim has
      been asserted by any person to the ownership of or right to use any material
      Proprietary Right or challenging or questioning the validity or effectiveness
      of
      any license or agreement constituting a part of any material Proprietary Right.
      To its knowledge, each of the Proprietary Rights is valid and subsisting, has
      not been canceled, abandoned or otherwise terminated and, if applicable, has
      been duly issued or filed.

     

    Section
      2.09  Title
      to Assets; Condition of Assets.

     

    (a)  ELS
      ESI
      owns no real property.

     

    (b)  ELS
      ESI
      has good and marketable title to its Company Assets (other than those disposed
      of in the ordinary course of business), free and clear of all security
      interests, liens, charges and other encumbrances, except for liens for taxes
      not
      yet due and payable or being contested in good faith in appropriate proceedings.
      All material facilities, machinery, equipment,

     

    (c)  fixtures,
      vehicles and other properties owned, leased or used by ELS ESI are in good
      operating condition and repair, normal wear and tear excepted, are adequate
      and
      sufficient for the business of ELS ESI and conform in all material respects
      with
      all applicable ordinances, regulations and laws relating to their use and
      operation.

     

    (d)  No
      shareholder of ELS ESI has any interest in any of the Company Assets except
      for
      salary, and no shareholder of ELS ESI has any financial interest in any
      transaction of ELS ESI.

     

    Section
      2.10  Compliance
      with Laws

     

    .
      ELS ESI
      has all material franchises, Permits, licenses and other rights and privileges
      necessary to permit it to own its Properties and to conduct its businesses
      as
      presently conducted. The business and operations of ELS ESI have been and are
      being conducted in all material respects in accordance with all applicable
      laws,
      rules and regulations, and ELS ESI is not in violation of any judgment, law
      or
      regulation except where any such violation would not have a Material Adverse
      Effect. ELS ESI has not received any written notice from any Governmental
      Authority or any other person or entity regarding any actual, alleged or
      potential violation or failure to comply in any material respect with any Legal
      Requirement.

     

    Section
      2.11  Litigation;
      Default

     

    .
      There
      are no claims, actions, suits, investigations or proceedings against ELS ESI
      pending or, to the Knowledge of ELS ESI, threatened in any court or before
      or by
      any Governmental Authority, or before any arbitrator, other than worker’s
      compensation claims that are covered by ELS ESI’s self insurance arrangement.

     

    Section
      2.12  Other
      Transactions

     

    .
      Except
      as contemplated by this Agreement, ELS ESI has not entered into any agreements
      or arrangements and there are no pending offers or discussions concerning or
      providing for the merger or consolidation of ELS ESI, the sale of all or any
      substantial portion of its assets, the sale by ELS ESI of any securities of
      ELS
      ESI or any similar transaction affecting ELS ESI.

     

    ARTICLE
      III.  

    REPRESENTATIONS
      AND WARRANTIES OF MERGER
      SUB AND RESOLVE

    Each
      of
      Merger Sub and Resolve, jointly and severally, represents and warrants to ELS
      ESI as of the Closing Date that:

     

    Section
      3.01  Corporate
      Existence and Qualification; Corporate Documents

     

    . 
      Each of
      Merger Sub and Resolve is duly organized, validly existing and in good standing
      under the laws of its state of jurisdiction, and is not required to be qualified
      to do business as a foreign corporation in any other jurisdiction where the
      failure to so qualify would have a material adverse effect on either of them.
      Each of Merger Sub and Resolve has all required corporate or limited liability
      company power and authority to own its properties and to carry on its business
      as presently conducted.

     

    Section
      3.02  Authority,
      Approval and Enforceability

     

    .
      This
      Agreement and each other agreement to which Merger Sub or Resolve is a party
      have been duly executed and delivered by

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    such
      entity, and each of Merger Sub and Resolve has all requisite corporate or
      limited liability company power and legal authority to execute and deliver
      this
      Agreement and each other agreement to which it is a party, to consummate the
      transactions contemplated hereby and thereby, and to perform its obligations
      hereunder and thereunder. This Agreement and each other agreement to which
      Merger Sub or Resolve is a party will constitute the legal, valid and binding
      obligations of such entity, enforceable in accordance with their respective
      terms, except as such enforceability may be limited by any applicable
      bankruptcy, insolvency, reorganization, moratorium or other similar laws
      affecting the enforcement of creditors' rights generally, and except as the
      availability of equity remedies may be limited by the application of general
      principles of equity (regardless of whether such equitable principles are
      applied in a proceeding at law or in equity).

     

    Section
      3.03  No
      Defaults or Consents

     

    .
      Neither
      the execution and delivery of this Agreement nor the carrying out of the
      transactions contemplated hereby will:

     

    (a)  violate
      or conflict with any of the terms, conditions or provisions of the Articles
      of
      Incorporation or Organization or Code or Regulations or Bylaws of Merger Sub
      or
      Resolve;

     

    (b)  violate
      any Legal Requirements applicable to Merger Sub or Resolve;

     

    (c)  result
      in
      the creation of any lien, charge or other encumbrance on the shares of capital
      stock or any Property of Merger Sub or Resolve; or

     

    (d)  require
      Merger Sub or Resolve to obtain or make any waiver, consent, action, approval
      or
      authorization of, or registration, declaration, notice or filing with, any
      private non-governmental third party or any Governmental Authority

     

    Section
      3.04  No
      Proceedings

     

    .
      No
      suit, action or other proceeding is pending or, to the Knowledge of each of
      Merger Sub and Resolve, threatened before any Governmental Authority seeking
      to
      restrain Merger Sub or Resolve or prohibit either's entry into this Agreement
      or
      prohibit the Closing, or seeking damages against Merger Sub or Resolve or their
      Properties, as a result of the consummation of the transaction contemplated
      by
      this Agreement.

     

    Section
      3.05  Securities

     

    .
      The
      authorized capital stock of Resolve is 50,000,000 shares of common stock, par
      value $0.0001 per share, and 10,000,000 shares of preferred stock, par value
      $0.0001 per share. The shares of Resolve Common Stock to be issued hereunder
      have been duly authorized and, when issued in accordance with the terms of
      this
      Agreement, will be validly issued, fully paid and non-assessable and will be
      issued in compliance with all applicable federal and state securities laws.
      There are no outstanding options, warrants, subscriptions or other rights or
      obligations to purchase or acquire any of shares of Resolve Common Stock, nor
      any outstanding securities convertible into or exchangeable for such shares.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    SURVIVAL

     

    Section
      3.06  Survival
      of Representations and Warranties

     

    .
      Notwithstanding any right of any party hereto fully to investigate the affairs
      of any other party hereto and notwithstanding any knowledge of facts determined
      or determinable by any party hereto pursuant to such investigation or right
      of
      investigation, each of Merger Sub and Resolve, on the one hand, and ELS ESI,
      on
      the other hand, has the right to rely fully upon the representations,
      warranties, covenants and agreements of Merger Sub and Resolve and ELS ESI,
      as
      the case may be, contained in this Agreement, or in any certificate delivered
      pursuant to any of the foregoing; provided, that no party hereto shall be
      entitled to rely on any representation or warranty made by any other party
      hereto herein to the extent that such party has actual knowledge that such
      representation or warranty is untrue or incorrect in any material respect.
      All
      such representations and warranties shall survive the execution and delivery
      of
      this Agreement and the Closing hereunder, and, except as otherwise specifically
      provided in this Agreement, shall thereafter terminate and expire at the end
      of
      the twenty fourth (24th) month following the Closing Date, subject to the
      limitations on indemnification set forth in Section 6.04 hereof. Notwithstanding
      the foregoing, the representations and warranties set forth in Sections 3.01,
      3.02, 3.09(b), 4.01 and 4.02, and all covenants and agreements, shall survive
      indefinitely and shall not terminate or expire. 

     

    ARTICLE
      IV.  

    INDEMNIFICATION

    Section
      4.01  Obligation
      of ELS ESI to Indemnify

     

    .
      Subject
      to the limitations contained in Article V and Section 6.04 hereof, ELS ESI
      agrees to indemnify, defend and hold harmless Merger Sub and Resolve (and their
      Affiliates, successors and assigns and their respective officers and directors)
      from and against all losses, liabilities, damages, deficiencies, costs or
      expenses (including interest, penalties and reasonable attorneys’ fees and
      disbursements, but offset by any proceeds from insurance and taking into account
      the present value of any tax savings to Merger Sub and Resolve resulting from
      such losses, liabilities, damages, deficiencies, costs or expenses)
      (“Losses”)
      based
      upon, arising out of or otherwise in respect of any inaccuracy in or any breach
      of any representation, warranty, covenant or agreement of ELS ESI contained
      in
      this Agreement.

     

    Section
      4.02  Obligation
      of Merger Sub and Resolve to Indemnify

     

    .
      Each of
      Merger Sub and Resolve, jointly and severally, agrees to indemnify, defend
      and
      hold harmless ELS ESI from and against any Losses based upon, arising out of
      or
      otherwise in respect of any inaccuracy in or any breach of any representation,
      warranty, covenant or agreement of Merger Sub or Resolve contained in this
      Agreement.

     

    Section
      4.03  Notice
      and Opportunity to Defend.

