RCG Companies Incorporated

MICHAEL D. PRUITT
CHIEF EXECUTIVE OFFICER
RCG COMPANIES INCORPORATED
6836 MORRISON BOULEVARD
SUITE 200
CHARLOTTE, NC 28211
(704) 366-5054

Copies of all communications, including all communications sent to the agent for service, should be sent to:

JOEL D. MAYERSOHN, ESQ.
ADORNO & YOSS, P.A.
350 EAST LAS OLAS BOULEVARD
SUITE 1700
FORT LAUDERDALE, FLORIDA 33301
(954) 763-1200 (phone)
(954) 766-7800 (fax)

Approximate date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective.

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. [ ]

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. [ ]

If the delivery of the Prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ]


			PROPOSED MAXIMUM			PROPOSED MAXIMUM
TITLE OF EACH CLASS OF	AMOUNT		OFFERING PRICE PER			AGGREGATE OFFERING		AMOUNT OF
SECURITIES TO BE REGISTERED	TO BE REGISTERED		SECURITY			PRICE		REGISTRATION FEE

Common Stock, $.04 par value		4,032,428	$	2.05	(1)	$	8,266,477	$	668.76
Common Stock, $.04 par value		2,500,000	$	2.44	(2)	$	6,100,000.00	$	493.49
Common Stock, $.04 par value		42,857	$	2.45	(3)	$	104,999.65	$	8.49
Common Stock, $.04 par value		100,000	$	2.05	(4)	$	205,000	$	16.58
Common Stock, $.04 par value		100,000	$	2.05	(5)	$	205,000	$	16.58
Total Registration Fee								$	1,203.92

(1)

Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(c) under the Securities Act of 1933, as amended. Based upon the average of the high and low prices of the registrant’s common stock on December 19, 2003, as reported by the American Stock Exchange.

(2)

Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(g). Based upon the exercise price of the common stock underlying the warrants which is higher than the average of the high and low prices of the registrant’s common stock on December 19, 2003, as reported by the American Stock Exchange.

(3)

(4)

Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(g). Based upon the average of the high and low prices of the registrant’s common stock on December 19, 2003, as reported by the American Stock Exchange, which is higher than the exercise price of the common stock underlying the warrants ($1.85).

(5)

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 SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

The information in this Prospectus is not complete, and it may be changed. These securities will not be publicly resold until the registration statement, of which this Prospectus is a part, is filed with the Securities and Exchange Commission and has become effective. This Prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where such offer or sale is not permitted.

This Prospectus relates to the resale of up to 6,775,285 shares of our common stock, par value $.04 per share, by certain stockholders. The shares that may be resold pursuant to this Prospectus include 2,500,000 shares of common stock underlying warrants exercisable at $2.44 per share, 42,857 shares of common stock underlying warrants exercisable at $2.45, 100,000 shares of common stock underlying warrants exercisable at $1.85 per share and 100,000 shares of common stock underlying warrants exercisable at $1.60 per share.

Our common stock is traded on the American Stock Exchange under the symbol “RCG.” The closing sales price of our common stock on December , 2003 was $ per share.

INVESTING IN THE COMMON STOCK INVOLVES CERTAIN RISKS. SEE “RISK FACTORS” BEGINNING ON PAGE 1 FOR INFORMATION THAT YOU SHOULD CONSIDER.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION, HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

You should carefully consider the risk factors set forth below, as well as the other information in this Prospectus, in evaluating whether to invest in our Shares.

WE MAY NEED TO RAISE ADDITIONAL FUNDS IN ORDER TO CONTINUE TO OPERATE AND GROW OUR BUSINESS.

We believe that our existing balances of cash and cash equivalents and investments will be sufficient to meet working capital and capital expenditure requirements of our continuing operations through the end of fiscal 2004. If we are unable to grow our business or improve our operating cash flows as expected, we suffer significant losses on our investments or are unable to realize adequate proceeds from those investments, including our holdings in Lifestyle Innovations, Inc., then we will need to secure alternative debt or equity financing to provide us with additional working capital. There can be no assurance that we will be able to complete such financing if required. If we raise funds through debt financing, then we will incur additional interest expense going forward. If we raise additional funds by issuing additional equity securities, then the percentage ownership of our current stockholders will be diluted. We cannot be certain that additional financing will be available on acceptable terms. In addition, our ability to complete future financings may be affected by the market price of our common stock. If adequate funds are not available on acceptable terms, then we will not be able to continue to fund our existing businesses or our planned expansion or take other steps necessary to enhance our business or continue our operations.

WE HAVE BEEN INCURRING OPERATING LOSSES AND THERE CAN BE NO ASSURANCE THAT WE WILL ACHIEVE OR SUSTAIN PROFITABILITY.

We have incurred operating losses since inception. Certain of our operating businesses have incurred and continue to incur operating losses. We expect to continue to incur significant operating costs in connection with our efforts to expand our existing businesses and to grow through acquisitions. As a result of these costs and uncertain revenue growth, there can be no assurance that we will achieve or be able to sustain profitability.

THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE AND IF THE MARKET PRICE OF OUR COMMON STOCK DECREASES, STOCKHOLDERS MAY NOT BE ABLE TO SELL THEIR SHARES OF COMMON STOCK AT A PROFIT.

The trading price of our common stock during our last fiscal year, as reported by the American Stock Exchange, fluctuated from a high of $1.50 to a low of $0.26. Fluctuations in the price of our common stock may occur, among other reasons, in response to:

In addition, the volume of shares of our common stock bought and sold on any trading day has been subject to wide fluctuations which also contribute to fluctuations in the trading price of our common stock. The trading price of our common stock could continue to be subject to wide fluctuations in response to these or other factors, many of which are beyond our control.

WE MAY BE UNABLE TO MAINTAIN OUR LISTING ON THE AMERICAN STOCK EXCHANGE AND IF WE ARE DELISTED THE TRADING OF OUR COMMON STOCK COULD BE MORE DIFFICULT.

Our common stock is presently listed and trading on the American Stock Exchange. We believe that we meet the standards for continued listing but such a determination is subjective and the Exchange may not agree. If our common stock is delisted from the Exchange trading in our securities could be more difficult and trading of our common stock could be subject to the “penny stock” rules. The Securities and Exchange Commission has adopted

regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions (including trading on the American Stock Exchange). These rules require that any broker-dealer who recommends our securities to persons other than prior customers and accredited investors must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transactions involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from recommending transactions in our securities, which could severely limit the liquidity of our securities and consequently adversely affect the market price for our securities.

IF WE CANNOT INTEGRATE OUR RECENT OR FUTURE ACQUISITIONS, WE MAY BE UNABLE TO SUCCESSFULLY EXECUTE OUR STRATEGY.

We anticipate that a portion of our future growth will be accomplished through acquisitions. The success of our plan depends upon our ability to:

•

effectively integrate acquired personnel, operations, products and technologies into our organization;

•

obtain necessary financing on acceptable terms or use our securities as consideration for acquisitions.

Turbulence in financial markets and the current U.S. economy may result in a diminished pool of companies that meet our criteria for acquisition. Even if we are successful in acquiring companies, we may be unable to integrate them into our business model or achieve the expected synergies.

OUR ACQUISITION STRATEGY HAS AND WILL CONTINUE TO DILUTE OUR CURRENT STOCKHOLDERS’ OWNERSHIP.

