UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C INFORMATION
Preliminary Information Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the registrant |X|
Filed by a party other than the registrant | |
Check the appropriate box:
|X| Preliminary information statement | | Confidential, for use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
| | Definitive information statement
| | Definitive additional materials
| | Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
<PAGE>
PROVIDENCE CAPITAL I, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Information Statement, if Other Than the Registrant)
Not Applicable
Payment of Filing Fee(Check the appropriate box):
|X| No fee required.
| | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
<PAGE>
(1) Title of each class of securities to which transaction applies:
Common
(2) Aggregate number of securities to which transaction applies:
1,500,000
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
Not Applicable
(4) Proposed maximum aggregate value of transaction:
Not Applicable
(5) Total fee paid:
| | Fee paid previously with preliminary materials:
| | Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
Not Applicable
(2) Form Schedule or Registration Statement No.:
Not Applicable
(3) Filing Party:
Nadeau & Simmons, P.C.
1250 Turks Head Building
Providence, RI 02903
401-272-5800
(4) Date Filed:
July 31, 2000
<PAGE>
By Order of the Board of Directors
Mark T. Thatcher,
Secretary
Providence, Rhode Island
August 5, 2000
MANAGEMENT HOPES THAT STOCKHOLDERS WILL ATTEND THE MEETING.
YOUR COOPERATION WILL BE APPRECIATED.
STOCKHOLDERS WHO ATTEND THE MEETING
MAY VOTE THEIR STOCK PERSONALLY,
OTHERWISE YOUR VOTE WILL NOT BE COUNTED.
PROVIDENCE CAPITAL I, INC.
August 5, 2000
To the Shareholders of
PROVIDENCE CAPITAL I, INC.:
Dear Fellow Shareholders:
Attached please find a notice of annual meeting of the shareholders of
PROVIDENCE CAPITAL I, INC. (hereinafter referred to as "PROVIDENCE" and/or
the "Company"), that will be held at the Company headquarters, 1250 Turks
Head Building, Providence, Rhode Island 02903, on August 15, 2000, at 10:00
a.m., Eastern Daylight Time ("EDT"). The purpose of this meeting is to
consider, discuss, vote and act upon the following:
(i) Restating and amending the Company's Articles of Incorporation in
order to change its name from PROVIDENCE CAPITAL I, INC. to "UNITED
AMERICAN COMPANIES, INC." ("name change");
(ii) Approving an Agreement and Plan of Merger and Reorganization (the
"Merger") whereby UNITED AMERICAN COMPANIES, INC. (hereinafter
referred to as "UAC") will be acquired by PROVIDENCE; and
<PAGE>
Page 2
Providence Shareholders
August 5, 2000
______________________
(iii) electing a new Board of Directors.
Certain officers, directors and affiliates of PROVIDENCE who own in excess
of 50.00% of the outstanding voting shares of the Company have advised the
Company that they intend to vote in favor of each item set forth above.
Consequently, the proposals will be approved at the annual meeting of
stockholders.
PROVIDENCE hereby offers its shareholders Dissenter's Rights as provided
for in Article 7-113-101 through 7-113-302 of the Colorado Business
Corporation Act ("CBCA"), as amended. If a PROVIDENCE shareholder elects
to exercise their Dissenter's Rights in accordance with Article 7-113-204,
said shareholder of PROVIDENCE will be paid the fair value thereof as
determined by the Board of Directors. The Board of Directors has determined
the fair value of each share of Common Stock to be $0.11. The determination
of the per share fair value was computed based on a number of
considerations including the following:
(i) the Company has had no operations for approximately two years;
(ii) the Company has negative book value and no assets as of June 30, 2000;
(iii)other similar public shell companies have in effect been sold in the
marketplace for cash consideration of $150,000 to $200,000 which would
result in a fully diluted per share value of approximately $0.11 per
share.
In the event a shareholder elects to exercise Dissenters' Rights, such
shareholder must comply with the applicable procedures set forth in
Sections 7-113-201 through 7-113-209 of the CBCA in order to receive
payment of the fair value of any Common Shares. In compliance with Section
7-113-201 of the CBCA, a copy of Article 113 of the CBCA is set forth at
Item 3 of the accompanying Information Statement filed on Schedule 14C (the
"Information Statement") dated August 5, 2000.
<PAGE>
Page 3
Providence Shareholders
August 5, 2000
______________________
The Company is also including herewith a copy of its Registration Statement
on Form 10-SB, filed as an exhibit to the Information Statement. If there
are any questions or any further information is required with respect to
the meeting and the transactions contemplated thereby, please contact me at
(401) 272-5800 or Adam S. Clavell, Esq., Nadeau & Simmons, P.C., 1250 Turks
Head Building, Providence, RI 02903 (401) 272-5800.
Warmest regards,
/s/ Mark T. Thatcher
MARK T. THATCHER, Secretary
DATED: August 5, 2000
<PAGE>
DEFINITIVE COPY
PROVIDENCE CAPITAL I, INC.
1250 TURKS HEAD BUILDING
PROVIDENCE, RHODE ISLAND 02903
--------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
--------------------------------------------------------------------------------
PROVIDENCE CAPITAL I, INC.
Dated as of August 5, 2000
________________________________________________________________________
To the Stockholders of Providence:
Pursuant to the provisions of the Colorado Business Corporation Act, the
undersigned, being the Secretary of PROVIDENCE CAPITAL I, INC., provides
that:
________________________________________________________________________
Notice is hereby given that the annual meeting (the "Meeting") of the
stockholders of PROVIDENCE CAPITAL I, INC. (hereinafter referred to as
"PROVIDENCE" and/or the "Company"), a Colorado corporation, will be held
at the Company headquarters, 1250 Turks Head Building, Providence, Rhode
Island, on August 15, 2000, at 10:00 a.m., Eastern Daylight Time ("EDT").
________________________________________________________________________
The purpose of this meeting is to consider, discuss, vote and act upon the
following:
(i) Restating and amending the Company's Articles of Incorporation in
order to change its name from PROVIDENCE CAPITAL I, INC. to "UNITED
AMERICAN COMPANIES, INC." ("name change");
(ii) Approving an Agreement and Plan of Merger and Reorganization (the
"Merger") whereby UNITED AMERICAN COMPANIES, INC. (hereinafter
referred to as "UAC") will be acquired by PROVIDENCE; and
<PAGE>
(iii) electing a new Board of Directors.
Certain officers, directors and affiliates of PROVIDENCE who own in excess
of 50.00% of the outstanding voting shares of the Company have advised the
Company that they intend to vote in favor of each item set forth above.
Consequently, the proposals will be approved at the annual meeting of
stockholders.
PROVIDENCE hereby offers its shareholders Dissenter's Rights as provided
for in Article 7-113-101 through 7-113-302 of the Colorado Business
Corporation Act ("CBCA"), as amended. If any PROVIDENCE shareholder elects
to exercise their Dissenter's Rights in accordance with Article 7-113-204,
said shareholder of PROVIDENCE will be paid the fair value thereof as
determined by the Board of Directors.
The Board of Directors has determined the fair value of each share of
Common Stock to be $0.11. The determination of the per share fair value was
computed based on a number of considerations including the following: (i)
the Company has had no operations for approximately two years; (ii) the
Company has negative book value and no assets as of June 30, 2000; (iii)
other similar public shell companies have in effect been sold in the
marketplace for cash consideration of $150,000 to $200,000 which would
result in a fully diluted per share value of approximately $0.11 per share.
In the event a shareholder elects to exercise Dissenters' Rights, such
shareholder must comply with the applicable procedures set forth in
Sections 7-113-201 through 7-113-209 of the CBCA in order to receive
payment of the fair value of any Common Shares. In compliance with Section
7-113-201 of the CBCA, a copy of Article 113 of the CBCA is set forth at
Item 3 of the accompanying Information Statement filed on Schedule 14 C
(the "Information Statement") dated August 5, 2000.
In order to obtain the fair value payment for PROVIDENCE shares, a
shareholder must mail or deliver their intention no later than August 15,
2000, to the following address:
The Board of Directors
Providence Capital I, Inc.
1250 Turks Head Building
Providence, Rhode Island
02903
<PAGE>
The Board of Directors of the Company believe that the Merger will be in
the best interest of the PROVIDENCE shareholders. However, shareholders are
entitled to assert the above stated Dissenter's Rights (fair value of $0.11
per share) no later than August 15, 2000, as a result of this transaction
as explained in Section 7-111 ofthe CBCA. We are not asking you for a
proxy in conjunction with this Meeting, but you are urged to attend the
Meeting to vote your shares in person.
Upon the approval of the Proposals, PROVIDENCE and UAC will immediately
file an appropriate Articles of Merger in accordance with Colorado law
to effect the Merger and file articles of amendment to the Articles of
Incorporation of PROVIDENCE in accordance with Colorado law to effect a
name change of PROVIDENCE. The Merger will become effective upon the
completion of the filing. At the completion of the proposed Merger, each
PROVIDENCE shareholder will maintain their current shares of PROVIDENCE
Common Stock. The Board of Directors of the Company believes that the
Proposals will be in the best interest of PROVIDENCE shareholders and
recommends their adoption.
The Company is also including herewith a copy of its Registration Statement
on Form 10-SB, filed as an exhibit to the Information Statement.
If there are any questions or further information is required with respect
to the Proposals, please contact Adam S. Clavell, Esq. at 1250 Turks Head
Building, Providence, Rhode Island 02903 (401) 272-5800.
By order of the Board of Directors,
/s/ Mark T. Thatcher
MARK T. THATCHER, Secretary
DATED: August 5, 2000
<PAGE> 1
______________________________________
DEFINITIVE INFORMATION STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD AUGUST 15, 2000
______________________________________
PROVIDENCE CAPITAL I, INC.
1250 TURKS HEAD BUILDING
PROVIDENCE, RHODE ISLAND 02903
AUGUST 15, 2000
GENERAL INFORMATION
This Information Statement is furnished in connection with an Annual
Meeting of Stockholders called by the Board of Directors (the "Board") of
Providence Capital I, Inc. ("Providence"), to be held at 1250 Turks Head
Building, Providence, Rhode Island at 10:00 a.m. local time on August 15,
2000, and at any and all postponements, continuations or adjournments
thereof (collectively the "Meeting"). This Information Statement and the
accompanying Notice of Annual Meeting will be first mailed or given to
Providence's stockholders on or about August 5, 2000.
All shares of Providence's common stock, no par value per share (the
"Voting Shares"), represented in person will be eligible to be voted at the
Meeting.
WE ARE NOT ASKING FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY.
<PAGE> 2
ITEM 1. DATE, TIME AND PLACE INFORMATION
The enclosed information statement is provided by the Board of Providence
for use at the Annual Meeting of Stockholders to be held at the Company's
headquarters at 1250 Turks Head Building, Providence, Rhode Island at 10:00
a.m. on August 15, 2000, and at any adjournment or adjournments thereof.
