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<P STYLE="margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Washington, D.C. 20549</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CURRENT REPORT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>November 9, 2012</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Date of Report</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Date of Earliest Event Reported)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FIRST RATE STAFFING CORPORATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact Name of Registrant as Specified in
its Charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <TD STYLE="width: 33%; padding: 0; text-decoration: underline; text-align: center; text-indent: 0"><U>Delaware</U></TD>
    <TD STYLE="width: 33%; padding: 0; text-align: center; text-indent: 0">000-54427</TD>
    <TD STYLE="width: 33%; padding: 0; text-decoration: underline; text-align: center; text-indent: 0"><FONT STYLE="color: black"><U>46-0708635</U></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">(State or other jurisdiction</TD>
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">(Commission File Number)</TD>
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">(IRS Employer</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">of incorporation)</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: center; text-indent: 0">Identification No.)</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">2775 West Thomas Road</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Suite 107</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: black">Phoenix, Arizona
85018</FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Address of Principal Executive Offices)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>(602) 442-5277</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Registrant&rsquo;s Telephone Number)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company is concurrently
filing a registration statement on Form S-1 pursuant to the Securities Act of 1933 for the sale of up to 1,600,000 shares of its
common stock by the holders thereof. Certain items indicated below are incorporated by reference to that registration statement
and additional detailed information is discussed therein.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <TD STYLE="width: 12%; padding: 0; font-size: 10pt; font-weight: bold; text-indent: 0"><B>ITEM 2.01</B></TD>
    <TD STYLE="width: 87%; padding: 0; font-size: 10pt; font-weight: bold; text-align: justify; text-indent: 0"><B>Completion of Acquisition or Disposition of Assets</B></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On November 9, 2012,
First Rate Staffing Corporation, a Delaware corporation (the &ldquo;Company&rdquo;), entered into merger agreements with each of
First Rate Staffing, LLC, a California limited liability company (&ldquo;First Rate California&rdquo;), and First Rate Staffing,
Inc., a Nevada corporation (&ldquo;First Rate Nevada&rdquo;), in separate mergers (collectively, and together, the &ldquo;Mergers&rdquo;)
that were concurrently completed on November 13, 2012. The purpose of the Mergers was to facilitate and prepare the Company for
a registration statement and/or public offering of securities. Prior to the Mergers, First Rate California and First Rate Nevada
were under common control of the same group of shareholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Mergers were effected
by the Company through the exchange of (i) all of the outstanding membership interests of First Rate California for 2,000,000 shares
of common stock of the Company, and (ii) all of the outstanding shares of First Rate Nevada for 2,000,000 shares of common stock
of the Company. Accordingly, a total of 4,000,000 shares were issued in the Mergers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate California
was formed in April 2010 in the State of California. Since its inception, First Rate California has provided recruiting and staffing
services for temporary positions in light industrial, distribution center, assembly, and clerical businesses to clients in California.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate Nevada was
formed in March 2010 in the State of Nevada and is registered to do conduct business in the State of Arizona. Since its inception,
First Rate Nevada has provided recruiting and staffing services for temporary positions in light industrial, distribution center,
assembly, and clerical businesses to clients in Arizona.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As a result of the
Mergers, each of First Rate California and First Rate Nevada has merged into and become a part of the Company. The Company, as
the surviving entity from the Mergers, has taken over the respective operations and business plans of each of both First Rate California
and First Rate Nevada.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Business</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Prior to the Mergers,
the Company had no significant business, operations or plan. Accordingly, the business of the Company below is that of First Rate
California and First Rate Nevada, each which merged into the Company in the Mergers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company provides
recruiting and staffing services for temporary positions in light industrial, distribution center, assembly, and clerical businesses.
The Company&rsquo;s client customization model allows it to integrate its services to its client-specific needs and thereby providing
clients with the highest level of customer service. The Company strives to devote adequate time and attention to understand both
the needs of its clients and the capabilities of its employees so that the Company can identify the best suitable matches between
client needs and employee abilities. The Company is dedicated to achieving a high level of service for all of its clients and considers
itself to be a loyal partner to meeting client demands. In this regard, the Company seeks to position itself not only as a pool
of employee for its clients, but also as a dedicated business partner that understands its clients&rsquo; businesses and needs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Services provided to
clients by the Company include recruiting, payroll, all state and federal taxes, worker&rsquo;s compensation coverage, and screening
and managing of clients&rsquo; contingent work force. The Company provides comprehensive screening and electronic verification
(for federal employment eligibility requirements) for all employees. The Company also conducts reference checks of employees to
ensure that the employers receive accurate and useful descriptions of employees&rsquo; backgrounds and experiences. The Company
also operates a risk management department that helps client mitigate losses by implementing sound and effective risk management
procedures at client sites. Clients receive these risk management services at no cost, helping them to reduce their own business
risks and expenses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Services</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company prides
itself on client customization by developing the service around its clients current operating procedures. The Company creates and
maintains a fluid work environment between the client and the Company. In addition, the company also provides businesses with a
high-caliber of employee available for project or permanent work. The Company listens to individual needs and customizes personnel
solutions for both businesses and workers. The Company has designed an extensive service package with an emphasis on recruiting
and risk management which is incorporated into its client customization model.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company does not
apply one model to all situations, and instead maintains a fluid environment so that the Company can change as needed. Each team
member is highly cross trained in all aspects of staffing. This allows each member to assist clients and employees with any situation.
From operations to risk management to payroll, team members can handle client needs. Every employee is &ldquo;guaranteed&rdquo;
from Company &ndash; meaning that if the employee does not meet the quality and/or performance standards of our client, we will
refund the cost of that individual up to 8 hours.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Customized recruitments
match client specific needs with the pool of available candidates. The Company refreshes this pool weekly, which allows the Company
to provide only the best candidates in time effective manner. In addition, the Company attempts to reduce injuries and create a
safer and more productive worksite, in that the Company will perform site safety evaluations, implement an early intervention program,
perform safety training, OSHA Compliance, case management, claims review, back to work programs, and accident investigation<B>.
</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Among the Company&rsquo;s
human resources services, the Company specifically provides each of the following specific set of services:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-Employees are thoroughly
screened and tested to be sure they understand acceptable workplace practices.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-Employees are E-Verified
to insure only legal workers are employed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-Harassment and safe
practices training is provided to all employees prior to hire.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-Full harassment trainings
as needed by clients are also offered.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-Custom employee handbooks
can be issued for specific locations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-The Company carries
out disciplinary action and employee improvement plans for workplace infractions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Strategic Partners and Suppliers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company believes
that strategic partnerships will be a major component of the Company&rsquo;s operating strategy and path to success. The Company
hopes to work with several strategic partners in important areas of its business and operations. However, currently, the Company
has no such strategic partners.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company does work
with several important suppliers/vendors that are important for its operations and success:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Arizona Bio &amp; Safety
Supply Co., LLC, located in Glendale, Arizona, provides the Company with personal protective equipment used in the Company&rsquo;s
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company uses online
recruiting sources, among other recruiting tools, including common websites, such as Careerbuilder.com.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Insurance is an important
part of the Company&rsquo;s overall operations, and Company maintains insurance for workers&rsquo; compensation matters and general
liability.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company relies
heavily on its software provider to manage payroll, factoring and other related human resources issues. Currently, the Company
relies on Tempworks Software, but in the future, the Company may also consider other suitable software and service options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Risk Management Program</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company designed
and created an industry-leading risk management and safety program. This program starts with the initial risk assessment of client
sites. The Company&rsquo;s risk management team will present a risk analysis to a new or potential client showing exposures and
recommendations for correction. The Company&rsquo;s risk management includes in the risk assessment proper training techniques
for all employees to follow before being placed at the client site. This training incorporates the Company&rsquo;s client required
training as part of its customization model. Risk management also created a step by step &ldquo;in case of injury&rdquo; protocol
to be followed which allows the Company to manage the claim from beginning to end to ensure the best possible chance that the claim
remains first aid (non-recordable). If the claim does become a recordable injury, this program allows the Company to have the best
possible chance to get the employee back to work and avoid litigation. The Early Intervention Nurse Program is one of the Company&rsquo;s
unique services that give the company a competitive edge on the competition. This program allows a medical professional to assist
the employee via phone at the client site immediately when the injury occurs. First Rate Risk Management maintains relationships
with all treating clinics where employees are seen in an attempt to get the clinic doctors to understand our treating philosophy.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Early Intervention
Program: The Company contracts with Risk Solutions to provide a unique on call nurse 24 hours a day. This practice allows the Company
to diagnose injuries at the site to determine the extent of the injury and if the employee needs further medical treatment. If
further medical treatment is needed, the nurse provides the risk management team with valuable information so we can insure that
proper treatment is being administered by our contract clinic. The risk management team provides an extensive safety program to
clients free of charge. From annual risk analysis to accident investigation, the risk management team is here to support clients<B>.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Service Contracts</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company enters
into written service contracts with its customers. Among other things, these contracts provide that the Company will have various
duties, including the following: (i) recruiting, screening, testing, qualifying, reference checking, and hiring employees; (ii)
ensuring that Employment and Eligibility Verification form (I-9) is completed; (iii) maintaining all personnel files and payroll
records for its employees; and (iv) withholding, paying, reporting all taxes, and issuing employee W-2 forms at the end of each
year with respect to each employee provided to the customer as required by law. The Company also maintains workers&rsquo; compensation
coverage for each of its employees. The Company also administers all unemployment claims with respect to each employee provided
to customers. There are also obligations and requirements upon customers to ensure that the working relationship between the Company
and its customers is smooth, efficient and successful.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Strategic Partners and Suppliers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company believes
that strategic partnerships will be a major component of the Company&rsquo;s operating strategy and path to success. The Company
hopes to work with several strategic partners in important areas of its business and operations. However, currently, the Company
has no such strategic partners.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company does work
with several important suppliers/vendors that are important for its operations and success:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Arizona Bio &amp; Safety
Supply Co., LLC, located in Glendale, Arizona, provides the Company with personal protective equipment used in the Company&rsquo;s
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company uses online
recruiting sources, among other recruiting tools, including common websites, such as Careerbuilder.com.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Insurance is an important
part of the Company&rsquo;s overall operations, and Company maintains insurance for workers&rsquo; compensation matters and general
liability.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company relies
heavily on its software provider to manage payroll, factoring and other related human resources issues. Currently, the Company
relies on Tempworks Software, but in the future, the Company may also consider other suitable software and service options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Customers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has a diverse
array of customers across sectors. Key customers include the following (each of which comprises at least 5% or more of the Company&rsquo;s
sales): Essentials Packaging; States Logistics; Direct Chassis; Essentials, Inc.; Phillips Industries; and Premier Packaging. The
Company also has many other customers, and plans to continue to grow its customer base.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Marketing and Sales </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has conducted
limited advertising and marketing to date to reach new clients. To date, advertising and marketing has been centered on reaching
potential employees. In all locations, the Company has used multiple resources to drive in potential new temporary employees. These
tactics range from advertisements in newspapers, job boards, unemployment assist centers, as well as online advertisements. The
Company also utilizes CareerBuilder to recruit for professional placements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has, however,
given substantial attention to constructing the marketing strategy and plans that it will use in order to grow its business and
expand its customers. The Company eventually anticipates a significant budget and need for marketing activities. The primary focus
of marketing campaigns will be designed to help the Company find new customers and to increase awareness of the Company&rsquo;s
services and competitive solutions. A variety of marketing approaches, emphasizing the competitive advantages and key differentiators
of the Company&rsquo;s services, are expected to be used in order to attract new customers and entice existing customers to do
larger volumes of business with the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company expects
that its sales team will work closely with the marketing team to convert prospects into new customers. The sales team will be structured
to align with target markets based on territory and customer patterns.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Operations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company requires
that all potential employment candidates are required to complete an application process which screens for experience and work
history. Upon completion, each candidate is interviewed by the Company&rsquo;s staffing coordinators and is asked a series of questions
based on the company&rsquo;s local clientele's needs. The candidate is then given a sequence of competency testing to complete
within an undisclosed timeframe to test for analytical and instruction following skills. At this point, the staffing coordinators
make a determination to which client(s) the candidate is best suited based upon the most commonly filled positions. In the continued
effort to provide the best candidates to clients, all employees are E-verified for employment eligibility. All employees are also
subjected to additional testing (math and competency). The objective is to ensure that only the most qualified candidates fit current
clients&rsquo; needs so that the Company can provide the highest level of service possible.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Revenues</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has posted
revenues from operations based on its billings to, and services for, customers. Based on a combination of First Rate California
and First Rate Nevada, the Company posted revenues of approximately $2.5 million during the partial-year 2010, approximately $6.1
million in the full-year 2011 and approximately $3.3 million for the first half of 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>THE COMPANY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Employees and Organization</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company presently
has approximately 225 employees, consisting or approximately 175 employees in First Rate California and 50 employees in First Rate
Nevada.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Most employees receive
health benefits. The Company may offer additional fringe and welfare benefits in the future as the Company&rsquo;s profits grow
and/or the Company secures additional outside financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company considers
its employees to be a prime strategic asset of its overall business and operations, and the Company strives to operate its business
in a lean and cost-effective manner. The Company operates its business through the use of staffing coordinators, operation managers,
sales managers, and senior management, all of which are integral to the success of the Company&rsquo;s organization and operations.
The Company&rsquo;s model for its employment organization is based on the ratio of one employee for approximately every $1,000,000
in sales. The Company believes that this model compares favorably to an industry average based on one employee to every approximately
$800,000 in sales.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Property</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company currently
has two physical locations: Santa Fe Springs, California and Phoenix, Arizona.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Santa Fe Springs
location consists of 1,000 square feet and is a monthly lease that is located in an office park on a major thoroughfare for southern
Los Angeles County, California. The monthly lease cost is $1,015, and annually the Company expends $12,700 for such lease. This
location is almost filled at capacity and offers limited street visibility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Phoenix location
consists of 1,600 square feet and is a yearly lease and is located at an intersection of a major thoroughfare for Phoenix, Arizona.
The Phoenix location offers street visibility and room for growth. The monthly lease cost is $1,757, and annually the Company expends
$20,750 for such lease.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company also anticipates
opening an official corporate location in Irvine, California in the near future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Subsidiaries</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has no
subsidiaries.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Summary Financial Information</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As the Company had
no operations or specific business plan until the Mergers, the information presented below is with respect to First Rate California
and First Rate Nevada, respectively, each of which was merged into the Company in November 2012 as a result of the Mergers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The statements of operations
data for the year ended December 31, 2011 and the period from April 2, 2010 (Inception) through December 31, 2010, and the balance
sheet data as of December 31, 2011 and at December 2010, respectively, are derived from the audited financial statements of First
Rate California and related notes thereto included herewith. The statement of operations data for the six months ended June 30,
2012 provided below is derived from the unaudited financial statements of First Rate California and related notes thereto included
herewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">Six months ended</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">Year ended</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">April 2, 2010 (Inception)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">June 30, 2012</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">December 31, 2011</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">through December 31, 2010</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">(unaudited)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Statement of operations data</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 58%; font-size: 10pt; color: black; text-align: justify">Revenue</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">2,489,976</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">4,774,545</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">1,813,577</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Gross profit</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">201,297</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">418,283</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">136,082</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Income (Loss) from operations</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(95,851</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">120,783</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">39,295</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify; padding-bottom: 1pt">Net income (loss)</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">(97,185</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">63,518</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">15,106</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At June 30, 2012</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At December 31, 2011</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At December 31, 2010</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">(unaudited)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Balance sheet data</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 58%; font-size: 10pt; color: black; text-align: justify">Cash</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">33,126</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">11,796</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">2,310</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Other assets</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">221,169</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">112,451</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">67,992</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total assets</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">254,295</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">124,247</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">70,302</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total liabilities</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">258,511</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">21,368</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">27,204</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total members&rsquo; equity (deficit)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(4,216</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">102,879</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">43,098</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The statements of operations
data for the year ended December 31, 2011 and the period from March 24, 2010 (Inception) through December 31, 2010, and the balance
sheet data as of December 31, 2011 and at December 2010, respectively, are derived from the audited financial statements of First
Rate Nevada and related notes thereto included herewith. The statement of operations data for the six months ended June 30, 2012
provided below is derived from the unaudited financial statements of First Rate Nevada and related notes thereto included herewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">Six months ended</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">Year ended</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">March 24, 2010 (Inception)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">June 30, 2012</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">December 31, 2011</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">through December 31, 2010</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">(unaudited)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Statement of operations data</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 58%; font-size: 10pt; color: black; text-align: justify">Revenue</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">825,769</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">1,324,497</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">685,346</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Gross profit</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">95,876</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">146,736</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">69,158</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Income (Loss) from operations</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(16,020</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(25,227</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(8,163</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify; padding-bottom: 1pt">Net income (loss)</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">(16,037</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: black; text-align: right">(15,681</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: black; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At June 30, 2012</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At December 31, 2011</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">At December 31, 2010</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">(unaudited)</TD><TD NOWRAP STYLE="font-size: 10pt; color: black; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Balance sheet data</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 58%; font-size: 10pt; color: black; text-align: justify">Cash</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">17,175</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">116</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; color: black; text-align: right">10,340</TD><TD STYLE="width: 1%; font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Other assets</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">48,018</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">17,089</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">22,271</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total assets</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">65,193</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">17,205</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">32,611</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total liabilities</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">91,606</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">27,581</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">7,622</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: black; text-align: justify">Total shareholders&rsquo; equity (deficit)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(26,413</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">(10,376</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: black; text-align: right">24,989</TD><TD STYLE="font-size: 10pt; color: black; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Management's Discussion and Analysis
of Financial Condition and Results of Operations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">References to the financial
condition and performance of the Company below in this section &ldquo;Management&rsquo;s Discussions and Analysis of Financial
Condition and Results of Operation&rdquo; are to First State California and First State Nevada, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Revenues</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has posted
revenues from operations based on its billings to, and services for, customers. Based on a combination of First Rate California
and First Rate Nevada, the Company posted revenues of approximately $2.5 million during the partial-year 2010, approximately $6.1
million in the full-year 2011 and approximately $3.3 million for the first half of 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Equipment Financing</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has no
existing equipment financing arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Pricing</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pricing for services
is dependent on several variables ranging from credit, risk exposure, payment terms, payment methods, volume, and potential for
growth. Applicable pricing is specified in customer services agreements. The Company typically charges client by marking up the
pay of employees or through other bill rates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Potential Revenue</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company expects
to earn potential revenue from existing client services engagements whereby employees are placed at these clients. The Company
prospects for new clients on an ongoing basis and also seeks additional revenue enhancement opportunities from existing clients.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Alternative Financial Planning</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has no
alternative financial plans at the moment. If the Company is not able to successfully raise monies as needed through a private
placement or other securities offering (including, but not limited to, a primary public offering of securities), the Company&rsquo;s
ability to expand and implement any part of its longer term business plan or strategy will be severely jeopardized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Critical Accounting Policies</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The financial statements
of the Company have been prepared in accordance with accounting principles generally accepted in the United States. The preparation
of these financial statements requires making estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent assets and liabilities. The estimates are based on historical experience
and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis
of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual
results may differ from these estimates under different assumptions or conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Capital Resources </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of June 30, 2012,
First Rate California had cash available of $33,126, and First Rate Nevada had cash available of $17,175.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
proposed expansion plans and business process improvements will necessitate additional capital and financing. Accordingly, the
Company plans to raise between $2 million and $4 million of outside funding in the near future, for the purposes of funding its
own accounts receivable factoring company, establishing and operating its own worker&rsquo;s compensation captive unit, and acquiring
competitors and complementary service providers in its sector.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There can be no assurance
that the Company&rsquo;s activities will generate sufficient revenues to sustain its operations without additional capital, or
if additional capital is needed, that such funds, if available, will be obtainable on terms satisfactory to the Company. Accordingly,
given the Company&rsquo;s limited cash and cash equivalents on hand, the Company will be unable to implement its contemplated business
plans and operations unless it obtains additional financing or otherwise is able to generate sufficient revenues and profits. The
Company may raise additional capital through sales of debt or equity, obtain loan financing or develop and consummate other alternative
financial plans.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Discussion of Six Months ended June
30, 2012 for First Rate California</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate California
generated revenues during the six months ended June 30, 2012 of $2,489,976, as compared to revenues during the six months ended
June 30, 2011 of $2,163,448.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the six months
ended June 30, 2012, First Rate California posted an operating loss of $95,851 and net loss of $97,185, as compared to an operating
profit of $23,019 and net profit of $22,965 for the six months ended June 30, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the six months
ended June 30, 2012, First Rate California used cash of $160,118 in its operations. During such period, First Rate California also
obtained cash from financing activities totaling $181,448. During the six months ended June 30, 2011, First Rate California generated
cash of $34,688 from operations and used cash of $272 in financing activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate California
did not incur any capital expenditures during the six month period ended June 30, 2012 or the six month period ended June 30, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Discussion of Six Months ended June
30, 2012 for First Rate Nevada</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate Nevada generated
revenues during the six months ended June 30, 2012 of $825,769, as compared to revenues during the six months ended June 30, 2011
of $763,982.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the six months
ended June 30, 2012, First Rate Nevada posted an operating loss of $16,020 and net loss of $16,037, as compared to an operating
profit of $4,870 and net profit of $4,781 for the six months ended June 30, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the six months
ended June 30, 2012, First Rate Nevada used cash of $14,227 in its operations. During such period, First Rate Nevada also obtained
cash from financing activities totaling $31,286. During the six months ended June 30, 2011, First Rate Nevada generated cash of
$17,002 from operations and used cash of $448 in financing activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate Nevada did
not incur any capital expenditures during the six month period ended June 30, 2012 or the six month period ended June 30, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Discussion of Year ended December 31,
2011 for First Rate California</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate California
generated revenues during the year ended December 31, 2011 of $4,774,545.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the year ended
December 31, 2011, First Rate California posted operating income of $120,783 and net income of $63,518.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the year ended
December 31, 2011, First Rate California generated cash of $9,153 in its operations. During such period, First Rate California
also obtained cash from financing activities totaling $333.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate California
did not incur any capital expenditures during the year ended December 31, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Discussion of Year ended December 31,
2011 for First Rate Nevada</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate Nevada generated
revenues during the year ended December 31, 2011 of $1,324,497.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the year ended
December 31, 2011, First Rate Nevada posted an operating loss of $25,227 and a net loss of $42,203.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the year ended
December 31, 2011, First Rate Nevada used cash of $16,014 in its operations. During such period, First Rate Nevada also obtained
cash from financing activities totaling $5,790.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">First Rate Nevada did
not incur any capital expenditures during the year ended December 31, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Management</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth information regarding the members of the Company&rsquo;s board of directors and its officers:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 95%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; margin-left: 0.5in">
<TR STYLE="vertical-align: top">
    <TD NOWRAP STYLE="width: 7%; padding: 0; text-align: justify; text-indent: 0">Name</TD>
    <TD NOWRAP STYLE="width: 4%; padding: 0; text-align: justify; text-indent: 0">Age</TD>
    <TD NOWRAP STYLE="width: 16%; padding: 0; text-align: justify; text-indent: 0">Position</TD>
    <TD NOWRAP STYLE="width: 13%; padding: 0; text-align: justify; text-indent: 0">Year Commenced</TD>
    </TR>
<TR STYLE="vertical-align: top">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">&nbsp;</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">&nbsp;</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">&nbsp;</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Cliff Blake</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">58</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Chief Executive Officer and Director</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">2012</TD>
    </TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Devon Galpin</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">34</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">President and Chief Operating Officer, First Rate</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">2010</TD>
    </TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0"><FONT STYLE="color: black">Michael Maut<I>z</I></FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">46</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Vice President of Risk Management, First Rate</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">2010</TD>
    </TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Joy Mautz</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">37</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Vice President of Finance, First Rate</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">2010</TD>
    </TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Julie Galpin</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">35</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">Secretary, First Rate</TD>
    <TD NOWRAP STYLE="padding: 0; text-align: justify; text-indent: 0">2010</TD>
    </TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cliff Blake</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Cliff Blake serves
as Chief Executive Officer, President, Secretary and Treasurer of the Company, and is the sole director of the Company. Mr. Blake
has over 22 years of experience in business and management, including in starting, building and operating numerous businesses,
including over 12 years in owning and operating staffing businesses. Mr. Blake received a Bachelor of Science degree from Louisiana
Tech University in 1974 and a Master of Business Administration degree in Finance from Florida State University in 1975.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Devon Galpin</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Devon Galpin serves
as President and Chief Operating Officer of First Rate California and First Rate Nevada. Mr. Galpin supervises all operations of
these entities, which includes all office locations, recruiting, internal staffing, order fulfillment, payroll, invoicing compliance,
along with client management. Mr. Galpin has worked in similar roles and capacities for over the past 6 years. Mr. Galpin received
a Bachelor of Science degree in Political Science from Chapman College.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Michael Mautz</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Michael Mautz serves
as Vice President of Risk Management for First Rate California and First Rate Nevada. Mr. Mautz supervises all risk management
activities of these entities, including the worker&rsquo;s compensation program of the companies. Mr. Mautz has worked in similar
roles and capacities for over the past 6 years. Mr. Mautz is an OSHA-certified risk manager.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Joy Mautz</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Joy Mautz serves as
Vice President of Finance for First Rate California and First Rate Nevada. Ms. Mautz heads all accounting functions, including
cash flow management, state and federal tax compliance, financial modeling, forecasting and Sarbanes-Oxley compliance. Ms. Mautz
has worked in similar roles and capacities, including as Controller for a large staffing company for over the past 6 years. Ms.
