Pacific Alliance Corporation Preliminary Information Statement
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C
Information
Statement Pursuant to Section 14 (c)
of
the Securities Exchange Act of 1934
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Preliminary
Information Statement
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Confidential,
for use of the Commission Only (as permitted by Rule
14c-5(d)(2))
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Definitive
Information Statement
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PACIFIC
ALLIANCE CORPORATION
(Name
of
Registrant As Specified In Its Charter)
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of Filing Fee (Check the appropriate box):
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of each class of securities to which transaction applies:
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number of securities to which transaction applies: NA
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unit price or other underlying value of transaction computed pursuant
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maximum aggregate value of transaction: NA
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(3) Filing
Party: NA
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(4) Date
Filed: June 15, 2006
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Contact
Person: A. O. Headman, Jr., ESQ, Cohne Rappaport & Segal
257
East
200 South 7th
Floor,
Salt Lake City, UT 84111; Tel: 801-532-2666, Fax: 801-355-1813
PACIFIC
ALLIANCE CORPORATION
1661
Lakeview Circle
Ogden,
UT 84403
NOTICE
OF ACTION TO BE TAKEN WITHOUT A STOCKHOLDERS’ MEETING
TO
OUR
STOCKHOLDERS:
Notice
is
hereby given that Pacific Alliance Corporation. plans to take certain corporate
action pursuant to the written consent of our Board of Directors and the holders
of a majority of our outstanding voting securities (“Majority Stockholders”).
The action we plan to take is to amend our Certificate of Incorporation to
increase the number of shares of common stock which we are authorized to issue
from 25,000,000 to 100,000,000.
On
June
14, 2006, our Board of Directors unanimously approved the Increased Capital
Proposal and the Majority Stockholders have consented in writing to the
Increased Capital Proposal. The Increased Capital Proposal will be effected
through an amendment to our Restated Certificate of Incorporation.
The
Board
of Directors has fixed the close of business on June 14, 2006, as the Record
Date for determining the stockholders entitled to notice of the foregoing.
THIS
IS
NOT A NOTICE OF A MEETING OF STOCKHOLDERS AND NO STOCKHOLDERS’ MEETING WILL BE
HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN AND NO PROXY OR VOTE IS SOLICITED
BY THIS NOTICE.
June
____, 2006
By
Order
of the Board of Directors
PACIFIC
ALLIANCE CORPORATION
1661
Lakeview Circle
Ogden,
UT 84403
PRELIMINARY
INFORMATION STATEMENT
June
____, 2006
This
Information Statement is being provided to you by the
Board
of Directors of Pacific Alliance Corporation
_____________________
This
Information Statement and the Notice of Action Taken Without a Stockholders’
Meeting (jointly, the “Information Statement”) is furnished by the Board of
Directors of Pacific Alliance Corporation (the “Company” (“We”, “Us”” or
“Pacific Alliance”), a Delaware corporation, to the holders of the Pacific
Alliance’s common stock at June 14, 2006 (the “Record Date”) to provide
information with respect to action taken by the written consent of the Majority
Stockholders. The Majority Stockholders approved by written consent a proposal
(the “Increased Capital Proposal”) to amend our Restated Certificate of
Incorporation to increase the number of shares of common stock which we are
authorized to issue from 25,000,000 to 100,000,000.
Our
Board
of Directors decided to obtain written consent of the Majority Stockholders
in
order to avoid the costs and management time required to hold a special meeting
of stockholders. All required corporate approvals of the Increased Capital
Proposal have been obtained, subject to furnishing this notice and 20 days
elapsing from the date of this notice. This Information Statement is furnished
solely for the purpose of informing stockholders of this corporate action in
the
manner required by Rule 14c-2(b) under the Securities Exchange Act of 1934,
as
amended.