Stockholders of record at the close of business on August 5, 2000 (the
"Record Date") will be entitled to vote at the meeting or any adjournment
or adjournments thereof. On that date the Company had outstanding shares of
Common Stock entitled to one (1) vote per share (the "Voting Shares").
The affirmative vote of the holders of a majority of the Company's Voting
Shares is required to approve each of the Proposals.
The presence of the holders of a majority of the issued and outstanding
shares of Voting Shares voting as a single class, entitled to vote at the
meeting is necessary to constitute a quorum for the transaction of business
at the meeting.
BACKGROUND INFORMATION
An Agreement and Plan of Merger and Reorganization (the "Agreement") was
executed on July 26, 2000 by and among Providence and United American
Companies, Inc., ("UAC"), who joined in the execution of the Agreement for
the purpose of making certain covenants regarding the transaction
contemplated therein. Providence is a corporation duly organized and
validly existing under the laws of the state of Colorado, with its
registered office at 17 West Cheyenne Mountain Boulevard, Colorado Springs,
Colorado 80906 its principal executive office at 1250 Turks Head Building,
Providence, Rhode Island 02903, and its phone number is (401) 272-5800; UAC
is a corporation duly organized and validly existing under the laws of the
State of North Carolina, with its registered office located in the city of
Charlotte, State of North Carolina, its principal executive office at 8609
Wood Lake Court, Suite 206, Charlotte, North Carolina 28210 and its phone
number is (704) 556-7992.
The respective boards of directors of Providence and UAC deemed it
desirable and in the best interests of their respective corporations, for
Providence to acquire the outstanding capital stock of UAC in exchange for
14,234,000 shares of the common stock of Providence and have proposed,
declared advisable and approved such exchange (the "Merger") pursuant to
this Agreement, which Agreement has been duly approved by
<PAGE> 3
resolutions of the respective boards of directors of Providence and UAC.
This Agreement requires that a shareholders' meeting be called by
Providence for the purposes of approving the Merger prior to closing.
PROPOSAL ONE AMENDMENT TO ARTICLES OF INCORPORATION
The Board of Directors has unanimously approved, and recommends for
shareholder approval, the restatement and amendment of the Company's
Articles of Incorporation in order to change the Company's name to "United
American Companies, Inc.". Approval of the restatement and amendment will
not result in any other material amendment or change to the Company's
Articles of Incorporation. The restatement and amendment is required to
effect the Company's acquisition of UAC.
PROPOSAL TWO APPROVAL OF AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
The Board of Directors has unanimously approved, and recommends for
shareholder approval, an Agreement and Plan of Merger and Reorganization
(the "Merger"), whereby Providence will acquire all issued and outstanding
capital stock of UAC in exchange for 14,234,000 shares of the Common Stock
of Providence.
PROPOSAL THREE ELECTION OF DIRECTORS
At the Meeting, the successors to the current Board of Directors will be
elected for a term of office, such term to commence on the effective date
of the Merger. The nominee directors who are chosen to fill vacancies on
the Board shall hold office until the next election for which those nominee
directors are chosen, and until their successors are duly elected by the
stockholders.
The following table sets forth the ages of and positions and offices
presently held by each nominee director of the Company. For information
about ownership of the Company's Voting Securities by each nominee
director, see "BENEFICIAL OWNERSHIP OF VOTING SECURITIES."
<PAGE> 4
Date First
Became Positions and Offices
Name Age Director With the Company**
--------------------------------------------------------------------
Mark Craven 51 N/A Chairman and President
Arnold E. Pitoniak 37 N/A Chief Executive Officer
Michael Gilbert 59 N/A Chief Financial Officer and
Director
William F. Ruth 65 N/A Executive Vice President,
Retail Liquidation Services
Timothy A. Holly 51 N/A Director
Nicholas J. Coolidge 68 N/A Director
-------------------------------------------------------
** Nominees for election at this meeting.
Please see personal biographies below and at Item. 7
</FN>
PERSONAL BIOGRAPHIES (Insert)
ITEM 2. REVOCABILITY OF PROXY
Not Applicable
ITEM 3. DISSENTERS' RIGHT OF APPRAISAL
Providence hereby offers its shareholders Dissenter's Rights as provided
for in Article 7-113-101 through 7-113-302 of the CBCA. If a Providence
shareholder elects to exercise their Dissenter's Rights in accordance with
Article 7-113-204, said shareholder of Providence will be paid the fair
value thereof as determined by the Board of Directors.
The Board of Directors has determined the fair value of each share of
Common Stock to be $0.11. The determination of the per share fair value was
computed based on a number of considerations including the following:
(i) the Company has had no operations for approximately two years;
(ii) the Company has negative book value and no assets as of June 30, 2000;
and
(iii) other similar public shell companies have in effect been sold in the
marketplace for cash consideration of $150,000 to $200,000 which would
result in a fully diluted per share value of approximately $0.11 per
share.
<PAGE> 5
The Board of Directors of the Company believe that the Merger will be in
the best interest of Providence shareholders. However, shareholders are
entitled to assert their Dissenter's Rights (fair market value of $0.11 per
share) no later than August 15, 2000, as a result of this transaction as
explained in Section 7-111 of the CBCA.
In order to obtain the fair market value payment for Providence shares, a
shareholder must mail or deliver their intention to the following address:
The Board of Directors
Providence Capital IV, Inc.
1250 Turks Head Building
Providence, RI 02903
Pursuant to Article 113 of the CBCA, each shareholder has the right and is
entitled to dissent from the completion of the Merger and receive payment
of the fair value of the Common Shares owned by any such shareholder
("Dissenters' Rights"). In the event a shareholder elects to exercise
Dissenters' Rights, such shareholder must comply with the applicable
procedures set forth in Sections 7-113-201 through 7-113-209 of the CBCA,
as summarized below, in order to receive payment of the fair value of any
Common Shares. In compliance with Section 7-113-201 of the CBCA, a copy of
Article 113 of the CBCA and its summary are set forth below.
SUMMARY OF ARTICLE 113 OF THE CBCA
THE FOLLOWING IS ONLY A SUMMARY OF THE PROCEDURES FOR DISSENTING
SHAREHOLDERS PRESCRIBED BY SECTIONS 7-113-101 THROUGH 7-113-302 OF THE
CBCA AND IS QUALIFIED IN ITS ENTIRETY BY THE FULL TEXT OF ARTICLE 113 OF
THE CBCA AS SET FORTH BELOW
Section 7-113-102 of the CBCA provides that each record or beneficial
shareholder of the Company is entitled to dissent from the Merger and
demand payment of the fair value of the shares of Common Stock owned by
such shareholder. In accordance with Section 7-113-202 of the CBCA, in
order for a shareholder to exercise Dissenters' Rights, such shareholder
must, prior to the taking of the vote of the shareholders on the Merger,
deliver to the Company written notice of such shareholder's intent to
demand payment for shares in the event the Merger is approved and shall not
vote such shareholder's shares in favor of the Merger.
In accordance with Section 7-113-203 of the CBCA, within ten days after the
Merger is effected, the Company must deliver a written dissenter's notice
("Dissenter's Notice") to all shareholders who satisfy the requirements of
Section 7-113-202 of the CBCA. The Dissenter's Notice must state that the
Merger was authorized and the effective date of the Merger, set forth the
address at which the Company will receive payment demands and where stock
certificates shall be deposited, supply a form for demanding payment, which
form shall request an address from the dissenting shareholder to which
payment is to be made, and set the date by which the Company must receive
the payment demand and stock certificates, which date shall not be less
than 30 days after the date the Dissenter's Notice was delivered.
Furthermore, the Dissenter's Notice may require that all beneficial
shareholders, if any, certify as to the assertion of Dissenters' Rights,
and be accompanied by Article 113 of the CBCA.
<PAGE> 6
Pursuant to Section 7-113-204 of the CBCA, a shareholder receiving the
Dissenter's Notice must demand payment in writing and deposit such
shareholder's stock certificates in accordance with the terms of the
Dissenter's Notice. A shareholder who does not comply with the foregoing
requirements is not entitled to the fair value of such shareholder's shares
under Article 113 of the CBCA.
Upon the later of the effective date of the Merger, or upon receipt of a
demand for payment by a dissenting shareholder,the Company must pay each
dissenting shareholder who complies with Section 7-113-204 the amount the
Company estimates to be the fair value of such shares, plus accrued
interest in accordance with Section 7-113-206 of the CBCA. The payment must
be accompanied by (i) the Company's balance sheet as of the fiscal year
ending not more than sixteen months before the date of payment, an income
statement for that year, a statement of change in shareholders' equity for
that year, and the latest available interim financial statement; (ii) a
statement of the Company's estimate of the fair value of the shares; (iii)
an explanation by the Company of how the interest was calculated; (iv) a
statement of the dissenting shareholder's right to demand payment under
Section 7-113-209 of the CBCA; and (v) a copy of Article 113 of the CBCA.
In the event a dissenting shareholder is dissatisfied with the Company's
payment or offer of payment, such dissenting shareholder, pursuant to
Section 7-113-209 of the CBCA, may notify the Company in writing within 30
days after the Company makes or offers to pay each dissenting shareholder,
of such shareholder's own estimate of the fair value of such shares and the
amount of interest due, and demand payment of such shareholder's estimate,
less any payment already made by the Company under Section 7-113-206, or
reject the Company's offer under Section 7-113-208 and demand payment for
the fair value of the shares and interest due. A dissatisfied dissenting
shareholder may effect the foregoing if: (i) the dissenting shareholder
believes that the amount paid or offered is less than the fair value of the
shares or that the interest due is incorrectly calculated; (ii) the Company
has failed to make payment within 60 days after the date set for demanding
payment; or (iii) the Company does not return the deposited stock
certificates within the time specified by Section 7-113-207 of the CBCA. In
the event a demand for payment under Section 7-113-209 remains unresolved,
the Company may commence a court proceeding to determine the fair value of
the shares and accrued interest within 60 days after receiving the payment
demand from a dissenting shareholder.
<PAGE> 7
TITLE 7. COLORADO BUSINESS CORPORATION ACT
ARTICLE 113. DISSENTERS' RIGHTS
PART 1. RIGHT OF DISSENT - PAYMENT FOR SHARES
C.R.S. 7-113-101 (1996)
7-113-101. DEFINITIONS
For purposes of this article:
(1) "Beneficial shareholder" means the beneficial owner of shares held in a
voting trust or by a nominee as the record shareholder.
(2) "Corporation" means the issuer of the shares held by a dissenter before
the corporate action, or the surviving or acquiring domestic or foreign
corporation, by merger or share exchange of that issuer.
(3) "Dissenter" means a shareholder who is entitled to dissent from
corporate action under section 7-113-102 and who exercises that right at
the time and in the manner required by part 2 of this article.
