<PAGE> 1
As filed with the Securities and Exchange Commission on August 17, 1994.
REGISTRATION NO. 33-68626
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________
FORM S-3
POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
______________________________
UNITED COMPANIES FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
LOUISIANA 71-0430414
(State or other jurisdiction of 4041 ESSEN LANE (I.R.S. Employer Identification No.)
incorporation or organization) BATON ROUGE, LA. 70809
TELEPHONE (504) 924-6007
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
</TABLE>
DALE E. REDMAN
CHIEF FINANCIAL OFFICER
4041 ESSEN LANE
BATON ROUGE, LA. 70809
(504) 924-6007
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
______________________________
Copy to:
LEE C. KANTROW
KANTROW, SPAHT, WEAVER & BLITZER
(A PROFESSIONAL LAW CORPORATION)
P.O. BOX 2997
BATON ROUGE, LA 70821-2997
(504) 383-4703
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: ( )
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. (X)
_____________________________________________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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(RED) SUBJECT TO COMPLETION DATED AUGUST 17, 1994.
1,951,204 SHARES
UNITED COMPANIES FINANCIAL CORPORATION
COMMON STOCK
(LOGO)
________________________________________________
The 1,951,204 shares of common stock, par value $2.00 per share (the
"Common Stock") of United Companies Financial Corporation (the "Securities
Company") offered hereby may be sold from time to time by certain stockholders
of the Company described herein (the "Selling Stockholders") in transactions on
the National Stock Market of the National Association of Securities Dealers
Automated Quotation System (the "NASDAQ NSM"), otherwise in the over-the
counter market or otherwise at prices and at terms prevailing at the time of
sale, at prices related to the then current market price or in negotiated
transactions. The Company will not receive any of the proceeds from the sale
of the shares of Common Stock by the Selling Stockholders.
All of the shares of the Common Stock owned by the Selling
Stockholders have been "restricted securities" under the Securities Act of
1933, as amended (the "Securities Act"), prior to their registration hereunder.
On June 29, 1993, the Company sold to the Selling Stockholders 800,000 shares
of its 6.5% convertible, cumulative preferred stock (the "Preferred Stock")
pursuant to Regulation S promulgated by the Securities and Exchange Commission
(the "Commission") which shares of Preferred Stock were convertible into shares
of the Common Stock offered hereby. The Company gave notice of redemption of
the Preferred Stock on August 26, 1993. The Selling Stockholders converted all
of the shares of Preferred Stock to the shares of Common Stock prior to
redemption of the Preferred Stock, and such shares of Common Stock may be sold
from time to time by the Selling Stockholders pursuant to this Prospectus or in
transactions exempt from the registration requirements of the Securities Act.
The shares of Common Stock offered hereby reflect the 100% Common Stock
dividend paid on October 18, 1993, to stockholders of record on October 1,
1993. Pursuant to the requirements of agreements between the Company and the
Selling Stockholders, the Company filed a shelf registration statement on Form
S-1 under the Securities Act with the Commission with respect to the shares of
Common Stock offered hereby and the registration statement was declared
effective by the Commission on December 13, 1993. The Company filed a
post-effective amendment with the Commission on August 17, 1994, to convert the
shelf registration statement from a Form S-1 to a Form S-3. This Prospectus
has been prepared for use in connection with future sales of the shares of
Common Stock by the Selling Stockholders under the shelf registration statement
on Form S-3. In connection with any sales, the Selling Stockholders and any
brokers participating in such sales may be deemed to be "underwriters" within
the meaning of the Securities Act. See "Selling Stockholders and Plan of
Distribution." For information regarding the possible sale of Common Stock of
the Company which could affect the market price therefor, see "Risk Factors -
Possible Volatility of Stock Price."
Outstanding shares of Common Stock of the Company are reported on the
NASDAQ NSM under the symbol "UCFC".
SEE "RISK FACTORS" FOR CERTAIN INFORMATION THAT SHOULD BE CONSIDERED
BY PROSPECTIVE INVESTORS.
_________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is August ____, 1994.
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
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THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
FOR NORTH CAROLINA INVESTORS: THE COMMISSIONER OF INSURANCE OF THE STATE
OF NORTH CAROLINA (THE "NORTH CAROLINA INSURANCE COMMISSIONER") HAS NOT
APPROVED OR DISAPPROVED THIS OFFERING, NOR HAS THE NORTH CAROLINA INSURANCE
COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
LOUISIANA INSURANCE LAWS AND REGULATIONS PROVIDE THAT NO PERSON MAY
ACQUIRE CONTROL OF THE COMPANY AND THUS INDIRECT CONTROL OF ITS INSURANCE
SUBSIDIARIES, UNITED COMPANIES LIFE INSURANCE COMPANY AND UNITED GENERAL TITLE
INSURANCE COMPANY, UNLESS SUCH PERSON HAS PROVIDED CERTAIN REQUIRED INFORMATION
TO THE INSURANCE COMMISSIONER OF THE STATE OF LOUISIANA AND SUCH ACQUISITION
HAS BEEN APPROVED BY THE INSURANCE COMMISSIONER OF THE STATE OF LOUISIANA,
AFTER PUBLIC HEARING. UNDER LOUISIANA INSURANCE LAWS AND REGULATIONS, ANY
PERSON WHO OWNS, CONTROLS OR HAS THE POWER TO VOTE 10% OR MORE OF THE VOTING
SECURITIES OF A CORPORATION IS PRESUMED TO HAVE CONTROL OF THAT CORPORATION AND
ITS SUBSIDIARIES. CONSEQUENTLY, NO PURCHASER IN THIS OFFERING MAY ACQUIRE,
DIRECTLY OR INDIRECTLY, AN AMOUNT OF COMMON STOCK WHICH WOULD BRING SUCH
PURCHASER'S TOTAL HOLDINGS TO 10% OR MORE OF THE VOTING SECURITIES OF THE
COMPANY, UNLESS SUCH PURCHASER HAS PROVIDED THE REQUIRED INFORMATION TO THE
INSURANCE COMMISSIONER OF THE STATE OF LOUISIANA AND THE ACQUISITION HAS BEEN
APPROVED BY THE INSURANCE COMMISSIONER OF THE STATE OF LOUISIANA.
The Company intends to furnish its stockholders annual reports containing
audited financial statements audited by an independent auditor.
AVAILABLE INFORMATION
The Company is subject to informational requirements of the Securities
Exchange Act of 1934, as amended, (the "Exchange Act"), and in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the following
regional offices of the Commission: Seven World Trade Center, 13th Floor, New
York, New York 10048 and Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. In addition, reports, proxy
statements and other information concerning the Company may be inspected at the
offices of the National Association of Securities Dealers, Inc., 1735 K Street,
N.W., Washington, D.C. 20006.
This Prospectus constitutes a part of a Registration Statement filed by
the Company with the Commission on Form S-3 under the Securities Act of 1933,
as amended (the "Securities Act"). This Prospectus omits certain of the
information set forth in the Registration Statement, and reference is hereby
made to the Registration Statement and related exhibits for further information
with respect to the Company and the securities offered hereby. Statements
contained herein concerning the provisions of any such document are not
necessarily complete and, in each instance, reference is made to the copy of
such documents filed as an exhibit to the Registration Statement or otherwise
filed with the Commission. The documents may be inspected without charge at
the Commission's office at Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and copies thereof may be obtained from the Commission upon payment
of the prescribed fees.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission under the
Exchange Act (Commission File No. 1-7067) are hereby incorporated by reference
in this Prospectus: (1) the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993; (2) the Company's Quarterly Reports on Form 10-Q
for the quarters ended March 31, 1994 and June 30, 1994; and (3) the
description of the Company's Preferred Stock Purchase Rights contained in the
Company's Registration Statement on Form 8-A filed on August 5, 1994.
In addition, all documents filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior
to the termination of the offering of the securities made hereby shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is incorporated or deemed to be incorporated by reference herein modifies
or supersedes such statement. Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
Upon written or oral request, the Company will provide without charge to
each person to whom a copy of this Prospectus is delivered, a copy of any and
all of the documents incorporated herein by reference (other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
into such documents). Requests shall be directed to United Companies Financial
Corporation, 4041 Essen Lane, Baton Rouge, Louisiana 70809, Attention: Dale E.
Redman, Chief Financial Officer, telephone (504) 924-6007.