WE
ARE NOT ASKING YOU FOR A PROXY
AND
YOU ARE REQUESTED NOT TO SEND US A PROXY
THIS
IS
NOT A NOTICE OF A MEETING OF STOCKHOLDERS AND NO STOCKHOLDER’S MEETING WILL BE
HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
We
have
asked brokers and other custodians, nominees and fiduciaries to forward this
Information Statement to the beneficial owners of our common stock held of
record by such persons and will reimburse such persons for out-of-pocket
expenses incurred in forwarding such material.
INTEREST
OF CERTAIN PERSONS IN FAVOR OF OR OPPOSITION
TO
MATTERS ACTED UPON
We
are
not aware of any interest that would be substantially affected through the
adoption of the Increased Capital Proposal whether adversely or
otherwise.
VOTING
SECURITIES
As
of the
Record Date, Pacific Alliance’s authorized capitalization consisted of
25,000,000 shares of common stock, par value $.001 per share. At June 14, 2006,
the Record Date, we had 15,703,800 shares of common stock issued and
outstanding. Each
share of common stock entitles its holder to one vote on each matter submitted
to the stockholders. However, as a result of the voting rights of the common
stockholders who hold at least a majority of the voting rights of all
outstanding shares of capital stock as of June 14, 2006, who voted in favor
of
the foregoing Increased Capital Proposal by written consent, no other
stockholder consents will be solicited in connection with this Information
Statement. The Majority Stockholders who have consented to the Increased Capital
Proposal are the following:
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Mark
Scharmann
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5,316,896
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David
Knudson
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2,164,958
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Dan
Price
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38,275
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Curtis
Kaminska
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1,012,002
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Northcliffe
Consulting, Inc.
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1,000,000
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Total
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9,532,131
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We
also
have 5,000,000 shares of preferred stock authorized, none of which are issued
or
outstanding.
BACKGROUND
INCREASE
IN AUTHORIZED COMMON STOCK
General
Our
Board
of Directors has unanimously approved a proposal to amend our Restated
Certificate of Incorporation to increase the number of shares of common stock
which we are authorized to issue from 25,000,000 to 100,000,000. Our Board
has
recommended to our Majority Stockholders that they vote in favor of the
Increased Capital Proposal and our Majority Stockholders have voted in favor
of
the Increased Capital Proposal. The votes of our Majority Stockholders were
obtained by written consent.
The
terms of the additional shares of Common Stock will be identical to those of
the
currently outstanding shares of Common Stock. This amendment and the creation
of
additional shares of authorized common stock will not alter the current number
of issued shares. The relative rights and limitations of the shares of Common
Stock will remain unchanged under this amendment.
Consent
Required
Approval
of the Increased Capital Proposal, through an amendment to our Certificate
of
Incorporation, required the consent of the holders of a majority of the
outstanding voting shares. As of the Record Date, Majority Stockholders
beneficially owned 9,532,131 shares of our common stock representing
approximately 60.7% of the votes that could be cast by the holders of our
outstanding voting shares as of the Record Date. The Majority Stockholders
have
given their written consent to this Increased Capital Proposal and accordingly,
the requisite stockholder approval of this Proposal was obtained by the
execution of the Majority Stockholders’ written consent in favor of the
Proposal.
Amendment
Our
Board
of Directors and the Majority Stockholders have voted to amend Article IV of
our
Certificate of Incorporation to read as follows:
ARTICLE
IV
Capital
Stock
The
total number of shares of all classes of capital stock which the Corporation
has
the authority to issue is 105,000,000 shares which are divided into two classes
as follows:
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5,000,000
shares of Preferred Stock (Preferred Stock) $.001 par value per share,
and
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100,000,000
shares of Common Stock (Common Stock) $.001 par value per
share.
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The
designations, voting powers, preferences and relative, participating, optional
or other special rights, and qualification, limitations or restrictions of
the
above classes of stock are as follows:
Preferred
Stock
1. Issuance
in Series.
