<PAGE> 1
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
Date of Report (Date of earliest event reported) December 17, 1998
DIGITAL SOLUTIONS, INC.
(Exact name of Registrant as specified in charter)
New Jersey 0-18492 22-1899798
(State or other jurisdic- (Commission (IRS Employer
tion of incorporation) File Number) Identification No.)
300 Atrium Drive, Somerset, N.J. 08873
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (732) 748-1700
--------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE> 2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On December 17, 1998, Digital Solutions, Inc.(the "Company") held a
Special Meeting of Shareholders in Somerset, New Jersey. Shareholders of record
at October 30, 1998 were entitled to attend and vote at the meeting. At the
record date there were outstanding 19,356,833 shares of Common Stock, of which
12,632,968 (65%)were represented by proxy or in person at the Special Meeting.
Voting of the shares of Common Stock was on a noncumulative basis.
The purpose of the Special Meeting was to consider and vote upon the
following proposals:
1. APPROVAL OF THE ACQUISITION OF THE TEAMSTAFF COMPANIES. To approve and adopt
two separate agreements entitled Plan and Agreement of Merger and
Reorganization, dated as of October 29, 1998 (together, the "Merger Agreement")
providing for the acquisition of the TeamStaff Entities, the result of which the
TeamStaff Entities will become wholly-owned subsidiaries of the Company and
pursuant to which the Company agreed (i) to issue up to an aggregate of
9,633,334 shares of Common Stock and (ii) to pay approximately $3.1 million for
the payment of debt and preferred stock.
RESULTS OF VOTING UPON PROPOSAL TO ACQUIRE THE TEAMSTAFF COMPANIES
The Shareholders of the Company voted 12,320,088 shares (98% of those
voting) in favor of the proposal. Shareholders holding 235,640 shares (2% of
those voting) voted against the proposal and shareholders holding 77,240 shares
either withheld approval or abstained from voting.
2. CHANGE OF NAME. To consider and approve a proposal to amend the Company's
Certificate of Incorporation to change the name of the Company from Digital
Solutions, Inc. to "TeamStaff, Inc."
RESULTS OF VOTING UPON PROPOSAL TO CHANGE NAME.
The Shareholders of the Company voted 12,217,552 (97% of those voting)
shares in favor of the proposal to change the Company's name. Shareholders
holding 246,124 shares (2% of those voting) voted against the proposal and
shareholders holding 169,292 shares abstained from the vote.
ITEM 5. OTHER EVENTS.
Pursuant to the terms of the Agreement to acquire the TeamStaff
Companies, Digital Solutions agreed to appoint to its Board of Directors a
representative of the TeamStaff Companies. On December 17,1998, the Board of
Directors of the Company was
2
<PAGE> 3
expanded by one member. Mr. Kirk Scoggins, the President of the TeamStaff
Companies, was appointed effective upon closing of the acquisition to occupy
this vacancy.
The Company expects to consummate the acquisition of the TeamStaff
Companies upon receipt of necessary financing from its lender. The Company
expects to complete the change of its name to TeamStaff, Inc., Inc. within
approximately 60 days.
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits.
3. Amendment to Amended and Restated Certificate of Incorporation
(filed as Exhibit G to the Company's Proxy Statement dated
November 12, 1998 as filed with the Securities and Exchange
Commission).
99. Press Release dated December 18, 1998.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
DIGITAL SOLUTIONS, INC.
(Registrant)
By /s/ Donald T. Kelly
---------------------
Donald T. Kelly
Chief Financial Officer
Dated: December 22, 1998
3
<PAGE> 1
(DIGITAL-SOLUTIONS) (DGSI) Stockholders of Digital Solutions Approve Acquisition
of the TeamStaff Companies
SOMERSET, N.J.--Dec. 17, 1998--Digital Solutions, Inc. (NASDAQ: DGSI),
one of the nation's leading Professional Employer Organizations (PEO), announced
today that its shareholders, at a special meeting, have approved the company's
proposed merger agreement with The TeamStaff Companies, a group of
privately-held PEOs located in Tampa, FL. The transaction was approved by
holders of approximately 60 percent of Digital Solutions common stock, which
represents 91 percent of the shares voted. The merged companies will have
revenues of approximately $240 million and approximately 11,000 worksite
employees, ranking the combined company among the top 15 PEOs in the U.S. PEOs
provide outsourcing of human resource, payroll, benefits, and workmen's
compensation protection to small and medium sized businesses.
As previously announced, Digital Solutions will issue a minimum of
approximately 8.2 million shares of its common stock in exchange for all of the
common stock of TeamStaff and $3.1 million in cash for all the preferred stock
and for payment of debt. Completion of the transaction is contingent upon the
receipt of necessary financing and other normal closing conditions. Upon
completion of the merger, the company will be renamed TeamStaff, Inc. Following
the name change, the company expects its common shares to trade on the NASDAQ
SmallCap market under a new proposed symbol "TSTF".
According to Donald W. Kappauf, president and chief executive officer
of DSI, the merger will provide Digital Solutions with an avenue for expansion
in the attractive Southeastern marketplace, afford many opportunities for
achieving operating efficiencies and synergies and accelerate the company's
revenue and earnings growth over the next few years.
The merged companies' PEO business will be based in Tampa. Kirk
Scoggins, president and a principal shareholder of TeamStaff, will become
president of the combined company's professional employment organization
division and join its board of directors. TeamStaff has offices in
Raleigh/Durham, NC; Dallas, TX; Atlanta, GA; and Jacksonville, FL as well as
Tampa. The company serves a variety of industries, including golf course
management, resort property management, manufacturing, distribution and service
industries.
Digital Solutions, Inc. provides comprehensive human resource
management to small and mid-sized companies in a variety of industries. The
company's service include professionally employer services which provide the
administration of the human resource function, workers' compensation, employee
benefits, a 401K plan, payroll and payroll tax service preparation. DSI also
provides temporary and permanent staffing and payroll services. This press
release contains statements of a forward-looking nature regarding future events.
These statements are only
<PAGE> 2
predictions and actual events may differ materially. Please refer to documents
that DSI files from time to time with the Securities and Exchange Commission for
a discussion of certain factors that could cause actual results to differ
materially from those contained in the forward-looking statements.
CONTACT: Company Contact:
Don Kappauf, Chief Executive Officer
(732) 748-1700
2