(4) "Fair value", with respect to a dissenter's shares, means the value of
the shares immediately before the effective date of the corporate action to
which the dissenter objects, excluding any appreciation or depreciation in
anticipation of the corporate action except to the extent that exclusion
would be inequitable.
(5) "Interest" means interest from the effective date of the corporate
action until the date of payment, at the average rate currently paid by the
corporation on its principal bank loans or, if none, at the legal rate as
specified in section 5-12-101, C.R.S.
(6) "Record shareholder" means the person in whose name shares are
registered in the records of a corporation or the beneficial owner of
shares that are registered in the name of a nominee to the extent such
owner is recognized by the corporation as the shareholder as provided in
section 7-107-204.
(7) "Shareholder" means either a record shareholder or a beneficial
shareholder.
<PAGE> 8
7-113-102. RIGHT TO DISSENT
(1) A shareholder, whether or not entitled to vote, is entitled to dissent
and obtain payment of the fair value of the shareholder's shares in the
event of any of the following corporate actions:
(a) Consummation of a plan of merger to which the corporation is a
party if:
(I) Approval by the shareholders of that corporation is required
for the merger by section 7-111-103 or 7-111-104 or by the
articles of incorporation; or
(II) The corporation is a subsidiary that is merged with its
parent corporation under section 7-111-104;
(b) Consummation of a plan of share exchange to which the corporation
is a party as the corporation whose shares will be acquired;
(c) Consummation of a sale, lease, exchange, or other disposition of
all, or substantially all, of the property of the corporation for
which a shareholder vote is required under section 7-112-102 (1);
and
(d) Consummation of a sale, lease, exchange, or other disposition of
all, or substantially all, of the property of an entity controlled
by the corporation if the shareholders of the corporation were
entitled to vote upon the consent of the corporation to the
disposition pursuant to section 7-112-102 (2).
(1.3) A shareholder is not entitled to dissent and obtain payment, under
subsection (1) of this section, of the fair value of the shares of any
class or series of shares which either were listed on a national securities
exchange registered under the federal "Securities Exchange Act of 1934", as
amended, or on the national market system of the national association of
securities dealers automated quotation system, or were held of record by
more than two thousand shareholders, at the time of:
(a) The record date fixed under section 7-107-107 to determine the
shareholders entitled to receive notice of the shareholders'
meeting at which the corporate action is submitted to a vote;
(b) The record date fixed under section 7-107-104 to determine
shareholders entitled to sign writings consenting to the
corporate action; or
(c) The effective date of the corporate action if the corporate
action is authorized other than by a vote of shareholders.
<PAGE> 9
(1.8) The limitation set forth in subsection (1.3) of this section shall
not apply if the shareholder will receive for the shareholder's shares,
pursuant to the corporate action, anything except:
(a) Shares of the corporation surviving the consummation of the plan
of merger or share exchange;
(b) Shares of any other corporation which at the effective date of
the plan of merger or share exchange either will be listed on a
national securities exchange registered under the federal
"Securities Exchange Act of 1934", as amended, or on the national
market system of the national association of securities dealers
automated quotation system, or will be held of record by more
than two thousand shareholders;
(c) Cash in lieu of fractional shares; or
(d) Any combination of the foregoing described shares or cash in lieu
of fractional shares.
(2) (Deleted by amendment, L. 96, p. 1321, 30, effective June 1, 1996.)
(2.5) A shareholder, whether or not entitled to vote, is entitled to
dissent and obtain payment of the fair value of the shareholder's shares in
the event of a reverse split that reduces the number of shares owned by the
shareholder to a fraction of a share or to scrip if the fractional share or
scrip so created is to be acquired for cash or the scrip is to be voided
under section 7-106-104.
(3) A shareholder is entitled to dissent and obtain payment of the fair
value of the shareholder's shares in the event of any corporate action to
the extent provided by the bylaws or a resolution of the board of
directors.
(4) A shareholder entitled to dissent and obtain payment for the
shareholder's shares under this article may not challenge the corporate
action creating such entitlement unless the action is unlawful or
fraudulent with respect to the shareholder or the corporation.
<PAGE> 10
7-113-103. DISSENT BY NOMINEES AND BENEFICIAL OWNERS
(1) A record shareholder may assert dissenters' rights as to fewer than all
the shares registered in the record shareholder's name only if the record
shareholder dissents with respect to all shares beneficially owned by any
one person and causes the corporation to receive written notice which
states such dissent and the name, address, and federal taxpayer
identification number, if any, of each person on whose behalf the record
shareholder asserts dissenters' rights. The rights of a record shareholder
under this subsection (1) are determined as if the shares as to which the
record shareholder dissents and the other shares of the record shareholder
were registered in the names of different shareholders.
(2) A beneficial shareholder may assert dissenters' rights as to the shares
held on the beneficial shareholder's behalf only if:
(a) The beneficial shareholder causes the corporation to receive the
record shareholder's written consent to the dissent not later
than the time the beneficial shareholder asserts dissenters'
rights; and
(b) The beneficial shareholder dissents with respect to all shares
beneficially owned by the beneficial shareholder.
(3) The corporation may require that, when a record shareholder dissents
with respect to the shares held by any one or more beneficial shareholders,
each such beneficial shareholder must certify to the corporation that the
beneficial shareholder and the record shareholder or record shareholders of
all shares owned beneficially by the beneficial shareholder have asserted,
or will timely assert, dissenters' rights as to all such shares as to which
there is no limitation on the ability to exercise dissenters' rights. Any
such requirement shall be stated in the dissenters' notice given pursuant
to section 7-113-203.
<PAGE> 11
7-113-201. NOTICE OF DISSENTERS' RIGHTS
(1) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is submitted to a vote at a shareholders' meeting, the
notice of the meeting shall be given to all shareholders, whether or not
entitled to vote. The notice shall state that shareholders are or may be
entitled to assert dissenters' rights under this article and shall be
accompanied by a copy of this article and the materials, if any, that,
under articles 101 to 117 of this title, are required to be given to
shareholders entitled to vote on the proposed action at the meeting.
Failure to give notice as provided by this subsection (1) shall not affect
any action taken at the shareholders' meeting for which the notice was to
have been given, but any shareholder who was entitled to dissent but who
was not given such notice shall not be precluded from demanding payment for
the shareholder's shares under this article by reason of the shareholder's
failure to comply with the provisions of section 7-113-202 (1).
(2) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is authorized without a meeting of shareholders pursuant
to section 7-107-104, any written or oral solicitation of a shareholder to
execute a writing consenting to such action contemplated in section
7-107-104 shall be accompanied or preceded by a written notice stating that
shareholders are or may be entitled to assert dissenters' rights under this
article, by a copy of this article, and by the materials, if any, that,
under articles 101 to 117 of this title, would have been required to be
given to shareholders entitled to vote on the proposed action if the
proposed action were submitted to a vote at a shareholders' meeting.
Failure to give notice as provided by this subsection (2) shall not affect
any action taken pursuant to section 7-107-104 for which the notice was to
have been given, but any shareholder who was entitled to dissent but who
was not given such notice shall not be precluded from demanding payment for
the shareholder's shares under this article by reason of the shareholder's
failure to comply with the provisions of section 7-113-202 (2).
<PAGE> 12
7-113-202. NOTICE OF INTENT TO DEMAND PAYMENT
(1) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is submitted to a vote at a shareholders' meeting and if
notice of dissenters' rights has been given to such shareholder in
connection with the action pursuant to section 7-113-201 (1), a shareholder
who wishes to assert dissenters' rights shall:
(a) Cause the corporation to receive, before the vote is taken,
written notice of the shareholder's intention to demand payment
for the shareholder's shares if the proposed corporate action is
effectuated; and
(b) Not vote the shares in favor of the proposed corporate action.
(2) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is authorized without a meeting of shareholders pursuant
to section 7-107-104 and if notice of dissenters' rights has been given to
such shareholder in connection with the action pursuant to section
7-113-201 (2), a shareholder who wishes to assert dissenters' rights shall
not execute a writing consenting to the proposed corporate action.
(3) A shareholder who does not satisfy the requirements of subsection (1)
or (2) of this section is not entitled to demand payment for the
shareholder's shares under this article.
7-113-203. DISSENTERS' NOTICE
(1) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is authorized, the corporation shall give a written
dissenters' notice to all shareholders who are entitled to demand payment
for their shares under this article.
(2) The dissenters' notice required by subsection (1) of this section shall
be given no later than ten days after the effective date of the corporate
action creating dissenters' rights under section 7-113-102 and shall:
(a) State that the corporate action was authorized and state the
effective date or proposed effective date of the corporate
action;
(b) State an address at which the corporation will receive payment
demands and the address of a place where certificates for
certificated shares must be deposited;
(c) Inform holders of uncertificated shares to what extent transfer
of the shares will be restricted after the payment demand is
received;
<PAGE> 13
(d) Supply a form for demanding payment, which form shall request a
dissenter to state an address to which payment is to be made;
(e) Set the date by which the corporation must receive the payment
demand and certificates for certificated shares, which date shall
not be less than thirty days after the date the notice required
by subsection (1) of this section is given;
(f) State the requirement contemplated in section 7-113-103 (3), if
such requirement is imposed; and
(g) Be accompanied by a copy of this article.
7-113-204. PROCEDURE TO DEMAND PAYMENT
(1) A shareholder who is given a dissenters' notice pursuant to section
7-113-203 and who wishes to assert dissenters' rights shall, in accordance
with the terms of the dissenters' notice:
(a) Cause the corporation to receive a payment demand, which may be
the payment demand form contemplated in section 7-113-203 (2)
(d), duly completed, or may be stated in another writing; and
(b) Deposit the shareholder's certificates for certificated shares.
(2) A shareholder who demands payment in accordance with subsection (1) of
this section retains all rights of a shareholder, except the right to
transfer the shares, until the effective date of the proposed corporate
action giving rise to the shareholder's exercise of dissenters' rights and
has only the right to receive payment for the shares after the effective
date of such corporate action.
(3) Except as provided in section 7-113-207 or 7-113-209 (1)(b), the demand
for payment and deposit of certificates are irrevocable.
(4) A shareholder who does not demand payment and deposit the shareholder's
share certificates as required by the date or dates set in the dissenters'
notice is not entitled to payment for the shares under this article.
<PAGE> 14
7-113-205. UNCERTIFICATED SHARES
(1) Upon receipt of a demand for payment under section 7-113-204 from a
shareholder holding uncertificated shares, and in lieu of the deposit of
certificates representing the shares, the corporation may restrict the
transfer thereof.
(2) In all other respects, the provisions of section 7-113-204 shall be
applicable to shareholders who own uncertificated shares.
7-113-206. PAYMENT
(1) Except as provided in section 7-113-208, upon the effective date of the
corporate action creating dissenters' rights under section 7-113-102 or
upon receipt of a payment demand pursuant to section 7-113-204, whichever
is later, the corporation shall pay each dissenter who complied with
section 7-113-204, at.