     

    (a)  Notice
      of Asserted Liability.
      Promptly after receipt by any party hereto (the “Indemnitee”)
      of
      notice of any demand, claim or circumstances which, with the lapse of time,
      would or might give rise to a claim or the commencement (or threatened
      commencement) of any action, proceeding or investigation (an “Asserted
      Liability”)
      that
      may result in a Loss, the

     

    (b)  Indemnitee
      shall give notice thereof (the “Claims
      Notice”)
      to any
      other party (or parties) obligated to provide indemnification pursuant to
      Section 6.01 or 6.02 (the “Indemnifying Party”). The Claims Notice shall
      describe the Asserted Liability in reasonable detail and shall indicate the
      amount (estimated, if necessary and to the extent feasible) of the Loss that
      has
      been or may be suffered by the Indemnitee.

     

    (c)  Opportunity
      to Defend.
      The
      Indemnifying Party may elect to compromise or defend, at its own expense and
      by
      its own counsel, any Asserted Liability. If the Indemnifying Party elects to
      compromise or defend such Asserted Liability, it shall within thirty (30) days
      (or sooner, if the nature of the Asserted Liability so requires) notify the
      Indemnitee of its intent to do so, and the Indemnitee shall cooperate, at the
      expense of the Indemnifying Party, in the compromise of, or defense against,
      such Asserted Liability at the sole cost of the Indemnifying Party. If the
      Indemnifying Party elects not to compromise or defend the Asserted Liability,
      fails to notify the Indemnitee of its election as herein provided or contests
      its obligation to indemnify under this Agreement, the Indemnitee may pay,
      compromise or defend such Asserted Liability. Notwithstanding the foregoing,
      neither the Indemnifying Party nor the Indemnitee may settle or compromise
      any
      claim over the objection of the other, provided, however, that consent to
      settlement or compromise shall not be unreasonably withheld. In any event,
      the
      Indemnitee and the Indemnifying Party may participate (but not control), at
      their own expense, in the defense of such Asserted Liability. If the
      Indemnifying Party chooses to defend the claim, the Indemnitee shall make
      available to the Indemnifying Party any books, records or other documents within
      its control that are necessary or appropriate for such defense.

     

    Section
      4.04  Limitations
      on Indemnification

     

    .
      The
      indemnification provided for in Sections 6.01 and 6.02 shall be subject to
      the
      following limitations:

     

    (a)  ELS
      ESI
      shall not be obligated to pay any amounts for indemnification under this Article
      VI arising out of any Losses based upon, arising out of or otherwise in respect
      of any inaccuracy or breach disclosed to Merger Sub and Resolve prior to the
      Closing.

     

    (b)  Neither
      ELS ESI nor Merger Sub and Resolve shall be obligated to pay any amounts for
      indemnification for breach of a representation or warranty under this Article
      VI, except those based upon, arising out of or otherwise in respect of Section
      3.01, 3.02, 3.09(b), 4.01, or 4.02 hereof (which shall be indemnifiable from
      the
      first dollar), until the aggregate indemnification payments, exclusive of those
      payable with respect to Sections 3.01, 3.02, 3.09(b), 4.01, or 4.02 equals
      $1,000,000 (the “Deductible”),
      whereupon Merger Sub and Resolve, or ELS ESI, as the case may be, shall be
      obligated to pay any indemnification payments, in excess of the Deductible,
      in
      full. This Section 6.04(b) will not apply to any breach of any representation
      and warranty of which the breaching party had Knowledge at any time prior to
      the
      date on which such representation and warranty is made or any intentional breach
      by any party of any covenant or obligation.

     

    (c)  After
      the
      Closing, the indemnification rights set forth in this Article VI shall be each
      party's sole and exclusive remedy against the other party for any breach of
      any
      representation, warranty or covenant contained in this Agreement.
      Notwithstanding the foregoing, nothing herein shall prevent any party from
      bringing an action based upon allegations of fraud in connection with this
      Agreement.

     

    (d)  

     

    POST-CLOSING
      OBLIGATIONS

     

    Section
      4.05  Further
      Assurances

     

    .
      Following the Closing, each of the parties shall execute and deliver such
      documents, and take such other action, as shall be reasonably requested by
      any
      other party hereto to carry out the transactions contemplated by this
      Agreement.

     

    Section
      4.06  Access
      to Records

     

    .
      From
      and after the Closing, (i) ELS ESI shall (A) deliver to Resolve all books,
      records, files, agreements and other information relating to ELS ESI, and (B)
      use best efforts to permit Resolve and its authorized employees, agents,
      accountants, legal counsel and other representatives to have access to the
      employees, counsel, accountants and other representatives of ELS ESI, in each
      case, to the extent and at all times reasonably requested by Resolve for the
      purpose of investigating or defending any claim made against Resolve in
      connection with periods ending on or before the Closing Date, and (ii) Resolve
      shall (A) permit ELS ESI and its authorized employees, agents, accountants,
      legal counsel and other representatives to have access to the books, records,
      files, agreements and other information of or regarding ELS ESI, and (B) use
      its
      best efforts to permit ELS ESI and its authorized employees, agents,
      accountants, legal counsel and other representatives to have access to the
      employees, counsel, accountants and other representatives of Resolve and its
      Affiliates, in each case, to the extent and at all times reasonably requested
      by
      ELS ESI, for the purpose of (I) investigating or defending any claim made
      against ELS ESI in connection with Article VI, or (II) with respect to any
      pre-Closing Date tax matters affecting ELS ESI.

     

    ARTICLE
      V.  

    MISCELLANEOUS

    Section
      5.01  Brokers

     

    .
      Regardless of whether the Closing shall occur, (i) ELS ESI shall indemnify
      and
      hold harmless Merger Sub and Resolve from and against any and all liability
      for
      any brokers or finders' fees arising with respect to brokers or finders retained
      or engaged by ELS ESI in respect of the transactions contemplated by this
      Agreement, and (ii) Merger Sub and Resolve, jointly and severally, shall
      indemnify and hold harmless ELS ESI from and against any and all liability
      for
      any brokers' or finders' fees arising with respect to brokers or finders
      retained or engaged by Merger Sub and/or Resolve in respect of the transactions
      contemplated by this Agreement.

     

    Section
      5.02  Costs
      and Expenses

     

    .
      Each of
      the parties to this Agreement shall bear its own expenses incurred in connection
      with the negotiation, preparation, execution and closing of this Agreement
      and
      the transactions contemplated hereby.

     

    Section
      5.03  Notices

     

    .
      Any
      notice, request, instruction, correspondence or other document to be given
      hereunder by any party hereto to another (herein collectively called
“Notice”)
      shall
      be in writing and delivered personally or mailed by registered or certified
      mail, postage prepaid and return receipt requested, or by telecopier, as
      follows:

     

    Merger
      Sub or Resolve: Resolve
      Staffing, Inc.

    ELS
      Human
      Resource Solutions, Inc.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3235
      Omni
      Drive

    Cincinnati,
      OH 45245

    Telecopy
      No.: (513) 943-4908

    

    With
      a
      copy to:  Greg
      Bartko, Esq.

    3475
      Lenox Road, Suite 400

    Atlanta,
      Georgia 30326

    Telecopy
      No.: (404) 238-0551

    

    ELS
      ESI:   c/o
      Employee Leasing Services, Inc.

    3235
      Omni
      Drive

    Cincinnati,
      OH 45245

    Attention:
      Ronald E. Heineman

    Telecopy
      No.: (513) 943-4908

    

    With
      a
      copy to:  Tracey
      A.
      Puthoff, Esq.

    Taft,
      Stettinius & Hollister LLP

    425
      Walnut Street, Suite 1800

    Cincinnati,
      OH 45202-3957

    Telecopy
      No.: 513-381-0205

    

    Each
      of
      the above addresses for notice purposes may be changed by providing appropriate
      notice hereunder. Notice given by personal delivery or registered mail shall
      be
      effective upon actual receipt. Notice given by telecopier shall be effective
      upon actual receipt if received during the recipient's normal business hours,
      or
      at the beginning of the recipient's next normal business day after receipt
      if
      not received during the recipient's normal business hours. All Notices by
      telecopier shall be confirmed by the sender thereof promptly after transmission
      in writing by registered mail or personal delivery. Anything to the contrary
      contained herein notwithstanding, Notices to any party hereto shall not be
      deemed effective with respect to such party until such Notice would, but for
      this sentence, be effective both as to such party and as to all other persons
      to
      whom copies are provided above to be given.

     

    Section
      5.04  Governing
      Law

     

    .
      The
      provisions of this Agreement and the documents delivered pursuant hereto shall
      be governed by and construed in accordance with the laws of the State of Ohio
      (excluding any conflict of law rule or principle that would refer to the laws
      of
      another jurisdiction).

     

    Section
      5.05  Entire
      Agreement, Amendments and Waivers

     

    .
      This
      Agreement, together with all exhibits and schedules attached hereto, constitutes
      the entire agreement between the parties hereto pertaining to the subject matter
      hereof and supersedes all prior agreements, understandings, negotiations and
      discussions, whether oral or written, of the parties, and there are no
      warranties, representations or other agreements between the parties in
      connection with the subject matter hereof except as set forth specifically
      herein or contemplated hereby. No supplement, modification or waiver of this
      Agreement shall be binding unless executed in writing by the party to be bound
      thereby. No waiver of any of the provisions of this Agreement shall be deemed
      or
      shall constitute a waiver of any other provision hereof (regardless of
      whether

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    similar),
      nor shall any such waiver constitute a continuing waiver unless otherwise
      expressly provided.