Our acquisition strategy contemplates that we may issue our securities to make strategic acquisitions and attempt to grow our business. Each of the acquisitions that we complete in the future, involving the issuance of securities, will further dilute our current stockholders’ ownership interest in the Company.

OUR GROWTH PLACES STRAIN ON OUR MANAGERIAL, OPERATIONAL AND FINANCIAL RESOURCES.

Our growth has placed, and is expected to continue to place, a significant strain on our managerial, operational and financial resources. Further growth will increase this strain on our managerial, operational and financial resources, which may inhibit our ability to successfully implement our business plan.

WE DEPEND ON CERTAIN IMPORTANT EMPLOYEES, AND THE LOSS OF ANY OF THOSE EMPLOYEES MAY HARM OUR BUSINESS.

Our performance is substantially dependent on the performance of our executive officers, Michael D. Pruitt, our CEO and Melinda Morris Zanoni, our EVP, and other key employees. The familiarity of these key employees with our Company and Kent Elsbree and Carlisle Vason, with the charter services business make them especially critical to our success. In addition, our success is dependent on our ability to attract, train, retain and motivate high quality personnel, especially for our management team. The loss of the services of any of our executive officers or key employees may harm our business. Our success also depends on our continuing ability to attract, train, retain and motivate other highly qualified technical and managerial personnel. Competition for such personnel is intense and our limited resources are likely to make it more difficult for us to attract and retain such personnel.

THE MAJORITY OF OUR REVENUES HAS HISTORICALLY BEEN DERIVED THROUGH CONTRACTS WITH VACATION EXPRESS, A COMPANY THAT WE RECENTLY ACQUIRED; IF WE ARE UNABLE TO OPERATE AND MANAGE THIS ACQUISITION SUCCESSFULLY, OUR REVENUES MAY DECREASE AND WE MAY INCUR SUBSTANTIAL DEBT.

During the three month periods ended September 30, 2003 and 2002, sales to Vacation Express, a MyTravel Group company and a customer of our aviation travel services business, represented 71% and 69%, respectively, of the Company’s consolidated revenue. For the fiscal years ended June 30, 2003 and 2002, sales to Vacation Express represented 73% and 54%, respectively, of our consolidated revenue. This concentration of revenue with Vacation Express, and its sister company, SunTrips, Inc., increased in July 2002 with the beginning of a new program for SunTrips. In October, 2003 we acquired Vacation Express and SunTrips. If we are unable to operate these recent acquisitions successfully, our new acquisitions may not be profitable or may incur substantial debt.

PURSUANT TO THE TERMS OF OUR ACQUISITION OF VACATION EXPRESS WE HAVE INCURRED SUBSTANTIAL DEBT WHICH IS SECURED BY CERTAIN OF OUR INVESTMENT HOLDINGS.

Under the terms of our acquisition of Vacation Express we issued a $10,000,000 seven year promissory note which is secured by certain of our investment holdings. In addition, under the terms of the acquisition we have made a commitment to purchase $4,500,000 of travel related services. If we are unable to repay the note or satisfy the commitment, we may forfeit certain of our investment holdings. In addition, the debt may put a strain on our working capital. If we are unable to repay the debt, our financial position will be negatively impacted.

FUTURE EVENTS SIMILAR TO THOSE OF SEPTEMBER 11, 2001 MAY HAVE AN ADVERSE EFFECT ON OUR BUSINESSES.

The terrorist attack against the United States on September 11, 2001 produced great uncertainty in the economy in general and in the aviation industry in particular. These events are still having a negative impact on the air travel industry. These events may drastically alter the long-term demand for charter services. In addition, these events may lead the Federal Aviation Administration to place additional restrictions on charter flight operators, which may increase the cost of private charter services. The long-term impact of these events on the aviation industry and the chartered services segment of that industry are not known. These events could have a material adverse effect on our aviation travel services business.

GOVERNMENT REGULATION OF THE TRAVEL INDUSTRY COULD IMPACT OUR AVIATION TRAVEL SERVICES’ BUSINESS OPERATIONS.

Certain segments of the travel industry are regulated by the United States Government and, while we are not currently required to be certified or licensed under such regulation, certain services offered by our aviation travel services business are affected by such regulation. Charter flights operators, upon which our aviation travel services business depends, are subject to vigorous and continuous certification requirements by the Federal Aviation

Administration. Changes in the regulatory framework for charter aviation travel could adversely affect our aviation travel services business’ operations and financial condition.

OUR AVIATION TRAVEL SERVICES BUSINESS FACES INTENSE COMPETITION FROM COMMERCIAL AIRLINERS AND OTHER TOUR OPERATORS FOR CUSTOMERS.

We provide leisure charter jet travel and tour services and face intense competition from commercial airlines and other tour operators for the potential customers who travel to these locations and other locations that we may serve in the future. These commercial airlines have greater resources, marketing efforts and brand equity than we do and they also offer a potential customer more flights to these locations. Furthermore, travelers have numerous choices of location when choosing travel destinations. Since we offer only limited travel destinations, we face intense competition from travel agents, commercial airlines, hotels, resorts, casinos and other organizations in the travel industry that offer alternative travel destinations to those offered by us. Many competitors possess far greater capital and human resources, marketing efforts and brand equity than we do. If we are unable to compete effectively with these various competitors in the travel industry, we may not be able to achieve and maintain profitability.

OUR TECHNOLOGY SOLUTIONS BUSINESS MAY NOT BE ABLE TO KEEP UP WITH THE CONTINUOUS TECHNOLOGICAL CHANGE IN ITS MARKET.

The success of our technology solutions business will depend, in part, on its ability to respond to technological advances. This business may not be successful in responding quickly, cost-effectively and sufficiently to these developments. Many of the competitors of our technology solutions business are larger than we are and have significantly more financial resources to invest in advances in technology, products and other areas central to providing technology and Internet solutions. Our technology solutions business will not be able to compete effectively or meet its growth objectives if it is unable, for technical, financial or other reasons, to adapt in a timely manner in response to technological advances. In addition, employee time allocated to responding to technological advances will not be available for client engagements.

THE SUCCESS OF OUR TECHNOLOGY SOLUTIONS BUSINESS IS LARGELY DEPENDENT UPON ITS ABILITY TO RETAIN ITS MANUFACTURER AUTHORIZATIONS THAT ALLOW IT TO SELL SOFTWARE TO EDUCATIONAL CUSTOMERS AT DISCOUNTED PRICING.

Our technology solutions business has been accumulating authorizations from key software manufacturers that allow it to sell products to educational facilities at deep discounts. If our technology solutions business were to lose any of these authorizations, its ability to sell computer products to educational customers would be adversely impacted, which could have a similar impact on its sales, profitability and ability to expand within this business line. In addition, this business uses credit lines extended by software and hardware manufacturers and distributors. The loss of any of these credit lines would limit the ability of our technology solutions business to meet customer demand, thereby reducing sales and profits.

WE OWN A 71% INTEREST IN LIFESTYLE INNOVATIONS, INC., BUT WE HAVE NO CONTROL OVER ITS DAY TO DAY OPERATIONS, NOR CONTROL OVER ITS OPERATING LOSSES.

We own a 71% interest in Lifestyle Innovations, Inc. Although we own a majority interest in this company, we do not manage nor have any control over its day to day operations. Lifestyle Innovations, Inc. has incurred operating losses. If Lifestyle Innovations, Inc. continues to incur operating losses, it may effect our financial condition.

