Embed Doc
Copy Link
Readcast
Collections

1
CommentGo Back

Download

UC Hub Group Issues Letter to Shareholders

UC Hub Group, Incorporated (OTC Bulletin Board:UCHB-News) President and CEO, Larry Wilcox issued the following Letter to Shareholders:Dear Shareholders:With all the positive changes at UC Hub Group, we are truly entering an exciting chapter in ourcompany history. We are successfully executing our business plan while keeping shareholdervalue a top priority. These two elements have positioned the company to achieve even greaterresults in the weeks and months to come. While we still face competitive pressures and havemuch yet to do, UC Hub Group is better positioned today than at any time in our history. Thefoundation has been laid to generate major revenue improvements in upcoming quarters and toestablish multiple profit centers adding up to a strong bottom line in the years ahead.eSafe, a wholly-owned subsidiary of UC Hub Group, is gaining significant market traction asshown in recent announcements. Our goal is to have 100,000 eSafe cards in the marketplace byChristmas 2005. With current deals being discussed and negotiated we may eclipse those targets,but we consider this to be a prudent distribution estimate at this time. Our larger goal for eSafe isto have over a quarter million active users of our card products in 2006. This would represent asignificant reoccurring revenue base as we expect each active card will generate between $5-10/month in revenues.eSafe’s merchant processing division is also a significant part of our business plan. This istraditionally a very desirable business niche that adds considerable overall value to our companyas we grow the cash volumes transacted for our merchant accounts. Income is generated on thebasis point spread we capture from the merchant processing fees. This is a high volume businesswith hundreds of millions of dollars required to produce major income growth. Once an accountis secured, client retention is high and the maintenance requirements are minimal while theincome remains steady. Based on expected pending contracts, our immediate goals are to achieve$50,000,000 or more in annual cash volume processed this year. 2006 goals are to process up toa quarter billion dollars volume or more in merchant account transactions.We are currently in negotiations with numerous potential eSafe accounts for either card productsor merchant accounts or both with clients in a broad array of industries, including: Supermarketand Grocery Chains, Medical Data Processing and Integration, Specialized Marketing and SalesOrganizations, Universities, Non-Profits, Religious Organizations, Affinity Groups, SportsLeagues and Wagering Outlets.AllCom, a wholly-owned subsidiary of UC Hub Group, is now realizing true organic growth andreceiving repeat business from satisfied customers. We remain committed to this subsidiary as ithas been our primary revenue source and it remains an integral part of our vision as an upsellingtool for eSafe products and the cross-marketing of phone cards. We are currently in negotiationswith several potential clients which would represent both new and additional hardware andservice contracts for AllCom.

All of our divisions have overlapping synergies that intersect and will be maximized as many of our new and pending clients are integrated into our service programs. As the name of ourcompany implies, we are a hub for a variety of services. Our vision for some time has been tomaximize the digitization of commerce and data delivery by packaging these resources fordistinct regional communities and more disparate consumer communities defined by a commonthread or affinity such as interest groups, ethnicity or religious affiliation.eSafe has been organized to function as a transactional hub for the cities, affinity groups andorganizations that sign up for our services. This transactional hub encompasses merchantprocessing, debit cards, payroll and benefits cards, data storage cards, gift cards all maximizedwith our patented loyalty programs that give back rebates and ensure customer loyalty. Point of Sale terminals for our merchant processing accounts can then be connected via telecom which ispresently AllCom. Finally, this will be leveraged with full internet ePayment services thatintegrates the digital cash network as a global virtual network that extends our already extensiveground coverage through ATM networks and our much anticipated rollout of our MasterCard co-branded cards expected later this year.Recently closed deals have highlighted the completion of our digital transaction infrastructureand our concerted push to achieve rapid market distribution through focused sales channels. UCHub’s strategy is both regionally focused and sales channel focused. Regional focus involvescultivating deep market penetration into specific communities like our existing clients likeYonkers New York, Atlanta Gerogia and Victorville California where projected rapid populationgrowth presents a major market opportunity.The nurturing of a Digital City Hub is intended to combine the power of local merchantprocessing accounts with the pervasive local distribution of eSafe cards and services to achieve athriving local transactional loop that generates high rates of usage while benefiting thecommunity with loyalty program rebates. This is the longer term vision of UC Hub that webelieve will snowball to other communities in the coming years and which none of ourcompetitors truly offer.The Digital Cities Hub concept is already active with numerous municipalities being serviced byAllCom for telecom services and OT2, our government management software division, for localproject management. We have already begun the longer term process of upselling eSafe intothese municipal sales channels.The immediate growth and greatest accelerator of company revenues in the next year are comingthrough our use of focused sales channels. The ability to generate mass buy-ins of the eSafe cardfor distribution to defined market segments is already being effectively engaged as a growthstrategy. The recent deal with World Bank Financial targets the Vietnamese community inAmerica and is projected to serve users in Viet Nam in the future. The same strategies are beingdeployed in Latin America and clearly point to the power of delivering needed services tofocused user groups to achieve rapid market adoption. The variations on a focused sales channelare fairly unlimited as we hope to show to our shareholders with upcoming arrangements withnew clients.Having successfully taken our business plan to the next level, we are now receiving shareholderrequests for revenue guidance. I believe we have constructed a business that will operate veryefficiently with minimal intervention and high returns and that we will be well on our way to