Mautz received a Bachelor of Science degree from the California State University at Fullerton in 2004.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Julie Galpin</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Julie Galpin serves
as Secretary for First Rate California and First Rate Nevada. In this capacity, she also performs accounting and finance duties
for these companies. For the past 6 years, Ms. Galpin has worked in similar accounting roles and capacities. Ms. Galpin received
a Bachelor&rsquo;s degree in Psychology from the University of California, Irvine in 2005.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Director Independence</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to Rule 4200
of The NASDAQ Stock Market one of the definitions of an independent director is a person other than an executive officer or employee
of a company. The Company's board of directors has reviewed the materiality of any relationship that each of the directors has
with the Company, either directly or indirectly. Based on this review, the board has determined that there are no independent directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Committees and Terms</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors
(the &ldquo;Board&rdquo;) has not established any committees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Other than ongoing
and routine employee claims for worker&rsquo;s compensation that arise during the ordinary course of the business of the Company,
there are currently no pending, threatened or actual legal proceedings of a material nature in which the Company is a party.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Employment Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company enters
into and maintains customary employment agreements with each of its officers and employees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Anticipated Officer and Director Remuneration</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company pays reduced
levels of compensation to its officers and director at present. The Company intends to pay regular, competitive annual salaries
to all its officers and will pay an annual stipend to its directors when, and if, it completes a primary public offering for the
sale of securities and/or the Company reaches greater profitability, experiences larger and more sustained positive cash flow and/or
obtains additional funding. At such time, the Company anticipates offering additional cash and non-cash compensation to officers
and directors. In addition, although not presently offered, the Company anticipates that its officers and directors will be provided
with additional fringe benefits and perquisites at subsidizes rates, or at the sole expense of the Company, as may be determined
on a case-by-case basis by the Company in its sole discretion. In addition, the Company may plan to offer 401(k) matching funds
as a retirement benefit at a later time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Security Ownership of Certain Beneficial
Owners and Management</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth information as of the date of this regarding the beneficial ownership of the Company&rsquo;s common stock by each of
the Company&rsquo;s executive officers and directors, individually and as a group and by each person who beneficially owns in excess
of five percent of the common stock after giving effect to any exercise of warrants or options held by that person.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 5.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center">Number of Shares of</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">Name</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify; padding-left: 0.6in">Position</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center">Common Stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: center">Percent of Class (1)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 22%; font-size: 10pt; text-align: justify">Cliff Blake</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 41%; font-size: 10pt; text-align: justify">CEO and Director</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">14</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Devon Galpin</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">President and COO, First Rate</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Michael Mautz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">Vice President, First Rate</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Joy Mautz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">Vice President, First Rate</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Julie Galpin</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">Secretary, First Rate</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Terry Blake</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">5% shareholder</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">33 Tall Oak</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Irvine, CA&nbsp; 92603</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: justify">Total owned by officers and directors (2)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">6,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">86</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">* Less than 1%</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(1) Based upon 7,000,000 shares outstanding
as of the date of this report.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(2) Ms. Blake is the spouse of Mr. Cliff
Blake, the CEO and sole director of the Company. Ms. Blake&rsquo;s shares are accordingly presented above as part of the total
ownership by officers of the Company, due to the relationship of Ms. Blake with Mr. Blake.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Risk Factors</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black"><B>The Company has generated revenues, but limited profits, to date</B>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has generated
limited profits to date. The business model of the Company involves significant costs of services, resulting in a low gross margin
on revenues. Coupling this fact with operating expenses incurred by the Company, the Company has only generated a small amount
of total profits in the past. The Company hopes that as its business expands that the scale of the enterprise would result in a
higher gross margin and net margin.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>No assurance of continued market acceptance.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There is no assurance
that the Company&rsquo;s services or solutions will continued to meet with market acceptance. Moreover, there is no assurance that
these services and solutions will continue to have any competitive advantages. Also, there is no assurance that the market reception
will be positive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company is an early-stage company
with a limited operating history, and as such, any prospective investor may have difficulty in assessing the Company&rsquo;s profitability
or performance.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Because the Company
is an early-stage company with a limited operating history, it could be difficult for any investor to assess the performance of
the Company or to determine whether the Company will meet its projected business plan. The Company has limited financial results
upon which an investor may judge its potential. As a company still in the early stages of its life, the Company may in the future
experience under-capitalization, shortages, setbacks and many of the problems, delays and expenses encountered by any early-stage
business. An investor will be required to make an investment decision based solely on the Company management&rsquo;s history, its
projected operations in light of the risks, the limited operations and financial results of the Company to date, and any expenses
and uncertainties that may be encountered by one engaging in the Company&rsquo;s industry.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company is an early-stage company
and has little experience in being a public company.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company is an early-stage
company and as such has little experience in managing a public company. Such lack of experience may result in the Company experiencing
difficulty in adequately operating and growing its business. Further, the Company may be hampered by lack of experience in addressing
the issues and considerations which are common to growing companies. If the Company&rsquo;s operating or management abilities consistently
perform below expectations, the Company&rsquo;s business is unlikely to thrive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 10 -->
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company&rsquo;s business depends
on the ability to attract and retain qualified temporary employees that possess the skills demanded by clients, and intense competition
may limit the ability to attract and retain such qualified temporary employees.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The success of the
Company depends on the ability to attract and retain qualified temporary employees who possess the skills and experience necessary
to meet the requirements of clients or to successfully bid for new client projects. The ability to attract and retain qualified
temporary employees could be impaired by improvement in economic conditions resulting in lower unemployment, increases in compensation,
or increased competition. During periods of economic growth, the Company faces increasing competition from other staffing companies
for retaining and recruiting qualified temporary employees, which in turn leads to greater advertising and recruiting costs and
increased salary expenses. If the Company cannot attract and retain qualified temporary employees, the quality of its services
may deteriorate and the financial condition, business, and results of operations may be materially adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Any significant or prolonged economic
downturn could result in clients using fewer temporary employees and the other services which the Company offers, terminating their
relationship with the Company, or becoming unable to pay for services on a timely basis, or at all.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Because demand for
temporary staffing services is sensitive to changes in the level of economic activity, the Company&rsquo;s business has in the
past and may in the future suffer during economic downturns. Demand for temporary staffing is highly correlated to changes in the
level of economic activity and employment. Consequently, as economic activity begins to slow down, it has been the Company&rsquo;s
experience that companies tend to reduce their use of temporary employees, resulting in decreased demand for temporary employees
and the other services the Company offers. Significant declines in demand, and thus in revenues, would likely result in lower profit
levels. In addition, the Company may experience pricing pressure during economic downturns which could have a negative impact on
the results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The deterioration of
the financial condition and business prospects of clients could reduce their need for temporary staffing services and result in
a significant decrease in the Company&rsquo;s revenues and earnings derived from these clients. In addition, during economic downturns,
companies may slow the rate at which they pay their vendors, seek more flexible payment terms or become unable to pay their debts
as they become due</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">State unemployment
insurance expense is a direct cost of doing business in the temporary staffing industry. State unemployment tax rates are established
based on a company&rsquo;s specific experience rate of unemployment claims and a state&rsquo;s required funding formula on covered
payroll. Economic downturns have in the past, and may in the future, result in a higher occurrence of unemployment claims resulting
in higher state unemployment tax rates. Due to the recent economic downturn, states have increased, and may continue to increase,
unemployment tax rates to employers, regardless of the employer&rsquo;s specific experience. This would result in higher direct
costs to us. In addition, many state unemployment funds have been depleted during the recent economic downturn and many states
have borrowed from the federal government under the Title XII loan program. Employers in all states receive a credit against their
federal unemployment tax liability if the employer&rsquo;s federal unemployment tax payments are current and the applicable participating
state is also current with its Title XII loan program. If a state fails to repay such loans within a specific time period, employers
in such states may lose a portion of their tax credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company is exposed to employment-related
claims and costs as well as periodic litigation that could materially adversely affect the Company&rsquo;s financial condition,
business, and results of operations.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The temporary staffing
business entails employing individuals and placing such individuals in clients&rsquo; workplaces. The ability to control the workplace
environment of clients is limited. As the employer of record of temporary employees, the Company incurs a risk of liability to
temporary employees and clients for various workplace events, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-claims of misconduct
or negligence on the part of employees;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-discrimination or harassment
claims against employees, or claims by employees of discrimination or harassment by clients or the Company;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">- immigration-related
claims;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-claims relating to
violations of wage, hour, and other workplace regulations;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-claims related to
wrongful termination or denial of employment;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-violation of employment
rights related to employment screening or privacy issues;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-claims relating to employee
benefits, entitlements to employee benefits, or errors in the calculation or administration of such benefits; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-possible claims relating
to misuse of clients&rsquo; confidential information, misappropriation of assets, or other similar claims.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company may incur
fines and other losses and negative publicity with respect to any of these situations. Some of the claims may result in litigation,
which is expensive and distracts attention from the operations of ongoing business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The temporary staffing industry is affected
by seasonal fluctuations which make management of working capital more challenging and could adversely impact the Company&rsquo;s
financial position and the market price of its common stock.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The business of the
Company is seasonal in nature. Client demand for temporary staffing services is highest in the second half of a year, primarily
due to demands of the holiday season. Typically, earnings are lower in the first quarter of each year than in other quarters due
to reduced seasonal demand for temporary staffing services and due to lower gross margins during such period associated with the
front-end loading of certain taxes associated with payroll paid to employees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company assumes the obligation to
make wage, tax, and regulatory payments for our temporary employees, and, as a result, are exposed to client credit risks.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company generally
assumes responsibility for and manage the risks associated with temporary employees&rsquo; payroll obligations, including liability
for payment of salaries, wages, and certain taxes. These obligations are fixed, whether or not clients make payments as required
by services contracts, which exposes the Company to credit risks of clients.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Workers&rsquo; compensation costs for
temporary employees may rise and reduce our margins and require more liquidity.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company is responsible
for and pays workers&rsquo; compensation costs for regular staff and temporary employees. At times, these costs have risen substantially
as a result of increased claims and claim trends, general economic conditions, changes in business mix, increases in healthcare
costs, and government regulations. Although the Company carries insurance, unexpected changes in claim trends, including the severity
and frequency of claims, actuarial estimates, and medical cost inflation could result in costs that are significantly different
than initially reported. If future claims-related liabilities increase due to unforeseen circumstances, or if new laws, rules,
or regulations are passed, costs could increase significantly. There can be no assurance that the Company will be able to increase
the fees charged to clients in a timely manner and in a sufficient amount to cover increased costs as a result of any changes in
claims-related liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The failure or inability to perform
under client contracts could result in damage to the Company&rsquo;s reputation and give rise to legal claims against the Company.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If clients are not
satisfied with the level of performance, the reputation of the Company in the industry may suffer, which could have a material
adverse effect on the business, financial condition, results of operations, and cash flows of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company may not successfully consummate
or initiate acquisitions.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The ability of the
Company to grow through acquisitions (s planned) will depend on a number of factors, including competition for acquisitions, the
availability of capital and other resources to consummate acquisitions, and the ability to successfully integrate and train additional
staff, including the staff of an acquired company. There can be no assurance that the Company will continue to be able to establish
and expand its market presence or to successfully identify suitable acquisition candidates and complete acquisitions on favorable
terms.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition to facing
competition in identifying and consummating successful acquisitions, such acquisitions could involve significant risks, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-difficulties in the assimilation
of the operations, services, and corporate culture of acquired companies, and higher-than-anticipated costs associated with such
assimilation;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-over-valuation of acquired companies
or delays in realizing or a failure to realize the benefits, revenues, cost savings, and synergies that were anticipated;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-difficulties in integrating
the acquired business into information systems, controls, policies, and procedures;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-failure to retain
key personnel, business relationships, reputation, or clients of an acquired business;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-the potential impairment
of acquired assets;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-diversion of management&rsquo;s
attention from other business activities;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-insufficient indemnification
from the selling parties for legal liabilities incurred by the acquired companies prior to acquisition;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">-the assumption of
unknown liabilities and additional risks of the acquired business; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">-unforeseen operating difficulties
that require significant financial and managerial resources that would otherwise be available for the ongoing development or expansion
of existing operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, future
acquisitions could materially and adversely affect the Company&rsquo;s business, financial condition, results of operations, and
liquidity. Possible impairment losses on goodwill and intangible assets, or restructuring charges could occur. These risks could
have a material adverse effect on the business because they may result in substantial costs to the Company and disrupt its business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The temporary staffing industry is highly
competitive with limited barriers to entry, which could limit the Company&rsquo;s ability to maintain or increase our market share
or profitability.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The temporary staffing
industry is highly competitive with limited barriers to entry. The Company competes in national, regional, and local markets. Price
competition in the staffing industry, particularly from our smaller competitors in local and regional markets, is intense, and
pricing pressures from competitors and clients are increasing. Pricing pressure in the past has negatively impacted the Company&rsquo;s
results of operations. There are new competitors entering various markets which may further increase pricing pressures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Clients have continued
to competitively bid new contracts, and this trend is expected to continue for the foreseeable future. The Company also faces significant
competition in attracting and retaining qualified personnel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Client relocation of positions may have
a material adverse effect on the financial condition, business, and results of operations of the Company.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Many companies have
built or moved their operations or outsourced certain functions to other countries that have lower employment costs. If clients
relocate positions we filled, this would have a material adverse effect on the financial condition, business, and results of operations
of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Reliance on third party agreements and
relationships is necessary for development of the Company's business.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company will need
strong third party relationships and partnerships in order to develop and grow its business. The Company will be substantially
dependent on these strategic partners and third party relationships.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;Improper disclosure of employee
and client data could result in liability and harm to the reputation of the Company.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The business of the
Company involves the use, storage, and transmission of information about employees and clients. It is possible that security controls
over personal and other data and practices that the Company follows may not prevent the improper access to, or disclosure of, personally
identifiable or otherwise confidential information. Such disclosure could harm the reputation of the Company and subject the Company
to liability under contracts and the laws that protect personal data and confidential information, resulting in increased costs
or loss of revenue. Further, data privacy is subject to frequently changing rules and regulations, which sometimes conflict among
the various jurisdictions in which the Company provides services. The failure to adhere to or successfully implement processes
in response to changing regulatory requirements in this area could result in legal liability or impairment to the reputation of
the Company in the marketplace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company expects to incur additional
expenses and may ultimately never be profitable.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company is an early-stage
company and has a limited history of its operations. The Company will need to continue generating revenue in order to maintain
sustained profitability. Ultimately, in spite of the Company&rsquo;s best or reasonable efforts, the Company may have difficulty
in generating revenues or remaining profitable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company&rsquo;s officers and directors
beneficially own a majority of the Company&rsquo;s common stock and, as a result, can exercise control over stockholder and corporate
actions.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The officers and directors
of the Company currently beneficially own of approximately 86% of the Company&rsquo;s outstanding common stock. As such, they will
be able to control most matters requiring approval by stockholders, including the election of directors and approval of significant
corporate transactions. This concentration of ownership may also have the effect of delaying or preventing a change in control,
which in turn could have a material adverse effect on the market price of the Company&rsquo;s common stock or prevent stockholders
from realizing a premium over the market price for their Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company depends on its management
team to manage its business effectively.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company's future
success is dependent in large part upon its ability to understand and develop the business plan and to attract and retain highly
skilled management, operational and executive personnel. In particular, due to the relatively early stage of the Company's business,
its future success is highly dependent on its officers, to provide the necessary experience and background to execute the Company's
business plan. The loss of any officer&rsquo;s services could impede, particularly initially as the Company builds a record and
reputation, its ability to develop its objectives, and as such would negatively impact the Company's possible overall development.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Government regulation could negatively
impact the business.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
business segments may be subject to various government regulations in the jurisdictions in which they operate. Due to the potential
wide scope of the Company&rsquo;s operations, the Company could be subject to regulation by various political and regulatory entities,
including various local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to
comply with existing and newly adopted laws and regulations or penalties for any failure to comply. The Company&rsquo;s operations
could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>A substantial portion of the assets
of the Company are pledged as collateral under its factoring agreements.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The&nbsp;Company utilizes
factoring in its business, and in connection therewith it pledges various assets as collateral. The lenders have a right to proceed
against this collateral under certain circumstances. If the creditors were to foreclose on this collateral, such foreclosure could
result in significant damage to the Company&rsquo;s business, operations and relationship with key clients.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company may face significant competition
from companies that serve its industries. </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company may face
competition from other companies that offer similar solutions. Some of these potential competitors may have longer operating histories,
greater brand recognition, larger client bases and significantly greater financial, technical and marketing resources than the
Company possesses. These advantages may enable such competitors to respond more quickly to new or emerging trends and changes in
customer preferences. These advantages may also allow them to engage in more extensive market research and development, undertake
extensive far-reaching marketing campaigns, adopt more aggressive pricing policies and make more attractive offers to potential
customers, employees and strategic partners. The Company believes that its current and anticipated solutions are, and will be,
sufficiently different from existing competition, and that there is limited to no competition in its local area. However, it is
nevertheless possible that potential competitors may have or may rapidly acquire significant market share. Increased competition
may result in price reductions, reduced gross margin and loss of market share. The Company may not be able to compete successfully,
and competitive pressures may adversely affect its business, results of operations and financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>No formal market survey has been conducted</B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">No independent marketing
survey has been performed to determine the potential demand for the Company&rsquo;s services over the longer term. The Company
has conducted no marketing studies regarding whether its business would continue to be marketable. No assurances can be given that
upon marketing, sufficient customer markets and business segments can be developed to sustain the Company's operations on a continued
basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The time devoted by Company management
may not be full-time</B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">It is not anticipated
that key officers would devote themselves full-time to the business of the Company at the present time. Once the Company obtains
additional financing or generates sufficient revenues and profits, officers may then become employed in a full-time capacity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company has authorized the issuance
of preferred stock with certain preferences</B>.&#9;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The board of directors
of the Company is authorized to issue up to 20,000,000 shares of $0.0001 par value preferred stock. The board of directors has
the power to establish the dividend rates, liquidation preferences, and voting rights of any series of preferred stock, and these
rights may be superior to the rights of holders of the Shares. The board of directors may also establish redemption and conversion
terms and privileges with respect to any shares of preferred stock. Any such preferences may operate to the detriment of the rights
of the holders of the Shares, and further, could be used by the board of directors as a device to prevent a change in control of
the Company. No such preferred shares or preferences have been issued to date, but such shares or preferences may be issued at
a later time, subject to the sole discretion of the board of directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company does not maintain certain
insurance, including errors and omissions and indemnification insurance. </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has limited
capital and, therefore, does not currently have a policy of insurance against liabilities arising out of the negligence of its
officers and directors and/or deficiencies in any of its business operations. Even assuming that the Company obtained insurance,
there is no assurance that such insurance coverage would be adequate to satisfy any potential claims made against the Company,
its officers and directors, or its business operations. Any such liability which might arise could be substantial and may exceed
the assets of the Company. The certificate of incorporation and by-laws of the Company provide for indemnification of officers
and directors to the fullest extent permitted under Delaware law. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons, it is the opinion of the Securities and Exchange
Commission that such indemnification is against public policy, as expressed in the Act, and is therefore, unenforceable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Intellectual property and/or trade secret
protection may be inadequate</B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has not
applied for any intellectual property or trade secret protection on any aspects of its business. The Company has no current plans
on attempting to obtain patents, copyright, trademarks and/or service marks on any of its solutions and services. There can be
no assurance that the Company can obtain effective protection against unauthorized duplication or the introduction of substantially
similar solutions and services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Company is subject to the potential
factors of market and customer changes</B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The business of the
Company is susceptible to rapidly changing preferences of the marketplace and its customers. The needs of customers are subject
to constant change. Although the Company intends to continue to develop and improve its services to meet changing customer needs
of the marketplace, there can be no assurance that funds for such expenditures will be available or that the Company's competition
will not develop similar or superior capabilities or that the Company will be successful in its internal efforts. The future success
of the Company will depend in part on its ability to respond effectively to rapidly changing trends, industry standards and customer
requirements by adapting and improving the features and functions of its services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>ITEM 3.02 Unregistered Sales of Equity
Securities</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Recent Sales of Unregistered Securities</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has issued
the following securities in the last three (3) years. All such securities were issued pursuant to an exemption from registration
under Section 4(2) of the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering,
as noted below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(1) On April 20, 2011,
10,000,000 shares of common stock were issued to Tiber Creek Corporation for total consideration paid of $1,000.00. Subsequently,
in May 2012, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 20, 2011,
10,000,000 shares of common stock were issued to MB Americus, LLC for total consideration paid of $1,000.00. Subsequently, in May
2012, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif">(2)
On March 23, 2012, 1,000,000 shares of common stock were issued by the Company to Cliff Blake pursuant to a change of control in
the Company. The aggregate consideration paid for these shares was $100.</FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(3) From July 1, 2012
through October 31, 2012, 500,000 shares of common stock were issued by the Company to the shareholders named below pursuant to
executed subscription agreements under a Regulation D offering or other private placement of securities. Each of these transactions
was issued as part of the private placement of securities by the Company in which no underwriting discounts or commissions applied
to any of the transactions set forth below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 95%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: justify">Shareholder Name</TD><TD NOWRAP STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">Consideration</TD><TD NOWRAP STYLE="font-size: 10pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">Number of Shares</TD><TD NOWRAP STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: justify">Teri and Daryl Baldridge</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 12%; font-size: 10pt; text-align: right">1.39</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; text-align: right">13,888</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Sarah and Nino Barette</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Bob Blake</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Camille Blake</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Katy Blake</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Tim and Tracy Brown</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Toni and Tammy Canzone</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Carla Cole</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Janet Dickenson</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Eric Escalante</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Spiros Galpin</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2.78</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">27,778</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Spiros Galpin II</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Tanya Galpin</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,888</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Brian Gorman</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Randy and Vicki Haringa</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Edward Hartely</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Randy and Dee Haynes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Karl Hempel</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Mackie Hempel</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Heidi Hermreck</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Brad and Linda Ills</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Dick and Karen Ills</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.389</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Debbie Johns</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Mike Johns</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">3.67</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">36,668</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Doris Knox</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Jan Mautz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Kathy McArdle</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">David Mejia</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Marty and Patty Pflum</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Jen and Kevin Puebla</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,888</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Don and Barbara Rodgers</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Troy and Lisa Schweers</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Mike Tafoya</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,888</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Nancy and Dan Tafoya</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Rob Tafoya</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.39</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,889</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Rebecca Zabel</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Steve Zabel</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(4) On November 13,
2012, the Company issued 4,000,000 shares of common stock in connection with the Mergers, as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">Shareholder Name</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; text-align: center">Number of Shares</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 85%; font-size: 10pt; text-align: justify">Devon Galpin</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Julie Galpin</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; text-align: justify">Joy Mautz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Michael Mautz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(5) On November 13,
2012, the Company issued 1,000,000 shares of common stock to Terry Blake that were previously agreed-upon pursuant to the earlier
change of control of the Company that occurred in March 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>ITEM 5.06 Change in Shell Company Status</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has merged
with First Rate California and First Rate Nevada, each which has a defined business plan, and accordingly, the Company has commenced
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>ITEM 9.01 Financial Statements and Exhibits</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The <FONT STYLE="color: black">audited
financial statements of First Rate Staffing, LLC, including balance sheets as of December 31, 2011 and December 31, 2010, and the
related statements of operations, changes in members&rsquo; equity (deficit), and cash flows for the year ended December 31, 2011
and the period from April 2, 2010 (Inception) through December 31, 2010, are included herewith.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The <FONT STYLE="color: black">audited
financial statements of First Rate Staffing, Inc., including balance sheets as of December 31, 2011 and December 31, 2010, and
the related statements of operations, changes in shareholders&rsquo; equity (deficit), and cash flows for the year ended December
31, 2011 and the period from March 24, 2010 (Inception) through December 31, 2010, are included herewith.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Exhibits</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 1%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 6%; padding: 0; text-indent: 0">2.1+</TD>
    <TD STYLE="width: 93%; padding: 0; text-align: justify; text-indent: 0">Agreement and Plan of Reorganization</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">+ Filed concurrently herewith on Form S-1
as the same exhibit number as the exhibit number listed here, and incorporated herein by this reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned
hereunder duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 50%; padding: 0; font-weight: bold; text-indent: 0">FIRST RATE STAFFING CORPORATION</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0">Date: November 13, 2012</TD>
    <TD STYLE="padding: 0; text-decoration: underline; text-indent: 0"><FONT STYLE="color: black"><U>/s/ Cliff Blake&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </U></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0">Chief Executive Officer</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.8pt 0pt 0">&nbsp;</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 3.5in; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FIRST RATE STAFFING, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2012 and 2011</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>INDEX TO FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD STYLE="width: 90%">Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011</TD>
    <TD STYLE="width: 2%; text-align: right">&nbsp;</TD>