THE EXERCISE OF OUTSTANDING OPTIONS AND WARRANTS COULD SUBSTANTIALLY DILUTE EXISTING STOCKHOLDERS AND COULD HAVE A NEGATIVE EFFECT OUR STOCK PRICE.

We have adopted an Employee Stock Option Plan (the “Plan”) and our stockholders have authorized the issuance of options to acquire up to 20,000,000 shares of common stock under the Plan. As of September 30, 2003, we have outstanding options for 2,106,536 shares under the Plan that have been granted to our officers, directors,

employees and other service providers of which options for 1,373,159 shares are vested. No options were exercised for fiscal year 2003. In addition to options issued under the Plan, we currently have outstanding warrants as of September 30, 2003 for up to 2,702,962 shares. Our outstanding options and warrants have exercise prices ranging from $0.28 to $28.00. The exercise of these options or warrants would dilute the percentage ownership of our current stockholders and the potential sale of shares issued upon the exercise of these warrants or options could have a negative impact on the market price of our common stock.

IF WE ARE NOT ABLE TO PROTECT OUR INTELLECTUAL PROPERTY, PROPRIETARY RIGHTS AND TECHNOLOGY, WE COULD LOSE THOSE RIGHTS AND INCUR SUBSTANTIAL COSTS POLICING AND DEFENDING THOSE RIGHTS.

We rely primarily on a combination of intellectual property laws and contractual provisions to protect our proprietary rights and technologies, brand and marks. These laws and contractual provisions provide only limited protection of proprietary rights and technology. Our means of protecting our intellectual property, proprietary rights and technology may not be adequate.

IF THE SELLING STOCKHOLDERS SELL A SUBSTANTIAL AMOUNT OF THEIR SHARES, THESE SALES COULD HAVE AN ADVERSE IMPACT ON OUR STOCK PRICE.

If some or all of the Selling Stockholders sell a substantial amount of their common stock under this Prospectus, such sales could have a significant negative impact on the market price of our common stock. This Prospectus could result in a large number of shares of our common stock being sold in the market which, in turn, could result in a reduction in the market price of our common stock.

THIS PROSPECTUS CONTAINS FORWARD-LOOKING STATEMENTS THAT MAY PROVE NOT TO BE ACCURATE. This Prospectus (including information included or incorporated by reference herein) contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which represent our expectations or beliefs concerning future events that involve risks and uncertainties. All statements other than statements of historical facts included in this Prospectus (including, without limitation, the statements under the section of this document titled “About the Company” and elsewhere herein) and in our filings that are incorporated by reference herein are forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual future results or trends to differ materially from future results or trends expressed or implied by such forward-looking statements. The most significant of such risks, uncertainties and other factors are discussed under the section of this document titled “Risk Factors,” beginning on page 1 of this Prospectus. Prospective investors are urged to consider carefully such factors.

Pursuant to a Securities Purchase Agreement dated October 31, 2003 (the “Closing Date”), we sold an aggregate of 2,500,000 shares of our common stock and common stock purchase warrants to purchase 2,500,000 shares of our common stock exercisable at $2.44 per share to ten accredited investors for an aggregate purchase price of $4,000,000. The warrants may be exercised any time on or after the six month anniversary of the Closing Date and prior to forty two months after the issuance of the warrants. The shares of common stock and warrants were sold in a private transactions exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(2) of the Securities Act.

Under the terms of a Registration Rights Agreement, we are obligated, by December 30, 2003, to file a registration statement on Form S-3 in order to register the shares of common stock (including the shares of common

stock underlying the warrants) issued pursuant to the Securities Purchase Agreement. We are also required to use our commercially reasonable efforts to cause the registration statement to be declared effective under the Securities Act as promptly as possible, but in any event no later than 120 days following the Closing Date. We are filing this registration statement to comply with our obligations under the Securities Purchase Agreement and the Registration Rights Agreement.

In addition, we are also registering an additional aggregate of 1,775,285 shares of our common stock, including 242,857 shares of common stock underlying warrants.

The majority of these shares of common stock were issued pursuant to a private placement in September 2003. Under the private placement we issued an aggregate of 1,071,428 shares of our common stock to ten accredited investors for gross proceeds of $1,200,000. The private placement was made pursuant to Regulation D, Rule 506 of the Securities Act of 1933. The investors received information concerning our Company and had the opportunity to ask our Company questions regarding our operations. In addition, the shares issued to these investors contained the appropriate restrictive legends. The terms of the private placement provided the investors with piggy-back registration rights.

An aggregate of 200,000 shares are being registered pursuant to a debt conversion agreement with GAIA Holdings, Inc. The Company is registering up to 225,000 shares of common stock issuable to Computer Inventory Control, Inc. in consideration for the Company’s acquisition of substantially all of the assets from Computer Inventory Control, Inc. and 36,000 shares we are registering were issued to Equity Communications LLC pursuant to a settlement agreement dated August 11, 2003 for services rendered.

The aggregate of 242,857 shares are underlying two warrants issued by the Company. A warrant to purchase 42,857 shares of common stock is held by Delvest, Inc. and was issued in consideration for a loan made by Delvest to one of our subsidiaries. The remaining 200,000 shares are underlying a warrant issued to G. David Gordon, of which 100,000 are exercisable at $1.85 per share and the remaining 100,000 are exercisable at $1.60 per share. The warrants were issued to Mr. Gordon in lieu of legal fees.

RCG Companies Incorporated and its subsidiaries is a network of travel and entertainment and technology services companies brought together under one operating company to benefit from synergistic relationships and the infusion of intellectual and capital resources. We are engaged in the operation of aviation travel services, tour services, technology solutions businesses and a call center operation. RCG is a Delaware corporation incorporated in 1982 and our fiscal year ends on June 30.

Our current operating subsidiaries include: Flightserv, Inc. (our aviation travel services business); DM Marketing, Inc. (our telecommunications call center business); and Logisoft Corp. (our Internet/technology solutions business). During fiscal 2001, we expanded our aviation services business and acquired several companies operating in diverse technology segments. In fiscal 2002, we expanded the businesses of all of our subsidiaries, with particular focus on the aviation travel services business. Consequently, we have increased our focus on the travel and entertainment sector and plan to continue to acquire substantial interests in and operate and enhance the value of

companies operating in the travel and entertainment sectors. We are in the early phases of our expanded strategy and continue to focus on existing operations as well as our efforts to implement this strategy.

We also own a 71% interest in Lifestyle Innovations, Inc., a full service home technology integration company providing complete installation and equipment for structured wiring, home security, PC networking, home audio, home theater, central vacuum and accent lighting.

Our principal executive offices are located at 6836 Morrison Boulevard, Suite 200, Charlotte, North Carolina 28211. Our telephone number is (704) 366-5054.

In fiscal 2001, we brought in new executive management and modified our business plan to focus on acquiring and enhancing travel and entertainment and technology services companies and, as a result, acquired companies in the telecommunications call center, home technology and technology solutions business segments. We also brought in new management to our aviation business and completed the acquisition of an aviation services company that, together, have expanded that business into a highly specialized travel organization that delivers a unique turnkey air service. This air travel services business generated $62 million and $27 million in revenue in fiscal years 2003 and 2002, respectively. As a result of this growth, we have increased our focus on the travel and entertainment sector and plan to continue to acquire substantial interests in, operate and enhance the value of companies operating in the travel and entertainment sectors. We are in the early phases of our expanded strategy and continue to focus on existing operations as well as our efforts to implement this strategy.