     

    Section
      5.06  Binding
      Effect and Assignment

     

    .
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and their respective heirs, executors, legal representatives, permitted
      successors and assigns; but neither this Agreement nor any of the rights,
      benefits or obligations hereunder shall be assigned, by operation of law or
      otherwise, by any party hereto without the prior written consent of the other
      party. Nothing in this Agreement, express or implied, is intended to confer
      upon
      any person or entity, other than the parties hereto and their respective heirs,
      executors, legal representatives, permitted successors and assigns, any rights,
      benefits or obligations hereunder.

     

    Section
      5.07  Remedies

     

    .
      The
      rights and remedies provided by this Agreement are cumulative, and the use
      of
      any one right or remedy by any party hereto shall not preclude or constitute
      a
      waiver of its right to use any or all other remedies provided by this
      Agreement.

     

    Section
      5.08  Exhibits
      and Schedules

     

    .
      The
      exhibits and schedules referred to herein are attached hereto and incorporated
      herein by this reference.

     

    Section
      5.09  Multiple
      Counterparts

     

    .
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

     

    Section
      5.10  References

     

    .
      Whenever required by the context, and as used in this Agreement, the singular
      number shall include the plural and pronouns and any variations thereof shall
      be
      deemed to refer to the masculine, feminine, neuter, singular or plural, as
      the
      identification of the person may require. References to monetary amounts and
      specific named statutes are intended to be and shall be construed as references
      to United States dollars and statutes of the United States, respectively, unless
      the context otherwise requires.

     

    Section
      5.11  Survival

     

    .
      Any
      provision of this Agreement which contemplates performance or the existence
      of
      obligations after the Closing Date, and any and all representations and
      warranties set forth in this Agreement, shall not be deemed to be merged into
      or
      waived by the execution and delivery of the instruments executed at the Closing,
      but shall expressly survive Closing for the time period set forth in Section
      6.01 hereof and shall be binding upon the party or parties obligated thereby
      in
      accordance with the terms of this Agreement, subject to any limitations
      expressly set forth in this Agreement.

     

    ARTICLE
      VI.  

    DEFINITIONS

    Capitalized
      terms used in this Agreement shall have the respective meanings ascribed to
      such
      terms in this Article IX, unless otherwise defined in this
      Agreement.

     

    Section
      6.01  Affiliate

     

    .
      The
      term “Affiliate”
shall
      mean, with respect to any person, any other person controlling, controlled
      by or
      under common control with such person. The term “control” as used in the
      preceding sentence means, with respect to a corporation, the right
      to

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    exercise,
      directly or indirectly, more than fifty percent (50%) of the voting rights
      attributable to the shares of the controlled corporation and, with respect
      to
      any person other than a corporation, the possession, directly or indirectly,
      of
      the power to direct or cause the direction of the management or policies of
      such
      person.

     

    Section
      6.02  Company
      Assets

     

    .
      The
      term “Company
      Assets”
shall
      mean, with respect to ELS ESI, all of the Properties, Contracts and Permits
      Used
      by ELS ESI as of the Closing Date.

     

    Section
      6.03  Governmental
      Authorities

     

    .
      The
      term “Governmental
      Authorities”
shall
      mean any nation or country (including but not limited to the United States)
      and
      any commonwealth, territory or possession thereof and any political subdivision
      of any of the foregoing, including but not limited to courts, departments,
      commissions, boards, bureaus, agencies, ministries or other
      instrumentalities.

     

    Section
      6.04  Knowledge

     

    .
      The
      term “Knowledge”
shall
      mean the actual knowledge of a party and, in the case of ELS ESI, of any of
      its
      directors or executive officers with respect to the representation being
      made.

     

    Section
      6.05  Legal
      Requirements

     

    .
      The
      term “Legal
      Requirements”,
      when
      described as being applicable to any person, shall mean any and all laws
      (statutory, judicial or otherwise), ordinances, regulations, judgments, orders,
      directives, injunctions, writs, decrees or awards of, and any contracts with,
      any Governmental Authority, in each case as and to the extent applicable to
      such
      person or such person's business, operations or Properties.

     

    Section
      6.06  Material
      Adverse Change

     

    .
      The
      term “Material
      Adverse Change”
shall
      mean a material adverse change in ELS ESI’s condition (financial or otherwise),
      operations, results of operations, business, Properties or
      liabilities.

     

    Section
      6.07  Material
      Adverse Effect

     

    .
      The
      term “Material
      Adverse Effect”
shall
      mean a material adverse effect on ELS ESI’s operations, business, Properties,
      financial condition or results of operations.

     

    Section
      6.08  Permits

     

    .
      The
      term “Permits”
shall
      mean any and all permits or orders under any Legal Requirement or otherwise
      granted by any Governmental Authority.

     

    Section
      6.09  Properties

     

    .
      The
      term “Properties”
shall
      mean any and all properties and assets (real, personal or mixed, tangible or
      intangible).

     

    Section
      6.10  Regulations

     

    .
      The
      term “Regulations”
shall
      mean any and all regulations promulgated by the Department of the Treasury
      pursuant to the Code.

     

    Section
      6.11  Taxes
      or Tax

     

    .
      The
      term “Taxes”
or
      “Tax”
means
      any federal, state, local, or foreign income, gross receipts, license, payroll,
      employment, gift, excise, severance, stamp, occupation, premium, windfall
      profits, environmental (including taxes under Code §59A), customs duties,
      capital stock, franchise, profits, withholding, social security (or similar),
      unemployment, disability, real property, personal property, sales, use,
      transfer, registration, value added, alternative or add-on minimum, estimated,
      or other tax of any kind whatsoever, including any interest, penalty, or
      addition thereto, whether disputed or not.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Tax
      Returns

     

    .
      The
      term “Tax
      Return”
means
      any return, declaration, report, claim for refund, or information return or
      statement relating to Taxes, including any schedule or attachment thereto,
      and
      including any amendment thereof.

     

    Section
      6.12  Used

     

    .
      The
      term “Used”
shall
      mean, with respect to the Properties, Contracts or Permits of ELS ESI, those
      owned, leased, licensed or otherwise held by ELS ESI which were acquired for
      use
      or held for use by ELS ESI in connection with ELS ESI’s business and operations,
      whether or not reflected on the books of account.

     

    

     

    
      
        
        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    EXECUTED
      as of the date first written above.

     

    ELS
      EMPLOYER MERGER SUB LLC

    

    By:
      Resolve Staffing, Inc.,

    Sole
      member

    

    By:
      /s/ Donald Quarterman 

    Donald
      E.
      Quarterman

    Director
      and Authorized

    Representative

     

    

    RESOLVE
      STAFFING, INC.

    

    By:/s/
      Donald E Quarterman_______________

    Donald
      E.
      Quarterman

    Director
      and Authorized

    Representative

    

    

    ELS
      EMPLOYER SERVICES, INC.

    

    By:/s/Stephen
      Roux__________________________

    Stephen
      R. Roux

    President

    

    

    

    
      
        
          Signature
            Page

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    Exhibit
      A

    

    Capitalization

    

    ELS
      Employer Services, Inc.

    

    Authorized
      Capital Stock = 60,000
      shares

    No.
      of
      Shares Owned

    

    William
      J. Walton     280 

    Stephen
      R. Roux     720

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Schedule
      3.02

    

    Agreements

    

    

    
      	1.  	
              Agreement
                dated as of December 31, 2002, by and between ELS Administrative
                Services,
                LLC, Rockmor Group, Inc., Foxstar, Inc., Luxor Solutions, Inc., ELS
                Employer Services, Inc., Streamline Management, Inc., Imperial Human
                Resources, Inc., Rio Services, Inc., Integrated Payroll Solutions,
                Inc.,
                ELS Advantage, Inc., ELS Outsource Services, Inc., and ELS Employer
                Services, Inc.

            

    

     

    
      	2.  	
              Management
                Agreement dated as of December 31, 2002, between ELS Employer Services,
                Inc. and ELS Administrative Services,
                LLC.Exhibit 106

    

     

    

     

    AGREEMENT
      AND PLAN OF MERGER

     

    

     

    By
      and among

     

    

     

    RESOLVE
      STAFFING, INC.

     

    MANDALAY
      MERGER SUB LLC

     

    and

     

    MANDALAY
      SERVICES, INC.

     

    

     

    

    

     

    

     

    As
      of October 1, 2006

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    TABLE
      OF
      CONTENTS

     

    ARTICLE
      I. THE MERGER

    Section
      1.01 Merger
      into Mandalay.

    Section
      1.02 Effective
      Time and Effective Date

    Section
      1.03 Effects
      of the Merger

    Section
      1.04 Articles
      of Incorporation and Code of Regulations

    Section
      1.05 Directors

    Section
      1.06 Officers

    Section
      1.07 Rights
      and Obligations.

    ARTICLE
      II. CLOSING

    Section
      2.01 Closing

    Section
      2.02 Deliveries
      by Merger Sub to Mandalay

    Section
      2.03 Deliveries
      by Mandalay to Merger Sub

    Section
      2.04 Conversion
      of Equity.

    Section
      2.05 Surrender
      of Certificates.

    ARTICLE
      III. REPRESENTATIONS AND WARRANTIES OF MANDALAY

    Corporate
      Existence and Qualification: Corporate Documents.