    <TD STYLE="width: 8%; text-align: right; vertical-align: bottom">2</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Operations for the Three and Six Months Period Ended June 30, 2012 and 2011 (unaudited)</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">3</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Changes in Shareholders&rsquo; Deficit for the Period from December 31, 2010 to June 30, 2012 (unaudited)</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">4</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Cash Flows for the Six Months Period Ended June 30, 2012 and 2011 (unaudited)</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">5</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Notes to Financial Statements (unaudited)</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">6-12</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">BALANCE SHEETS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">(unaudited)</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: center">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Current Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; padding-left: 9pt">Cash</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">17,175</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">116</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Accounts receivables, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">24,848</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,397</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42,023</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,513</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">23,170</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">9,692</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">65,193</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,205</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: center">LIABILITIES AND SHAREHOLDERS' DEFICIT</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current Liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">542</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">456</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,889</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,662</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Due to affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,580</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,198</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,395</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">265</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">60,406</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,581</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Note payable - related party</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">31,200</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">91,606</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">27,581</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Shareholders' Deficit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 9pt">Common stock; $0.001 par value; 75,000,000 shares authorized,</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Zero shares issued and outstanding</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,508</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,508</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Accumulated deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(73,921</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(57,884</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Shareholders' Deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(26,413</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(10,376</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Liabilities and Shareholders' Deficit</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">65,193</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,205</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 21; Options: NewSection; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 15%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->2<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 85%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">STATEMENTS OF OPERATIONS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For&nbsp;the&nbsp;Six&nbsp;Months&nbsp;Ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For&nbsp;the&nbsp;Six&nbsp;Months&nbsp;Ended</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 60%">Revenues</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 17%; text-align: right">825,769</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 17%; text-align: right">763,892</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cost of revenues</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(729,893</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(680,462</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">95,876</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">83,430</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">111,896</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">78,560</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Income (loss) from operations</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,020</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">4,870</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other expenses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Interest expense, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">89</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">17</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">89</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Income (loss) before income tax</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(16,037</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,781</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Income tax expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net income (loss)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(16,037</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">4,781</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 22; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 15%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->3<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 85%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">STATEMENTS OF CHANGES IN SHAREHOLDERS&rsquo; DEFICIT</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Additional</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Total</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Common Stock</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Paid-In</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Accumulated</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Shareholders'</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Shares</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Capital</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 40%">Balance, December 31, 2010</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">40,670</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(15,681</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">24,989</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from shareholders</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,838</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,838</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Balance, December 31, 2011</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,508</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(57,884</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(10,376</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,037</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,037</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Balance, June 30 2012 (unaudited)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">47,508</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(73,921</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(26,413</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 23; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 15%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->4<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 85%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">STATEMENTS OF CASH FLOWS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For&nbsp;the&nbsp;Six&nbsp;Months&nbsp;Ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For&nbsp;the&nbsp;Six&nbsp;Months&nbsp;Ended</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Operating Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 60%; text-align: left; padding-left: 9pt">Net income (loss)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 17%; text-align: right">(16,037</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 17%; text-align: right">4,781</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(17,451</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,753</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">227</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,677</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Due to affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,382</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,130</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,651</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(13,478</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash provided by (used in) operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(14,227</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">17,002</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Financing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Changes in bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">86</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,504</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Proceeds from note payables</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">31,200</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Proceeds from shareholders</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,952</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">31,286</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">448</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Net change in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,059</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,450</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cash, beginning of period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">116</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,340</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Cash, end of period</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,175</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">27,790</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Supplemental disclosure of cash flow information:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for interest</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">19</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">90</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for taxes</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">190</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

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<!-- Field: Page; Sequence: 24; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 15%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->5<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 85%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
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    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>1. ORGANIZATION </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">First Rate Staffing, Inc. (the &ldquo;Company&rdquo;),
was incorporated on March 24, 2010 in Nevada as a C-Corporation, and is registered to do business in Arizona. The Company provides
recruiting and staffing services for temporary positions for light industrial, distribution centers, assembly, and clerical to
its clients in Arizona, with an option for the clients and candidates to choose the most beneficial working arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>2. BASIS OF PRESENTATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying unaudited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America (&ldquo;US GAAP&rdquo;),
and include all the notes required by generally accepted accounting principles for complete financial statements. The information
furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of
management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures
normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United
States of America have been omitted pursuant to such rules and regulations. The results of the six month periods ended June 30,
2012 are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The summary of significant accounting policies
presented below is designed to assist in understanding the Company&rsquo;s financial statements. Such financial statements and
accompanying notes are the representations of the Company&rsquo;s management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America in all material respects,
and have been consistently applied in preparing the accompanying financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Use of Estimates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cash and Cash Equivalents</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly-liquid&nbsp;investments
with maturities of three months or less when purchased to be cash equivalents.&nbsp;The Company had no cash equivalents <FONT STYLE="font-family: Times New Roman, Times, Serif">as
of June 30, 2012 and December 31, 2011. Under the terms of the Company&rsquo;s bank agreements, outstanding checks in excess of
the cash balances in the Company&rsquo;s primary disbursement accounts create a bank overdraft liability. Bank overdrafts were
$542 and $456 at June 30, 2012 and December 31, 2011.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Accounts Receivable and Factoring
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of June 30, 2012 and December 31, 2011 were zero.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the &quot;Factor&quot;). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of accounts receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $247,417 and $64,614
at June 30, 2012 and December 31, 2011, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Fair Value of Financial Instruments</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm&rsquo;s
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Concentration of Credit Risk</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company&rsquo;s customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Revenue Recognition</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
(&ldquo;ASC&rdquo;) No. 605, &ldquo;Revenue Recognition&rdquo;.&nbsp;&nbsp;In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the six months period ended June 30, 2012 and 2011, the Company generated revenue of $825,769
and $763,892, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cost of Revenue</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company&rsquo;s employees while they work on contract assignment
as temporary staff of the Company&rsquo;s customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Income Taxes</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As a result of the implementation of certain
provisions of ASC 740, <I>Income Taxes</I>, (formerly FIN 48, <I>Accounting for Uncertainty in Income Taxes &ndash; An Interpretation
of FASB Statement No. 109), </I>(&ldquo;ASC 740&rdquo;), which clarifies the accounting and disclosure for uncertainty in tax positions,
as defined. ASC 740 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement
related to accounting for income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In 2010, the Company adopted Accounting
for Uncertain Income Taxes under the provisions of ASC 740. <FONT STYLE="color: black">ASC 740 clarifies the accounting for income
taxes by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial
</FONT>statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting
in interim periods, disclosure and transition. The Company did not recognize any additional liability for unrecognized tax benefits
as a result of the adoption of ASC 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable
to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will
not be realized.<FONT STYLE="font-size: 10pt; color: black"> </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We believe that our income tax filing positions
and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial
position.&nbsp;&nbsp;Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.&nbsp;&nbsp;In
addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.&nbsp;&nbsp;Our policy for recording
interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black">Our tax provision
determined using an estimate of our annual effective tax rate using enacted tax rates expected to apply to taxable income in the
years in which they are earned, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter
we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment</FONT>.
Income taxes payable as of June 30, 2012 and December 31, 2011 was zero.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Recent Accounting Pronouncements </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Adopted</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In May 2011, the Financial Accounting Standards
Board (&quot;FASB&quot;) issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The adoption of this accounting standard did not have a material impact on our financial statements and related
disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Not Adopted</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In December 2011, the FASB issued ASU No.
2011-11: Balance Sheet (topic 210): Disclosures about Offsetting Assets and Liabilities, which requires new disclosure requirements
mandating that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement
of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement.
In addition, the standard requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. This ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented.
We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: justify; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company&rsquo;s
present or future financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>4. GOING CONCERN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has sustained operating losses
of $73,921 since inception. The Company&rsquo;s continuation as a going concern is dependent on management&rsquo;s ability to
develop profitable operations, and / or obtain additional financing from its shareholders and / or other third parties. In order
to address the need to satisfy its continuing obligations and realize its long term strategy, management&rsquo;s plans include
continuing to fund operations with cash received from financing activities. Further, the Company currently plans to start the
process to become a public company in the United States to increase its visibility to potential investors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern; however, the above conditions raise substantial doubt
about the Company&rsquo;s ability to do so. The financial statements do not include any adjustments to reflect the possible future
effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should
the Company be unable to continue as a going concern.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>5. ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s accounts receivable
consists of the following as of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 80%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2012</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Account receivable</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">247,417</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">64,614</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Factor reserve at 10%</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">24,848</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,397</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">272,265</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">72,011</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Less: factored accounts receivable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(247,417</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(64,614</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,848</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,397</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Allowance for doubtful accounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">24,848</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,397</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>6. SHAREHOLDERS&rsquo; EQUITY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the six months period ended June
30, 2012 and 2011, the Company had received capital injections from officers in the amount of $0 and $2,200, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of June 30, 2012 and December 31, 2011,
the Company has 75,000,000 shares of common stock authorized, $0.001 par value per share, and no share issued and outstanding.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>7. RELATED PARTY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, Inc., for working capital needs. As of June 30, 2012 and December 31, 2011, the amount due to the affiliate
company is $53,580 and $23,198, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In the first half of 2012, the Company
obtained unsecured promissory notes from a related party in the amount of $31,200. These notes are due within three year and carry
annual interest rate fixed at 6%. For the six months period ended June 30, 2012 and 2011, interest expense was $19 and $0, respectively.
During the reporting period, there were no financial covenant requirements under the note facilities granted to the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>8. INCOME TAXES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for income taxes in
accordance with the &quot;liability&quot; method. Under this method, deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the
year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined
that it is more likely than not that the asset will be realized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">This guidance also requires that deferred
tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not
be realized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Due to the existence of a full valuation
allowance against deferred tax assets, future changes in our unrecognized tax benefits will not impact the Company&rsquo;s effective
tax rate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As a corporation, the Company is primarily
subject to U.S. federal and state income tax. The Company&rsquo;s policy is to recognize interest and penalties related to income
tax matters in income tax expense. As of June 30, 2012 and December 31, 2011, the Company had no accruals for interest or penalties
related to income tax matters.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The components of the provision for income taxes are summarized
as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 90%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.13in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">For&nbsp;the&nbsp;Six&nbsp;Months&nbsp;Ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Current tax provision</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Deferred tax provision</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top; font-size: 12pt">
    <TD STYLE="font-weight: bold; text-align: center; font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following reconciles income taxes reported in the financial
statements to taxes that would be obtained by applying regular tax rates to income before taxes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 90%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June&nbsp;30,&nbsp;2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Expected tax benefit using regular rates</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">(16,863</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Valuation allowance</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">16,863</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>9. CONTINGENCIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Litigation</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the ordinary course of the Company&rsquo;s
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company&rsquo;s financial position, results of operations or cash flow.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>10. SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management has evaluated subsequent events
through September 30, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has
determined that no subsequent events have occurred which require disclosure through the date that these financial statements were
issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FIRST RATE STAFFING, LLC</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2012 and 2011</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>INDEX TO FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD STYLE="width: 94%">Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011</TD>
    <TD STYLE="width: 6%; text-align: right; vertical-align: bottom">2</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Operations for the Three and Six Months Period Ended June 30, 2012 and 2011 (unaudited)</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">3</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Changes in Members&rsquo; Equity for the Period from December 31, 2010 to June 30, 2012 (unaudited)</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">4</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Cash Flows for the Six Months Period Ended June 30, 2012 and 2011 (unaudited)</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">5</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Notes to Financial Statements (unaudited)</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">6-10</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; border-top: Black 2pt solid; font-size: 12pt; font-weight: bold; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">BALANCE SHEETS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 2pt solid; font-weight: bold; text-align: center">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2012</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">(unaudited)</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: center">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Current Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 74%; padding-left: 9pt">Cash</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">33,126</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">11,796</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts receivables, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56,124</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56,562</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Due from affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,580</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,198</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Prepaid expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">24,942</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">167,772</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">91,556</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">86,523</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">32,691</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">254,295</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">124,247</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: center">LIABILITIES AND MEMBERS' EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current Liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">13,468</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">46,423</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,800</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,262</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">3,100</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,685</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,368</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Note payable - related party</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">204,826</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">258,511</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">21,368</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Members' Equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Members' contributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,345</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,255</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Retained earnings</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(18,561</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">78,624</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Members' Equity</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(4,216</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">102,879</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Liabilities and Members' Equity</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">254,295</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">124,247</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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    <TD STYLE="width: 100%; text-align: center">&nbsp;</TD></TR>
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    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF OPERATIONS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the Six Months Ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the Six Months Ended</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 58%">Revenues</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 18%; text-align: right">2,489,976</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 18%; text-align: right">2,163,448</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cost of revenues</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,288,679</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,887,132</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">201,297</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">276,316</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">297,148</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">253,297</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Income (loss) from operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(95,851</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,019</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Interest expense, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,334</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">54</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Income (loss) before income tax</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(97,185</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,965</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Income tax provision</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net income (loss)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(97,185</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">22,965</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<!-- Field: Page; Sequence: 35; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->3<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF CHANGES IN MEMBERS&rsquo; EQUITY</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">Members'</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">Total Members'</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Interests</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Retained Earnings</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Equity</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 61%">Balance, December 31, 2010</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">27,992</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">15,106</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">43,098</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">Contributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">492,867</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">492,867</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 9pt">Distributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(496,604</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(496,604</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net income</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">63,518</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">63,518</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Balance, December 31, 2011</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,255</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">78,624</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">102,879</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">Contributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">147,590</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">147,590</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 9pt">Distributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(157,500</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(157,500</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(97,185</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(97,185</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Balance, June 30, 2012 (unaudited)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">14,345</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(18,561</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(4,216</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<!-- Field: Page; Sequence: 36; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->4<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF CASH FLOWS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the Six Months Ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the Six Months Ended</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Operating Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 58%; text-align: left; padding-left: 9pt">Net income (loss)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 18%; text-align: right">(97,185</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 18%; text-align: right">15,988</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 0.1in">Adjustments to reconcile net loss to net cash used in operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Provision for doubtful accounts</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,951</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">438</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(22,816</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Due from affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(30,382</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Prepaid expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24,942</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,524</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,623</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,820</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,162</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">37,135</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(53,832</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(34,274</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash (used in) provided by operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(160,118</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">34,688</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Financing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Changes in bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(13,468</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,072</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Proceeds from note payable - related party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">204,826</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Contributions from members</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">147,590</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">66,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Distributions to members</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(157,500</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(62,700</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash provided by (used in) financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">181,448</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(272</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Net change in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,330</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">34,416</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cash, beginning of period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">11,796</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,310</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Cash, end of period</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">33,126</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">36,726</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Supplemental disclosure of cash flow information:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for interest</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,337</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">54</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for taxes</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>1. ORGANIZATION </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">First Rate Staffing, LLC (the &ldquo;Company&rdquo;),
was formed on April 2, 2010 as a limited liability company in California. The Company provides recruiting and staffing services
for temporary positions for light industrial, distribution centers, assembly, and clerical to its clients in California, with an
option for the clients and candidates to choose the most beneficial working arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>2. BASIS OF PRESENTATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying unaudited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America (&ldquo;US GAAP&rdquo;),
and include all the notes required by generally accepted accounting principles for complete financial statements. The information
furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of
management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures
normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United
States of America have been omitted pursuant to such rules and regulations. The results of the six month periods ended June 30,
2012 are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The summary of significant accounting policies
presented below is designed to assist in understanding the Company&rsquo;s financial statements. Such financial statements and
accompanying notes are the representations of the Company&rsquo;s management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America in all material respects,
and have been consistently applied in preparing the accompanying financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Use of Estimates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cash and Cash Equivalents</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly-liquid&nbsp;investments
with maturities of three months or less when purchased to be cash equivalents.&nbsp;The Company had no cash equivalents <FONT STYLE="font: 10pt Times New Roman, Times, Serif">as
of June 30, 2012 and December 31, 2010. Under the terms of the Company&rsquo;s bank agreements, outstanding checks in excess of
the cash balances in the Company&rsquo;s primary disbursement accounts create a bank overdraft liability. Bank overdrafts were
$0 and $13,468 at June 30, 2012 and December 31, 2011, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Accounts Receivable and Factoring
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of June 30, 2012 and December 31, 2011 are $29,824.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the &quot;Factor&quot;). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of accounts receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $<FONT STYLE="color: black">482,734</FONT>
and $506,718 at June 30, 2012 and December 31, 2011, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Fair Value of Financial Instruments</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm&rsquo;s
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Concentration of Credit Risk</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company&rsquo;s customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Revenue Recognition</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
(&ldquo;ASC&rdquo;) No. 605, &ldquo;Revenue Recognition&rdquo;.&nbsp;&nbsp;In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the six months period ended June 30, 2012 and 2011, the Company has generated revenue of
$2,489,976 and $2,163,448, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cost of Revenue</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company&rsquo;s employees while they work on contract assignment
as temporary staff of the Company&rsquo;s customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Members&rsquo; Equity, Personal Assets and Income Taxes
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Net income, loss, capital gains and cash
distributions pertaining to the Company are allocated to its members in accordance with the provisions of the Company&rsquo;s operating
agreements. The operating agreements provide that all items of net income, loss, capital gain and cash distributions be allocated
among the members based upon their respective percentage interest. There is only one class of members&rsquo; interest, whose rights
are governed and set forth in the operating agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In accordance with the generally accepted
method of presenting limited liability company financial statements, the financial statements do not include the personal assets
and liabilities of the members, including their obligation for income taxes on their distributive shares of net income of the LLCs,
or any provision for federal income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company is taxed as a limited liability
company (&ldquo;LLC&rdquo;) under the provisions of federal and state tax codes. Under federal laws, taxes based on income of a
limited liability company are payable by the LLC members individually. Accordingly, no provision for federal income taxes has been
made in the accompanying consolidated financial statements. A provision for California franchise tax has been recorded in costs
and expenses in the accompanying financial statements at a statutory amount based on gross receipts under California laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Recent Accounting Pronouncements </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Adopted</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In May 2011, the Financial Accounting Standards
Board (&quot;FASB&quot;) issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The adoption of this accounting standard did not have a material impact on our financial statements and related
disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Not Adopted</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In December 2011, the FASB issued ASU No.
2011-11: Balance Sheet (topic 210): Disclosures about Offsetting Assets and Liabilities, which requires new disclosure requirements
mandating that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement
of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement.
In addition, the standard requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. This ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented.
We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company&rsquo;s
present or future financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(unaudited)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>4. ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s accounts receivable
consists of the following as of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 85%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, 2012</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 62%; text-align: left">Account receivable</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 16%; text-align: right">488,327</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 16%; text-align: right">506,718</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Factor reserve at 10%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49,013</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">60,457</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">Chargebacks</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">31,342</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">25,929</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">568,682</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">593,104</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Less: factored accounts receivable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(482,734</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(506,718</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">85,948</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">86,386</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Allowance for doubtful accounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(29,824</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(29,824</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">56,124</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">56,562</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>5. RELATED PARTY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, LLC for working capital needs. As of June 30, 2012 and December 31, 2011, the amount due from the affiliate
company is $53,580 and $23,198, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In the first half of 2012, the Company
obtained unsecured promissory notes from a related party in the amount of $204,826. These notes are due within three year and carry
annual interest rate fixed at 6%. For the six months period ended June 30, 2012 and 2011, interest expense was $1,337 and $0, respectively.