At different times prior to fiscal 2000, we operated businesses in several industries including drug-screening, computer software and residential and commercial real estate development, all of which have now been discontinued. During fiscal 2000, our Company, under the name flightserv.com, Inc. was engaged in the development of an Internet website to provide access to private aviation travel services. In March 2000, we launched our private aviation program, called Private Seats^TM. We were able to generate only minimal customer bookings through the Private Seats^TM program and did not book any flights under this program after June 2000.

In October 2000, we changed our name to eResource Capital Group, Inc. to reflect the new business direction. On November 14, 2003, we changed our name to RCG Companies Incorporated to further reflect the nature and evolution of our business.

We acquired Internet Aviation Services, Ltd. (“IASL”), a leisure and business travel services company which provided charter aviation services, in August 2000. IASL was integrated into our aviation travel services business through our Flightserv, Inc. (“Flightserv”) subsidiary.

Flightserv, headquartered in Atlanta, GA, is a nationally recognized airline and travel program management company providing tour operators, corporate travel departments, sports teams and casinos with cost effective and reliable charter air transportation on a scheduled and ad-hoc basis. Flightserv acts as a program manager by providing turnkey charter services including aircraft and related services such as ground support and aircraft fueling, passenger service and support, and real-time flight tracking. Flightserv also provides its clients with Internet-ready reservations services and aviation consulting. Flightserv differentiates itself in the charter travel industry by focusing on full program management services, which combines the functions of aircraft brokerage, flight operations, airport operations, contract negotiation between clients and air service providers, airport subsidy negotiations and consumer marketing. Flightserv does not own or operate any aircraft.

Flightserv had an agreement with Vacation Express, a member of the MyTravel Group, ending in December 2004, to operate a passenger hub at Atlanta Hartsfield Airport. Pursuant to the terms of the agreement, six commercial jet aircraft originate in six eastern and mid-western cities and serve six Caribbean destinations. Also, in July 2002, Flightserv entered into a three-year agreement with SunTrips, Inc., a sister company of Vacation Express in the MyTravel Group, to operate scheduled weekly flights between three west coast cities and two Mexican destinations. The majority of the revenue of Flightserv was historically generated pursuant to these contracts.

On October 31, 2003, VE Holdings, Inc. (“Vacation Express”) and SunTrips, Inc. (“SunTrips”) both wholly-owned subsidiaries of MyTravel USA Holdings, Inc., entered into an amended and restated asset purchase agreement with FS Tours, Inc. and FS SunTours, Inc., which are wholly-owned direct subsidiaries of Flightserv.

Under the terms of the asset purchase agreement, FS Tours and FS SunTours acquired substantially all of the assets and certain liabilities of Vacation Express and SunTrips, except for certain excluded items, for $12 million, of which $10 million is in the form of a seven-year non interest bearing promissory note from Flightserv secured by certain of our investment holdings.

In conjunction with the asset purchase, we entered into a three-year agreement with MyTravel Canada Holidays, Inc., for certain services, including the purchasing of hotel accommodations for our company on an exclusive basis. Under the asset purchase agreement we are required to pay MyTravel Canada approximately $4.5 million over three years.

Additionally, we were required to obtain replacement letters of credit in the aggregate principal amount of $3 million.

With the closing of these acquisitions, SunTrips and Vacation Express will continue to operate from their current locations, with FS Tours and FS SunTours assuming operational control. Air and hotel vacation packages will continue to be marketed and sold under the SunTrips and Vacation Express brands.

SunTrips, based in San Jose, California, sells air and hotel vacation packages to Mexico, Dominican Republic, Costa Rica, Hawaii and the Azores out of Oakland, California and/or Denver, Colorado. Vacation Express, based in Atlanta, Georgia, sells air and hotel packages to Mexico and Caribbean destinations, including Aruba, Bahamas, Costa Rica, Dominican Republic, Jamaica, and St. Martin. SunTrips and Vacation Express together generated revenues of approximately $200 million for the twelve months ended September 30, 2003. Both companies were air charter customers of Flightserv.

In fiscal 2002 and 2003, Flightserv developed and implemented a trial scheduled charter flight operation d/b/a Interstate Jet. Initial service began between Allentown PA/ Newburgh NY and Las Vegas NV and Los Angeles CA. The origination cities were chosen as a result of direct cash subsidies and marketing support from the respective airport authorities. While the first trials of these cities did not yield adequate passenger loads and yields to break even, Flightserv plans to continue to work with airport authorities to develop and implement new scheduled air service to minimize reliance on fixed length tour operator contracts.

During fiscal year 2003, Flightserv started two joint ventures, flightfuel, Inc. and Platinum Air Charter, LLC, with initial investments of $5,000 and $60,000, respectively. Both are 50% owned by Flightserv. flightfuel began operations in January, 2003 and provides fuel management services to its clients. flightfuel has temporarily suspended further fuel sales, while it seeks to recover through litigation past due fuel amounts (approximately $360,000) from a former client. Platinum, a Dallas, Texas based company, began operations in July, 2003 and provides charter air program management services to its clients. Platinum specializes in charter flights that can utilize smaller non-commercial airports (FBO’s). Platinum currently has contracts primarily with casinos and NCAA colleges.

Our technology solutions business is the result of our acquisition of Logisoft Corp. (f/k/a Logisoft Computer Products Corp.), and its wholly-owned subsidiary eStorefronts.net Corp. in June 2001.

Our technology solutions business provides integrated products and services to assist customers in meeting their strategic technology initiatives. Our products and services include distribution of third-party published software titles to the educational market and corporate customers, full service Internet development, Internet site hosting and co-location and Internet business development services encompassing partner site management and marketing. In our Internet business development and marketing services business, we generally participate in the development and implementation of the business plan in exchange for revenue-sharing and/or equity-based arrangements.

On June 6, 2001, the Company acquired Logisoft in exchange of 785,714 shares of common stock pursuant to that certain agreement and plan of merger. The total purchase price aggregated $5,504,879 and the transaction was recorded using the purchase method of accounting. The excess value of the purchase price over the fair value of Logisoft’s net assets on the acquisition date aggregating $4,146,000 was allocated to goodwill. The aggregate purchase price and goodwill were both adjusted in fiscal 2002 by $42,000 to reflect the issuance of earn-out shares to certain members of Logisoft’s management.

On June 10, 2003 eStorefronts.net Corporation, 100% owned by Logisoft, purchased a 75% interest in Premier Shoe Group, LLC for $187,000. A one-year 10% note of $147,000 was signed at closing and $40,000 cash was paid. Premier Shoe Group operates a website named 123Shoes.com which sells brand name shoes. The results of Premier Shoe Group will be consolidated on Logisoft’s financial statements and the portion of income or loss attributable to the minority interest as an increase or decrease to the minority interest recorded.