THE COMPANY
United Companies Financial Corporation (the "Company"), founded in 1946,
is a financial services holding company having mortgage and insurance
operations. The Company conducts its mortgage operations through United
Companies Lending Corporation ("UC Lending" or "UCLC") and its insurance
operations primarily through United Companies Life Insurance Company ("UC Life"
or "UCLIC"). The Company's mortgage operations are focused on the origination,
sale and servicing of first mortgage, non-conventional, home equity loans. The
Company's insurance operations sell primarily single premium deferred annuities
marketed in 47 states, the District of Columbia and Puerto Rico and underwrite
primarily residential title insurance in 28 states.
The Company is incorporated in the State of Louisiana, its headquarters is
located at 4041 Essen Lane, Baton Rouge, Louisiana 70809, and its telephone
number is (504) 924-6007. As of June 30, 1994, the Company had approximately
1,300 employees.
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RISK FACTORS
An investment in the Common Stock of the Company involves certain risks.
In addition to other information contained or incorporated by reference in this
Prospectus, prospective purchasers of the Company's Common Stock should
carefully consider the following factors:
Decline in Real Estate Values; Recessionary Environment. The risks
associated with the Company's business become more acute in any economic
slowdown. Periods of economic slowdown may be accompanied by decreased demand
for consumer credit and declining real estate values in many areas of the
country, including certain of the areas in which the Company originates loans.
Any material decline in real estate values in states in which the Company
operates could have a material adverse effect on the Company. Such declines in
real estate values increase the loan-to-value ratios of loans previously made
by the Company, thereby weakening collateral coverage and increasing the
possibility of a loss in the event of default. In addition, foreclosures and
losses generally increase during economic slowdowns or recessions.
Interest Rates. The primary assets and liabilities of the Company are
interest rate sensitive. Profitability is directly affected by the level of
and fluctuations in interest rates and is dependent upon the Company's ability
to earn a spread between the earnings on its assets and the costs of its
liabilities. Additionally, the value and effective maturity of the Company's
assets and the cost and duration of its liabilities are affected by changes in
interest rates. See "-- Duration of Annuities" below. While the Company
monitors the interest rate environment and employs an approach to
asset/liability management designed to mitigate the impact of changes in
interest rates and to maintain adequate margin and liquidity, there can be no
assurance that the profitability and/or liquidity of the Company would not be
adversely affected during any period of unexpected volatility in the interest
rate environment. Further, a substantial increase in interest rates could
adversely affect the ability of the Company to originate loans as well as the
gains recognized by the Company upon their securitization and sale. A
significant reduction in interest rates also could decrease the size of the
loan servicing portfolio by increasing the level of loan prepayments. In
addition, a reduction in the difference between long-term and short-term
interest rates could have an adverse impact on the profitability of the
Company.
Capitalized Excess Servicing Income. At June 30, 1994, the Company's
balance sheet reflected capitalized excess servicing income (i.e. unamortized
loan sale gains) of approximately $149 million and an allowance for loss on
loans serviced of approximately $20.5 million. The Company derives a
significant portion of its income by realizing gains upon the sale of loans due
to the excess servicing income of such loans. Excess servicing income
represents the excess of the interest rate payable by a borrower on a loan over
the interest rate passed through to the investor acquiring an interest in such
loan, less the Company's normal servicing fee and other applicable recurring
fees. When loans are sold, the Company recognizes as current income the
present value of the excess servicing income expected to be realized over the
anticipated average life of loans sold less future estimated credit losses
relating to the loans sold. The capitalized excess servicing income is
computed using prepayment, default and interest rate assumptions that the
Company believes market participants would use for similar instruments at the
time of sale. The weighted average discount rate used to determine the present
value of the balance of capitalized excess servicing income on home equity
loans reflected on the Company's balance sheet at June 30, 1994, was
approximately 9.9%. The Company is not aware of an active market for this kind
of receivable. No assurance can be given that this receivable could in fact be
sold at its stated value on the balance sheet.
Capitalized excess servicing income is amortized over the lesser of the
estimated or actual remaining life of the underlying loans as an offset against
the excess servicing income component of servicing income actually received in
connection with such loans. Although management of the Company believes that
it has made reasonable estimates of the excess servicing income likely to be
realized, it should be recognized that the rate of prepayment and the amount of
defaults utilized by the Company are estimates and actual experience may vary
from these estimates. The Company periodically reviews its prepayment
assumptions in relation to current rates of prepayment and, if necessary,
writes down the remaining asset to the net present value of the estimated
remaining future excess servicing income. Rapid increases in interest rates or
competitive pressures may result in a reduction of excess servicing income,
thereby reducing the gains recognized by the Company upon the sale of loans in
the future.
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Risk of Prepayments and Defaults. The gain recognized by the Company upon
sale of loans will have been overstated if the excess servicing income actually
received by the Company is less than originally assumed. An acceleration of
future prepayments could result in capitalized excess servicing income
amortization expense exceeding realized excess servicing income, thereby
adversely affecting the Company's servicing income and resulting in a charge to
earnings in the period of adjustment. Likewise, if delinquencies or
liquidations were to occur sooner in the portfolio of loans sold by the Company
and/or with greater frequency than was initially assumed, capitalized excess
servicing income amortization would occur more quickly than originally
anticipated, which would have an adverse effect on servicing income in the
period of such adjustment.
Contingent Credit Risk. Although the Company sells substantially all home
equity loans which it originates, the Company retains some degree of credit
risk on substantially all loans sold. During the period of time that loans are
held for sale by the Company, it is subject to the various business risks
associated with the lending business, including the risk of borrower default,
the risk of foreclosure and the risk that a rapid increase in interest rates
would result in a decline in the value of a loan to potential purchasers. The
Company retains a limited credit risk in the loans which are sold in the
secondary market and, to this extent, it continues to be subject to the risks
of default and foreclosure following the sales of the loans. In addition,
transactions effected in the secondary market require the Company to commit to
repurchase or replace loans which do not conform to the representations and
warranties included as part of the sale documentation.
Liquidity. The values of and markets for the Company's loans and bonds
are dependent on a number of factors, including general economic conditions,
interest rates, and governmental regulations. Adverse changes in such factors
may affect the Company's ability to purchase or sell loans and/or bonds for
acceptable prices within reasonable time frames. The ability of the Company to
sell loans and/or mortgage-backed securities in the secondary market is
essential for continuation of the Company's loan origination operations. A
prolonged, substantial reduction in the size of the secondary market for home
equity loans may adversely affect the Company's ability to sell its loan
originations and/or mortgage-backed securities in the secondary market with
consequent adverse impact on the Company's profitability and future
originations. In addition, adequate credit facilities are necessary to the
operations of the Company. The generally reduced availability of credit from
commercial banks continues to be of concern to the Company. There can be no
assurance that the Company's present credit facilities will be available in the
future on terms which the Company would consider favorable. Further, any
restrictions on the ability of UC Life to purchase loans from UC Lending could
adversely affect the ability of the Company to continue loan origination
operations. In addition, increased surrenders of the Company's annuity
policies could adversely impact the Company's liquidity, potentially requiring
the sale of certain assets, such as bonds and loans, prior to maturity which
may result in a loss. Loan securitization transactions require the Company to
fund reserve accounts to cover losses in the pool of loans which back the
securities issued thereunder. These reserve account funding requirements
restrict the Company's ability to access cash flows from the excess interest
spread retained by it in such securitization transactions.
Duration of Annuities. Reserves for annuity policies constitute the
Company's primary liabilities. The duration of these liabilities is affected
by a number of factors, including interest rates, surrender penalties, ratings,
public confidence in the insurance industry generally, and in the Company
specifically, governmental regulations and tax laws. Since insurance
commissions incurred at the origination of annuity policies are generally
deferred and recognized over the estimated life of the policies, any unexpected
increase in surrenders of annuity contracts would require more rapid
recognition of these expenses, thereby adversely impacting profitability.
Ratings. The Company's senior debt is rated "BBB" by Duff & Phelps, Inc.
("D&P"), and its life insurance subsidiary is rated "A-" (Excellent) by A.M.