During the reporting period, there were no financial covenant requirements under the note facilities granted to the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>6. CONTINGENCIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Litigation</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the ordinary course of the Company&rsquo;s
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company&rsquo;s financial position, results of operations or cash flow.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>7. SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management has evaluated subsequent events
through September 30, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has
determined that no subsequent events have occurred which require disclosure through the date that these financial statements were
issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<!-- Field: Page; Sequence: 42; Value: 2 -->
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FIRST RATE STAFFING, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>FINANCIAL
STATEMENTS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>December
31, 2011 and 2010</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<!-- Field: Page; Sequence: 43 -->
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>INDEX TO FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top; width: 90%">Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="vertical-align: bottom; width: 10%; text-align: right">1</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Balance Sheets as of December 31, 2011 and 2010</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">2</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Statements of Operations for the Year Ended December 31, 2011 and for the Period from March 24, 2010 (Inception) to December 31, 2010</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">3</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Statements of Changes in Stockholders&rsquo; Equity (Deficit) for the Period from March 24, 2010 (Inception) to December 31, 2011</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">4</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Statements of Cash Flows for the Year Ended December 31, 2011 and for the Period from March 24, 2010 (Inception) to December 31, 2010</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">5</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Notes to Financial Statements</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">6-12</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><IMG SRC="tlogo.jpg"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Board of Directors and Shareholders of</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">First Rate Staffing, Inc.:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have audited the accompanying balance
sheets of First Rate Staffing, Inc. (the &ldquo;Company&rdquo;) as of December 31, 2011 and 2010, and the related statements of
operations, changes in shareholders&rsquo; equity (deficit), and cash flows for the year ended December 31, 2011 and the period
from March 24, 2010 (Inception) through December 31, 2010. These financial statements are the responsibility of the Company&rsquo;s
management. Our responsibility is to express an opinion on these financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company&rsquo;s
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In our opinion, the financial statements
referred to the above present fairly, in all material respects, the financial position of First Rate Staffing, Inc. as of December
31, 2011 and 2010, and the results of its operations and cash flows for the year ended December 31, 2011 and the period from March
24, 2010 (Inception) through December 31, 2010 in conformity with accounting principles generally accepted in the United States
of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company has
incurred an accumulated deficit of $57,884 from inception to December 31, 2011. This raises substantial doubt about the Company&rsquo;s
ability to continue as a going concern. Management&rsquo;s plans in regard to this matter are described in Note 4. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>/s/ Anton &amp; Chia, LLP</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Newport Beach, California</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">June 25, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">BALANCE SHEETS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: center">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Current Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 74%; padding-left: 9pt">Cash</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">116</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">10,340</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Accounts receivables, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,397</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">12,579</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,513</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,919</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">9,692</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">9,692</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,205</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">32,611</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: center">LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current Liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">456</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,504</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,662</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,662</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Due to affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,198</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">265</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,456</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">27,581</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,622</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">27,581</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,622</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Shareholders' Equity (Deficit)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">Common stock; $0.001 par value; 75,000,000 shares authorized, 0 shares issued and outstanding as of December 31, 2011 and 2010</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,508</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,670</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Accumulated deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(57,884</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(15,681</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total Shareholders' Equity (Deficit)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(10,376</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">24,989</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Liabilities and Shareholders' Equity (Deficit)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,205</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">32,611</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

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    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page
                                                                                                                                                                                            <!-- Field: Sequence; Type: Arabic; Value: 2; Name: PageNo -->2<!--
                                                                                                                                                                                            Field:
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">STATEMENTS OF OPERATIONS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">From&nbsp;March&nbsp;24,&nbsp;2010</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For&nbsp;the&nbsp;year&nbsp;ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">(Inception)&nbsp;to</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2010</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 74%">Revenues</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">1,324,497</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">685,346</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cost of revenues</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,177,761</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(616,188</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">146,736</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">69,158</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">171,963</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">77,321</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Loss from operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(25,227</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,163</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other income (expenses):</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Interest expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(17,131</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,518</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other income</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">200</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,931</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,518</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Loss before income tax</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(42,158</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(15,681</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Income tax expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">45</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net loss</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(15,681</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page
                                                                                                                                                                                            <!--
                                                                                                                                                                                            Field:
                                                                                                                                                                                            Sequence;
                                                                                                                                                                                            Type:
                                                                                                                                                                                            Arabic;
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                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">STATEMENTS OF CHANGES IN
    STOCKHOLDERS&rsquo; EQUITY (DEFICIT)</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">For the period from March
    24, 2010 (Inception) to December 31, 2011</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 2pt solid"><FONT STYLE="font-size: 12pt">&nbsp;</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Additional</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Total</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Common&nbsp;Stock</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Paid-In</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Accumulated</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Shareholders'</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Shares</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Capital</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Equity&nbsp;(Deficit)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Balance, March 24, 2010 (Inception)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 45%; text-align: left; padding-left: 9pt">Proceeds from shareholders</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">40,670</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">40,670</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(15,681</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(15,681</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Balance, December 31, 2010</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,670</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(15,681</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,989</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from shareholders</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,838</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,838</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(42,203</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Balance, December 31, 2011</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">47,508</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(57,884</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(10,376</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<!-- Field: Page; Sequence: 48 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page
                                                                                                                                                                                            <!--
                                                                                                                                                                                            Field:
                                                                                                                                                                                            Sequence;
                                                                                                                                                                                            Type:
                                                                                                                                                                                            Arabic;
                                                                                                                                                                                            Name:
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                                                                                                                                                                                            Field:
                                                                                                                                                                                            /Sequence
                                                                                                                                                                                            --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">FIRST RATE STAFFING, INC.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">STATEMENTS OF CASH FLOWS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">From March 24, 2010</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the year ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">(Inception) to</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2010</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Operating Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 74%; text-align: left; padding-left: 9pt">Net loss</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">(42,203</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">(15,681</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,182</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,579</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Deposits and other assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(9,692</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,191</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,662</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Due to affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,198</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,456</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash used in operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,014</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(31,834</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Financing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Changes in bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,048</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,504</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Proceeds from shareholders</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">6,838</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">40,670</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 27pt">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,790</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">42,174</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Net change in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(10,224</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,340</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">Cash, beginning of period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,340</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Cash, end of period</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">116</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">10,340</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Supplemental disclosure of cash flow information:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for interest</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">17,131</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,518</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Cash paid for taxes</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">45</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 49 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page
                                                                                                                                                                                            <!--
                                                                                                                                                                                            Field:
                                                                                                                                                                                            Sequence;
                                                                                                                                                                                            Type:
                                                                                                                                                                                            Arabic;
                                                                                                                                                                                            Name:
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                                                                                                                                                                                            -->5<!--
                                                                                                                                                                                            Field:
                                                                                                                                                                                            /Sequence
                                                                                                                                                                                            --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>1. ORGANIZATION </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">First Rate Staffing, Inc. (the &ldquo;Company&rdquo;),
was incorporated on March 24, 2010 in Nevada as a C-Corporation, and is registered to do business in Arizona. The Company provides
recruiting and staffing services for temporary positions for light industrial, distribution centers, assembly, and clerical to
its clients in Arizona, with an option for the clients and candidates to choose the most beneficial working arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>2. BASIS OF PRESENTATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying audited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;),
and include all the notes required by generally accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation of the financial
statements have been included.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The summary of significant accounting policies
presented below is designed to assist in understanding the Company&rsquo;s financial statements. Such financial statements and
accompanying notes are the representations of the Company&rsquo;s management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;)
in all material respects, and have been consistently applied in preparing the accompanying financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Use of Estimates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cash and Cash Equivalents</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly-liquid&nbsp;investments
with maturities of three months or less when purchased to be cash equivalents.&nbsp;The Company had no cash equivalents <FONT STYLE="font: 10pt Times New Roman, Times, Serif">as
of December 31, 2011 and 2010. Under the terms of the Company&rsquo;s bank agreements, outstanding checks in excess of the cash
balances in the Company&rsquo;s primary disbursement accounts create a bank overdraft liability. Bank overdrafts were $456 and
$1,504 at December 31, 2011 and 2010.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Accounts Receivable and Factoring
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of December 31, 2011 and 2010 are zero.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the &quot;Factor&quot;). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of Accounts Receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $64,614 and $70,842
at December 31, 2011 and 2010, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Fair Value of Financial Instruments</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm&rsquo;s
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Concentration of Credit Risk</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company&rsquo;s customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Revenue Recognition</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
(&ldquo;ASC&rdquo;) No. 605, &ldquo;Revenue Recognition&rdquo;.&nbsp;&nbsp;In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the year ended December 31, 2011 and the period from March 24, 2010 (Inception) to December
31, 2010, the Company generated revenue of $1,324,497 and $685,346, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cost of Revenue</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company&rsquo;s employees while they work on contract assignment
as temporary staff of the Company&rsquo;s customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Income Taxes</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As a result of the implementation of certain
provisions of ASC 740, <I>Income Taxes</I>, (formerly FIN 48, <I>Accounting for Uncertainty in Income Taxes &ndash; An Interpretation
of FASB Statement No. 109), </I>(&ldquo;ASC 740&rdquo;), which clarifies the accounting and disclosure for uncertainty in tax positions,
as defined. ASC 740 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement
related to accounting for income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In 2010, the Company adopted Accounting
for Uncertain Income Taxes under the provisions of ASC 740. ASC 740 clarifies the accounting for income taxes by prescribing a
minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides
guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The Company did not recognize any additional liability for unrecognized tax benefits as a result of the adoption of ASC 740. Deferred
tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases. Valuation allowances are established
when it is more likely than not that some or all of the deferred tax assets will not be realized.<FONT STYLE="font-size: 10pt">
</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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                                                                                                                                                                                            <!--
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                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We believe that our income tax filing positions
and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial
position.&nbsp;&nbsp;Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.&nbsp;&nbsp;In
addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.&nbsp;&nbsp;Our policy for recording
interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our tax provision determined using an estimate
of our annual effective tax rate using enacted tax rates expected to apply to taxable income in the years in which they are earned,
adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of
the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Income taxes payable as
of December 31, 2011 and 2010 was zero.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Recent Accounting Pronouncements </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In January&nbsp;2010, the FASB issued amended
standards that require additional fair value disclosures. These disclosure requirements are effective in two phases. In the first
quarter of 2010, we adopted the requirements for disclosures about inputs and valuation techniques used to measure fair value as
well as disclosures about significant transfers. Beginning in the first quarter of 2011, these amended standards will require presentation
of disaggregated activity within the reconciliation for fair value measurements using significant unobservable inputs (Level 3).
These amended standards do not have a material impact on our financial statements or disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In May 2011, the Financial Accounting Standards
Board (&quot;FASB&quot;) issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The Company does not expect the adoption of this accounting guidance to have a material impact on its financial
statements and related disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company&rsquo;s
present or future financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>4. GOING CONCERN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has sustained operating losses
of $57,884 since inception. The Company&rsquo;s continuation as a going concern is dependent on management&rsquo;s ability to develop
profitable operations, and / or obtain additional financing from its shareholders and / or other third parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>



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                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>4. GOING CONCERN (CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In order to address the need to satisfy
its continuing obligations and realize its long term strategy, management&rsquo;s plans include continuing to fund operations with
cash received from financing activities. Further, the Company currently plans to start the process to become a public company in
the United States to increase its visibility to potential investors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern; however, the above conditions raise substantial doubt
about the Company&rsquo;s ability to do so. The financial statements do not include any adjustments to reflect the possible future
effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should
the Company be unable to continue as a going concern.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>5. ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s accounts receivable
consists of the following as of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 80%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">December 31</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Account receivable</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">64,614</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">70,842</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Factor reserve at 10%</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,397</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">12,579</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">72,011</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">83,421</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Less: factored accounts receivable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(64,614</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(70,842</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,397</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,579</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Allowance for doubtful accounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,397</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">12,579</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>6. SHAREHOLDERS&rsquo; EQUITY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the year ended December 31, 2011
and the period from March 24, 2010 (Inception) to December 31, 2010, the Company had received capital injections from shareholders
in the amount of $6,838 and $40,670, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of December 31, 2011 and 2010, the Company
has 75,000,000 shares of common stock authorized, $0.001 par value per share, and no share issued and outstanding.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>7. RELATED PARTY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, Inc., for working capital needs. As of December 31, 2011 and 2010, the amount due to the affiliate company
is $23,198 and $0, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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                                                                                                                                                                                                                                                                                                                              accompanying
                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>8. INCOME TAXES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for income taxes in
accordance with the &quot;liability&quot; method. Under this method, deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the
year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined
that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced
by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Due to the existence of a full valuation
allowance against deferred tax assets, future changes in our unrecognized tax benefits will not impact the Company&rsquo;s effective
tax rate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As a corporation, the Company is primarily
subject to U.S. federal and state income tax. The Company&rsquo;s policy is to recognize interest and penalties related to income
tax matters in income tax expense. As of December 31, 2011 and 2010, the Company had no accruals for interest or penalties related
to income tax matters.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The components of the provision for income taxes are summarized
as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 80%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">For&nbsp;the&nbsp;period&nbsp;from&nbsp;March</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">For&nbsp;the&nbsp;year&nbsp;ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">24,&nbsp;2010&nbsp;(Inception)&nbsp;to</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Current tax provision</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">45</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Deferred tax provision</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">45</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">-</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The following reconciles income taxes reported in the financial
statements to taxes that would be obtained by applying regular tax rates to income before taxes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 80%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">December 31</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2011</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 52%; text-align: left">Expected tax benefit using regular rates</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 21%; text-align: right">16,863</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 21%; text-align: right">6,272</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Valuation allowance</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,863</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(6,272</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>8. CONTINGENCIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Litigation</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the ordinary course of the Company&rsquo;s
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company&rsquo;s financial position, results of operations or cash flow.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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                                                                                                                                                                                            <!--
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                                                                                                                                                                                                                                                                                                                              accompanying
                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.</I></TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">FIRST RATE STAFFING, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-size: 12pt">NOTES TO FINANCIAL STATEMENTS</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>9. SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management has evaluated subsequent events
through June 25, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has determined
that no subsequent events have occurred which require disclosure through the date that these financial statements were issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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                                                                                                                                                                                            <!--
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                                                                                                                                                                                                                                                                                                                              accompanying
                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="margin: 0"></P>
<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>FIRST
RATE STAFFING, LLC</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2011 and 2010</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>INDEX TO FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD STYLE="width: 91%">Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="width: 9%; text-align: right; vertical-align: bottom">1</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Balance Sheets as of December 31, 2011 and 2010</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">2</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Operations for the Year Ended December 31, 2011 and for the Period from April 2, 2010 (Inception) to December 31, 2010</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">3</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Changes in Members&rsquo; Equity for the Period from April 2, 2010 (Inception) to December 31, 2011</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">4</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Statements of Cash Flows for the Year Ended December 31, 2011 and for the Period from April 2, 2010 (Inception) to December 31, 2010</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">5</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,255,204)">
    <TD>Notes to Financial Statements</TD>
    <TD STYLE="text-align: right; vertical-align: bottom">6-10</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 49.5pt"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0pt"><IMG SRC="tlogo.jpg"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0pt">&nbsp;</P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Board of Directors and Members of</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">First Rate Staffing, LLC:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have audited the accompanying balance
sheets of First Rate Staffing, LLC (the &ldquo;Company&rdquo;) as of December 31, 2011 and 2010, and the related statements of
operations, changes in members&rsquo; equity, and cash flows for the year ended December 31, 2011 and the period from April 2,
2010 (Inception) through December 31, 2010. These financial statements are the responsibility of the Company&rsquo;s management.
Our responsibility is to express an opinion on these financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company&rsquo;s
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In our opinion, the financial statements
referred to the above present fairly, in all material respects, the financial position of First Rate Staffing, LLC as of December
31, 2011 and 2010, and the results of its operations and cash flows for the year ended December 31, 2011 and the period from April
2, 2010 (Inception) through December 31, 2010 in conformity with accounting principles generally accepted in the United States
of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>/s/ Anton &amp; Chia, LLP</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Newport Beach, California</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"> </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">June 25, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">BALANCE SHEETS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 2pt solid; text-align: center">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2010</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: center">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Current Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 74%; padding-left: 9pt">Cash</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">11,796</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">2,310</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts receivables, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56,562</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,037</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Due from affiliate company</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">23,198</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Prepaid expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,524</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Total current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">91,556</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">68,871</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">32,691</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,431</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">124,247</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">70,302</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: center">LIABILITIES AND MEMBERS' EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current Liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">13,468</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9,398</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,800</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,060</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,100</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,946</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Tax payable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">6,800</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in; padding-bottom: 1pt">Total current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">21,368</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">27,204</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in; padding-bottom: 1pt">Total Liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">21,368</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">27,204</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Members' Equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Members' contributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,255</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,992</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Retained earnings</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">78,624</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">15,106</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in; padding-bottom: 1pt">Total Members' Equity</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">102,879</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">43,098</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Liabilities and Members' Equity</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">124,247</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">70,302</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<!-- Field: Page; Sequence: 60; Options: NewSection; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->2<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF OPERATIONS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">From April 2, 2010</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the year ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">(Inception) to</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%">Revenues</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">4,774,545</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">1,813,577</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cost of revenues</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(4,356,262</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(1,677,495</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">418,283</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">136,082</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">297,500</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">96,787</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Income from operations</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">120,783</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">39,295</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other expenses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Interest expense, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(50,164</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(17,389</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Other expense, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(301</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(50,465</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(17,389</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Income before income tax</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">70,318</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,906</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Income tax expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">6,800</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">6,800</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net income</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">63,518</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">15,106</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 61; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->3<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF CHANGES IN MEMBERS&rsquo; EQUITY</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">Members</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">Total Members'</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Interests</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Retained Earnings</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Equity</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Balance, April 2, 2010 (Inception)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 46%; padding-left: 9pt">Contributions</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; text-align: right">52,325</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; text-align: right">52,325</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 9pt">Distributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24,333</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24,333</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Net income</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">15,106</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">15,106</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Balance, December 31, 2010</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,992</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,106</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">43,098</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">Contributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">492,867</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">492,867</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 9pt">Distributions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(496,604</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(496,604</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt; padding-bottom: 1pt">Net income</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">63,518</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">63,518</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Balance, December 31, 2011</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">24,255</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">78,624</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">102,879</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<!-- Field: Page; Sequence: 62; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-top: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: left; width: 20%"><I>Page <!-- Field: Sequence; Type: Arabic; Name: PageNo -->4<!-- Field: /Sequence --></I></TD><TD STYLE="text-align: right; width: 80%"><I>The accompanying notes are an integral part of these financial statements.</I></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-size: 12pt; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">STATEMENTS OF CASH FLOWS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">From April 2, 2010</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">For the year ended</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">(Inception) to</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31, 2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Operating Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 74%; text-align: left; padding-left: 9pt">Net income</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">63,518</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">15,106</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Adjustments to reconcile net income to net cash used by operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Provision for doubtful accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">29,824</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(50,349</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(36,037</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Due from affiliate company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(23,198</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Prepaid expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,524</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(30,524</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(260</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,060</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,846</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,946</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Tax payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,800</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,800</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in; padding-bottom: 1pt">Deposits and other assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(31,260</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(1,431</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 27pt; padding-bottom: 1pt">Net cash provided by (used in) operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">9,153</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(35,080</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Financing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Changes in bank overdraft</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,070</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,398</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Contributions from members</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">492,867</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">52,325</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in; padding-bottom: 1pt">Distributions to members</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(496,604</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(24,333</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 27pt; padding-bottom: 1pt">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">333</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">37,390</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Net change in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,486</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,310</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cash, beginning of period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">2,310</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 2.5pt">Cash, end of period</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">11,796</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">2,310</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Supplemental disclosure of cash flow information:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.12in">Cash paid for interest</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">50,173</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">17,389</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.12in">Cash paid for taxes</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">13,600</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">-</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>1. ORGANIZATION </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">First Rate Staffing, LLC (the &ldquo;Company&rdquo;),
was formed on April 2, 2010 as a limited liability company in California. The Company provides recruiting and staffing services
for temporary positions for light industrial, distribution centers, assembly, and clerical to its clients in California, with an
option for the clients and candidates to choose the most beneficial working arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>2. BASIS OF PRESENTATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying audited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;),
and include all the notes required by generally accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation of the financial
statements have been included.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The summary of significant accounting policies
presented below is designed to assist in understanding the Company&rsquo;s financial statements. Such financial statements and
accompanying notes are the representations of the Company&rsquo;s management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;)
in all material respects, and have been consistently applied in preparing the accompanying financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Use of Estimates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cash and Cash Equivalents</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly-liquid&nbsp;investments
with maturities of three months or less when purchased to be cash equivalents.&nbsp;The Company had no cash equivalents <FONT STYLE="font: 10pt Times New Roman, Times, Serif">as
of December 31, 2011 and 2010. Under the terms of the Company&rsquo;s bank agreements, outstanding checks in excess of the cash
balances in the Company&rsquo;s primary disbursement accounts create a bank overdraft liability. Bank overdrafts were $13,468 and
$9,398 at December 31, 2011 and 2010, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; color: #0070C0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #0070C0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; color: #0070C0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Accounts Receivable and Factoring
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of December 31, 2011 and 2010 are $29,824 and $0, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the &quot;Factor&quot;). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of Accounts Receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $506,718 and $355,648
at December 31, 2011 and 2010, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Fair Value of Financial Instruments</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm&rsquo;s
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Concentration of Credit Risk</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company&rsquo;s customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Revenue Recognition</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
(&ldquo;ASC&rdquo;) No. 605, &ldquo;Revenue Recognition&rdquo;.&nbsp;&nbsp;In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the year ended December 31, 2011 and the period from April 2, 2010 (Inception) to December
31, 2010, the Company generated revenue of $4,774,545 and $1,813,577, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Cost of Revenue</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company&rsquo;s employees while they work on contract assignment
as temporary staff of the Company&rsquo;s customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Members&rsquo; Equity, Personal Assets and Income Taxes
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Net income, loss, capital gains and cash
distributions pertaining to the Company are allocated to its members in accordance with the provisions of the Company&rsquo;s operating
agreements. The operating agreements provide that all items of net income, loss, capital gain and cash distributions be allocated
among the members based upon their respective percentage interest. There is only one class of members&rsquo; interest, whose rights
are governed and set forth in the operating agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In accordance with the generally accepted
method of presenting limited liability company financial statements, the financial statements do not include the personal assets
and liabilities of the members, including their obligation for income taxes on their distributive shares of net income of the LLCs,
or any provision for federal income taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company is taxed as a limited liability
company (&ldquo;LLC&rdquo;) under the provisions of federal and state tax codes. Under federal laws, taxes based on income of a
limited liability company are payable by the LLC members individually. Accordingly, no provision for federal income taxes has been
made in the accompanying consolidated financial statements. A provision for California franchise tax has been recorded in costs
and expenses in the accompanying financial statements at a statutory amount based on gross receipts under California laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B> <B>(CONTINUED)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Recent Accounting Pronouncements </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In January&nbsp;2010, the FASB issued amended
standards that require additional fair value disclosures. These disclosure requirements are effective in two phases. In the first
quarter of 2010, we adopted the requirements for disclosures about inputs and valuation techniques used to measure fair value as
well as disclosures about significant transfers. Beginning in the first quarter of 2011, these amended standards will require presentation
of disaggregated activity within the reconciliation for fair value measurements using significant unobservable inputs (Level 3).