Shares of Preferred Stock may be issued in one or more series at such time
or
times, and for such consideration or considerations as the Board of Directors
may determine All shares of any one series of Preferred Stock will be identical
with each other in all respects, except that shares of one series issued at
different times may differ as to dates from which dividends thereon may be
cumulative. All series will rank equally and be identical in all respects,
except as permitted by the following provisions of paragraph
2.
2. Authority
of the Board with Respect to Series.
The
Board of Directors is authorized, at any time and from time to time, to provide
for the issuance of shares of Preferred Stock in one or more series with such
designations, preferences and relative, participating, optional or other special
rights and qualifications, limitations or restrictions thereof as are stated
and
expressed in the resolution or resolutions providing for the issue thereof
adopted by the Board of Directors, and as are not stated and expressed in these
Articles of Incorporation or any amendment thereto including, but not limited
to, determination of any of the following:
(a) the
distinctive serial designation and the number of shares constituting a
series;
(b) the
dividend rate or rates, whether dividends are cumulative and, if so, from which
date, the payment date or dates for dividends, and the participating or other
special rights, if any, with respect to dividends;
(c) the
voting powers, full or limited, if any, of the shares of the
series;
(d) whether
the shares are redeemable and, if so, the price or prices at which, and the
terms and conditions on which, the shares may be redeemed;
(e) the
amount or amounts payable upon the shares in the event of voluntary or
involuntary liquidation, dissolution or winding up of the Corporation prior
to
any payment or distribution of the assets of the Corporation to any class or
classes of stock of the Corporation ranking junior to the Preferred
Stock;
(f) whether
the shares are entitled to the benefit of a sinking or retirement fund to
applied to the purchase or redemption of shares of a series and, if so entitled,
the amount of the fund and the manner of its application, including the price
or
prices at which the shares may be redeemed or purchased through the application
of the fund;
(g) whether
the shares are convertible into, or exchangeable for, shares of any other class
or classes of stock of the Corporation and, if so convertible or exchangeable,
the conversion price or prices, or the rates of exchange, and the adjustments
thereof, if any, at which the conversion or exchange may be made, and any other
terms and conditions of the conversion or exchange; and
(h) any
other preferences, privileges and powers, and relating participating, optional
or other special rights, and qualifications, limitations or restrictions of
a
series, as the Board of Directors may deem advisable and as are not inconsistent
with the provisions of this Certificate of Incorporation.
3. Dividends.
Before any dividends on any class or classes of stock of the Corporation ranking
junior to the Preferred Stock (other than dividends payable in shares of any
class or classes of stock of the corporation ranking junior to the Preferred
Stock) may be declared or paid or set apart for payment, the holders of shares
of Preferred Stock of each series are entitled to such cash dividends, but
only
when and as declared by the Board of Directors out of funds legally available
therefor, as they may be adopted by the Board of Directors providing for the
issue of the series, payable on such dates in each year as may be fixed in
the
resolution or resolutions. The term "class or classes of stock of the
Corporation ranking junior to the Preferred Stock" means the Common Stock and
any other class or classes of stock of the Corporation hereafter authorized
which rank junior to the Preferred Stock as to dividends or upon liquidation.
4. Reacquired
Shares.
Shares of Preferred Stock which have been issued and reacquired in any manner
by
the Corporation (excluding, until the corporation elects to retire them, shares
which are held as treasury shares but including shares redeemed, shares
purchased and retired and shares which have been converted into shares of Common
Stock) will have the status of authorized and unissued shares of Preferred
Stock
and may be reissued.
5. Voting
Rights.
Unless and except to the extent otherwise required by law or provided in the
resolution or resolutions of the Board of Directors creating any series of
Preferred Stock the holders of the Preferred Stock shall have no voting power
with respect to any matter whatsoever.
Common
Stock
1. Dividends.
Subject to the preferential rights of the Preferred Stock, the holders of the
Common Stock are entitled to receive, to the extent permitted by law, such
dividends as may be declared from time to time by the Board of
Directors.