Best Company ("Best") and "A+" by D&P. D&P and Best are each independent
rating organizations. Best ratings are based on factors relevant to
policyholders and are not directed toward the protection of stockholders. On
June 1, 1993, Best, based on its current opinion of the life insurance
subsidiary's financial condition and operating performance, lowered the rating
from "A" (Excellent) to "A-" (Excellent). Ratings such as those held by the
Company and its life insurance subsidiary are important to maintaining public
confidence in the Company and the Company's ability to market its loan and
annuity products and services. Although the Company did not experience a
material reduction in the level of annuity sales or an increase in the rate of
annuity surrenders following this action by Best, this lower rating or any
further lowering of the life insurance subsidiary's rating could materially and
adversely affect the Company's ability to market its
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products, particularly the sale of annuities through financial institutions,
and could increase the surrender of its annuity policies. Both of these
consequences could, depending upon the extent thereof, have a materially
adverse effect on the Company's liquidity and, under certain circumstances, net
income and the ability of the Company's mortgage subsidiary to originate new
loans.
Investment Portfolio. The investment portfolio of UC Life, the Company's
life insurance company subsidiary, consists primarily of investment grade
publicly traded fixed maturity securities and mortgage loans meeting the
Company's underwriting standards. At June 30, 1994, 59.7% of UC Life's total
invested assets were invested in investment grade fixed maturity securities and
26.5% were invested in mortgage loans. At June 30, 1994, UC Life's holdings of
below investment grade publicly traded bonds represented 1.6% of its bond
portfolio. Of UC Life's mortgage loans, $172 million or 45.4% of total real
estate loans represented first mortgage commercial real estate loans. During
1991, UC Life decided to limit its investment in commercial real estate
mortgage loans. Future investments in commercial mortgage loans, however, may
be made with respect to refinancing of loans currently owned by UC Life or
loans previously sold in two private placement transactions in 1990. Continued
adverse conditions in the real estate market may adversely affect the Company's
mortgage loan portfolio.
Possible Volatility of Stock Price. The market price of the Common Stock
may experience fluctuations that are unrelated to the operating performance of
the Company. In particular, the price of the Common Stock may be affected by
general market price movements as well as developments specifically related to
the mortgage and insurance industries such as, among other things, interest
rate movements. In addition, the Company's operating income on a quarterly
basis is significantly dependent upon the successful completion of the
Company's loan sales in the secondary market, and the inability of the Company
to complete significant loan sale transactions in a particular quarter will
likely have a material adverse impact on the Company's operating results and
could, therefore, negatively impact the price of the Common Stock. On
September 13, 1993, the Company filed a shelf registration statement on Form
S-1 with the Commission on behalf of the Selling Stockholders with respect to
the shares of the Company's Common Stock offered hereby and this shelf
registration statement was declared effective by the Commission on December 13,
1993. The Company filed a post-effective amendment with the Commission on
August 17, 1994, to convert the shelf registration statement from a Form S-1 to
a Form S-3. This Prospectus has been prepared for use in connection with sales
of Common Stock by the Selling Stockholders under the shelf registration
statement on Form S-3. The Company has been advised that some of the shares of
the Company's Common Stock which were registered pursuant to such shelf
registration statement have been sold by some of the Selling Stockholders. On
March 18, 1994, the Company also filed an additional shelf registration
statement with the Commission to register 200,000 shares of the Company's
Common Stock underlying two stock purchase warrants of the Company. This shelf
registration statement was declared effective by the Commission on April 18,
1994. Management of the Company cannot predict the amount and timing of any
other sales of such Common Stock under the shelf registration statement of
which this prospectus is a part, or under the shelf registration statement
filed to register shares of Common Stock underlying two stock purchase warrants
of the Company or the impact of any such sales on the market for the Company's
Common Stock. However, should a significant number of shares of such Common
Stock be sold by one or more of the Selling Stockholders or by any shareholder
who has received or may receive shares of Common Stock upon the exercise of the
two stock purchase warrants within a short time period, the market price of the
Common Stock could be adversely affected.
Timing of Loan Sales. The Company presently expects to endeavor to effect
public home equity loan securitization transactions on approximately a
quarterly basis through its subsidiary's shelf registration statement.
However, market or other considerations could affect the timing of such
transactions and delays in such sales could reduce the amount of gains
recognized from the sale of home equity loans in a given quarter which
constitutes a significant portion of the Company's income.
Government Regulation and Legislation; Legal Proceedings. The Company's
mortgage and insurance businesses are subject to extensive regulation,
supervision and licensing by federal and state authorities. Regulated matters
include, without limitation, maximum interest rates and fees which may be
charged by the Company, disclosures in connection with loan originations,
credit reporting requirements, servicing requirements, insurance premium rates
and coverage issues, federal and state taxation, and multiple qualification and
licensing requirements for doing business in various jurisdictions. While the
Company believes that it maintains all requisite licenses, permits and
approvals and is in compliance with all material respects with applicable
federal and state regulations,
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there can be no assurance that more restrictive laws or regulations will not be
adopted which could make compliance in the future more difficult and/or more
expensive. Legislative and regulatory proposals are frequently advanced which,
if adopted, could adversely affect the Company's profitability or the manner in
which the Company conducts its activities. In particular, legislation has
recently been passed by both the United States Senate and House of
Representatives, and is awaiting signature by the President, that imposes
disclosure requirements and prohibits prepayment penalty charges, among other
requirements, on loans secured by a borrower's principal residence with a
specified level of origination fees or a specified interest rate level. A
significant percentage of the Company's home equity loans could be subject to
the restrictions of this legislation when it becomes effective. The Company is
currently reviewing this legislation in its final form to determine the impact
of its provisions on the Company's business or results of operations. A recent
federal appeals court decision held, in part, that a lender improperly
disclosed the collection of the Florida state intangible tax from the borrower,
thereby subjecting the loan to rescission under the Federal Truth-in-Lending
Act (the "TILA") by the borrower for three years after it was made. Subsequent
to the court's initial decision and prior to its refusal to reconsider its
decision, the Florida legislature amended the language of the intangible tax to
clarify the legislature's previous intention that the intangible tax be
disclosed for purposes of the TILA in the manner that had been followed by most
lenders in Florida, including the Company. Although the Florida legislature
intended this legislation to apply retroactively, no judicial determination has
yet been made as to the effect of this legislation on loans originated prior to
its effective date. This court decision may also apply to a similar intangible
tax imposed by other states. To its knowledge, as of August 11, 1994, no
claims have been filed against the Company under this recent court decision and
no notice of a breach of a representation has been received under the Company's
loan sale agreements requesting it to repurchase, cure or substitute other
loans for the loans sold. If a substantial number of loans are rescinded or
required to be repurchased, the Company's financial statements and operations
will be materially adversely affected. As the financial impact, if any, of
this contingency cannot presently be reasonably estimated, the Company has made
no accrual therefor. A substantial amount of the Company's annuity policies
are marketed through financial institutions. In August, 1993, the United
States Court of Appeals for the Fifth Circuit, held that the United States
Comptroller of the Currency's decision to permit national banks to sell
annuities in towns with more than 5,000 inhabitants violated the National Bank
Act. In June 1994, the United States Supreme Court granted certiorari and
decided that it will hear arguments in this action. If the Fifth Circuit
ruling is upheld by the Supreme Court, it will have a material adverse effect
on the ability of the Company to market its annuities. Furthermore, any future
regulatory restrictions on the authority of financial institutions to market
annuities could have a material adverse effect on the ability of the Company to
market this product.
Competition. As a marketer of credit and annuity products, the Company
faces intense competition. Traditional competitors in the financial services
business include mortgage banking companies, commercial banks, credit unions,
thrift institutions, credit card issuers and finance companies. Competitors in
the annuity business include established insurance companies, and there are an
increasing number of insurance companies which have recently begun to offer
annuity products. Many of these competitors in the financial services and
annuity business are substantially larger and have more capital and other
resources than the Company. Competition can take many forms including
convenience in obtaining a loan or annuity, customer service, marketing and
distribution channels and interest or crediting rates. In addition, the
current level of gains realized by the Company and its existing competitors on
the sale of its non-conventional loans could attract additional competitors
into this market with the possible effect of lowering gains on future loan
sales owing to increased loan origination competition.
