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Providence Service Corporation Issues Letter to Stockholders
Date:5/28/2009

ets," makes no quarterly, annual or periodic filings with the SEC, avoids any requirement to comply with the Sarbanes-Oxley Act, including the numerous corporate governance provisions thereof that are intended to protect stockholders, and has only one director, Mr. Smith.
  • According to Avalon Correctional Services' 2007 Annual Report, Avalon Correctional Services loaned certain members of its management a total of approximately $1.1 million during 2007 to purchase shares of its capital stock. While Avalon Correctional Services was no longer subject to the Sarbanes-Oxley Act at this time due to its decision to terminate the registration of its shares under the Exchange Act (so as to cease its obligation to comply therewith), these type of loan arrangements with officers of a public reporting company are expressly prohibited under Section 402 of the Sarbanes-Oxley Act.
  • In addition to the other related party transactions between Avalon Correctional Services and Mr. Smith that are discussed above, since 2001, Avalon Correctional Services has leased certain vehicles from an entity controlled by Mr. Smith and, pursuant to such leases, has made payments to such entity in the aggregate of more than $800,000

  • The above are only a few illustrations of how Mr. Smith has shown a flagrant disregard for best practices in corporate governance at Avalon Correctional Services over the past seventeen years. If you don't want to allow Donald E. Smith and his nominees to impose upon Providence the same approach to corporate governance that he imposed upon Avalon Correctional Services, elect your company's highly qualified, experienced, dedicated nominees on the WHITE proxy card TODAY.

    YOUR VOTE IS IMPORTANT--VOTE THE WHITE PROXY CARD TODAY

    Your vote is important, no matter how many or how few shares you own. To vote
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    SOURCE The Providence Service Corporation
    Copyright©2009 PR Newswire.
    All rights reserved

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