On October 31, 2003, Logisoft acquired substantially all of the assets of Computer Inventory Control, Inc. (“CIC”), a Pittsburgh, Pennsylvania based educational software company, in consideration of up to 225,000 shares of the Company’s common stock valued at $380,000. On October 31, 2003, the purchase price was 174,312 shares of the Company’s common stock, which was determined by dividing $380,000 by the average closing price of the Company’s common stock on the American Stock Exchange for the previous three consecutive business days ending on the day prior to the closing of the acquisition agreement. To the extent that the aggregate gross sales price for the sales of the 174,312 shares of the Company’s common stock held by CIC exceeds $380,000, then CIC shall surrender to the Company all of the remaining shares held by CIC for no additional consideration or pay to the Company an amount equal to the difference between the aggregate gross sales price and $380,000. In the alternative, if the gross sales price from the sale of the 174,312 shares of the Company’s common stock is less than $380,000, then the Company shall issue to CIC additional shares of Company common stock in an amount equal to the difference between $380,000 and the aggregate sales price. The short fall may also be paid in cash. Pursuant to the acquisition agreement, Logisoft acquired the “SchoolWorld Software” trademark, software licenses as well as all of the accounts, data bases and related inventory of CIC. CIC is a full service source for educational software.

We operate our telecommunications call center providing telemarketing, help desk and other services to companies through our subsidiary DM Marketing, Inc. (“DMM”). In December 2002, our aviation travel services business assumed operational responsibility of the call center operations located in Pensacola FL. The call center provides support to aviation travel services as a reservations and customer care center for airlines, tour operators and for internal programs for which the Company takes reservations from travelers. On September 1, 2003, the Company closed its Pensacola, FL call center facility. Future DMM programs will be managed by Flightserv, Inc.

In January 2003, DMM was operated and managed by Flightserv and provided in-bound reservations call center services to Southeast Airlines and Flightserv’s Interstate Jet. From January through June 2003 DMM booked approximately 65,000 passenger segment reservations for Southeast Airlines and Interstate Jet.

We own a 71% of interest in Lifestyle Innovations, Inc., a publicly traded company. Lifestyle is a full service home technology integration company providing complete installation and equipment for home automation, structured wiring, home security, PC networking, home audio, home theater, central vacuum and accent lighting. Lifestyle creates relationship with high-end residential homebuilders (those that build residences with value equal to or greater than $250,000) and provides such homebuilders with a basic structured wiring and security package in exchange for an agreement to introduce the homeowner to a Lifestyle sales consultant and to offer the homeowner a visit to the local Lifestyle showroom. While in the showroom, the homeowner is introduced to the complete line of home security, entertainment, lighting and home office options. Lifestyle has also secured relationships with product manufacturers, distributors and service providers (cable, Internet service provider, broadband and security) to ensure the highest quality and most attractive pricing for the homeowners’ needs.

On October 31, 2003, we completed a $4,000,000 private placement offering of our common stock to a group of private institutional investors. The offering was made pursuant to Regulation D. We issued 2,500,000 common shares at $1.60 per share. We have granted registration rights to the investors, which is our principle purpose of filing this registration statement.

In connection with the private placement, we issued 3-year common stock warrants, which are exercisable six months from closing, to purchase 2,500,000 common shares of our common stock. The common stock warrants have an exercise price of $2.44 per share, which was 110% of the closing bid price of our common stock the day prior to the closing date. The common stock warrants contain anti-dilution provisions.

In connection with the private placement, we paid $280,000 cash commission and issued 200,000 3-year common stock warrants to our investment bank, HPC Capital Management. These warrants are exercisable at $2.44 per share. Additionally, we paid legal fees and expenses incurred in connection with the transaction.

All of the shares of our common stock offered hereby are being sold by the Selling Stockholders. We will not receive any of the proceeds from the sale of the shares. However, this Prospectus includes 2,500,000 shares of common stock underlying warrants exercisable at $2.44 per share, 42,857 shares of common stock underlying warrants exercisable at $2.45 per share, 100,000 shares of common stock underlying warrants exercisable at $1.85 per share and 100,000 shares of common stock underlying warrants exercisable at $1.60 per share. If any of these warrants are exercised, we would receive the gross proceeds from payment of the exercise price. We intend to use these proceeds for working capital.

We are authorized to issue 200,000,000 shares of common stock, par value $.04. As of the date of this Prospectus, 18,593,003 shares are issued and outstanding. The outstanding shares of common stock are fully paid and non-assessable. The holders of common stock are entitled to one vote per share for the election of directors and with respect to all other matters submitted to a vote of shareholders. Shares of common stock do not have cumulative voting rights, which means that the holders of more than 50% of such shares voting for the election of directors can elect 100% of the directors if they choose to do so and, in such event, the holders of the remaining shares so voting will not be able to elect any directors.

Upon any liquidation, dissolution or winding-up, our assets, after the payment of our debts and liabilities and any liquidation preferences of, and unpaid dividends on, any class of preferred stock then outstanding, will be distributed pro-rata to the holders of our common stock. The holders of our common stock do not have preemptive or conversion rights to subscribe for any of our securities and have no right to require us to redeem or purchase their

shares. The holders of our shares of common stock are entitled to share equally in dividends if, as and when declared by our board of directors, out of funds legally available therefore, subject to the priorities accorded any class of preferred stock which may be issued. A consolidation or merger, or a sale, transfer or lease of all or substantially all of our assets, which does not involve distribution by us of cash or other property to the holders of our shares of common stock, will not be a liquidation, dissolution or winding up of our Company.

On the Closing Date (October 31, 2003) we entered into a Securities Purchase Agreement with ten accredited investors. Pursuant to the Securities Purchase Agreement, we sold an aggregate of 2,500,000 shares of our common stock and common stock purchase warrants to purchase 2,500,000 shares of our common stock for an aggregate purchase price of $4,000,000. The warrants may be exercised at any time on or after the six month anniversary of the Closing Date and prior to forty-two months after the issuance of the warrants. The exercise price of the warrants is $2.44 per share.

Under the terms of a Registration Rights Agreement, we are obligated, by December 30, 2003 to file a Registration Statement on Form S-3 in order to register the shares of common stock (including the shares of common stock underlying the warrants) issued pursuant to the Securities Purchase Agreement. We are also required to use our commercially reasonable efforts to cause the Registration Statement to be declared effective under the Securities Act as promptly as possible, but in any event, no later than 120 days following the Closing Date. We are filing this Registration Statement to comply with our obligations under the Securities Purchase Agreement and the Registration Rights Agreement. In the event that we do not comply with the registration requirements, we may be required to pay to each Selling Stockholder an amount in cash, as liquidated damages and not as a penalty, equal to 1.5% of the aggregate purchase price paid by such shareholder pursuant to the Securities Purchase Agreement for any shares then held by the shareholder and on each monthly anniversary of default (if there is no cure) we shall pay each stockholder an amount in cash, equal to 1% of the aggregate purchase price paid by the shareholder pursuant to the Securities Purchase Agreement for any shares held by the stockholder as of that date.

Until twelve months after the effective date of this Prospectus, we are prohibited from effecting any financing of our common stock or common stock equivalents unless we provide a notice to all of the Selling Stockholders providing each with an opportunity to participate in any such financing. In addition, until ninety days after the effective date of this Prospectus, neither our Company nor any of our subsidiaries shall issue shares of common stock or common stock equivalents. This restriction, however, shall not apply to non-capital raising transactions, including, but not limited to, acquisitions or strategic investments, granting of options to employees, officers and directors subject to our Stock Option Plan or the exercise of or conversion of any outstanding convertible securities outstanding as of the date of the Securities Purchase Agreement.