These amended standards do not have a material impact on our financial statements or disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In May 2011, the Financial Accounting Standards
Board (&quot;FASB&quot;) issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The Company does not expect the adoption of this accounting guidance to have a material impact on its financial
statements and related disclosures.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company&rsquo;s
present or future financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>4. ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s accounts receivable
consists of the following as of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">December 31</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2010</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 64%; text-align: left">Account receivable</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">506,718</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">355,648</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Factor reserve at 10%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">60,457</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,037</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">Chargebacks</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">25,929</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">593,104</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">391,685</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Less: factored accounts receivable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(506,718</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(355,648</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">86,386</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,037</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Allowance for doubtful accounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(29,824</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">-</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">56,562</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">36,037</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%; font-weight: bold; text-align: center; border-top: Black 2pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">FIRST RATE STAFFING, LLC</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 12pt; font-weight: bold; text-align: center">NOTES TO FINANCIAL STATEMENTS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 2pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>5. RELATED PARTY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, LLC for working capital needs. As of December 31, 2011 and 2010, the amount due from the affiliate company
is $23,198 and $0, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>6. CONTINGENCIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Litigation</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the ordinary course of the Company&rsquo;s
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company&rsquo;s financial position, results of operations or cash flow.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>7. SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management has evaluated subsequent events
through June 25, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has determined
that no subsequent events have occurred which require disclosure through the date that these financial statements were issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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[{"type": "8-K", "sequence": "1", "filename": "v328234_8k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 679277}]
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
November 9, 2012
Date of Report
(Date of Earliest Event Reported)
FIRST RATE STAFFING CORPORATION
(Exact Name of Registrant as Specified in
its Charter)
Delaware
000-54427
46-0708635
(State or other jurisdiction
(Commission File Number)
(IRS Employer
of incorporation)
Identification No.)
2775 West Thomas Road
Suite 107
Phoenix, Arizona
85018
(Address of Principal Executive Offices)
(602) 442-5277
(Registrant's Telephone Number)
The Company is concurrently
filing a registration statement on Form S-1 pursuant to the Securities Act of 1933 for the sale of up to 1,600,000 shares of its
common stock by the holders thereof. Certain items indicated below are incorporated by reference to that registration statement
and additional detailed information is discussed therein.
1
ITEM 2.01
Completion of Acquisition or Disposition of Assets
On November 9, 2012,
First Rate Staffing Corporation, a Delaware corporation (the "Company"), entered into merger agreements with each of
First Rate Staffing, LLC, a California limited liability company ("First Rate California"), and First Rate Staffing,
Inc., a Nevada corporation ("First Rate Nevada"), in separate mergers (collectively, and together, the "Mergers")
that were concurrently completed on November 13, 2012. The purpose of the Mergers was to facilitate and prepare the Company for
a registration statement and/or public offering of securities. Prior to the Mergers, First Rate California and First Rate Nevada
were under common control of the same group of shareholders.
The Mergers were effected
by the Company through the exchange of (i) all of the outstanding membership interests of First Rate California for 2,000,000 shares
of common stock of the Company, and (ii) all of the outstanding shares of First Rate Nevada for 2,000,000 shares of common stock
of the Company. Accordingly, a total of 4,000,000 shares were issued in the Mergers.
First Rate California
was formed in April 2010 in the State of California. Since its inception, First Rate California has provided recruiting and staffing
services for temporary positions in light industrial, distribution center, assembly, and clerical businesses to clients in California.
First Rate Nevada was
formed in March 2010 in the State of Nevada and is registered to do conduct business in the State of Arizona. Since its inception,
First Rate Nevada has provided recruiting and staffing services for temporary positions in light industrial, distribution center,
assembly, and clerical businesses to clients in Arizona.
As a result of the
Mergers, each of First Rate California and First Rate Nevada has merged into and become a part of the Company. The Company, as
the surviving entity from the Mergers, has taken over the respective operations and business plans of each of both First Rate California
and First Rate Nevada.
Business
Prior to the Mergers,
the Company had no significant business, operations or plan. Accordingly, the business of the Company below is that of First Rate
California and First Rate Nevada, each which merged into the Company in the Mergers.
The Company provides
recruiting and staffing services for temporary positions in light industrial, distribution center, assembly, and clerical businesses.
The Company's client customization model allows it to integrate its services to its client-specific needs and thereby providing
clients with the highest level of customer service. The Company strives to devote adequate time and attention to understand both
the needs of its clients and the capabilities of its employees so that the Company can identify the best suitable matches between
client needs and employee abilities. The Company is dedicated to achieving a high level of service for all of its clients and considers
itself to be a loyal partner to meeting client demands. In this regard, the Company seeks to position itself not only as a pool
of employee for its clients, but also as a dedicated business partner that understands its clients' businesses and needs.
Services provided to
clients by the Company include recruiting, payroll, all state and federal taxes, worker's compensation coverage, and screening
and managing of clients' contingent work force. The Company provides comprehensive screening and electronic verification
(for federal employment eligibility requirements) for all employees. The Company also conducts reference checks of employees to
ensure that the employers receive accurate and useful descriptions of employees' backgrounds and experiences. The Company
also operates a risk management department that helps client mitigate losses by implementing sound and effective risk management
procedures at client sites. Clients receive these risk management services at no cost, helping them to reduce their own business
risks and expenses.
Services
The Company prides
itself on client customization by developing the service around its clients current operating procedures. The Company creates and
maintains a fluid work environment between the client and the Company. In addition, the company also provides businesses with a
high-caliber of employee available for project or permanent work. The Company listens to individual needs and customizes personnel
solutions for both businesses and workers. The Company has designed an extensive service package with an emphasis on recruiting
and risk management which is incorporated into its client customization model.
2
The Company does not
apply one model to all situations, and instead maintains a fluid environment so that the Company can change as needed. Each team
member is highly cross trained in all aspects of staffing. This allows each member to assist clients and employees with any situation.
From operations to risk management to payroll, team members can handle client needs. Every employee is "guaranteed"
from Company – meaning that if the employee does not meet the quality and/or performance standards of our client, we will
refund the cost of that individual up to 8 hours.
Customized recruitments
match client specific needs with the pool of available candidates. The Company refreshes this pool weekly, which allows the Company
to provide only the best candidates in time effective manner. In addition, the Company attempts to reduce injuries and create a
safer and more productive worksite, in that the Company will perform site safety evaluations, implement an early intervention program,
perform safety training, OSHA Compliance, case management, claims review, back to work programs, and accident investigation
.
Among the Company's
human resources services, the Company specifically provides each of the following specific set of services:
-Employees are thoroughly
screened and tested to be sure they understand acceptable workplace practices.
-Employees are E-Verified
to insure only legal workers are employed.
-Harassment and safe
practices training is provided to all employees prior to hire.
-Full harassment trainings
as needed by clients are also offered.
-Custom employee handbooks
can be issued for specific locations.
-The Company carries
out disciplinary action and employee improvement plans for workplace infractions.
Strategic Partners and Suppliers
The Company believes
that strategic partnerships will be a major component of the Company's operating strategy and path to success. The Company
hopes to work with several strategic partners in important areas of its business and operations. However, currently, the Company
has no such strategic partners.
The Company does work
with several important suppliers/vendors that are important for its operations and success:
Arizona Bio & Safety
Supply Co., LLC, located in Glendale, Arizona, provides the Company with personal protective equipment used in the Company's
operations.
The Company uses online
recruiting sources, among other recruiting tools, including common websites, such as Careerbuilder.com.
Insurance is an important
part of the Company's overall operations, and Company maintains insurance for workers' compensation matters and general
liability.
The Company relies
heavily on its software provider to manage payroll, factoring and other related human resources issues. Currently, the Company
relies on Tempworks Software, but in the future, the Company may also consider other suitable software and service options.
Risk Management Program
The Company designed
and created an industry-leading risk management and safety program. This program starts with the initial risk assessment of client
sites. The Company's risk management team will present a risk analysis to a new or potential client showing exposures and
recommendations for correction. The Company's risk management includes in the risk assessment proper training techniques
for all employees to follow before being placed at the client site. This training incorporates the Company's client required
training as part of its customization model. Risk management also created a step by step "in case of injury" protocol
to be followed which allows the Company to manage the claim from beginning to end to ensure the best possible chance that the claim
remains first aid (non-recordable). If the claim does become a recordable injury, this program allows the Company to have the best
possible chance to get the employee back to work and avoid litigation. The Early Intervention Nurse Program is one of the Company's
unique services that give the company a competitive edge on the competition. This program allows a medical professional to assist
the employee via phone at the client site immediately when the injury occurs. First Rate Risk Management maintains relationships
with all treating clinics where employees are seen in an attempt to get the clinic doctors to understand our treating philosophy.
Early Intervention
Program: The Company contracts with Risk Solutions to provide a unique on call nurse 24 hours a day. This practice allows the Company
to diagnose injuries at the site to determine the extent of the injury and if the employee needs further medical treatment. If
further medical treatment is needed, the nurse provides the risk management team with valuable information so we can insure that
proper treatment is being administered by our contract clinic. The risk management team provides an extensive safety program to
clients free of charge. From annual risk analysis to accident investigation, the risk management team is here to support clients
.
3
Service Contracts
The Company enters
into written service contracts with its customers. Among other things, these contracts provide that the Company will have various
duties, including the following: (i) recruiting, screening, testing, qualifying, reference checking, and hiring employees; (ii)
ensuring that Employment and Eligibility Verification form (I-9) is completed; (iii) maintaining all personnel files and payroll
records for its employees; and (iv) withholding, paying, reporting all taxes, and issuing employee W-2 forms at the end of each
year with respect to each employee provided to the customer as required by law. The Company also maintains workers' compensation
coverage for each of its employees. The Company also administers all unemployment claims with respect to each employee provided
to customers. There are also obligations and requirements upon customers to ensure that the working relationship between the Company
and its customers is smooth, efficient and successful.
Strategic Partners and Suppliers
The Company believes
that strategic partnerships will be a major component of the Company's operating strategy and path to success. The Company
hopes to work with several strategic partners in important areas of its business and operations. However, currently, the Company
has no such strategic partners.
The Company does work
with several important suppliers/vendors that are important for its operations and success:
Arizona Bio & Safety
Supply Co., LLC, located in Glendale, Arizona, provides the Company with personal protective equipment used in the Company's
operations.
The Company uses online
recruiting sources, among other recruiting tools, including common websites, such as Careerbuilder.com.
Insurance is an important
part of the Company's overall operations, and Company maintains insurance for workers' compensation matters and general
liability.
The Company relies
heavily on its software provider to manage payroll, factoring and other related human resources issues. Currently, the Company
relies on Tempworks Software, but in the future, the Company may also consider other suitable software and service options.
Customers
The Company has a diverse
array of customers across sectors. Key customers include the following (each of which comprises at least 5% or more of the Company's
sales): Essentials Packaging; States Logistics; Direct Chassis; Essentials, Inc.; Phillips Industries; and Premier Packaging. The
Company also has many other customers, and plans to continue to grow its customer base.
Marketing and Sales
The Company has conducted
limited advertising and marketing to date to reach new clients. To date, advertising and marketing has been centered on reaching
potential employees. In all locations, the Company has used multiple resources to drive in potential new temporary employees. These
tactics range from advertisements in newspapers, job boards, unemployment assist centers, as well as online advertisements. The
Company also utilizes CareerBuilder to recruit for professional placements.
The Company has, however,
given substantial attention to constructing the marketing strategy and plans that it will use in order to grow its business and
expand its customers. The Company eventually anticipates a significant budget and need for marketing activities. The primary focus
of marketing campaigns will be designed to help the Company find new customers and to increase awareness of the Company's
services and competitive solutions. A variety of marketing approaches, emphasizing the competitive advantages and key differentiators
of the Company's services, are expected to be used in order to attract new customers and entice existing customers to do
larger volumes of business with the Company.
The Company expects
that its sales team will work closely with the marketing team to convert prospects into new customers. The sales team will be structured
to align with target markets based on territory and customer patterns.
Operations
The Company requires
that all potential employment candidates are required to complete an application process which screens for experience and work
history. Upon completion, each candidate is interviewed by the Company's staffing coordinators and is asked a series of questions
based on the company's local clientele's needs. The candidate is then given a sequence of competency testing to complete
within an undisclosed timeframe to test for analytical and instruction following skills. At this point, the staffing coordinators
make a determination to which client(s) the candidate is best suited based upon the most commonly filled positions. In the continued
effort to provide the best candidates to clients, all employees are E-verified for employment eligibility. All employees are also
subjected to additional testing (math and competency). The objective is to ensure that only the most qualified candidates fit current
clients' needs so that the Company can provide the highest level of service possible.
4
Revenues
The Company has posted
revenues from operations based on its billings to, and services for, customers. Based on a combination of First Rate California
and First Rate Nevada, the Company posted revenues of approximately $2.5 million during the partial-year 2010, approximately $6.1
million in the full-year 2011 and approximately $3.3 million for the first half of 2012.
THE COMPANY
Employees and Organization
The Company presently
has approximately 225 employees, consisting or approximately 175 employees in First Rate California and 50 employees in First Rate
Nevada.
Most employees receive
health benefits. The Company may offer additional fringe and welfare benefits in the future as the Company's profits grow
and/or the Company secures additional outside financing.
The Company considers
its employees to be a prime strategic asset of its overall business and operations, and the Company strives to operate its business
in a lean and cost-effective manner. The Company operates its business through the use of staffing coordinators, operation managers,
sales managers, and senior management, all of which are integral to the success of the Company's organization and operations.
The Company's model for its employment organization is based on the ratio of one employee for approximately every $1,000,000
in sales. The Company believes that this model compares favorably to an industry average based on one employee to every approximately
$800,000 in sales.
Property
The Company currently
has two physical locations: Santa Fe Springs, California and Phoenix, Arizona.
The Santa Fe Springs
location consists of 1,000 square feet and is a monthly lease that is located in an office park on a major thoroughfare for southern
Los Angeles County, California. The monthly lease cost is $1,015, and annually the Company expends $12,700 for such lease. This
location is almost filled at capacity and offers limited street visibility.
The Phoenix location
consists of 1,600 square feet and is a yearly lease and is located at an intersection of a major thoroughfare for Phoenix, Arizona.
The Phoenix location offers street visibility and room for growth. The monthly lease cost is $1,757, and annually the Company expends
$20,750 for such lease.
The Company also anticipates
opening an official corporate location in Irvine, California in the near future.
Subsidiaries
The Company has no
subsidiaries.
Summary Financial Information
As the Company had
no operations or specific business plan until the Mergers, the information presented below is with respect to First Rate California
and First Rate Nevada, respectively, each of which was merged into the Company in November 2012 as a result of the Mergers.
5
The statements of operations
data for the year ended December 31, 2011 and the period from April 2, 2010 (Inception) through December 31, 2010, and the balance
sheet data as of December 31, 2011 and at December 2010, respectively, are derived from the audited financial statements of First
Rate California and related notes thereto included herewith. The statement of operations data for the six months ended June 30,
2012 provided below is derived from the unaudited financial statements of First Rate California and related notes thereto included
herewith.
Six months ended
Year ended
April 2, 2010 (Inception)
June 30, 2012
December 31, 2011
through December 31, 2010
(unaudited)
Statement of operations data
Revenue
$
2,489,976
$
4,774,545
$
1,813,577
Gross profit
$
201,297
$
418,283
$
136,082
Income (Loss) from operations
$
(95,851
)
$
120,783
$
39,295
Net income (loss)
$
(97,185
)
$
63,518
$
15,106
At June 30, 2012
At December 31, 2011
At December 31, 2010
(unaudited)
Balance sheet data
Cash
$
33,126
$
11,796
$
2,310
Other assets
$
221,169
$
112,451
$
67,992
Total assets
$
254,295
$
124,247
$
70,302
Total liabilities
$
258,511
$
21,368
$
27,204
Total members' equity (deficit)
$
(4,216
)
$
102,879
$
43,098
The statements of operations
data for the year ended December 31, 2011 and the period from March 24, 2010 (Inception) through December 31, 2010, and the balance
sheet data as of December 31, 2011 and at December 2010, respectively, are derived from the audited financial statements of First
Rate Nevada and related notes thereto included herewith. The statement of operations data for the six months ended June 30, 2012
provided below is derived from the unaudited financial statements of First Rate Nevada and related notes thereto included herewith.
Six months ended
Year ended
March 24, 2010 (Inception)
June 30, 2012
December 31, 2011
through December 31, 2010
(unaudited)
Statement of operations data
Revenue
$
825,769
$
1,324,497
$
685,346
Gross profit
$
95,876
$
146,736
$
69,158
Income (Loss) from operations
$
(16,020
)
$
(25,227
)
$
(8,163
)
Net income (loss)
$
(16,037
)
$
(42,203
)
$
(15,681
)
At June 30, 2012
At December 31, 2011
At December 31, 2010
(unaudited)
Balance sheet data
Cash
$
17,175
$
116
$
10,340
Other assets
$
48,018
$
17,089
$
22,271
Total assets
$
65,193
$
17,205
$
32,611
Total liabilities
$
91,606
$
27,581
$
7,622
Total shareholders' equity (deficit)
$
(26,413
)
$
(10,376
)
$
24,989
Management's Discussion and Analysis
of Financial Condition and Results of Operations
References to the financial
condition and performance of the Company below in this section "Management's Discussions and Analysis of Financial
Condition and Results of Operation" are to First State California and First State Nevada, respectively.
Revenues
The Company has posted
revenues from operations based on its billings to, and services for, customers. Based on a combination of First Rate California
and First Rate Nevada, the Company posted revenues of approximately $2.5 million during the partial-year 2010, approximately $6.1
million in the full-year 2011 and approximately $3.3 million for the first half of 2012.
Equipment Financing
The Company has no
existing equipment financing arrangements.
6
Pricing
Pricing for services
is dependent on several variables ranging from credit, risk exposure, payment terms, payment methods, volume, and potential for
growth. Applicable pricing is specified in customer services agreements. The Company typically charges client by marking up the
pay of employees or through other bill rates.
Potential Revenue
The Company expects
to earn potential revenue from existing client services engagements whereby employees are placed at these clients. The Company
prospects for new clients on an ongoing basis and also seeks additional revenue enhancement opportunities from existing clients.
Alternative Financial Planning
The Company has no
alternative financial plans at the moment. If the Company is not able to successfully raise monies as needed through a private
placement or other securities offering (including, but not limited to, a primary public offering of securities), the Company's
ability to expand and implement any part of its longer term business plan or strategy will be severely jeopardized.
Critical Accounting Policies
The financial statements
of the Company have been prepared in accordance with accounting principles generally accepted in the United States. The preparation
of these financial statements requires making estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent assets and liabilities. The estimates are based on historical experience
and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis
of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual
results may differ from these estimates under different assumptions or conditions.
Capital Resources
As of June 30, 2012,
First Rate California had cash available of $33,126, and First Rate Nevada had cash available of $17,175.
The Company's
proposed expansion plans and business process improvements will necessitate additional capital and financing. Accordingly, the
Company plans to raise between $2 million and $4 million of outside funding in the near future, for the purposes of funding its
own accounts receivable factoring company, establishing and operating its own worker's compensation captive unit, and acquiring
competitors and complementary service providers in its sector.
There can be no assurance
that the Company's activities will generate sufficient revenues to sustain its operations without additional capital, or
if additional capital is needed, that such funds, if available, will be obtainable on terms satisfactory to the Company. Accordingly,
given the Company's limited cash and cash equivalents on hand, the Company will be unable to implement its contemplated business
plans and operations unless it obtains additional financing or otherwise is able to generate sufficient revenues and profits. The
Company may raise additional capital through sales of debt or equity, obtain loan financing or develop and consummate other alternative
financial plans.
7
Discussion of Six Months ended June
30, 2012 for First Rate California
First Rate California
generated revenues during the six months ended June 30, 2012 of $2,489,976, as compared to revenues during the six months ended
June 30, 2011 of $2,163,448.
During the six months
ended June 30, 2012, First Rate California posted an operating loss of $95,851 and net loss of $97,185, as compared to an operating
profit of $23,019 and net profit of $22,965 for the six months ended June 30, 2011.
For the six months
ended June 30, 2012, First Rate California used cash of $160,118 in its operations. During such period, First Rate California also
obtained cash from financing activities totaling $181,448. During the six months ended June 30, 2011, First Rate California generated
cash of $34,688 from operations and used cash of $272 in financing activities.
First Rate California
did not incur any capital expenditures during the six month period ended June 30, 2012 or the six month period ended June 30, 2011.
Discussion of Six Months ended June
30, 2012 for First Rate Nevada
First Rate Nevada generated
revenues during the six months ended June 30, 2012 of $825,769, as compared to revenues during the six months ended June 30, 2011
of $763,982.
During the six months
ended June 30, 2012, First Rate Nevada posted an operating loss of $16,020 and net loss of $16,037, as compared to an operating
profit of $4,870 and net profit of $4,781 for the six months ended June 30, 2011.
For the six months
ended June 30, 2012, First Rate Nevada used cash of $14,227 in its operations. During such period, First Rate Nevada also obtained
cash from financing activities totaling $31,286. During the six months ended June 30, 2011, First Rate Nevada generated cash of
$17,002 from operations and used cash of $448 in financing activities.
First Rate Nevada did
not incur any capital expenditures during the six month period ended June 30, 2012 or the six month period ended June 30, 2011.
Discussion of Year ended December 31,
2011 for First Rate California
First Rate California
generated revenues during the year ended December 31, 2011 of $4,774,545.
During the year ended
December 31, 2011, First Rate California posted operating income of $120,783 and net income of $63,518.
During the year ended
December 31, 2011, First Rate California generated cash of $9,153 in its operations. During such period, First Rate California
also obtained cash from financing activities totaling $333.
First Rate California
did not incur any capital expenditures during the year ended December 31, 2011.
Discussion of Year ended December 31,
2011 for First Rate Nevada
First Rate Nevada generated
revenues during the year ended December 31, 2011 of $1,324,497.
During the year ended
December 31, 2011, First Rate Nevada posted an operating loss of $25,227 and a net loss of $42,203.
During the year ended
December 31, 2011, First Rate Nevada used cash of $16,014 in its operations. During such period, First Rate Nevada also obtained
cash from financing activities totaling $5,790.
First Rate Nevada did
not incur any capital expenditures during the year ended December 31, 2011.