    Section
      3.02 Capitalization
      and Ownership

    Section
      3.03 Preemptive
      Rights; Registration Rights

    Section
      3.04 No
      Defaults or Consents

    Section
      3.05 No
      Proceedings

    Section
      3.06 Absence
      of Certain Changes

    Section
      3.07 Insurance

    Section
      3.08 Patents,
      Trademarks, Service Marks and Copyrights.

    Section
      3.09 Title
      to Assets; Condition of Assets.

    Section
      3.10 Compliance
      with Laws

    Section
      3.11 Litigation;
      Default

    Section
      3.12 Other
      Transactions

    ARTICLE
      IV. REPRESENTATIONS AND WARRANTIES OF MERGER SUB AND RESOLVE

    Section
      4.01 Corporate
      Existence and Qualification; Corporate Documents

    Section
      4.02 Authority,
      Approval and Enforceability

    Section
      4.03 No
      Defaults or Consents

    Section
      4.04 No
      Proceedings

    Section
      4.05 Securities

    ARTICLE
      V. SURVIVAL

    Section
      5.01 Survival
      of Representations and Warranties

    ARTICLE
      VI. INDEMNIFICATION

    Section
      6.01 Obligation
      of Mandalay to Indemnify

    Section
      6.02 Obligation
      of Merger Sub and Resolve to Indemnify

    Section
      6.03 Notice
      and Opportunity to Defend.

    Section
      6.04 Limitations
      on Indemnification

    ARTICLE
      VII. POST-CLOSING OBLIGATIONS

    Section
      7.01 Further
      Assurances

    Section
      7.02 Access
      to Records

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      VIII. MISCELLANEOUS 

    Section
      8.01 Brokers

    Section
      8.02 Costs
      and Expenses

    Section
      8.03 Notices

    Section
      8.04 Governing
      Law

    Section
      8.05 Entire
      Agreement, Amendments and Waivers

    Section
      8.06 Binding
      Effect and Assignment

    Section
      8.07 Remedies

    Section
      8.08 Exhibits
      and Schedules

    Section
      8.09 Multiple
      Counterparts

    Section
      8.10 References

    Section
      8.11 Survival

    ARTICLE
      IX. DEFINITIONS

    Section
      9.01 Affiliate

    Section
      9.02 Company
      Assets

    Section
      9.03 Governmental
      Authorities

    Section
      9.04 Knowledge

    Section
      9.05 Legal
      Requirements

    Section
      9.06 Material
      Adverse Change

    Section
      9.07 Material
      Adverse Effect

    Section
      9.08 Permits

    Section
      9.09 Properties

    Section
      9.10 Regulations

    Section
      9.11 Taxes
      or Tax

    Section
      9.12 Tax
      Returns

    Section
      9.13 Used

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    

    This
      AGREEMENT AND PLAN OF MERGER (the “Agreement”)
      is
      made and entered into as of October 1, 2006, by and among Resolve Staffing,
      Inc., a Nevada corporation (“Resolve”),
      Mandalay Merger Sub LLC, an Ohio limited liability company (“Merger
      Sub”)
      and
      Mandalay Services, Inc., a Michigan corporation (“Mandalay”).
      

     

    Preliminary
      Statements

     

    A.  The
      issued and outstanding capital stock of Mandalay is set forth on Exhibit
      A
      hereto;
      and

     

    B.  Resolve
      owns 100% of the issued and outstanding stock of Merger Sub; and

     

    C.  It
      is
      proposed that Merger Sub be merged with and into Mandalay, with Mandalay as
      the
      surviving corporation (the “Merger”),
      and
      that the presently issued and outstanding shares of common stock, without par
      value, of Mandalay be converted into merger consideration as set forth herein;
      and

     

    D.  The
      Boards of Directors and shareholders of Mandalay and the sole member of Merger
      Sub have each approved the Merger upon the terms and conditions set forth herein
      and have approved this Agreement; and

     

    E.  Mandalay
      and Merger Sub desire to enter into and carry out the transactions contemplated
      by this Agreement in accordance with the terms hereof, and the provisions of
      the
      Ohio Revised Code and the Michigan Business Corporation Act; and

     

    F.  The
      parties intend that the Merger shall qualify as a reorganization within the
      meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended
      (the "Internal
      Revenue Code").

     

    Capitalized
      terms used herein but not defined herein shall have the respective meanings
      given such terms in Article IX hereof.

     

    Agreement

     

    In
      consideration of the premises, mutual covenants and agreements contained herein
      and the benefits to accrue to the parties hereto, and subject to the
      satisfaction or waiver of the conditions contained herein, the parties hereto
      hereby agree as follows:

     

    ARTICLE
      I.  

    THE
      MERGER

    Section
      1.01  Merger
      into Mandalay.

     

    At
      the
      Effective Time on the Effective Date (each as hereinafter defined), Merger
      Sub
      shall be merged with and into Mandalay, with Mandalay (hereinafter sometimes
      called the “Surviving
      Corporation”)
      as the
      surviving corporation of the Merger. Following the Effective

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Time,
      the
      corporate existence of Mandalay shall continue unaffected and unimpaired, and
      as
      the Surviving Corporation of the Merger, Mandalay shall continue to be a
      corporation governed by the laws of the State of Michigan. On the Closing Date,
      Mandalay and Merger Sub shall cause (a) a Certificate of Merger to be executed
      and filed with the Secretary of State of Ohio in form required by the Ohio
      Revised Code (the “Ohio
      Certificate of Merger”);
      and
      (b) a Certificate of Merger to be executed and filed with the Secretary of
      State
      of Michigan in form required by the Michigan Business Corporation Act (the
      “Michigan
      Certificate of Merger”).

     

    Section
      1.02  Effective
      Time and Effective Date

     

    .
      The
      effective date of the Merger shall be October 1, 2006 (the “Effective
      Date”),
      and
      the effective time of the Merger shall be 12:01 a.m. on October 1, 2006 (the
      “Effective
      Time”).

     

    Section
      1.03  Effects
      of the Merger

     

    . The
      Merger shall have the effects set forth in the Michigan Business Corporation
      Act, as amended.

     

    Section
      1.04  Articles
      of Incorporation and Code of Regulations

     

    . 

     

    (a)  The
      articles of incorporation of Mandalay, as in effect immediately prior to the
      Effective Time, shall be the articles of incorporation of the Surviving
      Corporation until thereafter changed or amended as provided therein or by
      applicable law.

     

    (b)  The
      bylaws of Mandalay as in effect immediately prior to the Effective Time shall
      be
      the code bylaws of the Surviving Corporation, until thereafter changed or
      amended as provided therein or by applicable law.

     

    Section
      1.05  Directors

     

    .
      The
      directors of the Surviving Corporation from and after the Effective Time, and
      until the earlier of their respective death, resignation or removal or until
      their respective successors are duly elected and qualified, as the case may
      be,
      shall be the directors of Mandalay.

     

    Section
      1.06  Officers

     

    .
      The
      officers of the Surviving Corporation from and after the Effective Time, and
      until the earlier of their respective death, resignation or removal or until
      their respective successors are duly elected and qualified, as the case may
      be,
      shall be the officers of Mandalay.

     

    Section
      1.07  Rights
      and Obligations.

     

    At
      the
      Effective Time, the separate existence of Merger Sub shall cease, and in
      accordance with the terms of this Agreement, Mandalay shall possess and be
      vested with all of the rights, privileges, franchises, immunities and powers
      and
      all property (real, personal or mixed) of Merger Sub, debts due to Merger Sub,
      choses in action and all other things belonging to Merger Sub, and Mandalay
      shall be subject to all of the restrictions, liabilities, disabilities and
      duties of Merger Sub.

     

    The
      identity, existence, purposes, powers, objects, franchises, privileges, rights
      and immunities of Mandalay shall continue unaffected and unimpaired by the
      Merger.

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    CLOSING

     

    Section
      1.08  Closing

     

    .
      The
      closing of the transactions contemplated hereby (the “Closing”)
      shall
      be held as of 12:01 a.m., as of October 1, 2006 at the offices of Taft,
      Stettinius & Hollister LLP, 425 Walnut Street, Suite 1800, Cincinnati, Ohio
      45202, unless another date or place is agreed to in writing by the parties
      hereto. The date upon which the Closing occurs is hereinafter referred to as
      the
“Closing
      Date.”

     

    Section
      1.09  Deliveries
      by Merger Sub to Mandalay

     

    .
      At the
      Closing, Merger Sub shall deliver to Mandalay:

     

    (a)  the
      resignations of all officers and managers of Merger Sub;

     

    (b)  the
      stock
      books, stock ledgers or other records reflecting the ownership of all
      outstanding membership units, minute books and corporate seals, if any of Merger
      Sub;

     

    (c)  a
      certificate of the sole member of Merger Sub certifying, as complete and
      accurate as of the Closing, as to attached copies of the Articles of
      Organization of Merger Sub and all necessary action on behalf of Merger Sub
      approving its execution, delivery and performance of this
      Agreement;

     

    (d)  a
      certificate of good standing of Merger Sub issued by the Secretary of State
      of
      Ohio;

     

    (e)  a
      certificate of good standing of Resolve issued by the Secretary of State of
      the
      State of Nevada;

     

    (f)  certificates
      for shares of Resolve Common Stock (defined below) issued in accordance with
      Section 2.04; and

     

    (g)  a
      promissory note, duly executed by Resolve, in accordance with Section 2.04.
      

