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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _______ to________
Commission file number 0-25198
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
-------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-3973627
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11859 South Central Avenue
Alsip, Illinois 60803
---------------------
(Address of principal executive offices)
(Zip Code)
(708) 293-4050
--------------
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
----- -----
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act): Yes No X
----- -----
The number of shares of issuer's Common Stock, par value $.01 per share,
outstanding as of September 30, 2003 was 8,560,797 shares.
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
FORM 10-Q
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Page(s)
-------
Item 1. Financial Statements
Consolidated Balance Sheets
September 30, 2003 (Unaudited) and December 31, 2002 3
Consolidated Statements of Operations
(Unaudited) - For the nine months ended
September 30, 2003 and 2002 4
Consolidated Statements of Cash Flows
(Unaudited) - For the nine months ended
September 30, 2003 and 2002 5
Notes to Condensed Financial Statements (Unaudited) 6 - 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 8 - 10
Item 3. Quantitative and Qualitative Disclosure About Market Risk 10
Item 4. Controls and Procedures 11
PART II. OTHER INFORMATION
Items 1, 3, and 5 are not applicable to the Company in this report 11
Item 2 - Changes in Securities and Use of Proceeds 11
Item 4 - Submission of Matters to a Vote of Security Holders 11
Item 6 - Exhibits and Reports on Form 8-K 12
Signatures 12
EXHIBIT II - Computation of Earnings Per Share 13
EXHIBIT 31.1 Certificate of Chief Executive Officer 14
EXHIBIT 31.2 Certificate of Chief Financial Officer 15
EXHIBIT 32 Certificate of Chief Executive Officer and Chief Financial Officer 16
2
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEET
September 30, 2003 December 31, 2002
------------------ -----------------
(Unaudited)
Assets
Current assets:
Cash $ 110,143 $ 237,600
Accounts receivable - trade, net 12,110,754 12,702,701
Inventories 13,810,170 17,051,952
Deferred income taxes 240,000 240,000
Prepaid expenses and other current assets 291,550 215,987
------------ ------------
26,562,617 30,448,240
------------ ------------
Property and equipment , net 4,029,554 4,175,208
------------ ------------
Other assets:
Goodwill, net 480,498 480,498
Due from stockholders 361,539 345,296
Other assets 941,422 695,542
------------ ------------
1,783,459 1,521,336
------------ ------------
$ 32,375,630 $ 36,144,784
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable, trade $ 10,063,061 $ 10,212,291
Accrued expenses and other current liabilities 2,954,693 2,608,466
Subordinated debenture, current portion 71,770 84,020
Long-term indebtedness, current portion 177,091 356,663
------------ ------------
13,266,615 13,261,440
------------ ------------
Long-term liabilities:
Revolving line of credit 13,435,819 16,949,821
Subordinated debenture, non-current portion 2,200,549 1,109,986
Long-term indebtedness, non-current portion 36,183 110,510
Deferred rent expense 39,694 30,419
------------ ------------
15,712,245 18,200,736
------------ ------------
Stockholders' equity:
Preferred stock (authorized 2,000,000 shares, $.01 par value,
201,438 shares of Series A and 100,000 shares of Series B issued
and outstanding) 3,014 3,014
Common stock (authorized 30,000,000 shares, $.01 par value,
8,560,797 shares issued and outstanding at September 30, 2003
and 8,224,949 at December 31, 2002) 85,608 82,249
Additional paid-in-capital 15,373,008 15,208,441
Accumulated deficit (11,416,210) (9,644,606)
Accumulated other comprehensive loss (595,500) (904,340)
Stock subscription receivable (53,150) (62,150)
------------ ------------
3,396,770 4,682,608
------------ ------------
$ 32,375,630 $ 36,144,784
============ ============
The accompanying notes are an integral part of the financial statements.