Holding Company Structure. As a holding company, the Company's ability to
meet debt service obligations and pay operating expenses and dividends depends
on receipt of sufficient funds from its subsidiaries. The payment of dividends
by UC Life to the Company is subject to restrictions set forth in the insurance
laws and regulations of Louisiana, its domiciliary state. The Louisiana
Insurance Code (the "Code") provides that no Louisiana stock insurance company
shall declare and pay any dividends to its stockholders unless (i) its capital
is fully paid in cash and is unimpaired and (ii) it has a surplus beyond its
capital stock and the initial minimum surplus required and all other
liabilities equal to 15% of its capital stock, provided that this restriction
shall not apply to an insurance company when its paid-in capital and surplus
exceed the minimum required by the Code by 100% or more. Additional dividend
restrictions are imposed by the Louisiana Insurance Holding Company System
Regulatory Law (the "Insurance Holding Company Law"). Specifically,
extraordinary dividends by an insurance company are subject to a prior approval
requirement by the Louisiana Commissioner of Insurance (the "Louisiana
Commissioner") and an insurance company's surplus as regards policyholders
following any dividends or distributions to affiliates must be reasonable in
relation to the insurance company's outstanding liabilities and
7
<PAGE> 9
adequate to its financial needs. Effective October 31, 1993, an extraordinary
dividend is defined as an amount in excess of the lesser of (a) 10% of surplus
as of the preceding December 31, or (b) the net gain from operations for the
preceding calendar year. The Insurance Holding Company Law also subjects all
transactions between a Louisiana insurance company and its affiliates to
certain fairness and reasonableness standards, and, furthermore, certain types
of transactions with its affiliates are subject to prior notice to the
Louisiana Commissioner who may disapprove the transaction if it is determined
that such transaction does not meet certain fairness and reasonableness
standards or if it may adversely affect the interests of policyholders. If
insurance regulators determine that payment of a dividend or any other payment
to an affiliate (such as a payment under a tax allocation agreement or for
employee or other services or pursuant to a surplus debenture) would, because
of the financial condition of the paying insurance company or otherwise, be
hazardous to such insurance company's policyholders or creditors, the
regulators may block payment of such dividend or such other payment to the
affiliate that would otherwise be permitted without prior approval. Under the
current statutory and regulatory scheme in Louisiana, UC Life had the capacity
to pay dividends of $8.5 million at June 30, 1994 and December 31, 1993,
respectively, without prior regulatory approval. UC Life did not pay any
dividends to the Company during the first six months of 1994 or during 1991,
1992 and 1993 in order to retain capital in UC Life.
USE OF PROCEEDS
The shares of Common Stock offered hereby are being offered by the Selling
Stockholders. See "Selling Stockholders and Plan of Distribution". The
Company will not receive any of the proceeds from the sale of the Common Stock
by the Selling Stockholders.
SELLING STOCKHOLDERS AND PLAN OF DISTRIBUTION
The 1,951,204 shares of Common Stock (the "Shares") being registered are
the number of shares into which the 800,000 shares of the Preferred Stock
acquired by the Selling Stockholders from the Company on June 29, 1993, were
converted after giving effect to the 100% stock dividend paid on October 18,
1993, to stockholders of record on October 1, 1993. The Preferred Stock was
offered and sold to the Selling Stockholders by the Company in a transaction
exempt from the registration requirements of the Securities Act by virtue of
Regulation S of the Commission promulgated thereunder. (See "Description of
Capital Stock"). The agreements pursuant to which the Company sold the shares
of the Preferred Stock to the Selling Stockholders required the Company to file
a registration statement with the Commission for the Shares no later than
September 30, 1993, and the Company did file such registration statement on
September 13, 1993. This registration statement on Form S-1 was declared
effective by the Commission on December 13, 1993. The Company filed a
post-effective amendment with the Commission on August 17, 1994, to convert the
shelf registration statement from a Form S-1 to a Form S-3. The Shares have
been registered to facilitate their sale under the Securities Act. Pursuant to
such registration statement, the Selling Stockholders may choose to sell all or
a portion of the Shares from time to time in transactions reported on the
NASDAQ NSM, in the over-the-counter market or otherwise at prices and at terms
then prevailing or at prices related to the then current market price, or in
negotiated transactions. The Selling Stockholders include approximately 22
investors who were non-U.S. Persons. The table below reflects the number of
shares of Common Stock owned prior to the offering, the number of shares being
offered hereby for the Selling Stockholders account (assuming all of the Common
Stock acquired upon conversion are offered and sold) and the percentage of
outstanding shares to be held by them following completion of the offering.
Although the following table is presented on the assumption that all of the
Selling Stockholders will sell all of their Shares, the Company cannot predict
whether this in fact will occur, the timing or amount of any actual sales, or
the impact thereof on the market price of the Company's Common Stock. None of
the Selling Stockholders holds any position or office with the Company.
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<PAGE> 10
<TABLE>
<CAPTION>
# of Shares % of Shares
% of Shares of of Common # of Shares of Common
# of Shares of Common Stock Stock to of Common Stock
Common Stock Outstanding be Sold Stock Owned Outstanding
Purchaser Owned Prior to Owned Prior to Pursuant to After Owned After
Name Offering Offering Offering Offering Offering
----------- --------------- -------------- ------------ -------------- -------------
<S> <C> <C> <C> <C> <C>
Nippon Credit Gartmore Investment
Management LTD . . . . . . . . . . . 19,512 0.17% 19,512 0 0.00%
Midland Bank Trust Company for Gartmore
American Emerging Growth Trust . . . . 19,512 0.17% 19,512 0 0.00%
Citicorp Trustee Company Limited As
Trustee of Gartmore American Emerging 146,340 1.25% 146,340 0 0.00%
Companies Strategy Fund . . . . . . .
Equity & Law Life Assurance Society, 224,390 1.92% 224,390 0 0.00%
PLC . . . . . . . . . . . . . . . . .
Prudential Portfolio Managers LTD
(Prudential North American Trust) . . 268,292 2.30% 268,292 0 0.00%
Prudential Portfolio Managers LTD
(Prudential International Smaller
Companies Trust) . . . . . . . . . . 73,170 0.63% 73,170 0 0.00%
Prudential Portfolio Managers LTD
(Prudential Global Growth Trust) . . 24,390 0.21% 24,390 0 0.00%
Prudential Portfolio Managers LTD
(Prudential International Life Fund) 73,170 0.63% 73,170 0 0.00%
Schlagenhauf & Partner . . . . . . . . 48,780 0.42% 48,780 0 0.00%
Pictet & Cie . . . . . . . . . . . . . 68,292 0.58% 68,292 0 0.00%
Govett American Smaller Companies Trust 29,268 0.25% 29,268 0 0.00%
Equitable Life Assurance Society . . . 195,120 1.67% 195,120 0 0.00%
Handelsbanken Life . . . . . . . . . . 97,560 0.83% 97,560 0 0.00%
The GBC North American Growth . . . . . 97,560 0.83% 97,560 0 0.00%
Prolific American International Fund . 29,268 0.25% 29,268 0 0.00%
Chase Manhattan Trustees Limited as
Trustee of Prolific American
Opportunities Unit Trust . . . . . . 39,024 0.33% 39,024 0 0.00%
Chase Manhattan Trustees Limited as
Trustee of Prolific American Income
Unit Trust . . . . . . . . . . . . . 29,268 0.25% 29,268 0 0.00%
G.P.K. Finance . . . . . . . . . . . . 29,268 0.25% 29,268 0 0.00%
Orbis Pension Trustees LTD . . . . . . 195,120 1.67% 195,120 0 0.00%
Barclays . . . . . . . . . . . . . . . 195,120 1.67% 195,120 0 0.00%
Ohman Fondkommission . . . . . . . . . 48,780 0.42% 48,780 0 0.00%
Total . . . . . . . . . . . . . . . 1,951,204 16.70% 1,951,204
</TABLE>
The Shares owned by the Selling Stockholders may be sold in one or more of
the following transactions: (a) block trades in which the broker or dealer so
engaged will attempt to sell the Shares as agent but may position and resell a
portion of the block as principal to facilitate any transaction, (b) purchases
by a broker or dealer as principal and resale by such broker or dealer for its
account pursuant to the Registration Statement relating thereto, and (c)
ordinary brokerage transactions and transactions in which the broker solicits
purchasers. In effecting sales, brokers and dealers engaged the by the Selling
Stockholders may arrange for other brokers or dealers to participate. Brokers
or dealers will receive commissions or discounts from the Selling Stockholders
in amounts to be negotiated (and, if such broker-dealer acts as agent for the
purchaser of such shares, from such purchaser). Broker-dealers may agree with
the Selling Stockholders to sell a specified number of Shares at a stipulated
price per Share, and, to the extent such a broker-dealer is unable to do so
acting as agent for a Selling Stockholder, to purchase as principal any unsold
shares at the price required to fulfill the broker-dealer commitment to such
Selling Stockholder. Broker-dealers who acquire Shares as principal may
thereafter resell such Shares from time to time in transactions (which may
involve crosses and book transactions and which may involve sales to and
through other broker-dealers, including transactions, of the nature described
above) in the over- the-counter market, in negotiated transactions or
otherwise, at market prices prevailing at the time of sale or at negotiated
prices, and in connection with such resales may pay to or receive from the
purchasers of such Shares commissions as described above. Pursuant to the
9
<PAGE> 11
registration agreement entered into in connection with the sale of the
Preferred Stock by the Company, the Company has agreed to indemnify the Selling
Stockholders against certain liabilities, including liabilities under the
Securities Act.