7-113-302. COURT COSTS AND COUNSEL FEES
(1) The court in an appraisal proceeding commenced under section 7-113-301
shall determine all costs of the proceeding, including the reasonable
compensation and expenses of appraisers appointed by the court. The court
shall assess the costs against the corporation; except that the court may
assess costs against all or some of the dissenters, in amounts the court
finds equitable, to the extent the court finds the dissenters acted
arbitrarily, vexatiously, or not in good faith in demanding payment under
section 7-113-209.
(2) The court may also assess the fees and expenses of counsel and experts
for the respective parties, in amounts the court finds equitable:
(a) Against the corporation and in favor of any dissenters if the
court finds the corporation did not substantially comply with the
requirements of part 2 of this article; or
(b) Against either the corporation or one or more dissenters, in
favor of any other party, if the court finds that the party
against whom the fees and expenses are assessed acted
arbitrarily, vexatiously, or not in good faith with respect to
the rights provided by this article.
<PAGE> 15
(3) If the court finds that the services of counsel for any dissenter were
of substantial benefit to other dissenters similarly situated, and that the
fees for those services should not be assessed against the corporation, the
court may award to said counsel reasonable fees to be paid out of the
amounts awarded to the dissenters who were benefitted.
ITEM 4. PERSONS MAKING THE SOLICITATION
The enclosed information statement is distributed by the Board of Directors
(the "Board of Directors") of Providence. The cost of distribution will be
borne by the Company. In addition to the distribution by mail, officers and
employees of the Company may distribute in person. The Company may
reimburse brokers or persons holding stock in their names, or in the names
of their nominees, for their expenses in sending the information statement
to the beneficial owners.
ITEM 5. INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
Not Applicable
ITEM 6. VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Except as otherwise indicated, the persons or entities listed below have
sole voting and investment power with respect to the shares beneficially
owned by them.
For purposes of this table, information as to the shares of common stock is
calculated based on 1,500,000 shares of common stock outstanding upon the
closing of the Transaction. For purposes of this table, "beneficial ownership"
is determined in accordance with Rule 13d-3 under the Securities Exchange Act
of 1934, pursuant to which a person or group of persons is deemed to have
"beneficial ownership" of any shares of common stock that such person has
the right to acquire within 60 days after the date of this prospectus. For
purposes of computing the percentage of outstanding shares of common stock
held by each person or group of persons named below, any shares which such
person or persons has the right to acquire within 60 days after the date of
this prospectus are deemed to be outstanding but are not deemed to be
outstanding for the purpose of computing the percentage ownership of any
other person.
<PAGE> 16
<TABLE>
<CAPTION>
COMMON SHARES OWNED
Name and Address
Number of Percent of
Shares Owned Class Owned
Beneficially
<S> <C> <C>
Richard Nadeau, Jr. 250,000(1) 16.67%
1250 Turks Head Building
Providence, RI 02903
James R. Simmons 250,000(1) 16.67%
1250 Turks Head Building
Providence, RI 02903
Mark T. Thatcher 250,000(1) 16.67%
1250 Turks Head Building
Providence, RI 02903
James H. Brennan, III 250,000(1) 16.67%
735 Broad Street, Suite 800
Chattanooga, TN 37402
Doug Dyer 250,000(1) 16.67%
735 Broad Street, Suite 800
Chattanooga, TN 37402
All directors and executive
officers as a group
(3 persons) 750,000(1) 50.00%
</TABLE>
(1) The persons listed are the sole officers and directors of the Company.
Management has no plans to issue any additional securities to management,
promoters or their affiliates or associates and will do so only if such
issuance is in the best interests of shareholders of the Company and
complies with all applicable federal and state securities rules and
regulations.
Although the Company has a very large amount of authorized but unissued
common and preferred stock that may be issued without further shareholder
approval or notice, it is the intention of the Company to avoid inhibiting
certain transactions with prospective acquisition or merger candidates,
based upon the perception by such candidate that they may be engaged in a
rapidly expanding industry (i.e. Internet) and cannot afford to proxy
shareholders each time their management needs to authorize additional
shares.
<PAGE> 17
BENEFICIAL OWNERSHIP OF UAC SECURITIES
The following table sets forth certain information regarding beneficial
ownership of UAC Common Stock as of August 5, 2000 by (i) each person known
by UAC to own beneficially more than 5% of the outstanding Common Stock,
(ii) each director, and (iii) all executive officers and directors as a
group. Each person has sole voting and sole investment or dispositive power
with respect to the shares shown except as noted.
COMMON SHARES OWNED
Name and Address
Number of Title of
Shares Owned Class Owned
Beneficially
[S] [C] [C]
Mark A. Craven 5,700,000 Class A Common Shares
Arnold E. Pitoniak 5,600,000 Class A Common Shares
William F. Ruth 600,000 Class A Common Shares
Timothy A. Holly 1,500,000 Class A Common Shares
-------------------------------------------------------
PRICE RANGE OF COMMON STOCK
Not Applicable
DIVIDENDS
The Company has never paid dividends with respect to the Common Stock and
currently does not have any plans to pay cash dividends in the future.
There are no contractual restrictions on the Company's present or future
ability to pay dividends. Future dividend policy is subject to the
discretion of the Board of Directors and is dependent upon a number of
factors, including future earnings, capital requirements and the financial
condition of the Company. The Colorado Corporation Code provides that a
corporation may not pay dividends if the payment would reduce the remaining
net assets of the corporation below the corporation's stated capital plus
amounts constituting a liquidation preference to other security holders.
<PAGE> 18
ITEM 7. DIRECTORS AND EXECUTIVE OFFICERS
In 1998 and 1999, the Board of Directors met informally on a number of
occasions, voting on corporate actions by written consent.
THE DIRECTORS AND EXECUTIVE OFFICERS OF PROVIDENCE
The directors and executive officers of the Company, their ages and
positions held in the Company are as follows:
<TABLE>
<CAPTION>
Name Age Positions Held and Tenure
<S> <C> <C>
Richard Nadeau, Jr. 46 President and Director since
November 24, 1999
James R. Simmons 38 Vice President and Director since
November 24, 1999
Mark T. Thatcher 35 Secretary and Director since
November 24, 1999
</TABLE>
The directors named above will serve until the first annual meeting of the
Company's stockholders. Thereafter, directors will be elected for one-year
terms at the annual stockholders' meeting. Officers will hold their
positions at the pleasure of the board of directors, absent any employment
agreement, of which none currently exists or is contemplated. There is no
arrangement or understanding between the directors and officers of the
Company and any other person pursuant to which any director or officer was
or is to be selected as a director or officer.
The directors and officers of the Company will devote their time to the
Company's affairs on an "as needed" basis. As a result, the actual amount
of time which they will devote to the Company's affairs is unknown and is
likely to vary substantially from month to month.
<PAGE> 19
BIOGRAPHICAL INFORMATION
RICHARD NADEAU, JR.--
In 1982, Mr. Nadeau became associated with the Providence law firm of
Wistow, Barylick & Bruzzi, where he was responsible for the majority of the
firm's commercial litigation. He started the Providence law firm of Nadeau
& Simmons, P.C. in 1985 and, since then, has engaged in a successful
practice concentrating in corporate law,commercial lending and creditors'
rights. He was also appointed Municipal Court Judge for the Towns of
Burrillville and North Smithfield in 1999.
Mr. Nadeau graduated magna cum laude from the University of Hartford in
1985 and received his law degree from George Washington University in 1988.
After graduating from Georgetown, he was admitted to the District of
Columbia bar and became associated with King & Newmyer. Although he no
longer actively practices in Washington, he remains a member of the D.C.
Bar.
JAMES R. SIMMONS--
Before joining Nadeau & Simmons, P.C., a Providence corporate, banking and
real estate law firm, Mr. Simmons practiced with Tillinghast Collins &
Graham in its corporate, commercial and real estate departments. He serves
on the Banks and Trusts Committee of the Rhode Island Bar Association and
his practice is concentrated in the areas of corporate law, banking and
commercial law, mortgage lending and real estate, bankruptcy, and
creditors' rights.
Mr. Simmons is admitted to practice law in both Rhode Island and
Massachusetts. He graduated magna cum laude from the University of Hartford
in 1985 and received his law degree from George Washington University in 1988.
MARK T. THATCHER--
Mr. Thatcher has participated as a business and legal advisor for a number
of public and privately held companies. He has been retained for federal
and state securities compliance, venture capital analysis, public and
private mergers and acquisitions and corporate reorganization/restructuring.
He has served as General Counsel to Acadia Group, Inc. (Ticker "ANHS") and
CollegeLink.com (Ticker "APS"). He recently joined the Providence law firm
of Nadeau & Simmons, P.C. in an "of-counsel" capacity. He is an honorary
member of Alpha Kappa Delta, Sutton Award candidate, and recipient of the
E.V. Graham Scholarship Merit Award.
Mr. Thatcher attended the University of Denver where he earned his Juris
Doctor and Masters in business administration. He is presently a member of
the State Bar of Colorado; Court of Appeals, District of Columbia;
Committee Member of the Securities Forum, Colorado, Washington, D.C. and
the American Bar Association; and Member of the International Society of
Business Law.
---------------------------------------------------------------
<PAGE> 20
All directors of the Company will hold office until the next annual meeting
of the shareholders and until their successors have been elected and
qualified.
The officers of the Company are elected by the Board of Directors at the
first meeting after each annual meeting of the Company's shareholders, and
hold office until their successors are elected and shall have qualified, or
until resignation or removal from office.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act, requires the Company's officers,
directors and persons who beneficially own more than ten percent of the
Common Stock to file reports of securities ownership and changes in such
ownership with the Securities and Exchange Commission. Officers, directors
and greater than ten percent beneficial owners also are required by rules
promulgated by the Securities and Exchange Commission to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely upon review of the copies of such forms furnished to the
Company, or written representations that no Form 5 filings were required,
the Company believes that during 1999 all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten percent
beneficial owners were complied with.
COMMITTEES OF THE BOARD
Not Applicable
BOARD AND COMMITTEE ATTENDANCE
In 1999 and 2000, the Board of Directors met informally on a number of
occasions, voting on corporate actions by written consent. At the Meeting,
the successors to the current Board of Directors will be elected for a term
of office, such term to commence on the effective date of the Merger. The
nominee directors who are chosen to fill vacancies on the Board shall hold
office until the next election for which those nominee directors are
chosen, and until their successors are duly elected by the shareholders.
<PAGE> 21
THE NOMINEE DIRECTORS
The following table sets forth the ages of and positions and offices
presently held by each nominee director of the Company. For information
about ownership of the Company's Securities by each nominee director, see
"BENEFICIAL OWNERSHIP OF UAC SECURITIES."