Management
The following table
sets forth information regarding the members of the Company's board of directors and its officers:
Name
Age
Position
Year Commenced
Cliff Blake
58
Chief Executive Officer and Director
2012
Devon Galpin
34
President and Chief Operating Officer, First Rate
2010
Michael Maut
z
46
Vice President of Risk Management, First Rate
2010
Joy Mautz
37
Vice President of Finance, First Rate
2010
Julie Galpin
35
Secretary, First Rate
2010
Cliff Blake
Cliff Blake serves
as Chief Executive Officer, President, Secretary and Treasurer of the Company, and is the sole director of the Company. Mr. Blake
has over 22 years of experience in business and management, including in starting, building and operating numerous businesses,
including over 12 years in owning and operating staffing businesses. Mr. Blake received a Bachelor of Science degree from Louisiana
Tech University in 1974 and a Master of Business Administration degree in Finance from Florida State University in 1975.
8
Devon Galpin
Devon Galpin serves
as President and Chief Operating Officer of First Rate California and First Rate Nevada. Mr. Galpin supervises all operations of
these entities, which includes all office locations, recruiting, internal staffing, order fulfillment, payroll, invoicing compliance,
along with client management. Mr. Galpin has worked in similar roles and capacities for over the past 6 years. Mr. Galpin received
a Bachelor of Science degree in Political Science from Chapman College.
Michael Mautz
Michael Mautz serves
as Vice President of Risk Management for First Rate California and First Rate Nevada. Mr. Mautz supervises all risk management
activities of these entities, including the worker's compensation program of the companies. Mr. Mautz has worked in similar
roles and capacities for over the past 6 years. Mr. Mautz is an OSHA-certified risk manager.
Joy Mautz
Joy Mautz serves as
Vice President of Finance for First Rate California and First Rate Nevada. Ms. Mautz heads all accounting functions, including
cash flow management, state and federal tax compliance, financial modeling, forecasting and Sarbanes-Oxley compliance. Ms. Mautz
has worked in similar roles and capacities, including as Controller for a large staffing company for over the past 6 years. Ms.
Mautz received a Bachelor of Science degree from the California State University at Fullerton in 2004.
Julie Galpin
Julie Galpin serves
as Secretary for First Rate California and First Rate Nevada. In this capacity, she also performs accounting and finance duties
for these companies. For the past 6 years, Ms. Galpin has worked in similar accounting roles and capacities. Ms. Galpin received
a Bachelor's degree in Psychology from the University of California, Irvine in 2005.
Director Independence
Pursuant to Rule 4200
of The NASDAQ Stock Market one of the definitions of an independent director is a person other than an executive officer or employee
of a company. The Company's board of directors has reviewed the materiality of any relationship that each of the directors has
with the Company, either directly or indirectly. Based on this review, the board has determined that there are no independent directors.
Committees and Terms
The Board of Directors
(the "Board") has not established any committees.
Legal Proceedings
Other than ongoing
and routine employee claims for worker's compensation that arise during the ordinary course of the business of the Company,
there are currently no pending, threatened or actual legal proceedings of a material nature in which the Company is a party.
Employment Agreements
The Company enters
into and maintains customary employment agreements with each of its officers and employees.
Anticipated Officer and Director Remuneration
The Company pays reduced
levels of compensation to its officers and director at present. The Company intends to pay regular, competitive annual salaries
to all its officers and will pay an annual stipend to its directors when, and if, it completes a primary public offering for the
sale of securities and/or the Company reaches greater profitability, experiences larger and more sustained positive cash flow and/or
obtains additional funding. At such time, the Company anticipates offering additional cash and non-cash compensation to officers
and directors. In addition, although not presently offered, the Company anticipates that its officers and directors will be provided
with additional fringe benefits and perquisites at subsidizes rates, or at the sole expense of the Company, as may be determined
on a case-by-case basis by the Company in its sole discretion. In addition, the Company may plan to offer 401(k) matching funds
as a retirement benefit at a later time.
9
Security Ownership of Certain Beneficial
Owners and Management
The following table
sets forth information as of the date of this regarding the beneficial ownership of the Company's common stock by each of
the Company's executive officers and directors, individually and as a group and by each person who beneficially owns in excess
of five percent of the common stock after giving effect to any exercise of warrants or options held by that person.
Number of Shares of
Name
Position
Common Stock
Percent of Class (1)
Cliff Blake
CEO and Director
1,000,000
14
%
Devon Galpin
President and COO, First Rate
1,000,000
14
%
Michael Mautz
Vice President, First Rate
1,000,000
14
%
Joy Mautz
Vice President, First Rate
1,000,000
14
%
Julie Galpin
Secretary, First Rate
1,000,000
14
%
Terry Blake
5% shareholder
1,000,000
14
%
33 Tall Oak
Irvine, CA  92603
Total owned by officers and directors (2)
6,000,000
86
%
* Less than 1%
(1) Based upon 7,000,000 shares outstanding
as of the date of this report.
(2) Ms. Blake is the spouse of Mr. Cliff
Blake, the CEO and sole director of the Company. Ms. Blake's shares are accordingly presented above as part of the total
ownership by officers of the Company, due to the relationship of Ms. Blake with Mr. Blake.
Risk Factors
The Company has generated revenues, but limited profits, to date
.
The Company has generated
limited profits to date. The business model of the Company involves significant costs of services, resulting in a low gross margin
on revenues. Coupling this fact with operating expenses incurred by the Company, the Company has only generated a small amount
of total profits in the past. The Company hopes that as its business expands that the scale of the enterprise would result in a
higher gross margin and net margin.
No assurance of continued market acceptance.
There is no assurance
that the Company's services or solutions will continued to meet with market acceptance. Moreover, there is no assurance that
these services and solutions will continue to have any competitive advantages. Also, there is no assurance that the market reception
will be positive.
The Company is an early-stage company
with a limited operating history, and as such, any prospective investor may have difficulty in assessing the Company's profitability
or performance.
Because the Company
is an early-stage company with a limited operating history, it could be difficult for any investor to assess the performance of
the Company or to determine whether the Company will meet its projected business plan. The Company has limited financial results
upon which an investor may judge its potential. As a company still in the early stages of its life, the Company may in the future
experience under-capitalization, shortages, setbacks and many of the problems, delays and expenses encountered by any early-stage
business. An investor will be required to make an investment decision based solely on the Company management's history, its
projected operations in light of the risks, the limited operations and financial results of the Company to date, and any expenses
and uncertainties that may be encountered by one engaging in the Company's industry.
The Company is an early-stage company
and has little experience in being a public company.
The Company is an early-stage
company and as such has little experience in managing a public company. Such lack of experience may result in the Company experiencing
difficulty in adequately operating and growing its business. Further, the Company may be hampered by lack of experience in addressing
the issues and considerations which are common to growing companies. If the Company's operating or management abilities consistently
perform below expectations, the Company's business is unlikely to thrive.
10
The Company's business depends
on the ability to attract and retain qualified temporary employees that possess the skills demanded by clients, and intense competition
may limit the ability to attract and retain such qualified temporary employees.
The success of the
Company depends on the ability to attract and retain qualified temporary employees who possess the skills and experience necessary
to meet the requirements of clients or to successfully bid for new client projects. The ability to attract and retain qualified
temporary employees could be impaired by improvement in economic conditions resulting in lower unemployment, increases in compensation,
or increased competition. During periods of economic growth, the Company faces increasing competition from other staffing companies
for retaining and recruiting qualified temporary employees, which in turn leads to greater advertising and recruiting costs and
increased salary expenses. If the Company cannot attract and retain qualified temporary employees, the quality of its services
may deteriorate and the financial condition, business, and results of operations may be materially adversely affected.
Any significant or prolonged economic
downturn could result in clients using fewer temporary employees and the other services which the Company offers, terminating their
relationship with the Company, or becoming unable to pay for services on a timely basis, or at all.
Because demand for
temporary staffing services is sensitive to changes in the level of economic activity, the Company's business has in the
past and may in the future suffer during economic downturns. Demand for temporary staffing is highly correlated to changes in the
level of economic activity and employment. Consequently, as economic activity begins to slow down, it has been the Company's
experience that companies tend to reduce their use of temporary employees, resulting in decreased demand for temporary employees
and the other services the Company offers. Significant declines in demand, and thus in revenues, would likely result in lower profit
levels. In addition, the Company may experience pricing pressure during economic downturns which could have a negative impact on
the results of operations.
The deterioration of
the financial condition and business prospects of clients could reduce their need for temporary staffing services and result in
a significant decrease in the Company's revenues and earnings derived from these clients. In addition, during economic downturns,
companies may slow the rate at which they pay their vendors, seek more flexible payment terms or become unable to pay their debts
as they become due
State unemployment
insurance expense is a direct cost of doing business in the temporary staffing industry. State unemployment tax rates are established
based on a company's specific experience rate of unemployment claims and a state's required funding formula on covered
payroll. Economic downturns have in the past, and may in the future, result in a higher occurrence of unemployment claims resulting
in higher state unemployment tax rates. Due to the recent economic downturn, states have increased, and may continue to increase,
unemployment tax rates to employers, regardless of the employer's specific experience. This would result in higher direct
costs to us. In addition, many state unemployment funds have been depleted during the recent economic downturn and many states
have borrowed from the federal government under the Title XII loan program. Employers in all states receive a credit against their
federal unemployment tax liability if the employer's federal unemployment tax payments are current and the applicable participating
state is also current with its Title XII loan program. If a state fails to repay such loans within a specific time period, employers
in such states may lose a portion of their tax credit.
The Company is exposed to employment-related
claims and costs as well as periodic litigation that could materially adversely affect the Company's financial condition,
business, and results of operations.
The temporary staffing
business entails employing individuals and placing such individuals in clients' workplaces. The ability to control the workplace
environment of clients is limited. As the employer of record of temporary employees, the Company incurs a risk of liability to
temporary employees and clients for various workplace events, including:
-claims of misconduct
or negligence on the part of employees;
-discrimination or harassment
claims against employees, or claims by employees of discrimination or harassment by clients or the Company;
- immigration-related
claims;
-claims relating to
violations of wage, hour, and other workplace regulations;
-claims related to
wrongful termination or denial of employment;
-violation of employment
rights related to employment screening or privacy issues;
-claims relating to employee
benefits, entitlements to employee benefits, or errors in the calculation or administration of such benefits; and
-possible claims relating
to misuse of clients' confidential information, misappropriation of assets, or other similar claims.
11
The Company may incur
fines and other losses and negative publicity with respect to any of these situations. Some of the claims may result in litigation,
which is expensive and distracts attention from the operations of ongoing business.
The temporary staffing industry is affected
by seasonal fluctuations which make management of working capital more challenging and could adversely impact the Company's
financial position and the market price of its common stock.
The business of the
Company is seasonal in nature. Client demand for temporary staffing services is highest in the second half of a year, primarily
due to demands of the holiday season. Typically, earnings are lower in the first quarter of each year than in other quarters due
to reduced seasonal demand for temporary staffing services and due to lower gross margins during such period associated with the
front-end loading of certain taxes associated with payroll paid to employees.
The Company assumes the obligation to
make wage, tax, and regulatory payments for our temporary employees, and, as a result, are exposed to client credit risks.
The Company generally
assumes responsibility for and manage the risks associated with temporary employees' payroll obligations, including liability
for payment of salaries, wages, and certain taxes. These obligations are fixed, whether or not clients make payments as required
by services contracts, which exposes the Company to credit risks of clients.
Workers' compensation costs for
temporary employees may rise and reduce our margins and require more liquidity.
The Company is responsible
for and pays workers' compensation costs for regular staff and temporary employees. At times, these costs have risen substantially
as a result of increased claims and claim trends, general economic conditions, changes in business mix, increases in healthcare
costs, and government regulations. Although the Company carries insurance, unexpected changes in claim trends, including the severity
and frequency of claims, actuarial estimates, and medical cost inflation could result in costs that are significantly different
than initially reported. If future claims-related liabilities increase due to unforeseen circumstances, or if new laws, rules,
or regulations are passed, costs could increase significantly. There can be no assurance that the Company will be able to increase
the fees charged to clients in a timely manner and in a sufficient amount to cover increased costs as a result of any changes in
claims-related liabilities.
The failure or inability to perform
under client contracts could result in damage to the Company's reputation and give rise to legal claims against the Company.
If clients are not
satisfied with the level of performance, the reputation of the Company in the industry may suffer, which could have a material
adverse effect on the business, financial condition, results of operations, and cash flows of the Company.
The Company may not successfully consummate
or initiate acquisitions.
The ability of the
Company to grow through acquisitions (s planned) will depend on a number of factors, including competition for acquisitions, the
availability of capital and other resources to consummate acquisitions, and the ability to successfully integrate and train additional
staff, including the staff of an acquired company. There can be no assurance that the Company will continue to be able to establish
and expand its market presence or to successfully identify suitable acquisition candidates and complete acquisitions on favorable
terms.
In addition to facing
competition in identifying and consummating successful acquisitions, such acquisitions could involve significant risks, including:
-difficulties in the assimilation
of the operations, services, and corporate culture of acquired companies, and higher-than-anticipated costs associated with such
assimilation;
-over-valuation of acquired companies
or delays in realizing or a failure to realize the benefits, revenues, cost savings, and synergies that were anticipated;
-difficulties in integrating
the acquired business into information systems, controls, policies, and procedures;
-failure to retain
key personnel, business relationships, reputation, or clients of an acquired business;
12
-the potential impairment
of acquired assets;
-diversion of management's
attention from other business activities;
-insufficient indemnification
from the selling parties for legal liabilities incurred by the acquired companies prior to acquisition;
-the assumption of
unknown liabilities and additional risks of the acquired business; and
-unforeseen operating difficulties
that require significant financial and managerial resources that would otherwise be available for the ongoing development or expansion
of existing operations.
In addition, future
acquisitions could materially and adversely affect the Company's business, financial condition, results of operations, and
liquidity. Possible impairment losses on goodwill and intangible assets, or restructuring charges could occur. These risks could
have a material adverse effect on the business because they may result in substantial costs to the Company and disrupt its business.
The temporary staffing industry is highly
competitive with limited barriers to entry, which could limit the Company's ability to maintain or increase our market share
or profitability.
The temporary staffing
industry is highly competitive with limited barriers to entry. The Company competes in national, regional, and local markets. Price
competition in the staffing industry, particularly from our smaller competitors in local and regional markets, is intense, and
pricing pressures from competitors and clients are increasing. Pricing pressure in the past has negatively impacted the Company's
results of operations. There are new competitors entering various markets which may further increase pricing pressures.
Clients have continued
to competitively bid new contracts, and this trend is expected to continue for the foreseeable future. The Company also faces significant
competition in attracting and retaining qualified personnel.
Client relocation of positions may have
a material adverse effect on the financial condition, business, and results of operations of the Company.
Many companies have
built or moved their operations or outsourced certain functions to other countries that have lower employment costs. If clients
relocate positions we filled, this would have a material adverse effect on the financial condition, business, and results of operations
of the Company.
Reliance on third party agreements and
relationships is necessary for development of the Company's business.
The Company will need
strong third party relationships and partnerships in order to develop and grow its business. The Company will be substantially
dependent on these strategic partners and third party relationships.
Improper disclosure of employee
and client data could result in liability and harm to the reputation of the Company.
The business of the
Company involves the use, storage, and transmission of information about employees and clients. It is possible that security controls
over personal and other data and practices that the Company follows may not prevent the improper access to, or disclosure of, personally
identifiable or otherwise confidential information. Such disclosure could harm the reputation of the Company and subject the Company
to liability under contracts and the laws that protect personal data and confidential information, resulting in increased costs
or loss of revenue. Further, data privacy is subject to frequently changing rules and regulations, which sometimes conflict among
the various jurisdictions in which the Company provides services. The failure to adhere to or successfully implement processes
in response to changing regulatory requirements in this area could result in legal liability or impairment to the reputation of
the Company in the marketplace.
The Company expects to incur additional
expenses and may ultimately never be profitable.
The Company is an early-stage
company and has a limited history of its operations. The Company will need to continue generating revenue in order to maintain
sustained profitability. Ultimately, in spite of the Company's best or reasonable efforts, the Company may have difficulty
in generating revenues or remaining profitable.
13
The Company's officers and directors
beneficially own a majority of the Company's common stock and, as a result, can exercise control over stockholder and corporate
actions.
The officers and directors
of the Company currently beneficially own of approximately 86% of the Company's outstanding common stock. As such, they will
be able to control most matters requiring approval by stockholders, including the election of directors and approval of significant
corporate transactions. This concentration of ownership may also have the effect of delaying or preventing a change in control,
which in turn could have a material adverse effect on the market price of the Company's common stock or prevent stockholders
from realizing a premium over the market price for their Shares.
The Company depends on its management
team to manage its business effectively.
The Company's future
success is dependent in large part upon its ability to understand and develop the business plan and to attract and retain highly
skilled management, operational and executive personnel. In particular, due to the relatively early stage of the Company's business,
its future success is highly dependent on its officers, to provide the necessary experience and background to execute the Company's
business plan. The loss of any officer's services could impede, particularly initially as the Company builds a record and
reputation, its ability to develop its objectives, and as such would negatively impact the Company's possible overall development.
Government regulation could negatively
impact the business.
The Company's
business segments may be subject to various government regulations in the jurisdictions in which they operate. Due to the potential
wide scope of the Company's operations, the Company could be subject to regulation by various political and regulatory entities,
including various local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to
comply with existing and newly adopted laws and regulations or penalties for any failure to comply. The Company's operations
could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry.
A substantial portion of the assets
of the Company are pledged as collateral under its factoring agreements.
The Company utilizes
factoring in its business, and in connection therewith it pledges various assets as collateral. The lenders have a right to proceed
against this collateral under certain circumstances. If the creditors were to foreclose on this collateral, such foreclosure could
result in significant damage to the Company's business, operations and relationship with key clients.
The Company may face significant competition
from companies that serve its industries.
The Company may face
competition from other companies that offer similar solutions. Some of these potential competitors may have longer operating histories,
greater brand recognition, larger client bases and significantly greater financial, technical and marketing resources than the
Company possesses. These advantages may enable such competitors to respond more quickly to new or emerging trends and changes in
customer preferences. These advantages may also allow them to engage in more extensive market research and development, undertake
extensive far-reaching marketing campaigns, adopt more aggressive pricing policies and make more attractive offers to potential
customers, employees and strategic partners. The Company believes that its current and anticipated solutions are, and will be,
sufficiently different from existing competition, and that there is limited to no competition in its local area. However, it is
nevertheless possible that potential competitors may have or may rapidly acquire significant market share. Increased competition
may result in price reductions, reduced gross margin and loss of market share. The Company may not be able to compete successfully,
and competitive pressures may adversely affect its business, results of operations and financial condition.
No formal market survey has been conducted
.
No independent marketing
survey has been performed to determine the potential demand for the Company's services over the longer term. The Company
has conducted no marketing studies regarding whether its business would continue to be marketable. No assurances can be given that
upon marketing, sufficient customer markets and business segments can be developed to sustain the Company's operations on a continued
basis.
The time devoted by Company management
may not be full-time
.
It is not anticipated
that key officers would devote themselves full-time to the business of the Company at the present time. Once the Company obtains
additional financing or generates sufficient revenues and profits, officers may then become employed in a full-time capacity.
14
The Company has authorized the issuance
of preferred stock with certain preferences
.
The board of directors
of the Company is authorized to issue up to 20,000,000 shares of $0.0001 par value preferred stock. The board of directors has
the power to establish the dividend rates, liquidation preferences, and voting rights of any series of preferred stock, and these
rights may be superior to the rights of holders of the Shares. The board of directors may also establish redemption and conversion
terms and privileges with respect to any shares of preferred stock. Any such preferences may operate to the detriment of the rights
of the holders of the Shares, and further, could be used by the board of directors as a device to prevent a change in control of
the Company. No such preferred shares or preferences have been issued to date, but such shares or preferences may be issued at
a later time, subject to the sole discretion of the board of directors.
The Company does not maintain certain
insurance, including errors and omissions and indemnification insurance.
The Company has limited
capital and, therefore, does not currently have a policy of insurance against liabilities arising out of the negligence of its
officers and directors and/or deficiencies in any of its business operations. Even assuming that the Company obtained insurance,
there is no assurance that such insurance coverage would be adequate to satisfy any potential claims made against the Company,
its officers and directors, or its business operations. Any such liability which might arise could be substantial and may exceed
the assets of the Company. The certificate of incorporation and by-laws of the Company provide for indemnification of officers
and directors to the fullest extent permitted under Delaware law. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons, it is the opinion of the Securities and Exchange
Commission that such indemnification is against public policy, as expressed in the Act, and is therefore, unenforceable.
Intellectual property and/or trade secret
protection may be inadequate
.
The Company has not
applied for any intellectual property or trade secret protection on any aspects of its business. The Company has no current plans
on attempting to obtain patents, copyright, trademarks and/or service marks on any of its solutions and services. There can be
no assurance that the Company can obtain effective protection against unauthorized duplication or the introduction of substantially
similar solutions and services.
The Company is subject to the potential
factors of market and customer changes
.
The business of the
Company is susceptible to rapidly changing preferences of the marketplace and its customers. The needs of customers are subject
to constant change. Although the Company intends to continue to develop and improve its services to meet changing customer needs
of the marketplace, there can be no assurance that funds for such expenditures will be available or that the Company's competition
will not develop similar or superior capabilities or that the Company will be successful in its internal efforts. The future success
of the Company will depend in part on its ability to respond effectively to rapidly changing trends, industry standards and customer
requirements by adapting and improving the features and functions of its services.
ITEM 3.02 Unregistered Sales of Equity
Securities
Recent Sales of Unregistered Securities
The Company has issued
the following securities in the last three (3) years. All such securities were issued pursuant to an exemption from registration
under Section 4(2) of the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering,
as noted below.
(1) On April 20, 2011,
10,000,000 shares of common stock were issued to Tiber Creek Corporation for total consideration paid of $1,000.00. Subsequently,
in May 2012, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00
On April 20, 2011,
10,000,000 shares of common stock were issued to MB Americus, LLC for total consideration paid of $1,000.00. Subsequently, in May
2012, the Company redeemed an aggregate of 9,750,000 of these shares for the redemption price of $975.00
(2)
On March 23, 2012, 1,000,000 shares of common stock were issued by the Company to Cliff Blake pursuant to a change of control in
the Company. The aggregate consideration paid for these shares was $100.
15
(3) From July 1, 2012
through October 31, 2012, 500,000 shares of common stock were issued by the Company to the shareholders named below pursuant to
executed subscription agreements under a Regulation D offering or other private placement of securities. Each of these transactions
was issued as part of the private placement of securities by the Company in which no underwriting discounts or commissions applied
to any of the transactions set forth below.