2. Liquidation.
In
the event of the voluntary or involuntary liquidation, dissolution, distribution
of assets or winding up of the Corporation, after distribution in full of the
preferential amounts, if any, to be distributed to the holders of shares of
Preferred Stock, holders of Common Stock shall be entitled to receive all of
the
remaining assets of the Corporation of whatever kind available for distribution
to Stockholders ratably in proportion to the number of shares of Common Stock
held by them respectively. The Board of Directors may distribute in kind to
the
holders of Common Stock such remaining assets of the Corporation or may sell,
transfer or otherwise dispose of all or any part of such remaining assets to
any
other corporation, trust or other entity and receive payment therefor in cash,
stock or obligations of such other corporation, trust or other entity, or any
combination thereof, and may sell all or any part of the consideration so
received and distribute any balance thereof in kind to holders of Common Stock.
The merger or consolidation of the Corporation into or with any other
corporation, or the merger or any other corporation into it, or any purchase
or
redemption of shares of stock of the Corporation of any class, shall not be
deemed to be a dissolution, liquidation or winding up of the Corporation for
the
purposes of this paragraph.
3. Voting
Rights.
Except as may be otherwise required by law or this Certificate of Incorporation,
each holder of Common Stock has one vote in respect of each share of stock
held
by him or record on the books of the corporation on all matters voted upon
by
the Stockholders.
Other
Provisions
1. Pre-emptive
Rights.
No
Stockholder shall have any pre-emptive right to subscribe to an additional
issue
of stock of any class or series or to any securities of the Corporation
convertible into such stock.
2. Changes
in Authorized Capital Stock.
Subject to the protective conditions and restrictions of any outstanding
Preferred Stock, any amendment to these Articles of Incorporation which
increases or decreases the authorized capital stock of any class or classes
may
be adopted by the affirmative vote of the holders of a majority of the
outstanding shares of the voting stock of the Corporation.
Reasons
for Increase in Capital
We
anticipate that in order to commence active business operations we will engage
in a reverse merger transaction. Our
current
business plan is to serve as a vehicle for the acquisition of, or the merger
or
consolidation with another company (a ‘Target Business”). We intend to utilize
our common stock to effect a business combination (“Business Combination”) with
a Target Business which our Board of Directors believes has significant growth
potential. We have not identified any specific Target Business and have not
entered into any letter of intent or definitive agreement to acquire any Target
Business.
We
anticipate that we will be required to issue such number of shares of our common
stock that will provide the owners of any Target Business that we ultimately
acquire with 80% to 95% of our total shares issued and outstanding immediately
following such acquisition. Although we may be required to complete a reverse
stock split as a condition to the closing of any acquisition, we anticipate
that
we will need additional shares of common stock authorized in order to complete
any Business Combination.
Although
we will increase the number of shares we have authorized, no Business
Combination will be consummated unless it is approved by our
stockholders.
The
disadvantages of increasing our authorized common stock include:
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The
issuance of authorized but unissued stock could be used to deter
a
potential takeover of Pacific Alliance that may otherwise be beneficial
to
stockholders by diluting the shares held by a potential suitor or
issuing
shares to a shareholder that will vote in accordance with our Board
of
Directors’ desires. A takeover may be beneficial to independent
stockholders because, among other reasons, a potential suitor may
offer
such stockholders a premium for their shares of stock compared to
the
then-existing market price. Pacific Alliance does not have any other
provisions in its certificate or incorporation, by-laws, employment
agreements, credit agreements or any other documents that have material
anti-takeover consequences. Additionally, Pacific Alliance has no
plans or
proposals to adopt other provisions or enter into other arrangements,
except as disclosed below, that may have material anti-takeover
consequences. The Board of Directors is not aware of any attempt,
or
contemplated attempt, to acquire control of Pacific Alliance, and
this
proposal is not being presented with the intent that it be utilized
as a
type of anti-takeover device.
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Stockholders
do not have any preemptive or similar rights to subscribe for or
purchase
any additional shares of common stock that may be issued in the future,
and therefore, future issuances of common stock may, depending on
the
circumstances, have a dilutive effect on the earnings per share,
voting
power and other interests of the existing
stockholders.