     

    Section
      1.10  Deliveries
      by Mandalay to Merger
      Sub

     

    .
      At
      the
      Closing, Mandalay shall deliver to Merger Sub:

     

    (a)  a
      certificate of the Secretary of Mandalay certifying, as complete and accurate
      as
      of the Closing, as to attached copies of the Articles of Incorporation and
      Bylaws of Mandalay and all necessary corporate action on behalf of Mandalay
      approving its execution, delivery and
      performance of this Agreement; and

     

    (b)  a
      certificate of good standing of Mandalay issued by the Secretary of State of
      the
      State of Michigan. 

     

    Section
      1.11  Conversion
      of Equity.

     

    (a)  At
      the
      Effective Time on the Effective Date, (i) all shares of common stock, par value
      $10.00 per share, of Mandalay (“Mandalay
      Common Stock”)
      issued
      and outstanding immediately prior thereto and owned by Scott D. Horne shall
      be
      converted into the right to receive, collectively, 200,000 shares of common
      stock, par value $0.0001 per share, of Resolve (“Resolve
      Common Stock”)
      for
      all shares of Mandalay Common Stock so converted; and (ii) all shares of
      Mandalay Common Stock issued and outstanding immediately prior thereto and
      owned
      by Ronald E. Heineman shall be converted into the right to receive,
      collectively, for all shares of Mandalay Common Stock so converted (A) a
      promissory note from Resolve in the principal amount of $91,107, and (B) 32,215
      shares of Resolve Common Stock (collectively, the “Mandalay
      Merger Consideration”).
      On
      the Closing Date, Resolve will send irrevocable instructions to its transfer
      agent to issue certificates to Scott D. Horne and Ronald E. Heineman
      representing 200,000 and 32,215 shares of Resolve Common Stock, respectively,
      to
      be issued hereunder. For purposes of this Agreement, the shares of Resolve Stock
      being issued hereunder are valued at $2.00 per share.

     

    (b)  The
      shares of Resolve Common Stock to be issued as set forth in the above paragraph
      shall not be registered under state or federal securities laws but shall qualify
      as exempt from registration under Regulation D promulgated under the Securities
      Act of 1933 (“Act”)
      or
      other recognized exemptions from registration, and as such, shall be deemed
      to
      be restricted securities as defined in Rule 144(a)(3) of the Act. As such,
      the
      Resolve Common Stock shall include a customary form of restrictive legend which
      indicates that the shares may not be resold, transferred, pledged or
      hypothecated by the holder(s) thereof unless such shares are registered under
      the Act or in accordance with a legal opinion permitting such sale or transfer,
      which legal opinion shall be in form and substance acceptable to counsel for
      Resolve.

     

    (c)  All
      equity of Merger Sub outstanding at the Effective Time shall be cancelled as
      of
      the Effective Time.

     

    Section
      1.12  Surrender
      of Certificates.

     

    From
      and
      after the Effective Time, each holder of certificates representing shares of
      Mandalay Common Stock converted by virtue of the Merger into the right to
      receive merger consideration, upon surrender of such certificates to Resolve
      (the “Exchange
      Agent”),
      shall
      be entitled forthwith to receive in exchange therefor, respectively, only the
      Mandalay Merger Consideration to which such holder is entitled pursuant to
      the
      terms of this Agreement. Such conversion shall be complete and effective at
      the
      Effective Time without regard to the date or dates upon which outstanding
      certificates of common stock are surrendered for the applicable merger
      consideration.

     

    ARTICLE
      II.  

    REPRESENTATIONS
      AND WARRANTIES OF MANDALAY

    Subject
      to the limitations of Section 6.04 hereof, Mandalay represents and warrants
      to
      Merger Sub as of the Closing Date as set forth in this Article:

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Corporate
      Existence and Qualification: Corporate Documents.

     

    (a)  Mandalay
      is duly organized, validly existing and in good standing under the laws of
      its
      state of incorporation and is not required to be qualified to do business as
      a
      foreign corporation in any other jurisdiction where the failure to so qualify
      would have a material adverse effect on it. Mandalay has all requisite corporate
      power and authority to own its Properties and carry on its business as presently
      conducted. The copies of the Articles of Incorporation and Bylaws of Mandalay
      attached to the Secretary’s Certificate for Mandalay delivered pursuant to
      Section 2.04(c) are complete and reflect all amendments thereto through the
      date
      hereof.

     

    (b)  The
      stock
      and minute books of Mandalay have been made available to Merger Sub for review
      and contain a complete and accurate record of all shareholders of Mandalay
      and
      all material actions of the shareholders and directors (and any committees
      thereof) taken at meetings of shareholders or directors of Mandalay or by
      written consent.

     

    (c)  Mandalay
      has no subsidiaries, participates in any partnership or joint venture, or owns
      any outstanding capital stock of any other entity.

     

    Section
      2.02  Capitalization
      and Ownership

     

    .
      As of
      the date of this Agreement, the entire authorized capital stock of Mandalay
      is
      set forth on Exhibit
      A
      hereto,
      and all issued and outstanding shares of common stock of Mandalay are owned
      of
      record and beneficially as set forth on Exhibit
      A
      hereto.
      All of the presently outstanding shares of common stock of Mandalay have been
      validly authorized and issued and are fully paid and non-assessable. Mandalay
      has not issued any other shares of its capital stock and there are no
      outstanding options, warrants, subscriptions or other rights or obligations
      to
      purchase or acquire any of such shares, nor any outstanding securities
      convertible into or exchangeable for such shares. Except as contemplated under
      this Agreement, or as set forth in Schedule
      3.02
      with
      respect to the Articles of Incorporation, By-Laws and certain Agreements, there
      are no agreements to which Mandalay or its shareholders is a party regarding
      the
      issuance, registration, voting or transfer of its outstanding shares of its
      capital stock. No dividends are accrued but unpaid on any capital stock of
      Mandalay.

     

    Section
      2.03  Preemptive
      Rights; Registration Rights

     

    .
      Mandalay’s Articles of Incorporation do not afford pre-emptive rights to any
      shareholder. There have been no shares of Mandalay issued to which preemptive
      rights accrued or are outstanding. There are no registration rights affecting
      the issuance or sale of capital stock of Mandalay.

     

    Section
      2.04  No
      Defaults or Consents

     

    .
      Neither
      the execution and delivery of this Agreement nor the carrying out of the
      transactions contemplated hereby will:

     

    (i)  violate
      or conflict with any of the terms, conditions or provisions of the Articles
      of
      Incorporation or Bylaws of Mandalay;

     

    (ii)  violate
      in any material respect any Legal Requirements applicable to
      Mandalay;

     

    (iii)  result
      in
      the creation of any lien, charge or other encumbrance on the shares of capital
      stock or any Property of Mandalay; or

     

    (iv)  require
      Mandalay to obtain or make any waiver, consent, action, approval or
      authorization of, or registration, declaration, notice or filing with, any
      private non-governmental third party or any Governmental Authority except where
      the failure to so obtain or make would not have a Material Adverse
      Effect.

     

    Section
      2.05  No
      Proceedings

     

    .
      No
      suit, action or other proceeding is pending or, to the Knowledge of Mandalay,
      threatened before any Governmental Authority seeking to restrain Mandalay or
      prohibit its entry into this Agreement or prohibit the Closing, or seeking
      damages against Mandalay or its Properties, as a result of the consummation
      of
      the transactions contemplated by this Agreement.

     

    Section
      2.06  Absence
      of Certain Changes

     

    .
      Since
      August 31, 2006, Mandalay has not:

     

    (a)  suffered
      any Material Adverse Change;

     

    (b)  contracted
      for the purchase of any capital assets having a cost in excess of $10,000 or
      paid any capital expenditures in excess of $10,000, except in the ordinary
      course of business consistent with past practice;

     

    (c)  incurred
      any indebtedness for borrowed money or issued or sold any debt securities,
      except in the ordinary course of business consistent with past
      practice;

     

    (d)  incurred
      or discharged any material liabilities or obligations except in the ordinary
      course of business consistent with past practice;

     

    (e)  paid
      any
      amount on any indebtedness prior to the due date, forgiven or canceled any
      material debts or claims or released or waived any material rights or claims,
      except in the ordinary course of business consistent with past
      practice;

     

    (f)  mortgaged,
      pledged or subjected to any security interest, lien, lease or other charge
      or
      encumbrance any of its Properties or Company Assets;

     

    (g)  suffered
      any damage or destruction to or loss of any Company Assets (whether or not
      covered by insurance) that has materially adversely affected its
      business;

     

    (h)  acquired
      or disposed of any material Company Assets except in the ordinary course of
      business consistent with past practice;

     

    (i)  made
      any
      payments to any person or entity except in the ordinary course of business
      consistent with past practice or loaned any money to any person or entity that
      is not reflected in the Financial Statements;

     

    (j)  formed
      or
      acquired or disposed of any interest in any corporation, partnership, joint
      venture or other entity;

     

    (k)  redeemed,
      purchased or otherwise acquired, or sold, granted or otherwise disposed of,
      directly or indirectly, any of its capital stock or securities or any rights
      to
      acquire such capital stock or securities, or agreed to change the terms and
      conditions of any such rights or paid any dividends or made any distribution
      to
      the holders of its capital stock;

     

    (l)  entered
      into or terminated any material agreement with any person or group, or modified
      or amended in any material respect the terms of any existing agreement except
      in
      the ordinary course of business consistent with past practice;

     

    (m)  received
      any indication from any customer or supplier that it intends to discontinue
      or
      change the terms of its relationship with Mandalay;

     

    (n)  materially
      changed its accounting methods; or

     

    (o)  entered
      into any agreement (written or oral) to do any of the foregoing.