Date First
Became Positions and Offices
Name Age Director With the Company**
--------------------------------------------------------------------
Mark Craven 51 N/A Chairman and President
Arnold E. Pitoniak 37 N/A Chief Executive Officer
Michael Gilbert 59 N/A Chief Financial Officer,
Treasurer and Director
William F. Ruth 65 N/A Executive Vice President,
Retail Liquidation Services
Timothy A. Holly 51 N/A Director
Nicholas J. Coolidge 67 N/A Director
-------------------------------------------------------
** Nominees for election at this meeting.
Please see personal biographies below and at Item. 7
</FN>
PERSONAL BIOGRAPHIES (Insert)
Mark A. Craven
In 1971, Mr. Craven became associated with a family apparel firm, Arnold Craven,
Inc., located in High Point, North Carolina, as President of the company and
remained as such until 1993 and was responsible for expanding the company into
three prominent well-respected retail apparel stores. In 1980, Mr. Craven
formed a direct marketing catalog business to compliment the retail apparel
stores. In 1981, the Direct Marketing Association (DMA) awarded the national
catalog with an award for its layout and design. With peak sales of $4,500,000
Mr. Craven sold the name and concept in 1982.
With experience in retail apparel and distribution, Mr. Craven has utilized that
experience in developing a national reputation since 1993 in liquidations and
consulting for retail, wholesale and distribution firms by liquidating inventory
and maximizing value for his clients.
Born and raised in High Point, North Carolina, Mr. Craven has long-standing
contacts in the apparel, textile and furniture industries and as a result
developed a liquidation and consulting division to capitalize off his experience
and contacts in those industries by forming High Point Furniture Liquidators,
LLC, capitalizing as well off High Point's reputation as furniture capital
of the world as an affiliate to Craven & Ruth Promotions, LLC as the retail and
wholesale inventory liquidation consulting firm of The Craven Companies, LLC.
Mr. Craven graduated from Hargrave Military Academy, attended Wake Forest
University in 1968 1971 majoring in business administration and attended the
MRA Institute of Retailing at New York University. He is currently a member of
the Turnaround Management Association.
Arnold E. Pitoniak
Mr. Pitoniak has seventeen years experience as an entrepreneur, investment
banker and merchant banker. He formed his first company while a senior at Wake
Forest University and has formed, developed, bought and sold over 10 companies
since as a principal. During that period, Mr. Pitoniak has had 3 1/2 years of
direct experience as an investment banker in corporate and real estate finance
where his primary focus was providing mergers and acquisition advisory services,
financing advisory services raising equity and debt for publicly-traded
furniture and textile companies. His latter experience was in general corporate
finance providing mergers and acquisition advisory services and was responsible
for raising equity and debt for corporations and real estate developers.
Mr. Pitoniak's experience brings a unique perspective to the asset liquidation
and management business with his financial and analytical skills, ability to
negotiate and structure transactions, and experience in public and private
mergers and acquisitions and financings, corporate restructuring and corporate
development, all of which will help UAC to become a fully integrated asset
management company.
Mr. Pitoniak attended Southern Methodist University in Dallas, Texas in 1981 and
graduated from Wake Forest University with a Bachelor of Arts degree in
Economics in 1985. He is a current member of the Turnaround Management
Association.
William F. Ruth
Mr. Ruth began a long career of 31 years with Belk Stores, Inc. in 1957 and has
held positions over that span as floor manager, buyer, merchandiser, divisional
merchandise manager, general merchandise manager to area merchandise manager.
Belk Stores is one of the largest regional department store chains in the
country.
Since leaving Belk Stores, Inc., Mr. Ruth owned and operated his own apparel
store in Winston-Salem, North Carolina for a period of three years and held a
position in sales with Pine Apparel, a distributor of apparel. Mr. Ruth's
experience in merchandising, buying, managing apparel of retail inventory has
provided him a sound base in which to provide liquidation consulting services
to retailers, wholesalers, and distributors since 1993. Mr. Ruth graduated
with a Bachelor's Degree in Business Administration from Western Carolina
University.
Michael H. Gilbert
Michael H. Gilbert is a certified public accountant and from October 1997 to
October 1999 was chief financial officer, secretary and treasurer of The Prima
Group International, Inc. a holding company in Charlotte, North Carolina, and
from May 1986 to September 1997 was a shareholder, officer, and director of
Hitchner, Whitt & Co., P.A., a firm of certified public accountants.
Nicholas J. Coolidge
Nicholas J. Coolidge is President of Jefferson Worldwide Group Ltd. He is a
graduate of Harvard College (1954) and Harvard Law School (1959) and spent two
years as a lieutenant in the United States Marine Corps. From 1959 to 1969
he was associated with the New York Law firm of Sullivan & Cromwell, where he
worked for investment banking clients on debt and equity financings, both
domestic and international, investment company matters and mergers and
acquisitions.
In 1965 he left the practice of law and became a member of the Corporate
Finance Department of Kidder, Peabody & Co. Incorporated in New York
City. While there, he served as a Vice President, Director and Stockholder,
with sixteen professionals under his direction. He had responsibility for the
firm's project finance, leasing, real estate and Canadian activities. He was
active in public offerings, private placements, international transactions and
mergers and acquisitions. While at Kidder, Peabody he and his staff originated
and carried out in excess of 200 separate financings for new clients involving
over two billion dollars of securities. In 1978 he left Kidder, Peabody and
formed Coolidge Securities Corporation, an investment banking firm engaged in
a broad range of financing activities for corporate and government clients.
More recently, he formed Jefferson Worldwide Group Ltd., a member of the
National Association of Securities Dealers, Inc. (NASD), specializing in private
placements for clients. Jefferson Worldwide Group, Ltd. is also an investment
advisor registered with the Securities and Exchange Commission.
Timothy A. Holly
Timothy A. Holly, 51, has been an international investment manager for over 22
years. He has extensive expertise and substantial skills in investment analysis
and management, international finance, foreign commercial intelligence, and
strategic planning. Mr. Holly is currently the Chief Executive Officer of
Jefferson Acquisition Group, Inc., a merchant banking firm, which recently
acquired All Points Telecom, Inc., a manufacturing firm making the world's only
solar-powered wireless pay phones with internet capability. From 1994 to 1998,
Mr. Holly was the Chairman of Stone Harbor Holdings, Ltd (an offshore venture
capital fund).
From 1987 to 1994, Mr. Holly headed Royal Overseas Investment Group, Ltd., which
included Royal Asset Management Company, a registered investment advisory firm
managing the assets of high-net worth individuals and institutions from the
Middle East and Europe. Prior to 1987, he was lead analyst for two private
banks, with responsibility for structuring foreign direct investments in the
United States advising on over $2.3 billion of investments of foreign capital.
He continues to advise certain members of the Saudi Royal Family.
Also, active in education, Mr. Holly was on the faculties of both the University
of Massachusetts and City Colleges of Chicago; the research staff of the
Investment Negotiation Center at the Institute for International and Foreign
Trade Law; the Board of the Association of Schools of International Affairs;
and General Editor of The Fletcher Forum; A Journal of International Affairs.
Mr. Holly received his undergraduate education in Political Science at Indiana
University; and graduate studies in Comparative Systems, University of Notre
Dame, and law at Georgetown University Law Center. He was also a Compton
Foundation Fellow working towards a Ph.D. in International Business and Finance
at the Fletcher School of Law and Diplomacy. He has taken executive training
courses at the OIC Management Academy, Harvard Business School, MIT Sloan
School and the University of Chicago.
ITEM 8. COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
At inception of the Company, its Directors, Richard Nadeau, Jr., James R.
Simmons and Mark T. Thatcher each received one hundred thousand (100,000)
shares of Common Stock valued at $0.0038 per share in consideration of
pre-incorporation services rendered to the Company related to investigating
and developing the Company's proposed business plan and capital structure,
and completion of the incorporation and organization of the Company. No
officer or director has received any other remuneration. Although there is
no current plan in existence, it is possible that the Company will adopt a
plan to pay or accrue compensation to its sole officers and directors for
services related to seeking business opportunities and completing a merger
or acquisition transaction. See "Certain Relationships and Related
Transactions." The Company has no stock option, retirement, pension, or
profit-sharing programs for the benefit of directors, officers or other
employees, but the Board of Directors may recommend adoption of one or more
such programs in the future.
<PAGE> 22
It is possible that, after the Company successfully consummates a merger or
acquisition with an unaffiliated entity, that entity may desire to employ
or retain one or more members of the Company's management for the purposes
of providing services to the surviving entity, or otherwise provide other
compensation to such persons. However,the Company has adopted a policy
whereby the offer of any post-transaction remuneration to members of
management will not be a consideration in the Company's decision to
undertake any proposed transaction. Each member of management has agreed
to disclose to the Company's Board of Directors any discussions concerning
possible compensation to be paid to them by any entity which proposes to
undertake a transaction with the Company and further, to abstain from
voting on such transaction. Therefore, as a practical matter, if each
member of the Company's Board of Directors is offered compensation in any
form from any prospective merger or acquisition candidate, the proposed
transaction will not be approved by the Company's Board of Directors as a
result of the inability of the Board to affirmatively approve such a
transaction.
No member of management of the Company will receive any finders fee, either
directly or indirectly, as a result of their respective efforts to
implement the Company's business plan outlined herein. Also,there are no
plans, proposals, arrangements or understandings with respect to the sale
or issuance of additional securities by the Company prior to the location
of an acquisition or merger candidate. Please also see Item I, Description
of Business-General for information regarding the seeking out and selection
of a target company, addressing matters such as the manner of solicitation
of potential investors, the approximate number of persons who will be
contacted or solicited, their relationships to the Company's management,
etc.
INDEMNIFICATION AND LIMITATION OF LIABILITY
The Company's Articles of Incorporation include provisions which eliminate
or limit the personal liability of the Company's directors except in
situations when a director shall be liable for (i) a breach of Section
7-5-114 of the Colorado Business Corporation Act, including liability for
improper dividends or distributions; (ii) a breach of loyalty; (iii)
failure to act in good faith; (iv) intentional misconduct or knowing
violation of the law; or (v) obtaining an improper personal benefit. In
addition, the Articles of Incorporation allow for the indemnification of
any director or officer to the fullest extent permitted by the Colorado
Corporation Code as in effect at the time of the conduct of such person.
No employee of the Company receives any additional compensation for his
services as a director. The Company has no retirement, pension or profit
sharing program for the benefit of its directors, officers or other
employees. The Board of Directors may recommend one or more such programs
for adoption in the future.
<PAGE> 23
SUMMARY COMPENSATION TABLE FOR UAC
SUMMARY COMPENSATION TABLE
Long Term Compensation
____________________________________________________________________________
Annual Compensat. Awards Payouts
____________________________________________________________________________
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Rest. All
Name and Annual Stock LTIP Other
Principal Calend. Comp. Award(s) Opt. P/outs Comp.