Shareholder Name
Consideration
Number of Shares
Teri and Daryl Baldridge
$
1.39
13,888
Sarah and Nino Barette
$
1.39
13,889
Bob Blake
$
1.00
10,000
Camille Blake
$
1.00
10,000
Katy Blake
$
1.00
10,000
Tim and Tracy Brown
$
1.00
10,000
Toni and Tammy Canzone
$
1.00
10,000
Carla Cole
$
1.39
13,889
Janet Dickenson
$
1.39
13,889
Eric Escalante
$
1.39
13,889
Spiros Galpin
$
2.78
27,778
Spiros Galpin II
$
1.39
13,889
Tanya Galpin
$
1.39
13,888
Brian Gorman
$
1.39
13,889
Randy and Vicki Haringa
$
1.39
13,889
Edward Hartely
$
1.00
10,000
Randy and Dee Haynes
$
1.39
13,889
Karl Hempel
$
1.00
10,000
Mackie Hempel
$
1.00
10,000
Heidi Hermreck
$
1.39
13,889
Brad and Linda Ills
$
1.39
13,889
Dick and Karen Ills
$
1.389
13,889
Debbie Johns
$
1.00
10,000
Mike Johns
$
3.67
36,668
Doris Knox
$
1.00
10,000
Jan Mautz
$
1.39
13,889
Kathy McArdle
$
1.39
13,889
David Mejia
$
1.39
13,889
Marty and Patty Pflum
$
1.39
13,889
Jen and Kevin Puebla
$
1.39
13,888
Don and Barbara Rodgers
$
1.00
10,000
Troy and Lisa Schweers
$
1.39
13,889
Mike Tafoya
$
1.39
13,888
Nancy and Dan Tafoya
$
1.39
13,889
Rob Tafoya
$
1.39
13,889
Rebecca Zabel
$
1.00
10,000
Steve Zabel
$
1.00
10,000
(4) On November 13,
2012, the Company issued 4,000,000 shares of common stock in connection with the Mergers, as follows:
Shareholder Name
Number of Shares
Devon Galpin
1,000,000
Julie Galpin
1,000,000
Joy Mautz
1,000,000
Michael Mautz
1,000,000
(5) On November 13,
2012, the Company issued 1,000,000 shares of common stock to Terry Blake that were previously agreed-upon pursuant to the earlier
change of control of the Company that occurred in March 2012.
ITEM 5.06 Change in Shell Company Status
The Company has merged
with First Rate California and First Rate Nevada, each which has a defined business plan, and accordingly, the Company has commenced
operations.
ITEM 9.01 Financial Statements and Exhibits
The
audited
financial statements of First Rate Staffing, LLC, including balance sheets as of December 31, 2011 and December 31, 2010, and the
related statements of operations, changes in members' equity (deficit), and cash flows for the year ended December 31, 2011
and the period from April 2, 2010 (Inception) through December 31, 2010, are included herewith.
16
The
audited
financial statements of First Rate Staffing, Inc., including balance sheets as of December 31, 2011 and December 31, 2010, and
the related statements of operations, changes in shareholders' equity (deficit), and cash flows for the year ended December
31, 2011 and the period from March 24, 2010 (Inception) through December 31, 2010, are included herewith.
Exhibits
2.1+
Agreement and Plan of Reorganization
+ Filed concurrently herewith on Form S-1
as the same exhibit number as the exhibit number listed here, and incorporated herein by this reference.
17
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned
hereunder duly authorized.
FIRST RATE STAFFING CORPORATION
Date: November 13, 2012
/s/ Cliff Blake
Chief Executive Officer
18
FINANCIAL STATEMENTS
FIRST RATE STAFFING, INC.
FINANCIAL STATEMENTS
June 30, 2012 and 2011
INDEX TO FINANCIAL STATEMENTS
Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011
2
Statements of Operations for the Three and Six Months Period Ended June 30, 2012 and 2011 (unaudited)
3
Statements of Changes in Shareholders' Deficit for the Period from December 31, 2010 to June 30, 2012 (unaudited)
4
Statements of Cash Flows for the Six Months Period Ended June 30, 2012 and 2011 (unaudited)
5
Notes to Financial Statements (unaudited)
6-12
FIRST RATE STAFFING, INC.
BALANCE SHEETS
June 30, 2012
December 31, 2011
(unaudited)
ASSETS
Current Assets
Cash
$
17,175
$
116
Accounts receivables, net
24,848
7,397
Total current assets
42,023
7,513
Deposits and other assets
23,170
9,692
Total Assets
$
65,193
$
17,205
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities
Bank overdraft
$
542
$
456
Accounts payable
3,889
3,662
Due to affiliate company
53,580
23,198
Other current liabilities
2,395
265
Total current liabilities
60,406
27,581
Note payable - related party
31,200
-
Total Liabilities
91,606
27,581
Shareholders' Deficit
Common stock; $0.001 par value; 75,000,000 shares authorized,
Zero shares issued and outstanding
-
-
Additional paid-in capital
47,508
47,508
Accumulated deficit
(73,921
)
(57,884
)
Total Shareholders' Deficit
(26,413
)
(10,376
)
Total Liabilities and Shareholders' Deficit
$
65,193
$
17,205
Page
2
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF OPERATIONS
(unaudited)
For the Six Months Ended
For the Six Months Ended
June 30, 2012
June 30, 2011
Revenues
$
825,769
$
763,892
Cost of revenues
(729,893
)
(680,462
)
Gross profit
95,876
83,430
Operating expenses
111,896
78,560
Income (loss) from operations
(16,020
)
4,870
Other expenses:
Interest expense, net
17
89
Other expense
-
-
17
89
Income (loss) before income tax
(16,037
)
4,781
Income tax expense
-
-
Net income (loss)
$
(16,037
)
$
4,781
Page
3
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT
Additional
Total
Common Stock
Paid-In
Accumulated
Shareholders'
Shares
Amount
Capital
Deficit
Deficit
Balance, December 31, 2010
-
$
-
$
40,670
$
(15,681
)
$
24,989
Proceeds from shareholders
-
-
6,838
-
6,838
Net loss
-
-
-
(42,203
)
(42,203
)
Balance, December 31, 2011
-
-
47,508
(57,884
)
(10,376
)
Net loss
-
-
-
(16,037
)
(16,037
)
Balance, June 30 2012 (unaudited)
-
$
-
$
47,508
$
(73,921
)
$
(26,413
)
Page
4
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF CASH FLOWS
(unaudited)
For the Six Months Ended
For the Six Months Ended
June 30, 2012
June 30, 2011
Operating Activities:
Net income (loss)
$
(16,037
)
$
4,781
Changes in operating assets and liabilities:
Accounts receivable
(17,451
)
(2,753
)
Accounts payable
227
(2,677
)
Due to affiliate company
30,382
-
Other current liabilities
2,130
17,651
Deposits and other assets
(13,478
)
Net cash provided by (used in) operating activities
(14,227
)
17,002
Financing Activities:
Changes in bank overdraft
86
(1,504
)
Proceeds from note payables
31,200
-
Proceeds from shareholders
-
1,952
Net cash provided by financing activities
31,286
448
Net change in cash
17,059
17,450
Cash, beginning of period
116
10,340
Cash, end of period
$
17,175
$
27,790
Supplemental disclosure of cash flow information:
Cash paid for interest
$
19
$
90
Cash paid for taxes
$
190
$
-
Page
5
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
1. ORGANIZATION
First Rate Staffing, Inc. (the "Company"),
was incorporated on March 24, 2010 in Nevada as a C-Corporation, and is registered to do business in Arizona. The Company provides
recruiting and staffing services for temporary positions for light industrial, distribution centers, assembly, and clerical to
its clients in Arizona, with an option for the clients and candidates to choose the most beneficial working arrangements.
2. BASIS OF PRESENTATION
The accompanying unaudited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"),
and include all the notes required by generally accepted accounting principles for complete financial statements. The information
furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of
management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures
normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United
States of America have been omitted pursuant to such rules and regulations. The results of the six month periods ended June 30,
2012 are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The summary of significant accounting policies
presented below is designed to assist in understanding the Company's financial statements. Such financial statements and
accompanying notes are the representations of the Company's management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America in all material respects,
and have been consistently applied in preparing the accompanying financial statements.
Use of Estimates
In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly-liquid investments
with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents
as
of June 30, 2012 and December 31, 2011. Under the terms of the Company's bank agreements, outstanding checks in excess of
the cash balances in the Company's primary disbursement accounts create a bank overdraft liability. Bank overdrafts were
$542 and $456 at June 30, 2012 and December 31, 2011.
Page
6
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
Accounts Receivable and Factoring
Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of June 30, 2012 and December 31, 2011 were zero.
The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the "Factor"). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of accounts receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $247,417 and $64,614
at June 30, 2012 and December 31, 2011, respectively.
Fair Value of Financial Instruments
The Company's financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.
Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm's
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.
Page
7
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
The Company's policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company's customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.
Revenue Recognition
The Company's revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
("ASC") No. 605, "Revenue Recognition".  In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the six months period ended June 30, 2012 and 2011, the Company generated revenue of $825,769
and $763,892, respectively.
Cost of Revenue
Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company's employees while they work on contract assignment
as temporary staff of the Company's customers.
Income Taxes
As a result of the implementation of certain
provisions of ASC 740,
Income Taxes
, (formerly FIN 48,
Accounting for Uncertainty in Income Taxes – An Interpretation
of FASB Statement No. 109),
("ASC 740"), which clarifies the accounting and disclosure for uncertainty in tax positions,
as defined. ASC 740 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement
related to accounting for income taxes.
In 2010, the Company adopted Accounting
for Uncertain Income Taxes under the provisions of ASC 740.
ASC 740 clarifies the accounting for income
taxes by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial
statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting
in interim periods, disclosure and transition. The Company did not recognize any additional liability for unrecognized tax benefits
as a result of the adoption of ASC 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable
to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases. Valuation allowances are established when it is more likely than not that some or all of the deferred tax assets will
not be realized.
Page
8
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
We believe that our income tax filing positions
and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial
position.  Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.  In
addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.  Our policy for recording
interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.
Our tax provision
determined using an estimate of our annual effective tax rate using enacted tax rates expected to apply to taxable income in the
years in which they are earned, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter
we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment
.
Income taxes payable as of June 30, 2012 and December 31, 2011 was zero.
Recent Accounting Pronouncements
Adopted
In May 2011, the Financial Accounting Standards
Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The adoption of this accounting standard did not have a material impact on our financial statements and related
disclosures.
Not Adopted
In December 2011, the FASB issued ASU No.
2011-11: Balance Sheet (topic 210): Disclosures about Offsetting Assets and Liabilities, which requires new disclosure requirements
mandating that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement
of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement.
In addition, the standard requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. This ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented.
We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.
Page
9
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's
present or future financial statements.
4. GOING CONCERN
The Company has sustained operating losses
of $73,921 since inception. The Company's continuation as a going concern is dependent on management's ability to
develop profitable operations, and / or obtain additional financing from its shareholders and / or other third parties. In order
to address the need to satisfy its continuing obligations and realize its long term strategy, management's plans include
continuing to fund operations with cash received from financing activities. Further, the Company currently plans to start the
process to become a public company in the United States to increase its visibility to potential investors.
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern; however, the above conditions raise substantial doubt
about the Company's ability to do so. The financial statements do not include any adjustments to reflect the possible future
effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should
the Company be unable to continue as a going concern.
5. ACCOUNTS RECEIVABLE
The Company's accounts receivable
consists of the following as of:
June 30, 2012
December 31, 2011
Account receivable
$
247,417
$
64,614
Factor reserve at 10%
24,848
7,397
272,265
72,011
Less: factored accounts receivable
(247,417
)
(64,614
)
24,848
7,397
Allowance for doubtful accounts
-
-
$
24,848
$
7,397
6. SHAREHOLDERS' EQUITY
During the six months period ended June
30, 2012 and 2011, the Company had received capital injections from officers in the amount of $0 and $2,200, respectively.
As of June 30, 2012 and December 31, 2011,
the Company has 75,000,000 shares of common stock authorized, $0.001 par value per share, and no share issued and outstanding.
Page
10
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
7. RELATED PARTY
From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, Inc., for working capital needs. As of June 30, 2012 and December 31, 2011, the amount due to the affiliate
company is $53,580 and $23,198, respectively.
In the first half of 2012, the Company
obtained unsecured promissory notes from a related party in the amount of $31,200. These notes are due within three year and carry
annual interest rate fixed at 6%. For the six months period ended June 30, 2012 and 2011, interest expense was $19 and $0, respectively.
During the reporting period, there were no financial covenant requirements under the note facilities granted to the Company.
8. INCOME TAXES
The Company accounts for income taxes in
accordance with the "liability" method. Under this method, deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the
year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined
that it is more likely than not that the asset will be realized.
This guidance also requires that deferred
tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not
be realized.
Due to the existence of a full valuation
allowance against deferred tax assets, future changes in our unrecognized tax benefits will not impact the Company's effective
tax rate.
As a corporation, the Company is primarily
subject to U.S. federal and state income tax. The Company's policy is to recognize interest and penalties related to income
tax matters in income tax expense. As of June 30, 2012 and December 31, 2011, the Company had no accruals for interest or penalties
related to income tax matters.
The components of the provision for income taxes are summarized
as follows:
For the Six Months Ended
June 30, 2012
June 30, 2011
Current tax provision
$
-
$
-
Deferred tax provision
-
-
$
-
$
-
Page
11
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
The following reconciles income taxes reported in the financial
statements to taxes that would be obtained by applying regular tax rates to income before taxes:
June 30, 2012
December 31, 2011
Expected tax benefit using regular rates
$
-
$
(16,863
)
Valuation allowance
-
16,863
$
-
$
-
9. CONTINGENCIES
Litigation
During the ordinary course of the Company's
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company's financial position, results of operations or cash flow.
10. SUBSEQUENT EVENTS
Management has evaluated subsequent events
through September 30, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has
determined that no subsequent events have occurred which require disclosure through the date that these financial statements were
issued.
Page
12
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
FINANCIAL STATEMENTS
June 30, 2012 and 2011
INDEX TO FINANCIAL STATEMENTS
Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011
2
Statements of Operations for the Three and Six Months Period Ended June 30, 2012 and 2011 (unaudited)
3
Statements of Changes in Members' Equity for the Period from December 31, 2010 to June 30, 2012 (unaudited)
4
Statements of Cash Flows for the Six Months Period Ended June 30, 2012 and 2011 (unaudited)
5
Notes to Financial Statements (unaudited)
6-10
FIRST RATE STAFFING, LLC
BALANCE SHEETS
June 30, 2012
December 31, 2011
(unaudited)
ASSETS
Current Assets
Cash
$
33,126
$
11,796
Accounts receivables, net
56,124
56,562
Due from affiliate company
53,580
23,198
Prepaid expense
24,942
-
Total current assets
167,772
91,556
Deposits and other assets
86,523
32,691
Total Assets
$
254,295
$
124,247
LIABILITIES AND MEMBERS' EQUITY
Current Liabilities
Bank overdraft
$
-
$
13,468
Accounts payable
46,423
4,800
Other current liabilities
7,262
3,100
Total current liabilities
53,685
21,368
Note payable - related party
204,826
-
Total Liabilities
258,511
21,368
Members' Equity
Members' contributions
14,345
24,255
Retained earnings
(18,561
)
78,624
Total Members' Equity
(4,216
)
102,879
Total Liabilities and Members' Equity
$
254,295
$
124,247
Page
2
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF OPERATIONS
(unaudited)
For the Six Months Ended
For the Six Months Ended
June 30, 2012
June 30, 2011
Revenues
$
2,489,976
$
2,163,448
Cost of revenues
(2,288,679
)
(1,887,132
)
Gross profit
201,297
276,316
Operating expenses
297,148
253,297
Income (loss) from operations
(95,851
)
23,019
Interest expense, net
1,334
54
Income (loss) before income tax
(97,185
)
22,965
Income tax provision
-
-
Net income (loss)
$
(97,185
)
$
22,965
Page
3
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF CHANGES IN MEMBERS' EQUITY
Members'
Total Members'
Interests
Retained Earnings
Equity
Balance, December 31, 2010
$
27,992
$
15,106
$
43,098
Contributions
492,867
-
492,867
Distributions
(496,604
)
-
(496,604
)
Net income
-
63,518
63,518
Balance, December 31, 2011
24,255
78,624
102,879
Contributions
147,590
-
147,590
Distributions
(157,500
)
-
(157,500
)
Net loss
-
(97,185
)
(97,185
)
Balance, June 30, 2012 (unaudited)
$
14,345
$
(18,561
)
$
(4,216
)
Page
4
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF CASH FLOWS
(unaudited)
For the Six Months Ended
For the Six Months Ended
June 30, 2012
June 30, 2011
Operating Activities:
Net income (loss)
$
(97,185
)
$
15,988
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for doubtful accounts
-
9,951
Changes in operating assets and liabilities:
Accounts receivable
438
(22,816
)
Due from affiliate company
(30,382
)
-
Prepaid expense
(24,942
)
30,524
Accounts payable
41,623
(1,820
)
Other current liabilities
4,162
37,135
Deposits and other assets
(53,832
)
(34,274
)
Net cash (used in) provided by operating activities
(160,118
)
34,688
Financing Activities:
Changes in bank overdraft
(13,468
)
(4,072
)
Proceeds from note payable - related party
204,826
-
Contributions from members
147,590
66,500
Distributions to members
(157,500
)
(62,700
)
Net cash provided by (used in) financing activities
181,448
(272
)
Net change in cash
21,330
34,416
Cash, beginning of period
11,796
2,310
Cash, end of period
$
33,126
$
36,726
Supplemental disclosure of cash flow information:
Cash paid for interest
$
1,337
$
54
Cash paid for taxes
$
-
$
-
Page
5
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
(unaudited)
1. ORGANIZATION
First Rate Staffing, LLC (the "Company"),
was formed on April 2, 2010 as a limited liability company in California. The Company provides recruiting and staffing services
for temporary positions for light industrial, distribution centers, assembly, and clerical to its clients in California, with an
option for the clients and candidates to choose the most beneficial working arrangements.
2. BASIS OF PRESENTATION
The accompanying unaudited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP"),
and include all the notes required by generally accepted accounting principles for complete financial statements. The information
furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of
management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures
normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United
States of America have been omitted pursuant to such rules and regulations. The results of the six month periods ended June 30,
2012 are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The summary of significant accounting policies
presented below is designed to assist in understanding the Company's financial statements. Such financial statements and
accompanying notes are the representations of the Company's management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America in all material respects,
and have been consistently applied in preparing the accompanying financial statements.
Use of Estimates
In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Page
6
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
(unaudited)
Cash and Cash Equivalents
The Company considers all highly-liquid investments
with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents
as
of June 30, 2012 and December 31, 2010. Under the terms of the Company's bank agreements, outstanding checks in excess of
the cash balances in the Company's primary disbursement accounts create a bank overdraft liability. Bank overdrafts were
$0 and $13,468 at June 30, 2012 and December 31, 2011, respectively.
Accounts Receivable and Factoring
Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of June 30, 2012 and December 31, 2011 are $29,824.
The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the "Factor"). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of accounts receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $
482,734
and $506,718 at June 30, 2012 and December 31, 2011, respectively.
Fair Value of Financial Instruments
The Company's financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.
Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm's
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.
Page
7
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
(unaudited)
The Company's policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company's customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.
Revenue Recognition
The Company's revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
("ASC") No. 605, "Revenue Recognition".  In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the six months period ended June 30, 2012 and 2011, the Company has generated revenue of
$2,489,976 and $2,163,448, respectively.
Cost of Revenue
Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company's employees while they work on contract assignment
as temporary staff of the Company's customers.
Members' Equity, Personal Assets and Income Taxes
Net income, loss, capital gains and cash
distributions pertaining to the Company are allocated to its members in accordance with the provisions of the Company's operating
agreements. The operating agreements provide that all items of net income, loss, capital gain and cash distributions be allocated
among the members based upon their respective percentage interest. There is only one class of members' interest, whose rights
are governed and set forth in the operating agreements.
In accordance with the generally accepted
method of presenting limited liability company financial statements, the financial statements do not include the personal assets
and liabilities of the members, including their obligation for income taxes on their distributive shares of net income of the LLCs,
or any provision for federal income taxes.
The Company is taxed as a limited liability
company ("LLC") under the provisions of federal and state tax codes. Under federal laws, taxes based on income of a
limited liability company are payable by the LLC members individually. Accordingly, no provision for federal income taxes has been
made in the accompanying consolidated financial statements. A provision for California franchise tax has been recorded in costs
and expenses in the accompanying financial statements at a statutory amount based on gross receipts under California laws.
Page
8
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
(unaudited)
Recent Accounting Pronouncements
Adopted
In May 2011, the Financial Accounting Standards
Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The adoption of this accounting standard did not have a material impact on our financial statements and related
disclosures.
Not Adopted
In December 2011, the FASB issued ASU No.
2011-11: Balance Sheet (topic 210): Disclosures about Offsetting Assets and Liabilities, which requires new disclosure requirements
mandating that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement
of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement.
In addition, the standard requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. This ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented.
We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.
Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's
present or future financial statements.
Page
9
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
(unaudited)
4. ACCOUNTS RECEIVABLE
The Company's accounts receivable
consists of the following as of:
June 30, 2012
December 31, 2011
Account receivable
$
488,327
$
506,718
Factor reserve at 10%
49,013
60,457
Chargebacks
31,342
25,929
568,682
593,104
Less: factored accounts receivable
(482,734
)
(506,718
)
85,948
86,386
Allowance for doubtful accounts
(29,824
)
(29,824
)
$
56,124
$
56,562
5. RELATED PARTY
From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, LLC for working capital needs. As of June 30, 2012 and December 31, 2011, the amount due from the affiliate
company is $53,580 and $23,198, respectively.
In the first half of 2012, the Company
obtained unsecured promissory notes from a related party in the amount of $204,826. These notes are due within three year and carry
annual interest rate fixed at 6%. For the six months period ended June 30, 2012 and 2011, interest expense was $1,337 and $0, respectively.
During the reporting period, there were no financial covenant requirements under the note facilities granted to the Company.
6. CONTINGENCIES
Litigation
During the ordinary course of the Company's
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company's financial position, results of operations or cash flow.
7. SUBSEQUENT EVENTS
Management has evaluated subsequent events
through September 30, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has
determined that no subsequent events have occurred which require disclosure through the date that these financial statements were
issued.
Page
10
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
FINANCIAL
STATEMENTS
December
31, 2011 and 2010
INDEX TO FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm
1
Balance Sheets as of December 31, 2011 and 2010
2
Statements of Operations for the Year Ended December 31, 2011 and for the Period from March 24, 2010 (Inception) to December 31, 2010
3
Statements of Changes in Stockholders' Equity (Deficit) for the Period from March 24, 2010 (Inception) to December 31, 2011
4
Statements of Cash Flows for the Year Ended December 31, 2011 and for the Period from March 24, 2010 (Inception) to December 31, 2010
5
Notes to Financial Statements
6-12
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Board of Directors and Shareholders of
First Rate Staffing, Inc.:
We have audited the accompanying balance
sheets of First Rate Staffing, Inc. (the "Company") as of December 31, 2011 and 2010, and the related statements of
operations, changes in shareholders' equity (deficit), and cash flows for the year ended December 31, 2011 and the period
from March 24, 2010 (Inception) through December 31, 2010. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements
referred to the above present fairly, in all material respects, the financial position of First Rate Staffing, Inc. as of December
31, 2011 and 2010, and the results of its operations and cash flows for the year ended December 31, 2011 and the period from March
24, 2010 (Inception) through December 31, 2010 in conformity with accounting principles generally accepted in the United States
of America.