     

    Section
      2.07  Insurance

     

    .
      Mandalay has previously made available to Resolve a list of all insurance
      policies (including self insurance arrangements) with respect to the property,
      assets and operations of Mandalay’s business and a summary of the loss
      experience of Mandalay. All such insurance policies and arrangements are in
      full
      force and effect. There are no pending claims by Mandalay relating to its
      business under such insurance policies as to which the insurers listed thereon
      have denied liability.

     

    Section
      2.08  Patents,
      Trademarks, Service Marks and Copyrights.

     

    (a)  Mandalay
      owns all material patents, trademarks, service marks and copyrights
      (collectively “Proprietary
      Rights”),
      if
      any, necessary to conduct its business, or possesses adequate licenses or other
      rights (except for licenses for the use of non-customized software), if any,
      therefor, without conflict with the rights of others. 

     

    (b)  To
      its
      knowledge, Mandalay has the sole and exclusive right to use the Proprietary
      Rights without infringing or violating the rights of any third parties. To
      its
      knowledge, use of the Proprietary Rights does not require the consent of any
      other person and the Proprietary Rights are freely transferable. No claim has
      been asserted by any person to the ownership of or right to use any material
      Proprietary Right or challenging or questioning the validity or effectiveness
      of
      any license or agreement constituting a part of any material Proprietary Right.
      To its knowledge, each of the Proprietary Rights is valid and subsisting, has
      not been canceled, abandoned or otherwise terminated and, if applicable, has
      been duly issued or filed.

     

    Section
      2.09  Title
      to Assets; Condition of Assets.

     

    (a)  Mandalay
      owns no real property.

     

    (b)  Mandalay
      has good and marketable title to its Company Assets (other than those disposed
      of in the ordinary course of business), free and clear of all security
      interests, liens, charges and other encumbrances, except for liens for taxes
      not
      yet due and payable or being contested in good faith in appropriate proceedings.
      All material facilities, machinery, equipment,

     

    (c)  fixtures,
      vehicles and other properties owned, leased or used by Mandalay are in good
      operating condition and repair, normal wear and tear excepted, are adequate
      and
      sufficient for the business of Mandalay and conform in all material respects
      with all applicable ordinances, regulations and laws relating to their use
      and
      operation.

     

    (d)  No
      shareholder of Mandalay has any interest in any of the Company Assets except
      for
      salary, and no shareholder of Mandalay has any financial interest in any
      transaction of Mandalay.

     

    Section
      2.10  Compliance
      with Laws

     

    .
      Mandalay has all material franchises, Permits, licenses and other rights and
      privileges necessary to permit it to own its Properties and to conduct its
      businesses as presently conducted. The business and operations of Mandalay
      have
      been and are being conducted in all material respects in accordance with all
      applicable laws, rules and regulations, and Mandalay is not in violation of
      any
      judgment, law or regulation except where any such violation would not have
      a
      Material Adverse Effect. Mandalay has not received any written notice from
      any
      Governmental Authority or any other person or entity regarding any actual,
      alleged or potential violation or failure to comply in any material respect
      with
      any Legal Requirement.

     

    Section
      2.11  Litigation;
      Default

     

    .
      There
      are no claims, actions, suits, investigations or proceedings against Mandalay
      pending or, to the Knowledge of Mandalay, threatened in any court or before
      or
      by any Governmental Authority, or before any arbitrator, other than worker’s
      compensation claims that are covered by Mandalay’s self insurance arrangement.

     

    Section
      2.12  Other
      Transactions

     

    .
      Except
      as contemplated by this Agreement, Mandalay has not entered into any agreements
      or arrangements and there are no pending offers or discussions concerning or
      providing for the merger or consolidation of Mandalay, the sale of all or any
      substantial portion of its assets, the sale by Mandalay of any securities of
      Mandalay or any similar transaction affecting Mandalay.

     

    ARTICLE
      III.  

    REPRESENTATIONS
      AND WARRANTIES OF MERGER
      SUB AND RESOLVE

    Each
      of
      Merger Sub and Resolve, jointly and severally, represents and warrants to
      Mandalay as of the Closing Date that:

     

    Section
      3.01  Corporate
      Existence and Qualification; Corporate Documents

     

    . 
      Each of
      Merger Sub and Resolve is duly organized, validly existing and in good standing
      under the laws of its state of jurisdiction, and is not required to be qualified
      to do business as a foreign corporation in any other jurisdiction where the
      failure to so qualify would have a material adverse effect on either of them.
      Each of Merger Sub and Resolve has all required corporate or limited liability
      company power and authority to own its properties and to carry on its business
      as presently conducted.

     

    Section
      3.02  Authority,
      Approval and Enforceability

     

    .
      This
      Agreement and each other agreement to which Merger Sub or Resolve is a party
      have been duly executed and delivered by

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    such
      entity, and each of Merger Sub and Resolve has all requisite corporate or
      limited liability company power and legal authority to execute and deliver
      this
      Agreement and each other agreement to which it is a party, to consummate the
      transactions contemplated hereby and thereby, and to perform its obligations
      hereunder and thereunder. This Agreement and each other agreement to which
      Merger Sub or Resolve is a party will constitute the legal, valid and binding
      obligations of such entity, enforceable in accordance with their respective
      terms, except as such enforceability may be limited by any applicable
      bankruptcy, insolvency, reorganization, moratorium or other similar laws
      affecting the enforcement of creditors' rights generally, and except as the
      availability of equity remedies may be limited by the application of general
      principles of equity (regardless of whether such equitable principles are
      applied in a proceeding at law or in equity).

     

    Section
      3.03  No
      Defaults or Consents

     

    .
      Neither
      the execution and delivery of this Agreement nor the carrying out of the
      transactions contemplated hereby will:

     

    (a)  violate
      or conflict with any of the terms, conditions or provisions of the Articles
      of
      Incorporation or Organization or Code or Regulations or Bylaws of Merger Sub
      or
      Resolve;

     

    (b)  violate
      any Legal Requirements applicable to Merger Sub or Resolve;

     

    (c)  result
      in
      the creation of any lien, charge or other encumbrance on the shares of capital
      stock or any Property of Merger Sub or Resolve; or

     

    (d)  require
      Merger Sub or Resolve to obtain or make any waiver, consent, action, approval
      or
      authorization of, or registration, declaration, notice or filing with, any
      private non-governmental third party or any Governmental Authority

     

    Section
      3.04  No
      Proceedings

     

    .
      No
      suit, action or other proceeding is pending or, to the Knowledge of each of
      Merger Sub and Resolve, threatened before any Governmental Authority seeking
      to
      restrain Merger Sub or Resolve or prohibit either's entry into this Agreement
      or
      prohibit the Closing, or seeking damages against Merger Sub or Resolve or their
      Properties, as a result of the consummation of the transaction contemplated
      by
      this Agreement.

     

    Section
      3.05  Securities

     

    .
      The
      authorized capital stock of Resolve is 50,000,000 shares of common stock, par
      value $0.0001 per share, and 10,000,000 shares of preferred stock, par value
      $0.0001 per share. The shares of Resolve Common Stock to be issued hereunder
      have been duly authorized and, when issued in accordance with the terms of
      this
      Agreement, will be validly issued, fully paid and non-assessable and will be
      issued in compliance with all applicable federal and state securities laws.
      There are no outstanding options, warrants, subscriptions or other rights or
      obligations to purchase or acquire any of shares of Resolve Common Stock, nor
      any outstanding securities convertible into or exchangeable for such shares.
      

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    SURVIVAL

     

    Section
      3.06  Survival
      of Representations and Warranties

     

    .
      Notwithstanding any right of any party hereto fully to investigate the affairs
      of any other party hereto and notwithstanding any knowledge of facts determined
      or determinable by any party hereto pursuant to such investigation or right
      of
      investigation, each of Merger Sub and Resolve, on the one hand, and Mandalay,
      on
      the other hand, has the right to rely fully upon the representations,
      warranties, covenants and agreements of Merger Sub and Resolve and Mandalay,
      as
      the case may be, contained in this Agreement, or in any certificate delivered
      pursuant to any of the foregoing; provided, that no party hereto shall be
      entitled to rely on any representation or warranty made by any other party
      hereto herein to the extent that such party has actual knowledge that such
      representation or warranty is untrue or incorrect in any material respect.
      All
      such representations and warranties shall survive the execution and delivery
      of
      this Agreement and the Closing hereunder, and, except as otherwise specifically
      provided in this Agreement, shall thereafter terminate and expire at the end
      of
      the twenty fourth (24th) month following the Closing Date, subject to the
      limitations on indemnification set forth in Section 6.04 hereof. Notwithstanding
      the foregoing, the representations and warranties set forth in Sections 3.01,
      3.02, 3.09(b), 4.01 and 4.02, and all covenants and agreements, shall survive
      indefinitely and shall not terminate or expire. 

     

    ARTICLE
      IV.  