Position Year Salary Bonus($) ($) ($) SARs(#) ($) ($)
_____________________________________________________________________________
Director
Craven, 2000 $150,000
Jim (annualized)
1999
Director
Pitoniak, 2000 $125,000
Arnold (annualized)
1999
Director
Gilbert, 2000 $ 75,000
Michael (annualized)
1999
Director
Ruth, 2000 $ 85,000
William F. (annualized)
1999
ITEM 9. INDEPENDENT PUBLIC ACCOUNTANTS
Not Applicable
ITEM 11. AUTHORIZATION OR ISSUANCE OF SECURITIES OTHERWISE THAN FOR EXCHANGE
Not Applicable
<PAGE> 24
ITEM 12. MODIFICATION OR EXCHANGE OF SECURITIES
No action is to be taken by the Company with respect to the modification of
any class of securities of the Company, or the issuance or authorization
for issuance of securities of the Company in exchange for outstanding
securities of the Company.
ITEM 13. FINANCIAL AND OTHER INFORMATION
The Company and UAC hereby provides the information as required by
paragraph (a) of this Item as follows:
<PAGE> F-1
FINANCIAL STATEMENTS
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
PERIOD ENDED DECEMBER 31, 1999
<PAGE> F-2
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Providence Capital I, Inc.
(A Development Stage Company)
We have audited the accompanying balance sheet of PROVIDENCE CAPITAL I,
INC. (a development stage company) as of December 31, 1999 and the related
statements of operations, stockholders' equity and cash flows for the period
from November 24, 1999 to December 31, 1999. 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 audit.
We conducted our audit in accordance with generally accepted auditing
standards. These standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. 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, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
As discussed in Note 1 to the financial statements, the Company was
incorporated on November 24, 1999 and is in the development stage and had no
operations to date.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of PROVIDENCE CAPITAL
I, INC. as of December 31, 1999, and the results of its operations and its
cash flows for the period from November 24, 1999 to December 31, 1999 in
conformity with generally accepted accounting principles.
Providence, Rhode Island
July 26, 2000
/s/ Cayer Prescott Clune & Chatellier, LLP
<PAGE> F-3
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
BALANCE SHEET
DECEMBER 31, 1999
ASSETS
Total assets $ 0
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable $ 15,625
Stockholders' deficit:
Common stock, $.001 par value; 50,000,000 shares
authorized, 734,000 shares issued and outstanding 734
Paid in capital 2,055
Preferred stock, $.001 par value, 50,000,000 shares
authorized, no shares outstanding
Deficit accumulated during the development stage ( 18,414)
Total stockholders' deficit ( 15,625)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 0
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE> F-4
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION) TO DECEMBER 31, 1999
Revenue $ 0
Expenses:
Professional fees 15,525
Organization costs 2,789
Total expenses 18,414
Net loss $( 18,414)
Loss Per Common Share $ (.03)
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE> F-5
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIT
PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION) TO DECEMBER 31, 1999
Common
Stock
Shares Amount Deficit
Balance at November 24, 1999 0 $ 0 $ 0
Issuance of common stock:
Stock issued for services rendered at 2,789
inception 734,000
Net loss for the period from November 24,
1999 through December 31, 1999 ( 15,625)
Balance at December 31, 1999 734,000 $2,789 $( 15,625)
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE> F-7
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION) TO DECEMBER 31, 1999
Cash flows from operating activities:
Net loss $ ( 18,414)
Adjustments to reconcile net loss to net cash provided
by operating activities:
Services performed in exchange for stock 2,789
Increase in accounts payable 15,625
Net cash provided by operating activities 0
Increase in cash and cash equivalents 0
Cash and cash equivalents, beginning of period 0
Cash and cash equivalents, end of period $ 0
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE> F-8
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Development Stage Operations
The Company was incorporated on November 24, 1999, in the State of
Colorado. The Company is in the development stage and its intent is to
operate as a capital market access corporation and to acquire one or more
existing businesses through merger or acquisition. The Company has had no
significant business activity to date. The Company has selected the calendar
year as its fiscal year. Costs associated with organization have been
expensed in accordance with SOP 98-5.
Stock-Based Compensation
The Company accounts for stock-based compensation under Statement of
Financial Accounting Standards ("SFAS") No. 123 "Accounting for Stock-Based
Compensation". The Company accounts for stock-based compensation based on the
fair value of the consideration received or the fair value of the stock
issued, whichever is more reliably measurable.
Estimates
The preparation of the Company's financial statements in conformity with
generally accepted accounting principles requires the Company's management to
make estimates and assumptions that affect the amounts reported in these
financial statements and accompanying notes. Actual results could differ
from those estimates.
2. STOCKHOLDERS' EQUITY
On November 24, 1999, the Company issued seven hundred thirty-four
thousand (734,000) shares of its $0.001 par value common stock for services
valued at their fair market value of $2,789. The shares were issued pursuant
to Rule 701 of the Securities Act of 1933 (the "Act") and are restricted
securities within the meaning of Rule 144 of the Act.
The Company authorized 50,000,000 shares of Series A convertible
preferred stock with a par value of $0.001 per share. Currently, there are no
shares outstanding. Each share of preferred stock can be converted into one
share of common stock and each share is entitled to one vote, voting together
with the holders of shares of common stock.
3. RELATED PARTY TRANSACTIONS
The accounts payable of $15,625 was for legal services rendered in connection
with business planning and compliance. Those legal services were rendered by
shareholders of the Company.
As described in footnote #2 the Company issued common stock for services
provided by related parties that are valued at the fair market value of
$2,789.
(CONTINUED)
<PAGE> F-9
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
4. INCOME TAXES
Due to the current period's operating loss, the Company has no provision for
income taxes for 1999.
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. The Company's net
deferred tax asset balances are attributable to net operating loss
carryforwards. At December 31, 1999, the Company's deferred tax asset
consisted of the following:
Deferred tax asset $ 5,500
Valuation allowance ( 5,500)
Net deferred tax assets recognized on the
accompanying balance sheets $ 0
The components of the income tax provision (benefit) consisted of the
following for the year ended December 31, 1999.
Current $ 0
Deferred 5,500
Tentative tax provision (benefit) 5,500
Change in valuation allowance ( 5,500)
Net income tax provision (benefit) $ 0
The Company has a net operating and economic loss carryforward of
approximately $15,625 available to offset future federal and state taxable
income through 2019 as follows:
Year of Expiration Amount
2019 $ 15,625
(CONCLUDED)
<PAGE>
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000
AND THE PERIOD FROM NOVEMBER 24, 1999
(DATE OF INCEPTION) TO MARCH 31, 2000 AND
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS'
REVIEW REPORT
<PAGE> F-2
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORT
To the Board of Directors
Providence Capital I, Inc.
(A Development Stage Company)
We have reviewed the accompanying balance sheet of Providence Capital I, Inc.
(a development stage company) as of March 31, 2000, and the related statements
of operations, stockholders' equity, and cash flows for the three month period
then ended and the period from November 24, 1999 (inception) to March 31, 2000.
These financial statements are the responsibility of the company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
statements consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit in accordance with
generally accepted auditing standards, the objective of which is the expression
of an opinion regarding the financial statements taken as a whole. Accordingly,
we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.
Providence, Rhode Island
July 26, 2000
/s/ Cayer Prescott Clune & Chatellier, LLP
<PAGE> F-3
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
BALANCE SHEET
MARCH 31, 2000
(UNAUDITED)
ASSETS
TOTAL ASSETS $ 0
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable $ 16,825
Stockholders' deficit:
Common stock, $.001 par value;
50,000,000 shares authorized,
734,000 shares issued and
outstanding 734
Paid in capital 2,055
Preferred stock, $.001 par value,
50,000,000 shares authorized,
no shares outstanding
Deficit accumulated during the development stage ( 19,614)
Total stockholders' deficit ( 16,825)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 0
SEE NOTES TO FINANCIAL STATEMENTS AND
INDEPENDENT CERTIFIED ACCOUNTANTS' REVIEW REPORT.
<PAGE> F-4
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000
AND THE PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION)
TO MARCH 31, 2000
(UNAUDITED)
Three Months November 24, 1999
Ended (Inception) to
March 31, 2000 March 31, 2000
Revenue $ 0 $ 0
Expenses:
Professional fees 1,200 16,825
Organization costs 2,789
Total expenses 1,200 19,614
Net loss $ (1,200) $( 19,614)
Loss Per Common Share $ (.001) $ (.028)
SEE NOTES TO FINANCIAL STATEMENTS AND
INDEPENDENT CERTIFIED ACCOUNTANTS' REVIEW REPORT.
<PAGE> F-5
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIT
THREE MONTHS ENDED MARCH 31, 2000
AND THE PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION)
TO MARCH 31, 2000
(UNAUDITED)
Common
Stock
Shares Amount Deficit
Balance at November 24, 1999 0 $ 0 $ 0
Issuance of common stock:
Stock issued for services
rendered at inception 734,000 2,789
Net loss for the period from
November 24, 1999 through
December 31, 1999 ( 18,414)
Balance at December 31, 1999 734,000 $ 2,789 ( 18,414)
Net loss for the three months
ended March 31, 2000 (1,200)
Balance at March 31, 2000 734,000 $ 2,789 $( 19,614)
SEE NOTES TO FINANCIAL STATEMENTS AND
INDEPENDENT CERTIFIED ACCOUNTANTS' REVIEW REPORT.
<PAGE> F-6
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2000
AND THE PERIOD FROM NOVEMBER 24, 1999 (DATE OF INCEPTION)
TO MARCH 31, 2000
(UNAUDITED)
Three Months November 24, 1999
Ended (Inception) to
March 31, 2000 March 31, 2000
Cash flows from operating activities:
Net loss $ (1,200) $ ( 19,614)
Adjustments to reconcile net loss to
net cash provided by operating
activities:
Services performed for stock 2,789
Increase in accounts payable 1,200 16,825
Net cash provided by
operating activities 0 0
Increase in cash and cash equivalents 0 0
Cash and cash equivalents,
beginning of period 0 0
Cash and cash equivalents, end of period $ 0 $ 0
SEE NOTES TO FINANCIAL STATEMENTS AND
INDEPENDENT CERTIFIED ACCOUNTANTS' REVIEW REPORT.
<PAGE>
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Development Stage Operations
Providence Capital I, Inc. (a Development Stage Company) (the Company) was
incorporated on November 24, 1999, in the State of Colorado. The Company is in
the development stage and its intent is to operate as a capital market access
corporation and to acquire one or more existing businesses through merger or
acquisition. The Company has had no significant business activity to date.
The Company has selected the calendar year as its fiscal year. Costs
associated with organization have been expensed in accordance with SOP 98-5.
Stock-Based Compensation
The Company accounts for stock-based compensation under Statement of
Financial Accounting Standards ("SFAS") No. 123 "Accounting for Stock-Based
Compensation". The Company accounts for stock-based compensation based on the
fair value of the consideration received or the fair value of the stock issued,
whichever is more reliably measurable.