3
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended September 30, Nine Months Ended September 30,
2003 2002 2003 2002
---- ---- ---- ----
Net sales $ 14,083,051 $ 17,146,536 $ 46,938,618 $ 55,215,258
Cost of sales 12,176,229 13,940,213 40,648,203 44,793,042
---------------------------------------------------------------------
Gross profit 1,906,822 3,206,323 6,290,415 10,422,216
Selling, general, and administrative expenses 2,457,024 2,855,154 7,323,398 8,472,768
---------------------------------------------------------------------
Income (loss) from operations (550,202) 351,169 (1,032,983) 1,949,448
Other expense:
Interest expense 284,816 352,713 772,904 1,106,956
Other (22,801) (13,529) (34,283) 161,371
---------------------------------------------------------------------
262,015 339,184 738,621 1,268,327
---------------------------------------------------------------------
Income (loss) before provision for income taxes (812,217) 11,985 (1,771,604) 681,121
Income tax provision - - - -
---------------------------------------------------------------------
Net income (loss) $ (812,217) $ 11,985 $ (1,771,604) $ 681,121
=====================================================================
Comprehensive income (loss) :
Net income (loss) $ (812,217) $ 11,985 $ (1,771,604) $ 681,121
Other comprehensive income (loss),
Foreign currency translation adjustments (49,549) (101,371) 308,840 (8,751)
---------------------------------------------------------------------
Comprehensive income (loss) $ (861,766) $ (89,386) $ (1,462,764) $ 672,370
=====================================================================
Earnings (Loss) per share:
Basic $ (0.09) $ 0.00 $ (0.21) $ 0.08
Diluted $ (0.09) $ 0.00 $ (0.21) $ 0.08
Weighted average number of common shares outstanding:
Basic 8,437,589 8,220,949 8,296,608 8,187,803
Common stock equivalents resulting from
warrants and options - 3,014,380 - 3,377,640
---------------------------------------------------------------------
Diluted 8,437,589 11,235,329 8,296,608 11,565,443
=====================================================================
The accompanying notes are an integral part of the financial statements.
4
Nine Months Ended September 30,
------------------------------------
2003 2002
---- ----
Cash flows from operating activities:
Net income (loss) $(1,771,604) $ 681,121
Adjustments to reconcile net income (loss) to net cash provided
by (used in) operating activities:
Depreciation and amortization 885,192 1,025,215
Provision for bad debts 245,571 294,674
Compensation expense for stock options - 19,800
Changes in operating assets and liabilities:
Accounts receivable, trade 426,376 (313,672)
Inventories 3,241,782 (2,618,428)
Prepaid expenses and other current assets (525,759) (38,635)
Accounts payable, trade (149,230) 488,046
Accrued expenses and other current liabilities 268,164 53,058
----------- -----------
Net cash provided by (used in) operating activities 2,620,492 (408,821)
Cash flows for investing activities:
Payments on notes receivable 5,500 2,500
Increase in investments, reflected with other assets (25,000) -
Purchase of property and equipment (337,244) (459,321)
----------- -----------
Net cash used in investing activities (356,744) (456,821)
Cash flows from financing activities:
Net increase (decrease) in revolving loan indebtedness (3,514,002) 24,749
Payments on notes payable and subordinated debt (329,202) (694,290)
Proceeds from subordinated debt 1,240,000 -
Proceeds from excercise of options 167,925 601,623
----------- -----------
Net cash (used in) provided by financing activities (2,435,279) (67,918)
Effect of exchange rate changes on cash 44,074 (8,751)
----------- -----------
Net decrease in cash (127,457) (942,311)
Cash, beginning of period 237,600 976,585
----------- -----------
Cash, end of period $ 110,143 $ 34,274
=========== ===========
Supplemental disclosures of cash flow information:
Cash paid for interest $ 841,695 $ 1,193,200
=========== ===========
Cash paid for income taxes $ - $ 56,107
=========== ===========
The accompanying notes are an integral part of the financial statements.
5
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
1. UNAUDITED INTERIM FINANCIAL STATEMENTS
Interim condensed financial statements are prepared pursuant to the requirements
for reporting on Form 10-Q. Accordingly, certain disclosures accompanying annual
financial statements prepared in accordance with generally accepted accounting
principles are omitted. For additional disclosures, see the Notes to
Consolidated Financial Statements contained in Universal Automotive Industries,
Inc. Annual Report on Form 10-K for the year ended December 31, 2002.
Our significant accounting policies are described in Note 2 to the Consolidated
Financial Statements contained in Universal Automotive Industries, Inc. Annual
Report on Form 10-K for the year ended December 31, 2002. The application of
these policies may require management to make judgments and estimates about the
amounts reflected in the financial statements. Management uses historical
experience and all available information to make these estimates and judgments,
and different amounts could be reported using different assumptions and
estimates.