    INDEMNIFICATION

    Section
      4.01  Obligation
      of Mandalay to Indemnify

     

    .
      Subject
      to the limitations contained in Article V and Section 6.04 hereof, Mandalay
      agrees to indemnify, defend and hold harmless Merger Sub and Resolve (and their
      Affiliates, successors and assigns and their respective officers and directors)
      from and against all losses, liabilities, damages, deficiencies, costs or
      expenses (including interest, penalties and reasonable attorneys’ fees and
      disbursements, but offset by any proceeds from insurance and taking into account
      the present value of any tax savings to Merger Sub and Resolve resulting from
      such losses, liabilities, damages, deficiencies, costs or expenses)
      (“Losses”)
      based
      upon, arising out of or otherwise in respect of any inaccuracy in or any breach
      of any representation, warranty, covenant or agreement of Mandalay contained
      in
      this Agreement.

     

    Section
      4.02  Obligation
      of Merger Sub and Resolve to Indemnify

     

    .
      Each of
      Merger Sub and Resolve, jointly and severally, agrees to indemnify, defend
      and
      hold harmless Mandalay from and against any Losses based upon, arising out
      of or
      otherwise in respect of any inaccuracy in or any breach of any representation,
      warranty, covenant or agreement of Merger Sub or Resolve contained in this
      Agreement.

     

    Section
      4.03  Notice
      and Opportunity to Defend.

     

    (a)  Notice
      of Asserted Liability.
      Promptly after receipt by any party hereto (the “Indemnitee”)
      of
      notice of any demand, claim or circumstances which, with the lapse of time,
      would or might give rise to a claim or the commencement (or threatened
      commencement)

     

    (b)  of
      any
      action, proceeding or investigation (an “Asserted
      Liability”)
      that
      may result in a Loss, the Indemnitee shall give notice thereof (the
“Claims
      Notice”)
      to any
      other party (or parties) obligated to provide indemnification pursuant to
      Section 6.01 or 6.02 (the “Indemnifying Party”). The Claims Notice shall
      describe the Asserted Liability in reasonable detail and shall indicate the
      amount (estimated, if necessary and to the extent feasible) of the Loss that
      has
      been or may be suffered by the Indemnitee.

     

    (c)  Opportunity
      to Defend.
      The
      Indemnifying Party may elect to compromise or defend, at its own expense and
      by
      its own counsel, any Asserted Liability. If the Indemnifying Party elects to
      compromise or defend such Asserted Liability, it shall within thirty (30) days
      (or sooner, if the nature of the Asserted Liability so requires) notify the
      Indemnitee of its intent to do so, and the Indemnitee shall cooperate, at the
      expense of the Indemnifying Party, in the compromise of, or defense against,
      such Asserted Liability at the sole cost of the Indemnifying Party. If the
      Indemnifying Party elects not to compromise or defend the Asserted Liability,
      fails to notify the Indemnitee of its election as herein provided or contests
      its obligation to indemnify under this Agreement, the Indemnitee may pay,
      compromise or defend such Asserted Liability. Notwithstanding the foregoing,
      neither the Indemnifying Party nor the Indemnitee may settle or compromise
      any
      claim over the objection of the other, provided, however, that consent to
      settlement or compromise shall not be unreasonably withheld. In any event,
      the
      Indemnitee and the Indemnifying Party may participate (but not control), at
      their own expense, in the defense of such Asserted Liability. If the
      Indemnifying Party chooses to defend the claim, the Indemnitee shall make
      available to the Indemnifying Party any books, records or other documents within
      its control that are necessary or appropriate for such defense.

     

    Section
      4.04  Limitations
      on Indemnification

     

    .
      The
      indemnification provided for in Sections 6.01 and 6.02 shall be subject to
      the
      following limitations:

     

    (a)  Mandalay
      shall not be obligated to pay any amounts for indemnification under this Article
      VI arising out of any Losses based upon, arising out of or otherwise in respect
      of any inaccuracy or breach disclosed to Merger Sub and Resolve prior to the
      Closing.

     

    (b)  Neither
      Mandalay nor Merger Sub and Resolve shall be obligated to pay any amounts for
      indemnification for breach of a representation or warranty under this Article
      VI, except those based upon, arising out of or otherwise in respect of Section
      3.01, 3.02, 3.09(b), 4.01, or 4.02 hereof (which shall be indemnifiable from
      the
      first dollar), until the aggregate indemnification payments, exclusive of those
      payable with respect to Sections 3.01, 3.02, 3.09(b), 4.01, or 4.02 equals
      $1,000,000 (the “Deductible”),
      whereupon Merger Sub and Resolve, or Mandalay, as the case may be, shall be
      obligated to pay any indemnification payments, in excess of the Deductible,
      in
      full. This Section 6.04(b) will not apply to any breach of any representation
      and warranty of which the breaching party had Knowledge at any time prior to
      the
      date on which such representation and warranty is made or any intentional breach
      by any party of any covenant or obligation.

     

    (c)  After
      the
      Closing, the indemnification rights set forth in this Article VI shall be each
      party's sole and exclusive remedy against the other party for any breach of
      any
      representation, warranty or covenant contained in this Agreement.
      Notwithstanding the

     

    (d)  foregoing,
      nothing herein shall prevent any party from bringing an action based upon
      allegations of fraud in connection with this Agreement.

     

    ARTICLE
      V.  

    POST-CLOSING
      OBLIGATIONS

    Section
      5.01  Further
      Assurances

     

    .
      Following the Closing, each of the parties shall execute and deliver such
      documents, and take such other action, as shall be reasonably requested by
      any
      other party hereto to carry out the transactions contemplated by this
      Agreement.

     

    Section
      5.02  Access
      to Records

     

    .
      From
      and after the Closing, (i) Mandalay shall (A) deliver to Resolve all books,
      records, files, agreements and other information relating to Mandalay, and
      (B)
      use best efforts to permit Resolve and its authorized employees, agents,
      accountants, legal counsel and other representatives to have access to the
      employees, counsel, accountants and other representatives of Mandalay, in each
      case, to the extent and at all times reasonably requested by Resolve for the
      purpose of investigating or defending any claim made against Resolve in
      connection with periods ending on or before the Closing Date, and (ii) Resolve
      shall (A) permit Mandalay and its authorized employees, agents, accountants,
      legal counsel and other representatives to have access to the books, records,
      files, agreements and other information of or regarding Mandalay, and (B) use
      its best efforts to permit Mandalay and its authorized employees, agents,
      accountants, legal counsel and other representatives to have access to the
      employees, counsel, accountants and other representatives of Resolve and its
      Affiliates, in each case, to the extent and at all times reasonably requested
      by
      Mandalay, for the purpose of (I) investigating or defending any claim made
      against Mandalay in connection with Article VI, or (II) with respect to any
      pre-Closing Date tax matters affecting Mandalay.

     

    ARTICLE
      VI.  

    MISCELLANEOUS

    Section
      6.01  Brokers

     

    .
      Regardless of whether the Closing shall occur, (i) Mandalay shall indemnify
      and
      hold harmless Merger Sub and Resolve from and against any and all liability
      for
      any brokers or finders' fees arising with respect to brokers or finders retained
      or engaged by Mandalay in respect of the transactions contemplated by this
      Agreement, and (ii) Merger Sub and Resolve, jointly and severally, shall
      indemnify and hold harmless Mandalay from and against any and all liability
      for
      any brokers' or finders' fees arising with respect to brokers or finders
      retained or engaged by Merger Sub and/or Resolve in respect of the transactions
      contemplated by this Agreement.

     

    Section
      6.02  Costs
      and Expenses

     

    .
      Each of
      the parties to this Agreement shall bear its own expenses incurred in connection
      with the negotiation, preparation, execution and closing of this Agreement
      and
      the transactions contemplated hereby.

     

    Section
      6.03  Notices

     

    .
      Any
      notice, request, instruction, correspondence or other document to be given
      hereunder by any party hereto to another (herein collectively
      called

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Notice”)
      shall
      be in writing and delivered personally or mailed by registered or certified
      mail, postage prepaid and return receipt requested, or by telecopier, as
      follows:

     

    Merger
      Sub or Resolve: Resolve
      Staffing, Inc.

    ELS
      Human
      Resource Solutions, Inc.

    3235
      Omni
      Drive

    Cincinnati,
      OH 45245

    Telecopy
      No.: (513) 943-4908

    

    With
      a
      copy to:  Greg
      Bartko, Esq.

    3475
      Lenox Road, Suite 400

    Atlanta,
      Georgia 30326

    Telecopy
      No.: (404) 238-0551

    

    Mandalay:   c/o
      Employee Leasing Services, Inc.

    3235
      Omni
      Drive

    Cincinnati,
      OH 45245

    Attention:
      Ronald E. Heineman

    Telecopy
      No.: (513) 943-4908

    

    With
      a
      copy to:  Tracey
      A.
      Puthoff, Esq.

    Taft,
      Stettinius & Hollister LLP

    425
      Walnut Street, Suite 1800

    Cincinnati,
      OH 45202-3957

    Telecopy
      No.: 513-381-0205

    

    Each
      of
      the above addresses for notice purposes may be changed by providing appropriate
      notice hereunder. Notice given by personal delivery or registered mail shall
      be
      effective upon actual receipt. Notice given by telecopier shall be effective
      upon actual receipt if received during the recipient's normal business hours,
      or
      at the beginning of the recipient's next normal business day after receipt
      if
      not received during the recipient's normal business hours. All Notices by
      telecopier shall be confirmed by the sender thereof promptly after transmission
      in writing by registered mail or personal delivery. Anything to the contrary
      contained herein notwithstanding, Notices to any party hereto shall not be
      deemed effective with respect to such party until such Notice would, but for
      this sentence, be effective both as to such party and as to all other persons
      to
      whom copies are provided above to be given.