profitability in 2006 with rapid growth thereafter. We believe we have presented our businessgoals with prudent timeframes and suitable information upon which to construct a reasonableopinion about our company’s prospects. We will necessarily seek to maintain our competitiveadvantages and refrain from disclosing the terms of our client contracts. We wish to solicitshareholder investment based on the solidity of our business plan and growing accomplishments.We expect to achieve revenue growth with the dissemination of eSafe cards and by the end of theyear the results will start to truly impact our bottom line. Since we are coping with a potentialembarrassment of riches in terms of pending partner and client deals, we have alreadycommenced an expansion of our staffing in the areas of finance, sales and marketing, including anew hire this week of a highly seasoned merchant accounts sales professional. It will beimportant to further expand our sales and marketing staff to capture market share, maximize thesales of our existing clients and build the monetary value of our brands.We believe the return on investment in the following year will be exponential in relation to anyimmediate personnel costs added now. We have been planning for success for some time and Iwould contend we have some of the top people in their respective fields working together toachieve our ambitious goals. With our infrastructure in place, we are ready to add the additionalstaff that will ensure we are ready to deliver on our promises and are never overwhelmed bysuccess.To date, I have personally funded directly and indirectly a considerable portion of our operationsout of pocket to maintain momentum and try to limit shareholder dilution. I will soon endeavorto raise a modest amount of bridge financing to facilitate our expansion and impending growthsurge. With this in mind, it is our stated goal to still have as a low amount of outstanding sharesas feasible as we turn profitable. I am optimistic that our business will be self sustaining in thefirst half of 2006 and we will have a very limited need for outside financing from that pointforward.In closing, I would like to personally thank each and every shareholder for their support. I amdeeply committed to the success of UC Hub and its subsidiary companies and have benefitedfrom your input. We are also gratified by the quality of service and communications providedthus far by the firm of L.G. Zangani and plan to continue keeping our public investors wellinformed of company objectives and activities. I am confident the strategies we are pursuing willgrow intrinsic value for our shareholders over the long-term. I am proud to be your CEO andlook forward to what I feel is the beginning of an exciting time for UC Hub Group and itsshareholders.Very sincerely yours,Larry WilcoxPresident and Chief Executive OfficerUC Hub Group Inc.

FORWARD

LOOKING

STATEMENTS

ALL STATEMENTS IN THIS LETTER OTHER THAN STATEMENTS OF HISTORICAL FACT ARE FORWARD

LOOKING STATEMENTS THAT INVOLVE RISKS ANDUNCERTAINTIES

THERE CAN BE NO ASSURANCE THAT THE COMPANY

’

S PLANS WILL BE REALIZED

THAT REVENUES WILL INCREASE OR THAT THE COMPANY

’

S OPERATIONS WILL IMPROVE

REFERENCE IS MADE TO THE COMPANY