In the opinion of our management, all adjustments, consisting solely of normal
recurring adjustments, necessary for the fair presentation of the financial
statements for these interim periods have been included. The current period's
results of operations are not necessarily indicative of results which ultimately
may be achieved for the year.
Certain reclassifications have been made for the period presented in the
financial statements to conform to the classifications presented in 2003.
2. INVENTORIES
SEPTEMBER 30, 2003 DECEMBER 31, 2002
Finished goods $ 10,966,117 $ 13,815,563
Work in process 574,588 510,264
Raw materials 2,269,465 2,726,125
--------------------------------------------
$ 13,810,170 $ 17,051,952
============================================
3. BASIS OF PRESENTATION
Net Loss Per Share
Warrants and options issued by us are only included in the computation of
weighted average number of shares where their inclusion is not anti-dilutive.
For the nine months ended September 30, 2003, common stock equivalents are not
included in the weighted average number of shares outstanding in determining net
loss per share.
Income Taxes
For the quarters ended September 30, 2003 and 2002, no provision for income
taxes has been provided. We believe that, consistent with accounting principles
generally accepted in the United States, it was not more likely than not that
the tax benefits associated with the balance of loss carryforwards and other
deferred tax assets will be realized through future taxable earnings or
alternative tax strategies. Accordingly, net deferred tax assets were offset
with a valuation allowance.
6
4. LASALLE INDEBTEDNESS
The LaSalle Credit Agreement contains certain limitations on dividends and
capital expenditures and requires us to satisfy a defined minimum tangible net
worth. At September 30, 2003, we were in compliance with this financial
covenant. In June 2003, the credit agreement was extended to May 31, 2005.
5. RECENTLY ISSUED ACCOUNTING STANDARDS
In December 2002, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 148, Accounting for Stock-Based Compensation-Transition and
Disclosure, which (i) amends SFAS No. 123, Accounting for Stock-Based
Compensation to add two new transitional approaches when changing from
Accounting Principles Board ("APB") Opinion No. 25, Accounting for Stock Issued
to Employees intrinsic value method of accounting for stock-based employee
compensation to the SFAS No. 123 fair value method and (ii) amends APB Opinion
No. 28 Interim Financial Reporting to call for disclosure of SFAS No. 123
pro-forma information on a quarterly basis. We have elected to adopt the
disclosure-only provisions of SFAS No. 148 and will continue to follow APB
Opinion No. 25 and the related interpretations in accounting for the stock
options granted to our employees and directors. Accordingly, employee and
director compensation expense is recognized only for those options whose price
is less than fair market value at the measurement date.
6. STOCK-BASED COMPENSATION
We have elected to follow APB Opinion No. 25, Accounting for Stock Issued to
Employees, and related interpretations in accounting for the stock options
granted to employees and directors. Accordingly, employee and director
compensation expense is recognized only for those options whose price is less
than fair market value at the measurement date. We have adopted the
disclosure-only provisions of SFAS No. 123, Accounting for Stock-Based
Compensation, as amended.
Had the compensation cost for our stock options plans been determined in
accordance with SFAS No. 123, our reported earnings per share for the three
month periods ending September 30, 2003 and 2002, would differ by less than $.01
per share from that which would have been recorded using the Black-Scholes
option valuation method.
7. CONTINGENCIES
The company is a party to various other claims, legal actions and complaints
arising in the ordinary course of business. In the opinion of management, all
such matters are adequately covered by insurance, or if not covered, would not
have a material effect on the Company's financial position, results of
operations, or liquidity.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS(1)
GENERAL
We are a manufacturer and distributor of brake rotors, drums, disc brake pads,
relined brake shoes, non-asbestos friction lining and a complete line of
hydraulic parts. We believe that we are the leading supplier of "value line"
brake parts (brake parts sold at prices below those of certain leading national
brand name brake parts) to mass-market retailers, traditional warehouse
distributors and specialty undercar distributors in North America.