In addition, we are also registering an additional 1,775,285 shares of our common stock, including 242,857 shares of common stock underlying warrants exercisable at various prices as disclosed below.

The majority of these shares of common stock were issued pursuant to a private placement in September 2003. Under the private placement the Company issued an aggregate of 1,071,428 shares of its common stock to ten accredited investors for gross proceeds of $1,200,000. The private placement was made pursuant to Regulation D, Rule 506 of the Securities Act of 1933. The shareholders received information concerning our Company and had the opportunity to ask our Company questions regarding our operations. In addition, the shares issued to these investors contained the appropriate restrictive legends. The terms of the private placement provided the investors with piggy-back registration rights.

An aggregate of 200,000 shares are being registered pursuant to a debt conversion agreement with GAIA Holdings, Inc. The Company is also registering up to 225,000 shares of common stock issued to CIC in consideration for the Company’s acquisition of substantially all of the assets of CIC. 36,000 shares we are registering were issued to Equity Communications LLC pursuant to a settlement agreement dated August 11, 2003 for services rendered. An aggregate of 242,857 shares are underlying warrants issued by the Company. A warrant to purchase 42,857 shares of common stock is held by Delvest, Inc. and was issued in consideration for a loan made by Delvest to one of our subsidiaries. The remaining 200,000 shares are underlying a warrant issued to G. David

Gordon, of which 100,000 are exercisable at $1.85 per share and the remaining 100,000 are exercisable at $1.60 per share. The warrants were issued to Mr. Gordon in lieu of legal fees.

The table below identifies each Selling Stockholder and sets forth information, to the best of our knowledge, regarding each Selling Stockholders’ beneficial ownership of shares of our common stock. This information is based upon information provided by each respective Selling Stockholder and public accounts filed with the SEC.

The shares offered by this Prospectus may be offered for sale from time to time by the Selling Stockholders. Because the Selling Stockholders may offer all, some or none of the shares pursuant to this Prospectus, and because there are currently no agreements, arrangements or understandings with respect to the sale of any Shares, no estimate can be given as to the number of shares of common stock that will be held by the Selling Stockholders after the completion of this offering, unless it is assumed that all the Shares offered pursuant to this Prospectus are sold.

The number of shares of common stock beneficially owned by the Selling Stockholders includes the shares of common stock beneficially owned by the Selling Stockholders as of the date of this Prospectus and shares of common stock underlying warrants or options held by Selling Stockholders that are exercisable within sixty (60) days of the date of this Prospectus. Except as otherwise indicated, to our knowledge, the Selling Stockholders have sole voting and investment power with respect to all shares of common stock beneficially owned by them, or with respect to the shares underlying options or warrants, will have sole voting and investment power at the time such shares are sold. Unless otherwise indicated, securities owned by the Selling Stockholders were received under the Securities Purchase Agreement. The percentages shown in the table below are based upon 18,593,003 shares of common stock outstanding as of December 3, 2003.


					NUMBER OF SHARES			NUMBER OF SHARES
		NUMBER OF SHARES			THAT MAY BE			BENEFICIALLY
		BENEFICIALLY OWNED			OFFERED PURSUANT			OWNED AFTER
SELLING STOCKHOLDERS		BEFORE OFFERING			TO THIS PROSPECTUS			OFFERING

Stonestreet L.P. 260 Town Centre Blvd., Suite 201 Markham, ON L3R 8H8 Canada			200,000			400,000	(1)		0
Alpha Capital AG Lettstrasse 32 Furstentums 9490 Vaduz, Leichtenstein			250,000			500,000	(2)		0
Bristol Investment Fund, Ltd. c/o Bristol Capital Advisors, LLC 6363 Sunset Blvd., 5th Floor Hollywood, CA 90028			312,500			625,000	(3)		0
Cranshire Capital, L.P. 666 Dundee Road, Suite 1901 Northbrook, IL 60062			93,750			187,500	(4)		0
Crescent International Ltd. c/o GreenLight (Switzerland) SA 84 Avenue Louis-Casai CH 1216 Cointrin, Geneva Switzerland			468,750			937,500	(5)		0
Gamma Opportunity Capital Partners, L.P. British Colonial Centre of Commerce One Bay Street, Suite 401 Nassau (NP), The Bahamas			218,750			437,500	(6)		0
Gryphon Master Fund, LP 500 Crescent Court, Suite 270 Dallas, TX 75201			312,500			625,000	(7)		0
Omicron Master Trust c/o Omicron Capital L.P. 810 Seventh Avenue, 39th Floor New York, NY 10019			93,750			187,500	(8)		0
Palisades Master Fund, L.P. 200 Mansell Court East, Suite 550 Roswell, GA 30076			456,250			912,500	(9)		0
Donald B. Sallee 705 Park Avenue, #36 SE Atlanta, GA 30326			387,500			387,500	(10)(13)		0
P. Roger Byer 88 Cottage Place Gillette, NJ 07933			176,429	(19)		133,929	(11)		85,000
GAIA Holdings, Inc. 7633 E. 63rd Place, Suite 210 Tulsa, OK 74133			500,000			248,660	(12)		251,340
K. Wesley M. Jones Sr. 6945 Baltusrol Lane Charlotte, NC 28210			203,572			178,572	(13)		25,000
Bobby M. Lutz 8712 Middleton lane Harrisburg, NC 28075			6,696			6,696	(13)		0
Perfect Timing, LLC 4390 River Bottom Drive Norcross, GA 30092			300,000	(21)		300,000	(13)		0
William J. Ritger 623 Ocean Avenue Sea Girt, NJ 08750			164,129	(20)		133,929	(13)		24,000
Vincent Sbarra 350 Summer Shade Lane Roswell, GA 30075			65,000			25,000	(13)		35,000
Scott Storick 11220 Elm Lane, Suite 200 Charlotte, NC 28277			22,321			22,321	(13)		0
Peter J. Wirth 11145 Metromont Parkway Charlotte, NC 28269			31,606			22,321	(13)		9,285
Delvest, Inc. 7633 East 63rd Place Suite 210 Tulsa, OK 74133			149,999			42,857	(14)		107,142
Equity Communications, LLC 1512 Grand Avenue Santa Barbara, CA 93103			36,000			36,000	(15)		0
G. David Gordon 10726 S. Lakewood Tulsa, OK 74133			769,853	(18)		200,000	(16)		569,853
Computer Inventory Control, Inc. 159 Techview Terrace Pittsburgh, PA 15213			225,000			225,000	(17)		0
	TOTAL:					6,775,285

* Omicron Capital, L.P., a Delaware limited partnership (“Omicron Capital”), serves as investment manager to Omicron Master Trust, a trust formed under the laws of Bermuda (“Omicron”), Omicron Capital, Inc., a Delaware corporation (“OCI”), serves as general partner of Omicron Capital, and Winchester Global Trust Company Limited (“Winchester”) serves as the trustee of Omicron. By reason of such relationships, Omicron Capital and OCI may be deemed to share dispositive power over the shares of our common stock owned by Omicron, and Winchester may be deemed to share voting and dispositive power over the shares of our common stock owned by Omicron. Omicron Capital, OCI and Winchester disclaim beneficial ownership of such shares of our common stock. Omicron Capital has delegated authority from the board of directors of Winchester regarding the portfolio management decisions with respect to the shares of common stock owned by Omicron and, as of April 21, 2003, Mr. Olivier H. Morali and Mr. Bruce T. Bernstein, officers of OCI, have delegated authority from the board of directors of OCI regarding the portfolio management decisions of Omicron Capital with respect to the shares of common stock owned by Omicron. By reason of such delegated authority, Messrs. Morali and Bernstein may be deemed to share dispositive power over the shares of our common stock owned by Omicron. Messrs. Morali and Bernstein disclaim beneficial ownership of such shares of our common stock and neither of such persons has any legal right to maintain such delegated authority. No other person has sole or shared voting or dispositive power with respect to the shares of our common stock being offered by Omicron, as those terms are used for purposes under Regulation 13D-G of the Securities Exchange Act of 1934, as amended. Omicron and Winchester are not “affiliates” of one another, as that term is used for purposes of the Securities Exchange Act of 1934, as amended, or of any other person named in this prospectus as a selling stockholder. No person or “group” (as that term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended, or the SEC’s Regulation 13D-G) controls Omicron and Winchester.