DESCRIPTION OF CAPITAL STOCK
GENERAL
Set forth below is a description of the material terms and provisions of
the equity securities of the Company. The following description does not
purport to be complete and is subject to and qualified in its entirety by
reference to the Articles of Incorporation, as amended, of the Company (the
"Articles of Incorporation") and the By-Laws, as amended, of the Company (the
"By- Laws") and the Rights Plan of the Company dated as of July 27, 1994 (the
"Rights Plan"). The Articles of Incorporation and the By- Laws are exhibits to
the Company's Annual Report on Form 10-K and the Rights Plan is an exhibit to
the Company's Registration Statement on Form 8-A.
The Company is authorized to issue (i) 100,000,000 shares of Common Stock,
par value $2.00 per share and (ii) 20,000,000 shares of preferred stock, par
value $2.00 per share, which may be issued in one or more series with such
voting powers, designations, preferences, rights, qualifications, limitations
and restrictions as shall be specified by the Board of Directors. The Board of
Directors may issue preferred stock with voting and conversion rights which
could adversely affect the voting power of the holders of Common Stock, and
which could, among other things, have the effect of delaying, deferring or
preventing a change in control of the Company. In connection with the Rights
Plan, the Board of Directors authorized issuance of 1,000,000 shares of Series
A Junior Participating Preferred Stock to holders of rights issued under the
Rights Plan. See "--Rights Plan" below.
As of July 14, 1994, 12,435,519 shares of Common Stock were issued and
outstanding, excluding 524,207 treasury shares.
6.5% CUMULATIVE CONVERTIBLE PREFERRED STOCK, SERIES A, ISSUE PRICE $25.00 PER
SHARE
On June 29, 1993, the Company sold to twenty-two institutional investors
located primarily in the United Kingdom 800,000 shares of 6.5% Cumulative
Convertible Preferred Stock, Series A, Issue Price $25.00 per share (the
"Preferred Stock") pursuant to Regulation S promulgated by the Commission. On
August 26, 1993, the Company called for redemption all outstanding shares of
the Preferred Stock. The Selling Stockholders had the right to convert their
shares of Preferred Stock into Common Stock. Each share of Preferred Stock
had a conversion price of $20.50 and was convertible into 1.2195 shares of
Common Stock (prior to the 100% Common Stock dividend paid on October 18, 1993,
to stockholders of record on October 1, 1993) at the option of the Selling
Stockholders. All of the Selling Stockholders elected to convert their shares
of Preferred Stock to Common Stock for a total of 975,602 shares of Common
Stock (now constituting 1,951,204 shares of Common Stock after the 100% stock
dividend). Pursuant to the requirement of agreements between the Company and
the Selling Stockholders, the Company filed a shelf registration statement on
Form S-1 under the Securities Act covering the resale by the Selling
Stockholders of the 1,951,204 shares of Common Stock issued upon such
conversion and such shelf registration statement was declared effective by the
Commission on December 13, 1993. The Company filed a post- effective amendment
with the Commission on August 17, 1994, to convert the shelf registration
statement from a Form S-1 to a Form S- 3. This Prospectus has been prepared
for use in connection with future sales of the Shares of Common Stock by the
Selling Stockholders under the shelf registration statement on Form S-3. In
connection with any sales, the Selling Stockholders and any brokers
participating in such sales may be deemed to be "underwriters" within the
meaning of the Securities Act. The Company has covenanted with the former
holders of Preferred Stock to keep such shelf registration statement effective
until the earlier of three years from June 29, 1993, or the sale by the former
holders of the Preferred Stock of all of the shares of Common Stock covered by
the shelf registration statement.
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<PAGE> 12
COMMON STOCK
Dividends
Holders of the Company's Common Stock are entitled to receive such
dividends as may be legally declared by the Board of Directors. The
declaration and amount of future dividends may depend, in part, on restrictive
covenants contained in certain loan agreements and certain state regulations
regarding minimum capitalization requirements for insurance companies that have
the effect of limiting dividends from UC Life and United General Title
Insurance Company, the Company's title insurance subsidiary, to the Company.
Under provisions of the Company's revolving credit facility restricting
the payment of dividends, approximately $37.2 million of retained earnings was
available for the payment of dividends at June 30, 1994. In addition to the
state regulatory provisions referenced above requiring minimum capitalization
for insurance companies and limiting the ability of insurance companies to pay
dividends or make other payments to affiliates, the ability of UC Life to pay
dividends to the Company is restricted under certain circumstances by the fact
that payment of dividends by UC Life would result in an increase in UC Life's
federal income taxes.
Voting Rights
Holders of Common Stock are entitled to one vote for each share held of
record. Except as discussed below, action of the stockholders may generally be
taken by the affirmative vote of a majority of the shares present or
represented at a duly called meeting at which a quorum is present or
represented.
Other Rights
Holders of Common Stock have no preemptive or subscription rights and have
no liability for further calls or assessments. Subject to the prior rights of
the Preferred Stock, all shares of Common Stock are entitled to share ratably
in net assets of the Company upon liquidation.
The transfer agent and registrar for the Common Stock is Chemical Bank of
New York, New York.
SPECIAL CHARTER AND LOUISIANA LAW PROVISIONS
Certain provisions of the Articles of Incorporation of the Company,
Louisiana law, and the Company's Rights Plan, may have the effect of delaying,
deterring or discouraging, among other things, a non-negotiated tender or
exchange offer for the Company's Common Stock or a proxy contest for control of
the Company.
Special Vote Provisions and Takeover Consideration Provisions in
the Company's Articles of Incorporation
The Articles of Incorporation of the Company include certain provisions
(the "Special Vote Provisions") requiring the affirmative vote of 80% of the
outstanding shares of the Company's voting stock before the Company may enter
into (i) a merger or consolidation with any other corporation, (ii) a sale or
lease of substantially all of the assets of the Company to any other
corporation, person or entity, or (iii) a sale or lease to the Company by any
other corporation, person or other entity of assets having a value greater than
$1 million in exchange for voting stock of the Company, in each case if such
other corporation, person or other entity, directly or indirectly, owns or
controls 10% or more of the Company's voting stock prior to any such
transaction. The Special Vote Provisions apply only to the above-described
transactions which do not receive prior approval of the Board of Directors.
The Articles of Incorporation of the Company also contain certain
provisions (the "Takeover Consideration Provisions") authorizing the Board of
Directors, in evaluating an offer from a third party to merge with or acquire
the shares or assets of the Company, to give due consideration of certain
factors not directly related either to the price per share offered for or the
then market price of the Company's Common Stock. The factors that the Board of
Directors is authorized to consider under the Takeover Consideration Provisions
include, without limitation: (i) the consideration being offered in the
acquisition proposal as it relates to the then current value of the Company in
11
<PAGE> 13
a freely negotiated transaction, and to the Board of Directors' then estimate
of the future value of the Company as an independent entity; (ii) the social,
legal and economic effects of the acquisition proposal on the Company and its
subsidiaries, and the franchisees, employees, suppliers, customers, creditors
and business of the Company and its subsidiaries; (iii) the financial condition
and earnings prospects of the potential offeror, including but not limited to,
debt service and other existing or likely financial obligations of the
potential offeror, and the possible effect of such condition upon the Company
and its subsidiaries and other elements of the communities in which the Company
and its subsidiaries operate or are located; and (iv) the competence,
experience and integrity of the potential offerer.
Pursuant to Section 92G of the Louisiana Business Corporation Law (the
"LBCL"), the Board of Directors is also authorized to consider the factors set
forth therein (which are generally comparable to those set forth in the
Takeover Consideration Provisions) and any other factors which it deems
relevant in evaluating a tender offer or an offer to make a tender or exchange
offer or to effect a merger or consolidation.
The Special Vote Provisions and the Takeover Consideration Provisions may
be altered only by the affirmative vote of 80% of the outstanding shares of the
Company's voting stock.