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As
of the
Record Date, a total of 15,703,800
shares
of
Pacific Alliance's currently authorized 25,000,000 shares of common stock are
issued and outstanding. The increase in the number of authorized but unissued
shares of common stock would enable Pacific Alliance, without further
stockholder approval, to issue shares from time to time as may be required
for
proper business purposes, such as raising additional capital for ongoing
operations, business and asset acquisitions, stock splits and dividends, present
and future employee benefit programs and other corporate purposes.
DISSENTERS’
RIGHTS
There
are
no dissenters’ rights applicable to the amendment of our Certificate of
Incorporation relating to Increased Capital Proposal.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND
MANAGEMENT
The
following table sets forth information regarding shares of our common stock
beneficially owned as of June 14, 2006 by: (1) each of our officers and
directors; (ii) all officers and directors as a group; and (iii) each person
known by us to beneficially own five percent or more of the outstanding shares
of its common stock.
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Name
and Address of Beneficial Owner
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Amount
and Nature of Beneficial Ownership
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Percent
of Class(1)
Ownership
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Mark
Scharmann(1)
1661
Lakeview Circle
Ogden,
UT 84403
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5,316,896
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33.86%
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Dan
Price(1)
1661
Lakeview Circle
Ogden,
UT 84403
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38,275
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0.24%
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Name
and Address of Beneficial Owner
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Amount
and Nature of Beneficial Ownership
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Percent
of Class(1)
Ownership
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David
Knudson(1)
1661
Lakeview Circle
Ogden,
UT 84403
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2,164,958
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13.79%
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Northcliffe
Consulting, LLC
12144
Mt. Shadow Road
Sandy,
UT 84092
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1,000,000
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6.37%
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Curtis
Kaminska
1327
E. 6125 S.
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1,012,002
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6.44%
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PIL
S.A.
8
Rue Neuve du Molard
Geneva
Switzerland
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1,350,000
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8.60%
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All
Officers and Directors as a Group (3 Persons)
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7,520,129
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47.89%
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Total
Shares Issued
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15,703,800
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100%
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(1)These
individuals are the officers and directors of the Company.
ADDITIONAL
AND AVAILABLE INFORMATION
Pacific
Alliance is subject to the informational filing requirements of the Exchange
Act
and, in accordance therewith, is required to file periodic reports, proxy
statements and other information with the SEC relating to its business,
financial condition and other matters. Such reports, proxy statements and other
information can be inspected and copied at the public reference facility
maintained by the SEC at 450 Fifth Street, N.W., Room 1024, and Washington,
D.C.
20549. Information regarding the public reference facilities may be obtained
from the SEC by telephoning 1-800-SEC-0330. Our filings are also available
to
the public on the SEC’s website (http://www.sec.gov). Copies of such materials
may also be obtained by mail from the Public Reference Section of the SEC at
450
Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates.
We
incorporate herein Pacific Alliance’s Annual Report on Form 10-KSB for the year
ended December 31, 2005 and Quarterly Report on Form 10-QSB for the quarter
ended March 31, 2006.
For
each
other document incorporated herein, we will provide without charge to each
person, including any beneficial owner of such person, to whom a copy of this
Information Statement has been delivered, on written or oral request, a copy
of
any and all of the documents referred to above that have been or may be
incorporated by reference herein other than exhibits to such documents (unless
such exhibits are specifically incorporated by reference herein).
All
documents filed by Pacific Alliance pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Information Statement
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 Information Statement to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is 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 Information Statement.
WE
ARE
NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
COMPANY
CONTACT INFORMATION
All
inquiries regarding Pacific Alliance should be addressed to Pacific Alliance’s
principal executive offices:
Pacific
Alliance Corporation
1661
Lakeview Circle
Ogden,
UT
84403
(801)
399-3632
By
order
of the Board of Directors:
/s/
Mark A. Scharmann
President