RESULTS OF OPERATIONS
Three Months Ended September 30, 2003 Compared To Three Months Ended September
30, 2002
Net sales for the three months ended September 30, 2003 decreased $3,064,485 or
17.9% under the same quarter in 2002 to $14,083,051. The decreased sales were a
result of a temporary disruption in the supply-chain for products imported from
China, the loss of a major customer coupled with a general slow-down in economic
activity, partially offset by increases in commodity sales of non-brake part
products.
Gross profit for the three months ended September 30, 2003 is $1,906,822 or
13.5% of net sales compared to $3,206,323 or 18.7% in the same period of 2002, a
decrease of $1,299,501 or 40.5%. Reduced gross margins on the lower sales volume
and the under absorption of fixed overhead at our manufacturing facilities due
to reduced production levels were partially offset by cost containment and
expense reduction initiatives.
Selling, general and administrative expenses of $2,457,024 (17.5% of net sales)
for the three months ended September 30, 2003 decreased by $398,130 when
compared to $2,855,154 (16.7% of net sales) for the same period in 2002. The
13.9% reduction was a result of reduced freight and commission costs on the
lower sales levels and cost containment and expense reduction initiatives.
Total other expense for the three months ended September 30, 2003 decreased
$77,169 to $262,015 from $339,184 for the same period of 2002. Of this total,
interest expense decreased $67,897 from the same period in 2002 due to lower
borrowing levels on the revolving line of credit coupled with lower interest
rates.
Net loss for the three months ended September 30, 2003 was $812,217 compared to
net income of $11,985 for the same period in 2002. The decrease in net income is
attributed to reduced margins on lower sales and under absorption of
manufacturing costs due to reduced production levels offset by lower selling,
general and administrative expenses and reduced interest expense.
- -------------------------
(1) Some of the statements included in Management's Discussion and Analysis of
Financial Condition and Results of Operations, may be considered to be "forward
looking statements" since such statements relate to matters which have not yet
occurred. For example, phrases such as "we anticipate," believe" or "expect"
indicate that it is possible that the event anticipated, believed or expected
may not occur. Should such event not occur, then the result, which we expected,
also may not occur or may occur in a different manner, which may be more or less
favorable to us. We do not undertake any obligation to publicly release the
result of any revisions to these forward looking statements that may be made to
reflect any future event or circumstances.
8
Nine Months Ended September 30, 2003 Compared To Nine Months Ended September 30,
2002
Net sales for the nine months ended September 30, 2003 decreased $8,276,640 or
15.0% under the same period in 2002 to $46,938,618. The decreased sales were a
result of a temporary disruption in the supply-chain for products imported from
China, the loss of a major customer coupled with a general slow-down in economic
activity partially offset by increases in commodity sales of non-brake part
products.
Gross profit for the nine months ended September 30, 2003 is $6,290,415 or 13.4%
of net sales compared to $10,422,216 or 18.9% in the same period of 2002, a
decrease of $4,131,801 or 39.6%. Reduced gross margins on the lower sales volume
and the under absorption of fixed overhead at the friction manufacturing
facilities due to reduced production levels and start-up expenses relating to
the relocation of the rotor manufacturing facility were partially offset by cost
containment and reduction initiatives.
Selling, general and administrative expenses of $7,323,398 or 15.6% of net sales
for the nine months ended September 30, 2003 decreased by $1,149,370 when
compared to $8,472,768 or 15.3% of net sales for the same period in 2002. The
13.6% reduction was a result of reduced freight and commission costs on the
lower sales levels, cost containment and reduction initiatives.
Total Other Expense for the nine months ended September 30, 2003 decreased
$529,706 to $738,621 from $1,268,327 for the same period of 2002. Of this total,
interest expense decreased $334,052 from the same period in 2002 due to lower
borrowing levels on the revolving line of credit coupled with lower interest
rates, and the absence of a $162,500 charge to income, incurred during the prior
period, resulting from the cancellation of a strategic supply agreement with
Creative Friction LLC.