Directors' and Officers' Exculpation and Indemnification
The Articles of Incorporation, as amended, provide that no director or
officer of the Company shall be personally liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a director or
officer except for liability (i) for breach of the directors' or officers' duty
of loyalty to the Company or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 92(D) of the LBCL, which specifies certain corporate
transactions, such as certain dividend declarations and dispositions of assets,
as unlawful, or (iv) for any transaction from which the director or officer
derived an improper personal benefit. With the exception of the items noted in
(i) through (iv) above, the effect of this provision of the Articles of
Incorporation is to eliminate the rights of the Company and its stockholders
(through stockholders' derivative suits on behalf of the Company) to recover
monetary damages against a director or officer for breach of fiduciary duty as
a director or officer. This provision does not limit or eliminate the rights
of the Company or any stockholders to seek non-monetary relief, such as an
injunction or rescission in the event of a breach of a director's or officer's
fiduciary duty.
Pursuant to Section 83 of the LBCL, the Company has adopted provisions in
its Articles of Incorporation which require the Company to indemnify its
directors and officers to the fullest extent permitted by Louisiana law.
Louisiana Fair Price and Control Share Acquisition Statutes
As a Louisiana corporation, the Company is subject to the provisions of
the LBCL which contain "fair price" and "control share acquisition" provisions.
Each of these provisions imposes significant restrictions on the ability of an
acquiror of a large block of voting stock of a Louisiana corporation to
exercise control over the corporation.
The "fair price" provisions are set forth in Sections 132-134 of the LBCL
and are designed to restrict the ability of a Louisiana corporation to enter
into mergers or other extraordinary corporate transactions with certain
stockholders. These provisions require that certain business combinations
between a Louisiana corporation and "interested stockholders" must be approved
by (i) the corporation's Board of Directors, (ii) the affirmative vote of at
least 80% of the voting stock of the corporation, and (iii) the affirmative
vote of two-thirds of the voting stock of the corporation (excluding stock held
by the interested stockholders), unless the business combination satisfies
certain "fair price" tests regarding the payments to be made to stockholders
and meets certain other procedural requirements. An "interested stockholder"
is defined as any person (other than the corporation, any subsidiary of the
corporation or any employee benefit plan of the corporation or any subsidiary)
that is the beneficial owner of 10% or more of the voting stock of the
corporation. In general, the "fair price" tests measure the value stockholders
receive for their stock from an interested stockholder in transactions within a
two year period.
The "control share acquisition" provisions of the LBCL are set forth in
Sections 135-140.2. In general, these provisions provide that persons who,
after May 4, 1987, acquire stock that would normally entitle them to exercise
20% or more of the voting power of the corporation will not be able to vote the
shares acquired by them in excess
12
<PAGE> 14
of 20% of such voting power unless their ability to vote is reinstated by the
stockholders of the corporation at a meeting held after the acquiring person
requests such a vote. A corporation is required to call such a meeting only if
the person proposing to make a control share acquisition (an "acquiring
stockholder") has demonstrated a financial ability to make a successful
acquisition and such proposed acquisition is lawful. At such a meeting, the
voting rights of the acquiring stockholder will be reinstated for shares held
by the acquiring stockholder in excess of 20% of the Company's voting power if
approved by the affirmative vote of (i) a majority of all shares of the Company
then entitled to vote and (ii) a majority of all shares of the Company then
entitled to vote (excluding shares beneficially owned by the acquiring
stockholder, its officers and its directors who are also its employees). If
the voting rights of the acquiring stockholder are reinstated, such stockholder
can acquire additional voting shares within certain threshold levels, without
obtaining additional stockholder approval. However, if the acquiring
stockholder acquires additional shares in an acquisition that places such
stockholder above the threshold ownership levels of one-third and one-half of
all voting shares, the additional shares acquired in such an acquisition in
excess of such ownership levels will not have voting rights unless reinstated
by the stockholders pursuant to the voting procedures described above. A
corporation must call a stockholders' meeting within 50 days of the date that
both the corporation and the proposed acquiring stockholder file definitive
proxy materials with the Commission.
Louisiana Insurance Code
UC Life is a Louisiana chartered life insurance company. Section 731 of
the Louisiana Insurance Code (La.R.S. 22:731) provides that a Louisiana insurer
may merge or consolidate with or acquire control of another insurer, or a
person may acquire control of a Louisiana insurance company only if the plan of
merger or consolidation or acquisition of control is submitted to or receives
advance approval from the Louisiana Commissioner of Insurance after a public
hearing thereon. Section 731 provides that the Louisiana Commissioner of
Insurance may disapprove any such merger, consolidation or other acquisition of
control for any of the following reasons: (i) the effect thereof would be
substantially to lessen competition in insurance in Louisiana or tend to create
a monopoly therein; (ii) the financial condition of any acquiring party is such
as might jeopardize the financial stability of the insurer, or prejudice the
interests of its policyholders or the interests of any remaining security
holders who are unaffiliated with such acquiring party; (iii) the terms of the
offer, request, invitation, agreement or acquisition are unfair and
unreasonable to the security holders of the insurer; (iv) the plans or
proposals which the acquiring party has to liquidate the insurer, sell its
assets or consolidate or merge it with any person, or to make any other
material change in its business or corporate structure or management are unfair
and unreasonable to policyholders of the insurer and not in the public
interest; or (v) the competence, experience and integrity of those persons who
would control the operation of the insurer are such that it would not be in the
interest of policyholders of the insurer and of the public to permit the
merger, consolidation or other acquisition of control.
Louisiana's Insurance Holding Company System Regulatory Law, constituting
Part XXI-A of the Louisiana Insurance Code (La.R.S. 22:1001-1015), requires
the filing of periodic registration statements by the Company with the
Louisiana Commissioner of Insurance and regulates transactions among members of
an insurance holding company system such as that of the Company. Any change of
control (10% or more of voting securities is presumed to constitute control for
purposes of this legislation) requires notification to, hearing before and
approval of the Louisiana Commissioner of Insurance.
RIGHTS PLAN
On July 27, 1994, the Board of Directors of the Company redeemed the
rights issued under the rights plan adopted in February 1989, adopted the
Rights Plan, declared a dividend of one preferred stock purchase right (a
"Right") for each outstanding share of Common Stock on August 6, 1994, and has
authorized the issuance of one Right with respect to each outstanding share of
Common Stock issued after August 6, 1994, before the earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date (as such
terms are hereinafter defined). The Rights have antitakeover effects. The
Rights will cause substantial dilution to a person or group that attempts to
acquire the Company on terms not approved by the Board of Directors, except
pursuant to an offer conditioned on a substantial number of Rights being
acquired.
Each Right entitles the registered holder upon exercise on and after the
Distribution Date to purchase from the Company one one-hundredth of a share of
Series A Junior Participating Preferred Stock, par value $2.00 per
13
<PAGE> 15
share (the "Preferred Shares"), of the Company at a price of $240.00 per one
one-hundredth of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights and the Preferred Shares
into which such Rights are exercisable, are set forth in a Rights Agreement
dated as of July 27, 1994 (the "Rights Plan"), between the Company and Chemical
Bank, acting as Rights Agent.
The "Distribution Date" occurs on the earliest of the close of business on
(i) the tenth day following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired
beneficial ownership of 20% or more of the outstanding shares of Common Stock,
(ii) the tenth day (or such later date as may be determined by action of the
Board of Directors of the Company prior to such time as any person becomes an
Acquiring Person) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer, the consummation of which
would result in the beneficial ownership by a person or group of 25% or more of
the outstanding shares of Common Stock, or (iii) 10 days after the Board of
Directors shall declare any person to be an "Adverse Person," upon a
determination that such person, alone or together with its affiliates and
associates, has become the beneficial owner of 10% or more of the outstanding
shares of Common Stock and a determination by at least a majority of the Board
of Directors who are not officers of the Company, after reasonable inquiry and
investigation, including consultation with such persons as such directors shall
deem appropriate, that (a) such beneficial ownership by such person is intended
to cause, is reasonably likely to cause or will cause the Company to repurchase
the shares of Common Stock beneficially owned by such person or to cause
pressure on the Company to take action or enter into a transaction or series of
transactions intended to provide such person with short-term financial gain
under circumstances where the Board of Directors determines that the best
long-term interests of the Company and its stockholders would not be served by
taking such action or entering into such transactions or series of transactions
at that time or (b) such beneficial ownership is causing or is reasonably
likely to cause a material adverse impact (including, but not limited to,
impairment of relationships with customers or impairment of the Company's
ability to maintain its competitive position) on the business or prospects of
the Company. However, the Board of Directors may not declare a person to be an
Adverse Person if, prior to the time that the person acquired 10% or more of
the shares of Common Stock then outstanding, such person provided to the Board
of Directors in writing a statement of the person's purpose and intentions in
connection with the proposed acquisition of Common Stock, together with any
other information reasonably requested of the person by the Board of Directors,
and the Board of Directors, based on such statement and reasonable inquiry and
investigation as it deems appropriate, determines to notify and notifies such
person in writing that it will not declare the person to be an Adverse Person;
provided, however, that the Board of Directors may expressly condition in any
manner a determination not to declare a person an Adverse Person on such
conditions as the Board of Directors may select, including without limitation,
such person's not acquiring more than a specified amount of stock and/or on
such person's not taking actions inconsistent with the purposes and intentions
disclosed by such person in the statement provided to the Board of Directors.
