July 22, 2010 (FinancialWire) (Go to http://www.financialwire.net/?s=ftrdnwswnd for all of today’s featured news.) — Smart-Tek Automated Services, Inc. (OTCBB: STTN) said it has signed an agreement with a Chicago-based broker who is targeting a minimum of $120 million in annual gross payroll with a resulting net reportable revenue (in compliance with GAAP) in excess of $40 million, subject to any adverse market changes. Under the deal, the firm will process $40 million in annual gross payroll ($12 million net reportable revenue) by the quarter ending September 30, with the balance placed by quarter ending December 31.

Smart-Tek said that growing its broker sales network is a strategic priority for the company, since brokers serve a critical role in the PEO world as the initial client contact. The company said it has signed several new contracts in recent weeks.

The company's presentations include broker information, submission forms, comparison tools, detailed reports on commissions, detailed reports on variances between booked and actual remarketing processes, and other technologies and enhancements.

Kelly Mowrey, COO of Smart-Tek, said, "We believe the U.S. broker market is critical to the success of PEOs in general and to our company in particular."

Nevada-based Smart-Tek Automated Services’ parent, Smart-Tek Solutions, generates revenue from the installation of security systems in construction projects. Its board is currently in negotiations to sell its original business and focus entirely on the PEO business of its wholly owned subsidiary.

The original business posted $3.3 million and $3.8 million of revenue in 2009 and 2008 respectively, and $0 and  loss of earnings in 2009 and 2008 respectively.

Smart-Tek Automated Services provides financial services to small and medium-size businesses, in areas such as payroll processing, human resources support, workers' compensation insurance, safety programs, employee benefits, and other administrative and aftermarket services predominantly related to staffing.

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