None of the selling security holders has, or within the past three years has had, any position, office or other material relationship with us or any of our predecessors or affiliates other than as set forth above. Paul Mannion, Jr. is a principal of HPC Capital Management, which serves as our investment bank and acted as placement agent in connection with our recent financing. HPC Capital Management is a registered broker-dealer. Mr. Mannion’s wife is the principal of Perfect Timing, LLC, which purchased the securities being registered under this Prospectus as disclosed under footnote 13. In addition, Vincent Sbarra, a managing director of HPC Capital Management, purchased the securities being registered under this Prospectus as disclosed under footnote 13. To our knowledge neither Mr. Mannion, Mr. Sbarra nor HPC Capital Management has any arrangement with any person to participate in the distribution of such securities.

We have agreed to pay the full costs and expenses in connection with the issuance, offer, sale and delivery of the shares, including all fees and expenses in preparing, filing and printing the registration statement and Prospectus and related exhibits, amendments and supplements thereto and mailing of those items. We will not pay selling commissions and expenses associated with any sale by the Selling Stockholders.

The Shares may be offered by the Selling Stockholders from time to time in transactions on the American Stock Exchange, in privately negotiated transactions, through the writing of options on the Shares, or a combination of such methods of sale, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The Selling Stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. The methods by which the Shares may be sold or distributed may include, but are not limited to, the following:

•

a cross or block trade in which the broker or dealer engaged by a Selling Stockholder will attempt to sell the Shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

•

purchases by a broker or dealer as principal and resale by such broker or dealer for its account;

•

ordinary brokerage transactions and transactions in which the broker solicits purchasers;

•

short sales or borrowings, returns and reborrowings of the Shares pursuant to stock loan agreements to settle short sales;

•

delivery in connection with the issuance of securities by issuers, other than us, that are exchangeable for (whether on an optional or mandatory basis), or payable in, such shares (whether such securities are listed on a national securities exchange or otherwise) or pursuant to which such shares may be distributed; and

In effecting sales, brokers or dealers engaged by the selling security holders may arrange for other brokers or dealers to participate in the resales. Brokers, dealers or agents may receive compensation in the form of commissions, discounts or concessions from selling security holders in amounts to be negotiated in connection with the sale. The selling security holders and these broker-dealers and agents and any other participating broker-dealers, or agents may be deemed to be “underwriters” within the meaning of the Securities Act, in connection with the sales. In addition, any securities covered by this Prospectus that qualify for sale under Rule 144 might be sold under Rule 144 rather than under this Prospectus. In connection with distributions of the shares or otherwise, the selling security holders may enter into hedging transactions with broker-dealers. In connection with the transactions, broker-dealers may engage in short sales of the shares registered hereunder in the course of hedging the positions they assume with selling security holders. The selling security holders may also sell shares short and deliver the shares to close out the positions. The selling security holders may enter into option or other transactions with broker-dealers which require the delivery to the broker-dealer of the shares registered hereunder, which the broker-dealer may resell under this Prospectus. The selling security holders may also pledge the shares registered hereunder to a broker or dealer and upon a default, the broker or dealer may effect sales of the pledged shares under this Prospectus.

Information as to whether an underwriter(s) who may be selected by the selling security holders, or any other broker-dealer, is acting as principal or agent for the selling security holders, the compensation to be received by underwriters who may be selected by the selling security holders, or any broker-dealer, acting as principal or agent for the selling security holders and the compensation to be received by other broker-dealers in the event the compensation of other broker-dealers is in excess of usual and customary commissions, will, to the extent required, be set forth in a supplement to this Prospectus. Any dealer or broker participating in any distribution of the shares may be required to deliver a copy of this Prospectus, including the supplement, if any, to any person who purchases any of the shares from or through a dealer or broker.

We have advised the selling security holders that during the time as they may be engaged in a distribution of the shares included herein they are required to comply with Regulation M of the Securities Exchange Act of 1934. With certain exceptions, Regulation M precludes any selling security holders, any affiliated purchasers and any broker-dealer or other person who participates in the distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire

distribution is complete. Regulation M also prohibits any bids or purchase made in order to stabilize the price of a security in connection with an at the market offering such as this offering. All of the foregoing may affect the marketability of our common stock.

None of the proceeds from the sales of the Shares by the Selling Stockholders will be received by us. We will bear certain expenses in connection with the registration of the Shares being offered by the Selling Stockholders, including all costs incident to the offering and sale of the Shares to the public other than any commissions and discounts of underwriters, dealers or agents and any transfer taxes.

The validity of the common stock offered hereby will be passed upon for us by the law firm of Adorno & Yoss, P.A, Fort Lauderdale, Florida.

Crisp Hughes Evans LLP, independent auditors, have audited our consolidated financial statements included in our Annual Report on Form 10-KSB for the years ended June 30, 2003 and June 30, 2002, as set forth in their report, which is incorporated by reference in this Prospectus. Our financial statements are incorporated by reference in reliance on Crisp Hughes Evans LLP’s report, given on their authority as experts in accounting and auditing.

We file annual, quarterly and special reports, proxy statements and other information with the SEC. You can inspect and copy the registration statement of which this Prospectus is a part, as well as such reports, proxy statements and other information, at the public reference room maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. Copies of such material can be obtained from the public reference room of the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. You may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. We are also required to file electronic versions of these documents with the SEC, which may be accessed through the SEC’s Web site at http://www.sec.gov. You may also inspect reports, proxy and information statements and other information about us at the American Stock Exchange at 86 Trinity Place, New York, New York 10006.

The SEC allows us to “incorporate by reference” the information we file with it, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this Prospectus, and later information that we file with the SEC will automatically update and supercede this information. We incorporate by reference the documents listed below and any future filings made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act until the earlier of the date the Selling Stockholders sell all the Shares or such other date as the offering is terminated and any unsold Shares are deregistered by the filing of a post-effective amendment:

•

Our Current Reports and Amendments thereto on Form 8-K and Form 8-K/A, respectively, filed with the SEC:

•

Our Definitive Proxy Statement for our Annual Meeting of Stockholders held on November 14, 2003, filed with the SEC on October 20, 2003; and

•

The description of our common stock contained in our Registration Statement on Form 8-A filed with the SEC on July 19, 1996.