Net loss for the nine months ended September 30, 2003 was $1,771,604 compared to
net income of $681,121 for the same period in 2002. The decrease in net income
is attributed to reduced margins on lower sales and under absorption of
manufacturing costs due to reduced production levels and start-up expenses
relating to the relocation of the rotor facility offset by lower selling,
general and administrative expenses and reduced other expense.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided from operating activities for the nine months ended September
30, 2003 was $2,620,492 which was primarily due to (a) a reduction in
inventories of $3,241,782 and (b) non-cash items consisting of depreciation and
amortization of $885,192, (c) reduction in net accounts receivable of $426,376
and (d) decrease in accrued expenses and other assets of $268,164 offset by (e)
the net loss for the period of $1,771,604, (f) an increase in accounts payable
of $149,230, and (g) an increase in prepaid and other current assets of
$540,360.
Net cash used in investing activities was $356,744 which is attributable
primarily to leasehold improvements incurred in connection with the relocation
of the rotor manufacturing from Cuba, MO into our Alsip, IL facility, and the
acquisition of tooling and patterns for the Brampton, Ontario friction facility.
Net cash used by financing activities was $2,435,279, consisting primarily of
reductions in borrowings under our line of credit agreement of $3,514,002 and
scheduled payments under term notes of $329,202 offset by proceeds from
subordinated debt of $1,240,000 and proceeds from the exercise of options of
$167,925.
We expect to continue to finance our operations through cash flow generated from
operations, borrowings under our bank lines of credit and obtaining credit from
our suppliers, and possibly additional unsecured lines of credit. In June 2003
our credit facility was amended to provide for a revised due date of May 31,
2005.
9
Future contractual obligations of the Company are as follows:
PAYMENTS DUE BY PERIOD 09/30/03
CONTRACTUAL NEXT AFTER
OBLIGATIONS TOTAL 12 MONTHS 1-3 YEARS 4 YEARS
- ----------- ----- ---------- ----------- ----------
Revolving loan $13,435,819 $ 0 $13,435,819 $ 0
Subordinated debt 2,272,319 71,770 2,200,549 0
Long-term debt 56,718 56,718 0 0
Capital leases 156,556 120,373 36,183 0
Operating leases 4,571,030 1,468,950 1,450,647 1,651,433
----------- ---------- ----------- ----------
Total $20,492,442 $1,717,811 $17,123,198 $1,651,433
=========== ========== =========== ==========
SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies are described in Note 2 to the Consolidated
Financial Statements contained in our Annual Report on Form 10-K for the year
ended December 31, 2002. The application of these policies may require
management to make judgments and estimates about the amounts reflected in the
financial statements. Management uses historical experience and all available
information to make these estimates and judgments, and different amounts could
be reported using different assumptions and estimates.
RECENTLY ISSUED ACCOUNTING STANDARDS
In December 2002, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 148, Accounting for Stock-Based Compensation-Transition and
Disclosure, which (i) amends SFAS No. 123, Accounting for Stock-Based
Compensation to add two new transitional approaches when changing from
Accounting Principles Board ("APB") Opinion No. 25, Accounting for Stock Issued
to Employees intrinsic value method of accounting for stock-based employee
compensation to the SFAS No. 123 fair value method and (ii) amends APB Opinion
No. 28 Interim Financial Reporting to call for disclosure of SFAS No. 123
pro-forma information on a quarterly basis. We have elected to adopt the
disclosure-only provisions of SFAS No. 148 and will continue to follow APB
Opinion No. 25 and the related interpretations in accounting for the stock
options granted to its employees and directors. Accordingly, employee and
director compensation expense is recognized only for those options whose price
is less than fair market value at the measurement date.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
We believe that we do not have significant exposure to market risk associated
with derivative financial instruments, other financial instruments, or
derivative commodity instruments. We previously utilized only limited derivative
financial instruments and did not use them for trading purposes and have never
used derivative commodity instruments. At September 30, 2003, there were no such
derivative instruments. The fair value of financial instruments, other than debt
instruments, closely approximates their carrying value. Because the interest
rate of the revolving loan and the term loan with LaSalle National Bank adjusts
with the changes in the market rate of interest, we believe that the fair value
is equivalent to the carrying value.
We believe the interest rate of seven percent (7.0%) on the subordinated
debenture is approximately equal to the current rate available for similar debt.
Accordingly, the fair value of this debenture approximates its carrying value.
10
ITEM 4. CONTROLS AND PROCEDURES.