In the event that the Board of Directors should at any time determine, upon
reasonable inquiry and investigation, that such person has not met or complied
with any conditions specified by the Board of Directors, the Board of Directors
may at any time thereafter declare the Person to be an Adverse Person. Until
the Distribution Date, the Rights will be transferred with and only with shares
of Common Stock. The Rights will expire on July 31, 2004 (the "Final
Expiration Date"), unless the Rights are earlier redeemed or exchanged by the
Company.
The Purchase Price payable, and the number of Preferred Shares or other
securities of property issuable, on exercise of the Rights are subject to
adjustment from time to time to prevent dilution in the event of a stock
dividend on the Preferred Shares or other events described in the Rights Plan.
Preferred Shares purchasable upon exercise of the Rights will not be
redeemable. Each Preferred Share will be entitled to a minimum preferential
quarterly dividend payment of $1.00 per share but will be entitled to an
aggregate dividend of 100 times the dividend declared per share of Common
Stock. In the event of liquidation, the holders of the Preferred Shares will
be entitled to a minimum preferential liquidation payment of $100.00 per share
but will be entitled to an aggregate payment of 100 times the payment made per
share of Common Stock. Each Preferred Share will have 100 votes, voting
together with the Common Stock. Finally, in the event of merger, consolidation
or other transaction in which shares of Common Stock are exchanged, each
Preferred Share will be entitled to receive 100 times the amount received per
share of Common Stock. The Rights are protected by customary antidilution
provisions.
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<PAGE> 16
Because of the nature of the Preferred Shares' dividend, liquidation and
voting rights, the value of the one one-hundredth interest in a Preferred Share
purchasable upon exercise of each Right should approximate the value of one
share of Common Stock.
The Rights Plan contains a "flip-over" feature allowing the exercise of
the Rights so that the holder thereof (except those Rights held by the
Acquiring Person) will receive shares of Common Stock of the Acquiring Person
at half price causing substantial dilution to the Acquiring Person. In
general, this "flip-over" feature provides that in the event that the Company
is acquired by an Acquiring Person in a merger or other business combination
transaction or 50% or more of its consolidated assets or earning power are sold
to an Acquiring Person, proper provision will be made so that each holder of a
Right, other than Rights that are or were beneficially owned by the Acquiring
Person after the date upon which the Acquiring Person became such (which will
thereafter be void), will thereafter have the right to receive, upon the
exercise thereof at the then current Purchase Price, that number of shares of
common stock of the Acquiring Person which at the time of such transaction will
have a market value of two times the Purchase Price.
The Rights Plan also contains a "flip-in" feature allowing holders of
Rights (except those held by an Acquiring Person) to purchase Common Stock of
the Company at half price. In general this "flip-in" feature provides that in
the event that (i) any person becomes the beneficial owner of 25% or more of
the outstanding Common Stock (unless such person first acquires 25% or more of
the outstanding Common Stock by a purchase pursuant to a tender offer for all
of the Common Stock), (ii) any person is declared by the Board to be an
"Adverse Person", (iii) an Acquiring Person engages in one or more
"self-dealing" transactions as set forth in the Rights Plan, or (iv) during
such time as there is an Acquiring Person, there shall be a reclassification of
securities or a recapitalization or reorganization of the Company or other
transaction or series of transactions involving the Company which has the
effect of increasing by more than 1% the proportionate share of the outstanding
shares of any class of equity securities of the Company or any of its
subsidiaries beneficially owned by the Acquiring Person, proper provision shall
be made so that each holder of a Right, other than Rights that are or were
beneficially owned by the Acquiring Person after the date upon which the
Acquiring Person became such (which will thereafter be void), will thereafter
have the right to receive upon exercise that number of shares of Common Stock
(or, in the event that there are insufficient authorized shares of Common
Stock, substitute consideration such as cash, property, or other securities of
the Company) having a market value of two times the Purchase Price.
At any time after the acquisition by an Acquiring Person of beneficial
ownership of 20% or more of the outstanding Common Stock and prior to the
acquisition by such person of 25% or more of the outstanding Common Stock, the
Board of Directors of the Company may exchange the Rights (other than Rights
owned by such person which have become void), in whole or in part, at an
exchange ratio of one share of Common Stock, or one one-hundredth of a
Preferred Share (or of a share of a class or series of the Company's preferred
stock having equivalent rights, preferences and privileges), per Right (subject
to adjustment).
At any time prior to the acquisition by an Acquiring Person of beneficial
ownership of 20% or more of the outstanding Common Stock, the Board of
Directors of the Company may redeem the Rights in whole, but not in part, at a
price of $.001 per Right (the "Redemption Price"). Immediately upon any
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holder of the Rights will be to receive the Redemption
Price. The date on which the redemption of the Rights occurs pursuant to the
foregoing provisions is referred to herein as the "Redemption Date".
The terms of the Rights may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights, including an
amendment to lower certain thresholds described above to not less than the
greater of (i) any percentage greater than the largest percentage of the
outstanding shares of the Common Stock then known to the Company to be
beneficially owned by any Acquiring Person and (ii) 10%, except that from and
after such time as any person becomes an Acquiring Person no such amendment may
adversely affect the interests of the holders of the Rights.
Until a Right is exercised, the holder of a Right will not, by reason of
being such a holder, have rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
15
<PAGE> 17
LEGAL MATTERS
The legality of the shares of Common Stock offered hereby will be passed
upon for the Company by the law firm of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation), P. O. Box 2997, Baton Rouge, Louisiana, 70821.
As of June 30, 1994, individual stockholders of the firm of Kantrow, Spaht,
Weaver & Blitzer (A Professional Law Corporation) owned, directly or
indirectly, approximately 20,766 shares of the Company's Common Stock.
EXPERTS
The consolidated financial statements and the related financial statement
schedules incorporated in this prospectus by reference from the Company's
Annual Report on Form 10-K for the year ended December 31, 1993 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
With respect to the unaudited interim financial information for the
periods ended March 31, 1994 and 1993 and June 30, 1994 and 1993, which is
incorporated herein by reference, Deloitte & Touche LLP have applied limited
procedures in accordance with professional standards for a review of such
information. However, as stated in their reports included in the Company's
Quarterly Reports on Form 10-Q for the quarters ended March 31, 1994 and 1993
and June 30, 1994 and 1993 and incorporated by reference herein, they did not
audit and they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their reports on such information should
be restricted in light of the limited nature of the review procedures applied.
Deloitte & Touche LLP are not subject to the liability provisions of Section
11 of the Securities Act of 1933 for their reports on the unaudited interim
financial information because those reports are not "reports" or a "part" of
the registration statement prepared or certified by an accountant within the
meaning of Sections 7 and 11 of the Act.
16
<PAGE> 18
================================================================================
No dealer, salesman or any other person has been authorized to give
any information or to make any representations in connection with this offering
other than those contained in this Prospectus and, if given or made, such other
information or representations must not be relied upon as having been so
authorized by the Company or the Selling Stockholders. This Prospectus does
not constitute an offer to sell or a solicitation of an offer to buy by anyone
in any jurisdiction in which such offer to sell or solicitation is not
authorized, or in which the person making such offer to sell or a solicitation
is not qualified to do so nor to any person to whom it is unlawful to make such
offer or solicitation. Neither the delivery of this Prospectus nor any sale
made hereunder shall, under any circumstances, create any implication that
there has been no change in the affairs of the Company since the date hereof.