Estimates
The preparation of the Company's financial statements in conformity with
generally accepted accounting principles requires the Company's management to
make estimates and assumptions that affect the amounts reported in these
financial statements and accompanying notes. Actual results could differ from
those estimates.
2. STOCKHOLDERS' EQUITY
On November 24, 1999, the Company issued seven hundred thirty-four thousand
(734,000) shares of its $.001 par value common stock for services, rendered by
related parties, valued at their fair market value of $2,789. The shares were
issued pursuant to Rule 701 of the Securities Act of 1933 (the "Act") and are
restricted securities within the meaning of Rule 144 of the Act.
The Company authorized 50,000,000 shares of Series A convertible preferred
stock with a par value of $.001 per share. Currently, there are no shares
outstanding. Each share of preferred stock can be converted into one share of
common stock and each share is entitled to one vote, voting together with the
holders of shares of common stock.
3. RELATED PARTY TRANSACTIONS
$16,525 of the accounts payable balance was for legal services rendered in
connection with business planning and compliance. Those legal services were
rendered by shareholders of the Company.
As described in footnote #2 the Company issued common stock for services
provided by related parties that are valued at the fair market value of
$2,789.
SEE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REVIEW REPORT.
(CONTINUED)
<PAGE>
PROVIDENCE CAPITAL I, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
4. INCOME TAXES
Due to the current period's operating loss, the Company has no provision for
income taxes.
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. The Company's net
deferred tax asset balances are attributable to net operating loss carry-
forwards. At March 31, 2000, the Company's deferred tax asset consisted of
the following:
Deferred tax asset $ 5,500
Valuation allowance ( 5,500)
Net deferred tax assets recognized on
the accompanying balance sheets $ 0
The components of the income tax provision (benefit) consisted of the following
for the period ended March 31, 2000.
Current $ 0
Deferred 5,500
Tentative tax provision (benefit) 5,500
Change in valuation allowance ( 5,500)
Net income tax provision (benefit) $ 0
The Company has a net operating and economic loss carryforward of
approximately $16,525 available to offset future federal and state taxable
income through 2019 as follows:
Year of Expiration Amount
2019 $ 16,525
SEE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REVIEW REPORT.
(CONCLUDED)
<PAGE> 25
UAC MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Financial
Statements and related notes thereto to be filed subsequently.
PLAN OF OPERATION
UAC does not currently have any external sources of working capital. UAC's
Management has not entered into any commitments for significant capital
expenditures. Furthermore, there are no plans to hire additional employees
unless Management is successful in securing a substantial capital infusion.
On July 26, 2000 UAC entered into the Agreement with Providence (the
"Transaction"). This Transaction will be structured as a Merger whereby the
existing shareholders of UAC will obtain control of Providence. Upon completion
of this transaction, there can be no assurance that the combined companies
will have sufficient funds to undertake any significant development,
marketing and operating activities. Accordingly, the combined companies
will be required to either seek additional debt or equity financing or
obtain funding from third parties, in exchange for which the combined
companies might be required to issue a substantial equity position. There
is no assurance that the combined companies will be able to obtain
additional financing on terms acceptable to the combined companies. If
Management is successful in obtaining additional funding, these funds will
be used primarily to provide working capital needed for repayment of
outstanding notes payable, operations, sales and marketing expense and to
finance research, development and advancement of intellectual property
concerns. A description of the UAC business is provided in ITEM 14.
LIQUIDITY AND CAPITAL RESOURCES
The Company remains in the development stage and, since inception, has
experienced no significant change in liquidity or capital resources or
stockholder's equity. The Company's balance sheet as of March 31, 2000,
reflects a current asset value of $0.00, and a total asset value of $0.00
in the form of cash and capitalized organizational costs.
The Company will carry out its plan of business as discussed below.
<PAGE> 26
RESULTS OF OPERATIONS
During the period from November 24, 1999 (inception) through June 30, 2000,
the Company has engaged in no significant operations other than organizational
activities, acquisition of capital and preparation for reporting as a
registrant under Section 12 of the Securities Exchange Act of 1934, as
amended. No revenues were received by the Company during this period.
NEED FOR ADDITIONAL FINANCING
The Company believes that its existing capital will be sufficient to meet
the Company's cash needs, including the costs of compliance with the
continuing reporting requirements of the Securities Exchange Act of 1934,
as amended, for a period of approximately two years.
INCOME TAXES
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes"
("SFAS 109") issued by the Financial Accounting Standards Board ("FASB"),
under which deferred tax assets and liabilities are provided on differences
between the carrying amounts for financial reporting and the tax basis of
assets and liabilities for income tax purposes using the enacted tax rates.
Under SFAS 109, deferred tax assets may be recognized for temporary
differences that will result in deductible amounts in future periods. A
valuation allowance is recognized, if on the weight of available evidence,
it is more likely than not that some portion or the entire deferred tax
asset will not be realized.
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
of" ("SFAS 121") issued by the FASB, is effective for financial statements
for fiscal years beginning after December 15, 1995. The standard establishes
new guidelines regarding when impairment losses on long-lived assets, which
include plant and equipment, certain identifiable intangible assets, and
goodwill, should be recognized and how impairment losses should be
measured.
The Company does not expect adoption to have a material effect on
its financial position or results of operations. Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation"
("SFAS 123") issued by the FASB, is effective for specific transactions
entered into after December 15, 1995. The disclosure requirements of SFAS
123 are effective for financial statements for fiscal years beginning no
later than December 15, 1995. The new standard established a fair value
method of accounting for stock-based compensation plans and for
transactions in which an entity acquires goods or services from
non-employees in exchange for equity instruments. The Company does not
expect adoption to have a material effect on its financial position or
results of operations.
<PAGE> 27
FEDERAL INCOME TAX ASPECTS OF INVESTMENT IN THE COMPANY
The discussion contained herein has been prepared by the Company and is
based on existing law as contained in the Code, amended United States
Treasury Regulations ("Treasury Regulations"), administrative rulings and
court decisions as of the date of this Registration Statement. No assurance
can be given that future legislative enactments, administrative rulings or
court decisions will not modify the legal basis for statements contained in
this discussion. Any such development may be applied retroactively to
transactions completed prior to the date thereof, and could contain
provisions having an adverse affect upon the Company and the holders of the
Common Stock. In addition, several of the issues dealt with in this summary
are the subjects of proposed and temporary Treasury Regulations. No
assurance can be given that these regulations will be finally adopted in
their present form.
Y2K COMPLIANCE
UAC has conducted an assessment of issues related to the Year 2000 and
determined that all its computer driven systems and software in use are
able to recognize, calculate, and display data-related dates correctly
after the year 1999. UAC can not determine the impact the Year 2000 will
have on its key suppliers. However, if UAC's key suppliers do not convert
their systems to become Year 2000 compliant, UAC may be adversely impacted.
FORWARD LOOKING STATEMENT
This Management's Discussion and Analysis of Financial Condition and
Results of Operations includes a number of forward-looking statements that
reflect Management's current views with respect to future events and
financial performance. Those statements include statements regarding the
intent, belief or current expectations of UAC and members of its management
team as well as the assumptions on which such statements are based.
Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve risk and
uncertainties, and that actual results may differ materially from those
contemplated by such forward-looking statements.
The Company undertakes no obligation to update or revise forward-looking
statements to reflect changed assumptions, the occurrence of unanticipated
events or changes in the future operating results over time. The Company
believes that its assumptions are based upon reasonable data derived from
and known about its business and operations and the business and operations
of UAC. No assurances are made that actual results of operations or the
results of the Company's future activities will not differ materially from
its assumptions.
<PAGE> 28
ITEM 14. MERGERS, CONSOLIDATIONS, ACQUISITIONS AND SIMILAR MATTERS
An Agreement and Plan of Merger and Reorganization was executed on July 26,
2000, by and among Providence and UAC, who joined in the execution of the
Agreement for the purpose of making certain covenants regarding the
Transaction contemplated therein. Providence is a corporation duly
organized and validly existing under the laws of the state of Colorado,
with its registered office at 17 West Cheyenne Mountain Blvd., Colorado
Springs, Colorado 80906, its principal executive office at 1250 Turks Head
Building, and its phone number is (401) 272-5800; UAC is a corporation duly
organized and validly existing under the laws of the state of North
Carolina, with its registered office located in the city of Charlotte,
State of North Carolina, its principal executive office at 8609 Wood Lake
Court, Suite 206, Charlotte, North Carolina 28210, and its phone number is
(704) 556-7992.
The respective boards of directors of Providence and UAC deemed it
desirable and in the best interests of their respective corporations, for
Providence to acquire the outstanding capital stock of UAC in exchange for
the issuance of shares of the common and preferred stock of Providence and
have proposed, declared advisable and approved such Merger (the "UAC
MERGER") pursuant to this Agreement, which Agreement has been duly approved
by resolutions of the respective boards of directors of Providence and UAC.
This Agreement requires that a shareholders' meeting be called by
Providence for the purposes of approving the UAC Merger prior to closing.
The UAC Merger shall become effective on the "Effective Date", such date
being the later upon which (i) amended Articles of Incorporation are filed
with the Secretary of State of Colorado and (ii) a Certificate of Merger is
filed with the Secretary of State of North Carolina. The "Closing Date"
will be on or within one (1) business day of the date the Agreement is
approved by the shareholders of Providence.
The UAC Merger is intended to qualify as an I.R.C. 368(b) tax-free
reorganization. At the Closing, (a) UAC shall deliver to Providence a
statement (in such form as may be reasonably requested by counsel to
Providence) conforming to the requirements of Section 1.897-2(h)(1)(i) of
the United States Treasury Regulations, and (b) UAC shall deliver to the
IRS the notification required under Section 1.897-2(h)(2) of the United
States Treasury Regulations.
<PAGE> 29
EFFECT OF UAC MERGER
In all other respects, the identity, existence, purposes, powers, objects,
franchises, rights, and immunities of Providence shall continue unaffected
and unimpaired by the UAC Merger.
The laws of Colorado shall continue to govern Providence. On and after the
Effective Date, the articles of incorporation of UAC shall be the articles
of incorporation of Providence until further amended in the manner provided
by law and in such articles of incorporation (the "Articles"). On the
Effective Date, the bylaws of UAC shall be the bylaws of Providence (the
"Restated Bylaws") until altered, amended, or repealed, or until new bylaws
shall be adopted in accordance with the provisions of law, the Articles,
and the Restated Bylaws.
CONVERSION OF UAC'S STOCK AND OTHER SECURITIES
UAC shareholders will surrender one hundred percent (100%) of their issued
and outstanding common and preferred shares to Providence on the date of
execution of this Agreement. In exchange for receipt of one hundred percent
(100%) of UAC shares, Providence, on the terms and subject to the
conditions herein set forth, shall issue and deliver to UAC shareholders:
On the Closing Date, 14,234,000 Common Shares, no par value
("Providence Common Stock"), of Providence, on a share-for-share
basis, registered in the name of each UAC shareholder or its nominee.