We maintain a system of controls and procedures designed to provide reasonable
assurance as to the material reliability of the financial statements and other
disclosures included in this report as well as to safeguard assets from
unauthorized use or disposition. However, no cost effective systems of internal
controls will preclude all errors and irregularities, and management is
necessarily required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.
We evaluated the effectiveness of the design and operation of our disclosure
controls and procedures under the supervision and with the participation of
management, including our chief executive officer and chief financial officer,
within 90 days prior to the filing date of the this report. Based upon that
evaluation, our chief executive officer and chief financial officer concluded
that our disclosure controls and procedures are effective in timely alerting
them to material information required to be included in our periodic Securities
and Exchange Commission filings. No significant changes were made to our systems
of internal controls or other factors that could significantly affect these
disclosure controls and procedures subsequent to the date of their evaluation.
PART II OTHER INFORMATION
ITEMS 1, 3, AND 5 ARE NOT APPLICABLE TO THE COMPANY IN THIS REPORT.
ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS
During the quarter ended September 30, 2003 we sold shares of our Common
stock (the "shares") in transactions not registered under the Securities Act of
1933, as amended (the "Securities Act"). During the quarter, we issued 240,000
shares to two persons in connection with the exercise of warrants. We did not
use the services of any finders or securities broker-dealers in connection with
the issuance of these shares. We believe that all Shares issued in these
transactions are exempt from registration under the Securities Act by virtue of
Section 4(2) of the Securities Act.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On July 18, 2003 Universal Automotive Industries, Inc. held its annual
meeting of shareholders. Present at this meeting, in person and by proxy, were
shareholders representing 7,862,282 of the 11,239,329 issued and outstanding
shares of voting securities consisting of 8,224,949 shares of Common Stock,
201,438 shares of Series A Preferred Stock, which have voting rights equivalent
to 2,014,380 shares of Common Stock and 100,000 shares of Series B Preferred
Stock, which have voting rights equivalent to 1,000,000 shares of Common Stock,
at the date of record (69.95% of the total number of shares of voting securities
outstanding and entitled to vote). The following items were voted upon at the
meeting:
A) The following Directors were elected to the Board:
NAME VOTES FOR(2) VOTES AGAINST VOTES WITHHELD
- ---- ------------ ------------- --------------
M. Catherine Jaros 7,848,482 0 13,800
Dennis Kessler 7,848,482 0 13,800
Sheldon Robinson 7,791,482 0 70,800
Arvin Scott 7,791,482 0 70,800
Yehuda Tzur 7,791,482 0 70,800
Zemin Xu 7,848,432 0 13,850
Alan Zeffer 7,848,482 0 13,800
- ----------------------
(2) Includes 2,014, 380 votes of the holders of Series A Preferred Stock and
1,000,000 votes of the holders of Series B Preferred Stock.
11
B) An amendment to the Universal Automotive Industries, Inc. Share Option
Plan was approved to increase the number of shares available for issuance to
2,500,000 from 1,400,000. Holders of Common Stock holding 4,847,902 shares,
holders of 2,014,380 shares of Series A Preferred Stock having 2,014,380 votes
and holders of 1,000 shares of Series B Preferred Stock having 1,000,000 votes
cast their votes in favor of the amendment, no votes were cast against, and no
shares abstained from voting.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
a) (i) Exhibit 11 - Computation of Earnings Per Share
(ii) Exhibit 31.1 - Certifications of Chief Executive Officer required by
Rule 13(a)-14(b) under the Securities Exchange Act of 1934
(iii) Exhibit 31.2 - Certifications of Chief Financial Officer required by
Rule 13(a)-14(b) under the Securities Exchange Act of 1934
(iv) Exhibit 32 - Certifications Required by Rule 13(a)-14(b) under the
Securities Exchange Act of 1934 (Sarbanes-Oxley Act of 2002, Section
906)
b) The Company filed forms 8-K on May 22, 2003 wherein we reported information
under Item 12 and on September 24, 2003 wherein we filed an exhibit under
Item 7.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
/s/ ARVIN SCOTT
---------------
Date: November 14, 2003 Arvin Scott, Chief Executive Officer, President
(Principal Executive Officer)
/s/ ROBERT W. ZIMMER
--------------------
Robert W. Zimmer, Chief Financial Officer
(Principal Financial Officer)
12