     

    Section
      6.04  Governing
      Law

     

    .
      The
      provisions of this Agreement and the documents delivered pursuant hereto shall
      be governed by and construed in accordance with the laws of the State of Ohio
      (excluding any conflict of law rule or principle that would refer to the laws
      of
      another jurisdiction).

     

    Section
      6.05  Entire
      Agreement, Amendments and Waivers

     

    .
      This
      Agreement, together with all exhibits and schedules attached hereto, constitutes
      the entire agreement between the parties hereto pertaining to the subject matter
      hereof and supersedes all prior agreements, understandings, negotiations and
      discussions, whether oral or written, of the parties, and there are no
      warranties, representations or other agreements between the parties in
      connection with the

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    subject
      matter hereof except as set forth specifically herein or contemplated hereby.
      No
      supplement, modification or waiver of this Agreement shall be binding unless
      executed in writing by the party to be bound thereby. No waiver of any of the
      provisions of this Agreement shall be deemed or shall constitute a waiver of
      any
      other provision hereof (regardless of whether similar), nor shall any such
      waiver constitute a continuing waiver unless otherwise expressly
      provided.

     

    Section
      6.06  Binding
      Effect and Assignment

     

    .
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and their respective heirs, executors, legal representatives, permitted
      successors and assigns; but neither this Agreement nor any of the rights,
      benefits or obligations hereunder shall be assigned, by operation of law or
      otherwise, by any party hereto without the prior written consent of the other
      party. Nothing in this Agreement, express or implied, is intended to confer
      upon
      any person or entity, other than the parties hereto and their respective heirs,
      executors, legal representatives, permitted successors and assigns, any rights,
      benefits or obligations hereunder.

     

    Section
      6.07  Remedies

     

    .
      The
      rights and remedies provided by this Agreement are cumulative, and the use
      of
      any one right or remedy by any party hereto shall not preclude or constitute
      a
      waiver of its right to use any or all other remedies provided by this
      Agreement.

     

    Section
      6.08  Exhibits
      and Schedules

     

    .
      The
      exhibits and schedules referred to herein are attached hereto and incorporated
      herein by this reference.

     

    Section
      6.09  Multiple
      Counterparts

     

    .
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

     

    Section
      6.10  References

     

    .
      Whenever required by the context, and as used in this Agreement, the singular
      number shall include the plural and pronouns and any variations thereof shall
      be
      deemed to refer to the masculine, feminine, neuter, singular or plural, as
      the
      identification of the person may require. References to monetary amounts and
      specific named statutes are intended to be and shall be construed as references
      to United States dollars and statutes of the United States, respectively, unless
      the context otherwise requires.

     

    Section
      6.11  Survival

     

    .
      Any
      provision of this Agreement which contemplates performance or the existence
      of
      obligations after the Closing Date, and any and all representations and
      warranties set forth in this Agreement, shall not be deemed to be merged into
      or
      waived by the execution and delivery of the instruments executed at the Closing,
      but shall expressly survive Closing for the time period set forth in Section
      6.01 hereof and shall be binding upon the party or parties obligated thereby
      in
      accordance with the terms of this Agreement, subject to any limitations
      expressly set forth in this Agreement.

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    DEFINITIONS

     

    Capitalized
      terms used in this Agreement shall have the respective meanings ascribed to
      such
      terms in this Article IX, unless otherwise defined in this
      Agreement.

     

    Section
      6.12  Affiliate

     

    .
      The
      term “Affiliate”
shall
      mean, with respect to any person, any other person controlling, controlled
      by or
      under common control with such person. The term “control” as used in the
      preceding sentence means, with respect to a corporation, the right to exercise,
      directly or indirectly, more than fifty percent (50%) of the voting rights
      attributable to the shares of the controlled corporation and, with respect
      to
      any person other than a corporation, the possession, directly or indirectly,
      of
      the power to direct or cause the direction of the management or policies of
      such
      person.

     

    Section
      6.13  Company
      Assets

     

    .
      The
      term “Company
      Assets”
shall
      mean, with respect to Mandalay, all of the Properties, Contracts and Permits
      Used by Mandalay as of the Closing Date.

     

    Section
      6.14  Governmental
      Authorities

     

    .
      The
      term “Governmental
      Authorities”
shall
      mean any nation or country (including but not limited to the United States)
      and
      any commonwealth, territory or possession thereof and any political subdivision
      of any of the foregoing, including but not limited to courts, departments,
      commissions, boards, bureaus, agencies, ministries or other
      instrumentalities.

     

    Section
      6.15  Knowledge

     

    .
      The
      term “Knowledge”
shall
      mean the actual knowledge of a party and, in the case of Mandalay, of any of
      its
      directors or executive officers with respect to the representation being
      made.

     

    Section
      6.16  Legal
      Requirements

     

    .
      The
      term “Legal
      Requirements”,
      when
      described as being applicable to any person, shall mean any and all laws
      (statutory, judicial or otherwise), ordinances, regulations, judgments, orders,
      directives, injunctions, writs, decrees or awards of, and any contracts with,
      any Governmental Authority, in each case as and to the extent applicable to
      such
      person or such person's business, operations or Properties.

     

    Section
      6.17  Material
      Adverse Change

     

    .
      The
      term “Material
      Adverse Change”
shall
      mean a material adverse change in Mandalay’s condition (financial or otherwise),
      operations, results of operations, business, Properties or
      liabilities.

     

    Section
      6.18  Material
      Adverse Effect

     

    .
      The
      term “Material
      Adverse Effect”
shall
      mean a material adverse effect on Mandalay’s operations, business, Properties,
      financial condition or results of operations.

     

    Section
      6.19  Permits

     

    .
      The
      term “Permits”
shall
      mean any and all permits or orders under any Legal Requirement or otherwise
      granted by any Governmental Authority.

     

    Section
      6.20  Properties

     

    .
      The
      term “Properties”
shall
      mean any and all properties and assets (real, personal or mixed, tangible or
      intangible).

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Regulations

     

    .
      The
      term “Regulations”
shall
      mean any and all regulations promulgated by the Department of the Treasury
      pursuant to the Code.

     

    Section
      6.21  Taxes
      or Tax

     

    .
      The
      term “Taxes”
or
      “Tax”
means
      any federal, state, local, or foreign income, gross receipts, license, payroll,
      employment, gift, excise, severance, stamp, occupation, premium, windfall
      profits, environmental (including taxes under Code §59A), customs duties,
      capital stock, franchise, profits, withholding, social security (or similar),
      unemployment, disability, real property, personal property, sales, use,
      transfer, registration, value added, alternative or add-on minimum, estimated,
      or other tax of any kind whatsoever, including any interest, penalty, or
      addition thereto, whether disputed or not.

     

    Section
      6.22  Tax
      Returns

     

    .
      The
      term “Tax
      Return”
means
      any return, declaration, report, claim for refund, or information return or
      statement relating to Taxes, including any schedule or attachment thereto,
      and
      including any amendment thereof.

     

    Section
      6.23  Used

     

    .
      The
      term “Used”
shall
      mean, with respect to the Properties, Contracts or Permits of Mandalay, those
      owned, leased, licensed or otherwise held by Mandalay which were acquired for
      use or held for use by Mandalay in connection with Mandalay’s business and
      operations, whether or not reflected on the books of account.

     

    

     

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    EXECUTED
      as of the date first written above.

     

    MANDALAY
      MERGER SUB LLC

    

    By:
      Resolve Staffing, Inc.,

    Sole
      Member

    

    By:_/s/
      Donald E. Quarterman__

    Donald
      E.
      Quarterman

    Director
      and Authorized

    Representative

    

    

    RESOLVE
      STAFFING, INC.

    

    By:_/s/
      Donald Quarterman__________

    Donald
      E.
      Quarterman

    Director
      and Authorized

    Representative

    

    

    MANDALAY
      SERVICES, INC.

    

    By:_/s/
      Scott Horne________________

    Scott
      D.
      Horne

    President
      

    

    

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

        

      

    

    Exhibit
      A

    

    Capitalization

    

    Mandalay
      Services, Inc.

    

    Authorized
      Capital Stock = 60,000

    No.
      of
      Shares Owned

    

    Ronald
      E.
      Heineman      28

    Scott
      D.
      Horne     
 72

    

    

    
      
        {W0786503.1}

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Schedule
      3.02

    

    Agreements

    

    

    
      	1.  	
              Agreement
                dated as of December 31, 2002, by and between ELS Administrative
                Services,
                LLC, Rockmor Group, Inc., Foxstar, Inc., Luxor Solutions, Inc., Mandalay
                Services, Inc., Streamline Management, Inc., Imperial Human Resources,
                Inc., Rio Services, Inc., Integrated Payroll Solutions, Inc., ELS
                Advantage, Inc., ELS Outsource Services, Inc., and ELS Employer Services,
                Inc.

            

    

     

    
      	2.  	
              Management
                Agreement dated as of December 31, 2002, between Mandalay Services,
                Inc.
                and ELS Administrative Services,
                LLC.

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