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company has
incurred an accumulated deficit of $57,884 from inception to December 31, 2011. This raises substantial doubt about the Company's
ability to continue as a going concern. Management's plans in regard to this matter are described in Note 4. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Anton & Chia, LLP
Newport Beach, California
June 25, 2012
FIRST RATE STAFFING, INC.
BALANCE SHEETS
December 31, 2011
December 31, 2010
ASSETS
Current Assets
Cash
$
116
$
10,340
Accounts receivables, net
7,397
12,579
Total current assets
7,513
22,919
Deposits and other assets
9,692
9,692
Total Assets
$
17,205
$
32,611
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Bank overdraft
$
456
$
1,504
Accounts payable
3,662
3,662
Due to affiliate company
23,198
-
Other current liabilities
265
2,456
Total current liabilities
27,581
7,622
Total Liabilities
27,581
7,622
Shareholders' Equity (Deficit)
Common stock; $0.001 par value; 75,000,000 shares authorized, 0 shares issued and outstanding as of December 31, 2011 and 2010
-
-
Additional paid-in capital
47,508
40,670
Accumulated deficit
(57,884
)
(15,681
)
Total Shareholders' Equity (Deficit)
(10,376
)
24,989
Total Liabilities and Shareholders' Equity (Deficit)
$
17,205
$
32,611
Page
2
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF OPERATIONS
From March 24, 2010
For the year ended
(Inception) to
December 31, 2011
December 31, 2010
Revenues
$
1,324,497
$
685,346
Cost of revenues
(1,177,761
)
(616,188
)
Gross profit
146,736
69,158
Operating expenses
171,963
77,321
Loss from operations
(25,227
)
(8,163
)
Other income (expenses):
Interest expense
(17,131
)
(7,518
)
Other income
200
-
(16,931
)
(7,518
)
Loss before income tax
(42,158
)
(15,681
)
Income tax expense
45
-
Net loss
$
(42,203
)
$
(15,681
)
Page
3
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF CHANGES IN
    STOCKHOLDERS' EQUITY (DEFICIT)
For the period from March
    24, 2010 (Inception) to December 31, 2011
Additional
Total
Common Stock
Paid-In
Accumulated
Shareholders'
Shares
Amount
Capital
Deficit
Equity (Deficit)
Balance, March 24, 2010 (Inception)
-
$
-
$
-
$
-
$
-
Proceeds from shareholders
-
-
40,670
-
40,670
Net loss
-
-
-
(15,681
)
(15,681
)
Balance, December 31, 2010
-
-
40,670
(15,681
)
24,989
Proceeds from shareholders
-
-
6,838
-
6,838
Net loss
-
-
-
(42,203
)
(42,203
)
Balance, December 31, 2011
-
$
-
$
47,508
$
(57,884
)
$
(10,376
)
Page
4
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
STATEMENTS OF CASH FLOWS
From March 24, 2010
For the year ended
(Inception) to
December 31, 2011
December 31, 2010
Operating Activities:
Net loss
$
(42,203
)
$
(15,681
)
Changes in operating assets and liabilities:
Accounts receivable
5,182
(12,579
)
Deposits and other assets
-
(9,692
)
Accounts payable
(2,191
)
3,662
Due to affiliate company
23,198
-
Other current liabilities
-
2,456
Net cash used in operating activities
(16,014
)
(31,834
)
Financing Activities:
Changes in bank overdraft
(1,048
)
1,504
Proceeds from shareholders
6,838
40,670
Net cash provided by financing activities
5,790
42,174
Net change in cash
(10,224
)
10,340
Cash, beginning of period
10,340
-
Cash, end of period
$
116
$
10,340
Supplemental disclosure of cash flow information:
Cash paid for interest
$
17,131
$
7,518
Cash paid for taxes
$
45
$
-
Page
5
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
First Rate Staffing, Inc. (the "Company"),
was incorporated on March 24, 2010 in Nevada as a C-Corporation, and is registered to do business in Arizona. The Company provides
recruiting and staffing services for temporary positions for light industrial, distribution centers, assembly, and clerical to
its clients in Arizona, with an option for the clients and candidates to choose the most beneficial working arrangements.
2. BASIS OF PRESENTATION
The accompanying audited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"),
and include all the notes required by generally accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation of the financial
statements have been included.
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The summary of significant accounting policies
presented below is designed to assist in understanding the Company's financial statements. Such financial statements and
accompanying notes are the representations of the Company's management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America ("GAAP")
in all material respects, and have been consistently applied in preparing the accompanying financial statements.
Use of Estimates
In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly-liquid investments
with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents
as
of December 31, 2011 and 2010. Under the terms of the Company's bank agreements, outstanding checks in excess of the cash
balances in the Company's primary disbursement accounts create a bank overdraft liability. Bank overdrafts were $456 and
$1,504 at December 31, 2011 and 2010.
Page
6
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
Accounts Receivable and Factoring
Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of December 31, 2011 and 2010 are zero.
The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the "Factor"). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of Accounts Receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $64,614 and $70,842
at December 31, 2011 and 2010, respectively.
Fair Value of Financial Instruments
The Company's financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.
Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm's
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.
Page
7
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
The Company's policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company's customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.
Revenue Recognition
The Company's revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
("ASC") No. 605, "Revenue Recognition".  In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the year ended December 31, 2011 and the period from March 24, 2010 (Inception) to December
31, 2010, the Company generated revenue of $1,324,497 and $685,346, respectively.
Cost of Revenue
Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company's employees while they work on contract assignment
as temporary staff of the Company's customers.
Income Taxes
As a result of the implementation of certain
provisions of ASC 740,
Income Taxes
, (formerly FIN 48,
Accounting for Uncertainty in Income Taxes – An Interpretation
of FASB Statement No. 109),
("ASC 740"), which clarifies the accounting and disclosure for uncertainty in tax positions,
as defined. ASC 740 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement
related to accounting for income taxes.
In 2010, the Company adopted Accounting
for Uncertain Income Taxes under the provisions of ASC 740. ASC 740 clarifies the accounting for income taxes by prescribing a
minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides
guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.
The Company did not recognize any additional liability for unrecognized tax benefits as a result of the adoption of ASC 740. Deferred
tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases. Valuation allowances are established
when it is more likely than not that some or all of the deferred tax assets will not be realized.
Page
8
The
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                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
We believe that our income tax filing positions
and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial
position.  Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740.  In
addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740.  Our policy for recording
interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.
Our tax provision determined using an estimate
of our annual effective tax rate using enacted tax rates expected to apply to taxable income in the years in which they are earned,
adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of
the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Income taxes payable as
of December 31, 2011 and 2010 was zero.
Recent Accounting Pronouncements
In January 2010, the FASB issued amended
standards that require additional fair value disclosures. These disclosure requirements are effective in two phases. In the first
quarter of 2010, we adopted the requirements for disclosures about inputs and valuation techniques used to measure fair value as
well as disclosures about significant transfers. Beginning in the first quarter of 2011, these amended standards will require presentation
of disaggregated activity within the reconciliation for fair value measurements using significant unobservable inputs (Level 3).
These amended standards do not have a material impact on our financial statements or disclosures.
In May 2011, the Financial Accounting Standards
Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The Company does not expect the adoption of this accounting guidance to have a material impact on its financial
statements and related disclosures.
Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's
present or future financial statements.
4. GOING CONCERN
The Company has sustained operating losses
of $57,884 since inception. The Company's continuation as a going concern is dependent on management's ability to develop
profitable operations, and / or obtain additional financing from its shareholders and / or other third parties.
Page
9
The
                                                                                                                                                                                                                                                                                                                             accompanying
                                                                                                                                                                                                                                                                                                                             notes
                                                                                                                                                                                                                                                                                                                             are
                                                                                                                                                                                                                                                                                                                             an
                                                                                                                                                                                                                                                                                                                             integral
                                                                                                                                                                                                                                                                                                                             part
                                                                                                                                                                                                                                                                                                                             of
                                                                                                                                                                                                                                                                                                                             these
                                                                                                                                                                                                                                                                                                                             financial
                                                                                                                                                                                                                                                                                                                             statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
4. GOING CONCERN (CONTINUED)
In order to address the need to satisfy
its continuing obligations and realize its long term strategy, management's plans include continuing to fund operations with
cash received from financing activities. Further, the Company currently plans to start the process to become a public company in
the United States to increase its visibility to potential investors.
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern; however, the above conditions raise substantial doubt
about the Company's ability to do so. The financial statements do not include any adjustments to reflect the possible future
effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should
the Company be unable to continue as a going concern.
5. ACCOUNTS RECEIVABLE
The Company's accounts receivable
consists of the following as of:
December 31
2011
2010
Account receivable
$
64,614
$
70,842
Factor reserve at 10%
7,397
12,579
72,011
83,421
Less: factored accounts receivable
(64,614
)
(70,842
)
7,397
12,579
Allowance for doubtful accounts
-
-
$
7,397
$
12,579
6. SHAREHOLDERS' EQUITY
During the year ended December 31, 2011
and the period from March 24, 2010 (Inception) to December 31, 2010, the Company had received capital injections from shareholders
in the amount of $6,838 and $40,670, respectively.
As of December 31, 2011 and 2010, the Company
has 75,000,000 shares of common stock authorized, $0.001 par value per share, and no share issued and outstanding.
7. RELATED PARTY
From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, Inc., for working capital needs. As of December 31, 2011 and 2010, the amount due to the affiliate company
is $23,198 and $0, respectively.
Page
10
The
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                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
8. INCOME TAXES
The Company accounts for income taxes in
accordance with the "liability" method. Under this method, deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the
year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined
that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced
by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized.
Due to the existence of a full valuation
allowance against deferred tax assets, future changes in our unrecognized tax benefits will not impact the Company's effective
tax rate.
As a corporation, the Company is primarily
subject to U.S. federal and state income tax. The Company's policy is to recognize interest and penalties related to income
tax matters in income tax expense. As of December 31, 2011 and 2010, the Company had no accruals for interest or penalties related
to income tax matters.
The components of the provision for income taxes are summarized
as follows:
For the period from March
For the year ended
24, 2010 (Inception) to
December 31, 2011
December 31, 2010
Current tax provision
$
45
$
-
Deferred tax provision
-
-
$
45
$
-
The following reconciles income taxes reported in the financial
statements to taxes that would be obtained by applying regular tax rates to income before taxes:
December 31
2011
2010
Expected tax benefit using regular rates
$
16,863
$
6,272
Valuation allowance
(16,863
)
(6,272
)
$
-
$
-
8. CONTINGENCIES
Litigation
During the ordinary course of the Company's
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company's financial position, results of operations or cash flow.
Page
11
The
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                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.
FIRST RATE STAFFING, INC.
NOTES TO FINANCIAL STATEMENTS
9. SUBSEQUENT EVENTS
Management has evaluated subsequent events
through June 25, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has determined
that no subsequent events have occurred which require disclosure through the date that these financial statements were issued.
Page
12
The
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                                                                                                                                                                                                                                                                                                                              notes
                                                                                                                                                                                                                                                                                                                              are
                                                                                                                                                                                                                                                                                                                              an
                                                                                                                                                                                                                                                                                                                              integral
                                                                                                                                                                                                                                                                                                                              part
                                                                                                                                                                                                                                                                                                                              of
                                                                                                                                                                                                                                                                                                                              these
                                                                                                                                                                                                                                                                                                                              financial
                                                                                                                                                                                                                                                                                                                              statements.
FIRST
RATE STAFFING, LLC
FINANCIAL STATEMENTS
December 31, 2011 and 2010
INDEX TO FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm
1
Balance Sheets as of December 31, 2011 and 2010
2
Statements of Operations for the Year Ended December 31, 2011 and for the Period from April 2, 2010 (Inception) to December 31, 2010
3
Statements of Changes in Members' Equity for the Period from April 2, 2010 (Inception) to December 31, 2011
4
Statements of Cash Flows for the Year Ended December 31, 2011 and for the Period from April 2, 2010 (Inception) to December 31, 2010
5
Notes to Financial Statements
6-10
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Board of Directors and Members of
First Rate Staffing, LLC:
We have audited the accompanying balance
sheets of First Rate Staffing, LLC (the "Company") as of December 31, 2011 and 2010, and the related statements of
operations, changes in members' equity, and cash flows for the year ended December 31, 2011 and the period from April 2,
2010 (Inception) through December 31, 2010. These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements
referred to the above present fairly, in all material respects, the financial position of First Rate Staffing, LLC as of December
31, 2011 and 2010, and the results of its operations and cash flows for the year ended December 31, 2011 and the period from April
2, 2010 (Inception) through December 31, 2010 in conformity with accounting principles generally accepted in the United States
of America.
/s/ Anton & Chia, LLP
Newport Beach, California
June 25, 2012
FIRST RATE STAFFING, LLC
BALANCE SHEETS
December 31, 2011
December 31, 2010
ASSETS
Current Assets
Cash
$
11,796
$
2,310
Accounts receivables, net
56,562
36,037
Due from affiliate company
23,198
-
Prepaid expense
-
30,524
Total current assets
91,556
68,871
Deposits and other assets
32,691
1,431
Total Assets
$
124,247
$
70,302
LIABILITIES AND MEMBERS' EQUITY
Current Liabilities
Bank overdraft
$
13,468
$
9,398
Accounts payable
4,800
5,060
Other current liabilities
3,100
5,946
Tax payable
-
6,800
Total current liabilities
21,368
27,204
Total Liabilities
21,368
27,204
Members' Equity
Members' contributions
24,255
27,992
Retained earnings
78,624
15,106
Total Members' Equity
102,879
43,098
Total Liabilities and Members' Equity
$
124,247
$
70,302
Page
2
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF OPERATIONS
From April 2, 2010
For the year ended
(Inception) to
December 31, 2011
December 31, 2010
Revenues
$
4,774,545
$
1,813,577
Cost of revenues
(4,356,262
)
(1,677,495
)
Gross profit
418,283
136,082
Operating expenses
297,500
96,787
Income from operations
120,783
39,295
Other expenses:
Interest expense, net
(50,164
)
(17,389
)
Other expense, net
(301
)
-
(50,465
)
(17,389
)
Income before income tax
70,318
21,906
Income tax expense
6,800
6,800
Net income
$
63,518
$
15,106
Page
3
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF CHANGES IN MEMBERS' EQUITY
Members
Total Members'
Interests
Retained Earnings
Equity
Balance, April 2, 2010 (Inception)
$
-
$
-
$
-
Contributions
52,325
-
52,325
Distributions
(24,333
)
-
(24,333
)
Net income
-
15,106
15,106
Balance, December 31, 2010
27,992
15,106
43,098
Contributions
492,867
-
492,867
Distributions
(496,604
)
-
(496,604
)
Net income
-
63,518
63,518
Balance, December 31, 2011
$
24,255
$
78,624
$
102,879
Page
4
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
STATEMENTS OF CASH FLOWS
From April 2, 2010
For the year ended
(Inception) to
December 31, 2011
December 31, 2010
Operating Activities:
Net income
$
63,518
$
15,106
Adjustments to reconcile net income to net cash used by operating activities:
Provision for doubtful accounts receivable
29,824
-
Changes in operating assets and liabilities:
Accounts receivable
(50,349
)
(36,037
)
Due from affiliate company
(23,198
)
-
Prepaid expense
30,524
(30,524
)
Accounts payable
(260
)
5,060
Other current liabilities
(2,846
)
5,946
Tax payable
(6,800
)
6,800
Deposits and other assets
(31,260
)
(1,431
)
Net cash provided by (used in) operating activities
9,153
(35,080
)
Financing Activities:
Changes in bank overdraft
4,070
9,398
Contributions from members
492,867
52,325
Distributions to members
(496,604
)
(24,333
)
Net cash provided by financing activities
333
37,390
Net change in cash
9,486
2,310
Cash, beginning of period
2,310
-
Cash, end of period
$
11,796
$
2,310
Supplemental disclosure of cash flow information:
Cash paid for interest
$
50,173
$
17,389
Cash paid for taxes
$
13,600
$
-
Page
5
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
First Rate Staffing, LLC (the "Company"),
was formed on April 2, 2010 as a limited liability company in California. The Company provides recruiting and staffing services
for temporary positions for light industrial, distribution centers, assembly, and clerical to its clients in California, with an
option for the clients and candidates to choose the most beneficial working arrangements.
2. BASIS OF PRESENTATION
The accompanying audited financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"),
and include all the notes required by generally accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation of the financial
statements have been included.
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
The summary of significant accounting policies
presented below is designed to assist in understanding the Company's financial statements. Such financial statements and
accompanying notes are the representations of the Company's management, who are responsible for their integrity and objectivity.
These accounting policies conform to accounting principles generally accepted in the United States of America ("GAAP")
in all material respects, and have been consistently applied in preparing the accompanying financial statements.
Use of Estimates
In preparing these financial statements,
management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly-liquid investments
with maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents
as
of December 31, 2011 and 2010. Under the terms of the Company's bank agreements, outstanding checks in excess of the cash
balances in the Company's primary disbursement accounts create a bank overdraft liability. Bank overdrafts were $13,468 and
$9,398 at December 31, 2011 and 2010, respectively.
Page
6
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
Accounts Receivable and Factoring
Accounts receivable billed are carried
at original amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.
Management determines the allowance for doubtful receivables by regularly evaluating individual customer receivables and considering
a customer's financial condition, credit history, and current economic conditions. Accounts receivable are written off when deemed
uncollectible. Recoveries of accounts receivable previously written off are recorded when received. The allowance for doubtful
accounts as of December 31, 2011 and 2010 are $29,824 and $0, respectively.
The Company entered into an accounts receivable
factoring arrangement with a non-related third party financial institution (the "Factor"). Pursuant to the terms of the
arrangement, the Company, from time to time, shall sell to the Factor certain of its accounts receivable balances on a non-recourse
basis for credit approved accounts. The Factor shall then remit 90% of the accounts receivable balance to the Company, with the
remaining balance, less fees to be forwarded to the Company once the Factor collects the full accounts receivable balance from
the customer. An administrative fee of 1.65% is charged on the gross amount of Accounts Receivables assigned to Factor, plus interest
to be calculated at 0.075% per day on late invoices. The total amount of accounts receivables factored was $506,718 and $355,648
at December 31, 2011 and 2010, respectively.
Fair Value of Financial Instruments
The Company's financial instruments
include cash, accounts receivable, and accounts payable. The estimated fair value of these instruments approximates its carrying
amount due to the short maturity of these instruments.
Management believes it is not practical
to estimate the fair value of due to shareholders because the transactions cannot be assumed to have been consummated at arm's
length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent
valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs.
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its
cash with high quality banking institutions. From time to time, the Company may maintain cash balances at certain institutions
in excess of the Federal Deposit Insurance Corporation limit. Historically, the Company has not experienced any losses on deposits.
Page
7
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
The Company's policy is to maintain
an allowance for doubtful accounts, if any, for estimated losses resulting from the inability of its customer to pay. However,
if the financial condition of the Company's customers were to deteriorate rapidly, resulting in nonpayment, the Company could
be required to provide for additional allowances, which would decrease operating results in the period that such determination
was made.
Revenue Recognition
The Company's revenue is derived
from providing temporary staffing services to its clients. The Company records its transactions under the accrual method of accounting
whereby revenue is recognized on arrangements in accordance with Financial Accounting Standards Board Accounting Standards Codification
("ASC") No. 605, "Revenue Recognition".  In all cases, revenue is recognized only when the price
is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting
receivable is reasonably assured. For the year ended December 31, 2011 and the period from April 2, 2010 (Inception) to December
31, 2010, the Company generated revenue of $4,774,545 and $1,813,577, respectively.
Cost of Revenue
Cost of revenue consists of wages, related
payroll taxes, workers compensation, and employee benefits of the Company's employees while they work on contract assignment
as temporary staff of the Company's customers.
Members' Equity, Personal Assets and Income Taxes
Net income, loss, capital gains and cash
distributions pertaining to the Company are allocated to its members in accordance with the provisions of the Company's operating
agreements. The operating agreements provide that all items of net income, loss, capital gain and cash distributions be allocated
among the members based upon their respective percentage interest. There is only one class of members' interest, whose rights
are governed and set forth in the operating agreements.
In accordance with the generally accepted
method of presenting limited liability company financial statements, the financial statements do not include the personal assets
and liabilities of the members, including their obligation for income taxes on their distributive shares of net income of the LLCs,
or any provision for federal income taxes.
The Company is taxed as a limited liability
company ("LLC") under the provisions of federal and state tax codes. Under federal laws, taxes based on income of a
limited liability company are payable by the LLC members individually. Accordingly, no provision for federal income taxes has been
made in the accompanying consolidated financial statements. A provision for California franchise tax has been recorded in costs
and expenses in the accompanying financial statements at a statutory amount based on gross receipts under California laws.
Page
8
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
3. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(CONTINUED)
Recent Accounting Pronouncements
In January 2010, the FASB issued amended
standards that require additional fair value disclosures. These disclosure requirements are effective in two phases. In the first
quarter of 2010, we adopted the requirements for disclosures about inputs and valuation techniques used to measure fair value as
well as disclosures about significant transfers. Beginning in the first quarter of 2011, these amended standards will require presentation
of disaggregated activity within the reconciliation for fair value measurements using significant unobservable inputs (Level 3).
These amended standards do not have a material impact on our financial statements or disclosures.
In May 2011, the Financial Accounting Standards
Board ("FASB") issued a new accounting standard on fair value measurements that clarifies the application of existing
guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about
fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption
is not permitted. The Company does not expect the adoption of this accounting guidance to have a material impact on its financial
statements and related disclosures.
Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's
present or future financial statements.
4. ACCOUNTS RECEIVABLE
The Company's accounts receivable
consists of the following as of:
December 31
2011
2010
Account receivable
$
506,718
$
355,648
Factor reserve at 10%
60,457
36,037
Chargebacks
25,929
-
593,104
391,685
Less: factored accounts receivable
(506,718
)
(355,648
)
86,386
36,037
Allowance for doubtful accounts
(29,824
)
-
$
56,562
$
36,037
Page
9
The accompanying notes are an integral part of these financial statements.
FIRST RATE STAFFING, LLC
NOTES TO FINANCIAL STATEMENTS
5. RELATED PARTY
From time to time, the Company advances
amounts to, as well as receives payments from, a related party, an affiliate company under common control by the same shareholders
of First Rate Staffing, LLC for working capital needs. As of December 31, 2011 and 2010, the amount due from the affiliate company
is $23,198 and $0, respectively.
6. CONTINGENCIES
Litigation
During the ordinary course of the Company's
business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will
not have a material adverse effect on the Company's financial position, results of operations or cash flow.
7. SUBSEQUENT EVENTS
Management has evaluated subsequent events
through June 25, 2012, the date upon which the financial statements were issued. Based on this evaluation, the Company has determined
that no subsequent events have occurred which require disclosure through the date that these financial statements were issued.
Page
10
The accompanying notes are an integral part of these financial statements.