________________________
TABLE OF CONTENTS
Page
----
Available Information . . . . . . . . . . . . 2
Incorporation of Certain Documents
by Reference . . . . . . . . . . . . . . . 3
The Company . . . . . . . . . . . . . . . . . 3
Risk Factors . . . . . . . . . . . . . . . . 4
Use of Proceeds . . . . . . . . . . . . . . . 8
Selling Stockholders and Plan of Distribution 8
Description of Capital Stock . . . . . . . . 10
Legal Matters . . . . . . . . . . . . . . . . 16
Experts . . . . . . . . . . . . . . . . . . . 16
________________________
================================================================================
================================================================================
1,951,204 SHARES
UNITED COMPANIES
FINANCIAL CORPORATION
(LOGO)
COMMON STOCK
________________
PROSPECTUS
________________
August ___, 1994
================================================================================
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the expenses in connection with the
preparation and filing of this Post-Effective Amendment and the issuance and
distribution of the securities being registered (all amounts are estimated):
<TABLE>
<CAPTION>
TOTAL
-----
<S> <C>
Accounting fees and expenses . . . . . . . . . . . . $ 5,000.00
Legal fees and expenses . . . . . . . . . . . . . . . 10,000.00
Cost of printing and engraving . . . . . . . . . . . 2,000.00
Transfer agents' fees . . . . . . . . . . . . . . . . 1,000.00
Miscellaneous . . . . . . . . . . . . . . . . . . . . 5,000.00
----------
Total . . . . . . . . . . . . . . . . . . . . . . $23,000.00
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 83 of the Louisiana Business Corporation Law (the "LBCL") provides
that a corporation may indemnify any person who was or is a party or is
threatened to be made a party to any action, suit or proceeding, whether civil,
criminal, administrative, or investigative (other than an action by or in the
right of the corporation), by reason of the fact that he is or was a director,
officer, employee, or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee, or agent of
another business, foreign or nonprofit corporation, partnership, joint venture,
or other enterprise. The indemnity may include expenses, including attorney
fees, judgments, fines, and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit, or proceeding if he acted
in good faith and in a manner he reasonably believed to be in, or not opposed
to, the best interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. Section 83 further provides that a Louisiana corporation may
indemnify officers and directors in an action by or in the right of the
corporation under the same conditions except that no indemnification is
permitted without judicial approval if the director or officer shall have been
adjudged to be liable for willful or intentional misconduct in the performance
of his duty to the corporation. Where an officer or director is successful on
the merits or otherwise in any defense of any action referred to above or any
claim therein, the corporation must indemnify him against such expenses that
such officer or director actually incurred. Section 83 permits a corporation
to pay expenses incurred by the officer or director in defending an action,
suit or proceeding in advance of the final disposition thereof if approved by
the board of directors.
Pursuant to Section 83 of the LBCL, the Company has adopted provisions in
its Articles of Incorporation which require the Company to indemnify its
directors and officers to the fullest extent permitted by the LBCL.
The Articles of Incorporation, as amended, provide that no director or
officer of the Company shall be personally liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a director or
officer except for liability (i) for breach of the directors' or officers' duty
of loyalty to the Company or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 92(D) of the LBCL, or (iv) for any transaction from
which the director or officer derived an improper personal benefit. Section
92(D) of the LBCL specifies certain corporate transactions, such as certain
dividend declarations and dispositions of assets, as unlawful. The effect of
this provision of the Articles of Incorporation is to eliminate the rights of
the Company and its stockholders (through stockholders' derivative suits on
behalf of the Company) to recover monetary damages against a director or
officer for breach of fiduciary duty as a director or officer. This provision
does not limit or eliminate the rights of the Company or any stockholders to
seek non-monetary relief, such as an injunction or rescission in the event of a
breach of a director's or officer's fiduciary duty.
II-1
<PAGE> 20
ITEM 16. EXHIBITS
(a) Exhibits
Exhibit No. Description of Document
----------- -----------------------
4.2(1) Series A Junior Participating Preferred Stock
Purchase Rights
5.1(2) Opinion of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation)
15.1(3) Letter of Deloitte & Touche LLP regarding
unaudited interim financial information
23.1(3) Consent of Deloitte & Touche LLP
23.2(2) Consent of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation) (Included in Exhibit
5.1)
24.1(2) Power of Attorney
(1) Incorporated herein by reference to the Company's Form 8-A filed with
the Commission on August 5, 1994.
(2) Previously filed.
(3) Filed herewith.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) of this
section do not apply if the registration statement is on Form S-3 or Form S-8,
and the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) For purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the provisions described above in Item
II-2
<PAGE> 21
15, the Company has been advised that, in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a director, officer or
controlling person of the Company in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-3
<PAGE> 22
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS
ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
POST-EFFECTIVE AMENDMENT NO. 1 TO THE REGISTRATION STATEMENT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED IN THE CITY OF BATON
ROUGE, STATE OF LOUISIANA, ON THE 16TH DAY OF AUGUST, 1994.
UNITED COMPANIES FINANCIAL CORPORATION
By: /s/ Sherry E. Anderson
___________________________________
Sherry E. Anderson,
Senior Vice President and Secretary
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
POST-EFFECTIVE AMENDMENT NO. 1 TO THE REGISTRATION STATEMENT HAS BEEN SIGNED
BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATE INDICATED.
<TABLE>
<CAPTION>
<S> <C> <C>
Signature Title Date
* Chairman of the Board of Directors August 15, 1994
___________________________________________ (Principal Executive Officer)
Harris J. Chustz
* Chief Executive Officer, President and August 15, 1994
___________________________________________ Director (Principal Executive Officer)
J. Terrell Brown
/s/ Dale E. Redman Executive Vice President, Chief Financial August 15, 1994
___________________________________________ Officer, Assistant Secretary and Director
Dale E. Redman (Principal Financial Officer)
/s/ Jesse O. Griffin Senior Vice President and Controller August 16, 1994
___________________________________________ (Princpal Accounting Officer)
Jesse O. Griffin
* Director August 15, 1994
___________________________________________
James J. Bailey, III
* Director August 15, 1994
___________________________________________
Robert H. Barrow
* Director August 15, 1994
___________________________________________
Richard A. Campbell
* Director August 15, 1994
___________________________________________
Robert D. Kilpatrick
* Director August 15, 1994
___________________________________________
O. Miles Pollard, Jr.
* Director August 15, 1994
___________________________________________
Charles S. Prosser, M.D.
* Director August 15, 1994
___________________________________________
William H. Wright, Jr.
*By: /s/ Dale E. Redman
_____________________________________
Dale E. Redman
Attorney-in-Fact
</TABLE>
II-4
<PAGE> 23
EXHIBIT INDEX
Exhibit No. Description of Document
----------- -----------------------
4.2(1) Series A Junior Participating Preferred Stock
Purchase Rights
5.1(2) Opinion of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation)
15.1(3) Letter of Deloitte & Touche LLP regarding
unaudited interim financial information
23.1(3) Consent of Deloitte & Touche LLP
23.2(2) Consent of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation) (Included in Exhibit
5.1)
24.1(2) Power of Attorney
(1) Incorporated herein by reference to the Company's Form 8-A field with
the Commission on August 5, 1994.
(2) Previously filed.
(3) Filed herewith.
<PAGE> 1
EXHIBIT 15.1
August 15, 1994
United Companies Financial Corporation
4041 Essen Lane
Baton Rouge, Louisiana
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim
consolidated financial information of United Companies Financial Corporation
and subsidiaries for the periods ended March 31, 1994 and 1993 and June 30,
1994 and 1993, as indicated in our reports dated April 28, 1994 and July 27,
1994, respectively; because we did not perform an audit, we expressed no
opinion on that information.
We are aware that our reports referred to above, which were included in your
Quarterly Reports on Form 10-Q for the quarters ended March 31, 1994 and June
30, 1994, are being used in this Registration Statement.
We also are aware that the aforementioned reports, pursuant to Rule 436(c)
under the Securities Act of 1933, are not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
/s/ DELOITTE & TOUCHE LLP
Baton Rouge, Louisiana
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Form S-3 Post-Effective
Amendment No. 1 to Registration Statement No. 33-68626 of United Companies
Financial Corporation on Form S-1 of the report of Deloitte & Touche dated
February 18, 1994, appearing in and incorporated by reference in the Annual
Report on Form 10-K of United Companies Financial Corporation for the year
ended December 31, 1993, and to the reference to Deloitte & Touche LLP under
the heading "Experts" in the Prospectus, which is part of this Registration
Statement.
/s/ DELOITTE & TOUCHE LLP
Baton Rouge, Louisiana
August 15, 1994
