Each of the stock options issued to the executive officers described above vest and become fully exercisable in four equal annual installments beginning on September 1, 2006, the date of grant. Each of the restricted stock units issued to the executive officers described above vest and become issuable in four equal annual installments beginning on August 10, 2006. The earlier vesting date for the restricted stock units was implemented so that yearly vesting will occur during an open trading window in order to allow the recipients to be able to sell a sufficient number of shares as they vest to cover withholding taxes. All of the stock options described above expire on September 1, 2013; however in the event of the employee’s termination of service except for death or disability, all vested and unexercised options expire upon the earlier to occur of 90 days from the date of termination or September 1, 2013. In addition, if any such employee is terminated other than for cause within two years after a change of control of the Company, all unvested options and restricted stock units become immediately vested.

On September 5, 2006, the Company executed a Letter of Agreement with Orrin T. Colby, III and Cygnus Resources Inc. (the “Letter of Agreement”) regarding the Stock Acquisition Agreement executed between the same parties on August 1, 2003 (the “Stock Acquisition Agreement”). Under the terms of the Stock Acquisition Agreement, Mr. Colby purchased all of the stock of Cygnus Resources, Inc., which was a wholly-owned subsidiary of the Company engaged in the business of a Professional Employer Organization. Mr. Colby had been employed by the Company in a management position with respect to the Cygnus business. The purchase price for the stock was to consist of contingent annual payments over a six year period based on Cygnus earnings calculated in accordance with the terms of the Stock Acquisition Agreement, not to exceed a total of $880,000. Because the Company believes that it is not likely that the financial results of Cygnus will result in any significant payments going forward, it has agreed to a payment by Mr. Colby of a lump sum of $12,000 in full satisfaction of the purchase price for the Cygnus Stock and termination of any contingent payment obligations going forward. Certain provisions of the Stock Acquisition Agreement, including indemnification survive the termination of the payment obligation.

The foregoing does not constitute a complete summary of the terms of the Letter of Agreement, and reference is made to the complete text, which is attached hereto as Exhibit 10.1.

On August 31, 2006, Jose Ferreira, Jr., a member of the Company’s Board of Directors, resigned from his position on the Board, effective immediately in order to devote more time to his private business ventures.

(c)     Exhibit.