--Providence Common Stock
None of the currently issued and outstanding shares of Providence
Common Stock, no par value, issued and outstanding at the effective
time of the UAC Merger shall be converted as a result of the UAC
Merger;
--Fractional Interests
No fractional shares of preferred or common stock of Providence or
certificate or scrip representing the same shall be issued. In lieu
thereof each holder of UAC Shares having a fractional interest arising
upon such conversion will be rounded up into one full additional share
of common stock of Providence;
--Status of Common Stock
All Shares of common stock of Providence into which UAC Shares are
converted as herein provided shall be fully paid and non-assessable
and shall be issued in full satisfaction of all rights pertaining to
such Providence Common Stock;
--Status of Preferred Stock
All Shares of preferred stock of Providence into which UAC Shares are
converted as herein provided shall be fully paid and non-assessable
and shall be issued in full satisfaction of all rights pertaining to
such Providence Preferred Stock;
<PAGE> 30
--Independent Appraisal, Right to Dissent and Obtain Payment for Shares
Procedures for Protection of Dissenter's Rights. In order to establish
a "fair value" for the UAC Shares which are paid in cash in lieu of
conversion into the Shares of Providence, as provided in this Article
VI,the Board of Directors of UAC shall establish the value of UAC
Shares prior to the UAC Merger, and shall afford to such shareholders
of UAC all of the rights, and implement the procedures for protection
of dissenters' rights, pursuant to the provisions of the North
Carolina General Corporation Law, Section __________ et seq., as
amended, the terms and provisions of which are hereby incorporated by
reference and made a part hereof.
UAC SHAREHOLDER DISSENTER'S RIGHTS
The Board of Directors of UAC shall establish the value of UAC's Shares
prior to the UAC Merger, and shall afford to the shareholders of UAC all of
the rights, and implement the procedures for protection of dissenters'
rights, pursuant to the provisions of the North Carolina Generally accepted
accounting principles, and the capital surplus and retained earnings
accounts of UAC shall be determined, in accordance with generally accepted
accounting principles, by the board of directors of UAC. Nothing herein
shall prevent the board of directors of UAC from making any future changes
in its accounts in accordance with law.
INVESTMENT REPRESENTATION LETTER
At the Closing, each of the UAC Shareholders shall execute and deliver to
UAC an investment representation letter statement in such form as may be
reasonably requested by counsel.
<PAGE> 31
UAC CORPORATION-
DESCRIPTION OF THE BUSINESS
UNITED AMERICAN COMPANIES, INC.
United American Companies, Inc. ("UAC"), is a newly formed North Carolina
corporation. Its primary purpose is to become a public company specializing
in asset evaluation, acquisition, liquidation, management and financing, by
seizing undervalued opportunities in the retail market based upon the
following factors:
--Domestic retail capacity is four times the level needed for US consumers
--Periodic declines in consumer spending result in more retail failures
--Dominant retailers like Wal-Mart and Home Depot accelerate the pace of
retail failures
--E-commerce and e-tailing will increase failures of traditional retailers
--Middle Market default rates indicate higher defaults among retailers
--In 1999, major principal liquidations exceeded an estimated $15 Billion
--Brands like London Fog and Bonwit Teller have been liquidated and are
therefore gone from the retail market
--Opportunities exist for brand licensing and exporting of liquidated assets.
To realize the opportunities from conditions in the retail market and to
effectively enter the comprehensive asset management industry, UAC is
acquiring in an exchange of common stock, either complete ownership or
control of several entities comprising the Craven Companies (the "Craven
Group" or "Craven") -- a nationally recognized liquidator of consumer product
inventories.
The Craven Group has antecedents dating back to 1994. However, Craven senior
management and principals have been active in the retail industry and in the
retail inventory liquidation industry since 1957. In the last five years, the
Craven Group has liquidated over $2 Billion in assets. Craven has served over
2,000 clients that include:
--Bonwit Teller
--Pantry Pride Supermarkets
--McCurdy's Dept. Stores
--National Dollar Stores
--Barron's Furniture
--B. Foreman Stores
--Hess Shoes
<PAGE> 32
To become a full-service asset acquisition, liquidation management firm, and
turnaround company, in November 1999, the Craven Group's activities were
structured as several Delaware limited liability companies -- each containing
the name "Fox." However, this designation was recently changed to "Craven" to
reflect certain internal changes and to take advantage of the widely known
and respected name of the Craven Chairman -- Mark Craven, an established
expert in the liquidation of retail inventories. The Craven Group is comprised
of the following affiliate entities:
--Craven and Ruth, Inc., merchandise sales, factoring, distribution
--Craven and Ruth Promotions, LLC., retail and wholesale liquidations
--High Point Furniture Liquidator, LLC, retail and wholesale liquidations
--Craven Advisory Group, LLC, business consulting services
--Craven Valuation Services, LLC, retail inventory valuations and appraisals
--Craven Capital Partners, LLC, principal purchasers of retail inventory
from distressed retailers (inventory liquidated by other Craven entities)
--Promo Services, LLC, provider of sign materials and promotion advertising
preparation and placement
--CrossStone Capital Group, LLC, merchant banking for Craven clients.
The Craven Group employs five full-time professionals who have extensive
financial, retail, and liquidation experience. Craven also has 50 professionals
who are affiliated with the group on a retainer basis. These contracted human
resources assist with appraisals and evaluations, liquidations, and marketing
activities. As additional support, Craven has an adequate back-office staff of
four to handle the collective activities of the group.
Craven uses a proprietary financial model and analysis to value inventories.
The model incorporates many variables including US economic indicators and
industry information such as gross profit margins, turnover, age, product mix,
distribution channels, computability, seasonality, and market values, then
compares the results to data of competitive retailers, manufacturers, or
wholesalers.
In the past, the Craven model has been applied in its "fee-based liquidation"
business i.e., where clients retain Craven to conduct liquidation sales and
promotions. While Craven will continue operating a fee-based practice, it
intends to become an "equity" liquidator i.e., where Craven, as a principal,
acquires the assets and then determines the most appropriate means of
liquidation, disposition, or positioning of the assets.
Though Craven, as an equity liquidator, would initially be the smallest of 8
national liquidators of consumer products inventories, the potential returns
are expected to be quite significant far surpassing the income potential of
fee-based business. In many instances, the larger liquidators form joint
ventures to acquire large inventories (at auctions, in bankruptcies, etc.).
These arrangements reduce competition and, in turn, improve profit potential.
To date, Craven has lacked the necessary capital to participate as a principal
in such transactions. However, UAC is presently preparing a private placement
of $100,000,000 in preferred stock and or secured revolving credit.
Last year, a small liquidator received a $100,000,000 credit facility from
General Electric Capital. This competitor participated in only six
transactions totaling $97,000,000 but had an annualized return of over 167%.
This competitor has since suffered management dissolution and has sought
Craven which can generate more transactions -- to participate in either a
merger or joint venture.
To date, in preliminary discussions with institutional funders, UAC's proposal
has been very well received, and each source is anxiously awaiting the private
placement memorandum.
<PAGE> 34
To accomplish its goals, maximize investor returns, and enhance shareholder
values, UAC proposes to become a public company. This will be effected via a
"reverse" merger with Providence Capital I ("PCI"), a reporting company
organized under the laws of Colorado. PCI has 50,000,000 of "blank check"
preferred stock authorized, but none outstanding; and 100,000,000 shares of
common stock, with 1,500,000 issued and outstanding to its founders (the
"PCI Founders"). UAC, following the acquisition of Craven, will have
50,000,000 of preferred stock authorized, but none outstanding; and
100,000,000 shares of common stock, with 13,500,000 issued and outstanding.
<PAGE> 35
Projected Income Statement
The Craven Companies, LLC and Affiliates
12 Months Post Closing
Total Revenues $51,550,000
Operating Costs/Expenses 41,648,750
EBITDA 9,904,250
Projected Income Statement
12 Months Post Closing
Without Craven Capital Partners, LLC
Total Revenues $ 6,550,000
Operating Costs/Expenses 4,748,750
EBITDA 1,801,250
ITEM 15. ACQUISITION OR DISPOSITION OF PROPERTY
No action is to be taken by the Company with respect to the acquisition or
disposition of any property.
ITEM 16. RESTATEMENT OF ACCOUNTS
No action is to be taken by the Company with respect to the restatement of
any asset, capital, or surplus account of the Company.
ITEM 17. ACTION WITH RESPECT TO REPORTS
No action is to be taken by the Company with respect to any report of the
Company or of its directors, officers, or committees or any minutes of a
meeting of its security holders.
ITEM 18. MATTERS NOT REQUIRED TO BE SUBMITTED
No action is to be taken by the Company with respect to any matter which is
not required to be submitted to a vote of security holders. Management does
not know of any other matters which may come before this meeting. However,
if any other matters are properly presented to the meeting, it is the
intention of the officers and directors named in the accompanying
information statement to vote, or otherwise act, in accordance with their
judgment on such matters.
<PAGE> 36
ITEM 19. AMENDMENT OF ARTICLES, BYLAWS OR OTHER DOCUMENTS
Action will be taken by the Company with respect to the restatement and
amendment of articles of the Company, whereby the name of the company will
be changed from "Providence Capital I, Inc." to "United American Companies,
Inc.", the Company's Articles of Incorporation will be amended to Copies of
the proposed Restated and Amended Articles of Incorporation are available
upon request by contacting the Company in writing at 1250 Turks Head
Building, Providence, Rhode Island 02903.
ITEM 20. OTHER PROPOSED ACTION
No action is to be taken by the Company on any matter not specifically
referred to in this Schedule 14C.
ITEM 21. VOTING PROCEDURES
The Board of Directors has fixed August 5, 2000 as the record date for the
determination of shareholders entitled to vote at the meeting. At the close
of business on that date there were outstanding and entitled to vote
1,500,000 shares of Common Stock entitled to one (1) vote per share (the
"Voting Shares"). The affirmative vote of the holders of a majority of the
Company's Voting Shares is required to approve each of the Proposals.
The directors, officers and affiliates of the Company as a group own or may
be deemed to control 1,250,000 shares of Common Stock constituting eighty-
three percent (83%) of the outstanding shares of Voting Shares. Each of the
directors, nominated directors and officers has indicated his or her intent
to vote all shares of Voting Shares owned by him or her in favor of each
item set forth herein.
ITEM 22. INFORMATION REQUIRED IN INVESTMENT COMPANY PROXY STATEMENT
Not applicable
THIS INFORMATION STATEMENT IS PROVIDED TO YOU FOR
INFORMATION PURPOSES ONLY.
NO ACTION ON YOUR PART IS SOUGHT OR REQUIRED.