You may request a copy of these filings, at no cost, by writing or telephoning us at the following address and telephone number:

RCG Companies Incorporated
6836 Morrison Boulevard
Suite 200
Charlotte, NC 28211
Attention: Controller
Telephone: (704) 366-5054

This Prospectus provides you with a general description of the securities that may be offered for sale, but does not contain all of the information that is in the registration statement that we filed with the SEC. Statements contained herein concerning the provisions of certain documents filed with, or incorporated by reference in, the registration statement are not necessarily complete and each such statement is qualified in its entirety by references to the applicable document filed with the SEC.

You should rely only on the information incorporated by reference or provided in this Prospectus or any supplement. We have not authorized anyone else to provide you with different information. The Selling Stockholders will not make an offer of these Shares in any state where the offer is not permitted. You should not assume that the information in this Prospectus or any supplement is accurate as of any date other than the date on the front of the respective document.

The estimated expenses to be paid in connection with the offering of the securities being registered are as follows and will be borne by the Company:

Section 145 of the Delaware General Corporation Law (“DGCL”) provides that, to the extent a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding, whether civil, criminal, administrative or investigative or in defense of any claim, issue, or matter therein (hereinafter a “Proceeding”), by reason of the fact that person is or was a director, officer, employee or agent of a corporation or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise (collectively an “Agent” of the corporation) that person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.

The DGCL also provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened Proceeding by reason of the fact that person is or was an Agent of the corporation, against expenses (including attorneys’ fees), judgment, fines and amounts paid in settlement actually and reasonably incurred by that person in connection with such action, suit or proceeding if that person acted in good faith and in a manner that person reasonably believed to be in, or not opposed to, the best interest of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe that person’s conduct was unlawful; provided, however, that in an action by or in the right of the corporation, the corporation may not indemnify such person in respect of any claim, issue, or matter as to which that person is adjudged to be liable to the corporation unless, and only to the extent that, the Court of Chancery or the court in which such proceeding was brought determined that, despite the adjudication of liability but in view of all the circumstances of the case, such person is reasonably entitled in indemnity.

Article VI of the Company’s Restated Certificate of Incorporation limits the liability of the Company’s directors to the fullest extent permitted by the DGCL. Specifically, no director will be personally liable to the Company or any stockholder for monetary damages for breach of a fiduciary duty as a director, except liability for (i) any breach of the duty of loyalty to the Company or its stockholders; (ii) acts or omissions not in good faith; (iii) acts that involve intentional misconduct or a knowing violation of law; or (iv) any transaction from which the director derives an improper personal benefit.

Article 5 of the Company’s Amended and Restated Bylaws provides that the Company shall indemnify, to the fullest extent permitted by applicable law, any Agent who was or is made or is threatened to be made a party to a Proceeding against all liability and loss suffered and expenses reasonably incurred by such Agent; provided, however, the Company shall be required to indemnify an Agent in connection with a Proceeding initiated by such Agent only if the Proceeding was authorized by the Board of Directors of the Company. The Company’s Amended and Restated Bylaws further provide that the Company shall pay the expenses incurred in defending any Proceeding in advance of its final disposition; provided, however, that the payment of expenses incurred by an officer or director in advance of the final disposition of a Proceeding is made only upon the Company’s receipt of an undertaking by the director or officer to repay all amounts advanced if it is ultimately determined that such officer or director is not entitled to be indemnified.

The Company maintains directors’ and officers’ liability insurance, including a reimbursement policy in favor of the Company. Additionally, the Company has entered into separate indemnifications agreements with certain of its directors and officers which provide, on a contractual basis, for generally the same rights to indemnification as set forth in the Company’s Amended and Restated Bylaws.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.


4.1		Securities Purchase Agreement dated October 31, 2003 (previously filed with the SEC on Form 8-K Current Report dated November 17, 2003)

4.2		Registration Rights Agreement dated October 31, 2003 (previously filed with the SEC on Form 8-K Current Report dated November 17, 2003)

4.3		Form of Common Stock Purchase Warrant (previously filed with the SEC on Form 8-K Current Report dated November 17, 2003)

4.4		Form of Subscription and Investment Representation Agreement, September 2003 Private Placement.

5.1		Legal Opinion with respect to due issuance and Consent of Adorno & Yoss, P.A.

23.1		Consent of Adorno & Yoss, P.A. (included in Exhibit 5.1)

23.2		Consent of Independent Accountants.

(1) To file, during any period in which it offers or sells securities, a post-effective amendment to this registration statement:

(i) To include any Prospectus required by Section 10(a)(3) of the Securities Act;

(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. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of Prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change in such information in the registration statement.

Provided, however, that (1)(i) and (1)(ii) do not apply if 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 Exchange Act that are incorporated by reference into this registration statement.

(2) That, for the purpose of determining any liability under the Securities Act, 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, the information omitted from the form of Prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of Prospectus filed by Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(5) For purposes of determining any liability under the Securities Act, each filing of the Registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) 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.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted as to directors, officers and controlling persons of the Registrant pursuant to the provisions described under Item 15 above or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant 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 Registrant 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 and will be governed by the final adjudication of such issue.

Pursuant to the requirements of the Securities Act of 1933, as amended (the “Securities Act”), 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 Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in Charlotte, North Carolina, on this 23rd day of December, 2003.

Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities indicated:

22 EX-4.4 3 g86467exv4w4.htm EX-4.4 FORM OF SUBSCRIPTION EX-4.4 Form of Subscription

THE SHARES REFERENCED HEREIN HAVE NOT BEEN REGISTERED WITH OR 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 THE INFORMATION CONTAINED HEREIN.

eResource Capital Group, Inc.
6836 Morrison Boulevard
Suite 200
Charlotte, North Carolina 28211

The undersigned (hereinafter referred to as “Subscriber”) hereby subscribes for and agrees to purchase ( ) restricted shares of the $0.04 par value Common Stock (the “Shares”) of eResource Capital Group, Inc., a Delaware corporation (“Company”), and agrees to pay therefor the purchase price of One Dollar and Twelve Cents ($1.12) per share, or an aggregate purchase price of Dollars ($ ), in cash or readily available funds. This Subscription is part of an offering of up to $1,200,000. There is no minimum amount and all funds will be immediately deposited into the treasury of Company. Upon receipt of the purchase price, acceptance of this Subscription and approval of the American Stock Exchange (“AMEX”), Company shall issue a stock certificate representing the Shares registered in Subscriber’s name and deliver same to Subscriber.

Subscriber hereby makes the following representations and warranties to Company and Subscriber understands that Company is materially relying upon such representations and warranties:

(a)

Investment Purposes. The Shares are being acquired for Subscriber’s own account, for investment, and not with the view to, or for, division or resale in connection with any distribution or public offering thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), or the securities or blue-sky laws of any state.

(b)

Restricted Stock. Subscriber understands that the Shares are being issued pursuant to an exemption from registration under the Securities Act and without registration under any state securities or blue-sky acts or laws. Subscriber understands that neither the Shares, nor any portion thereof, may, and agrees that neither the Shares, nor any portion thereof, will, be sold, transferred, pledged, or otherwise disposed of in the absence of an effective registration statement covering the Shares under the Securities Act and applicable state securities laws, or unless, in the opinion of counsel satisfactory to Company prepared at the expense of Subscriber or its proposed transferee, exemptions from such registration and state securities laws are available. Furthermore, Subscriber is aware of the restrictions which may be imposed by Company or the federal or state securities laws on the distribution of the securities, including, but not limited to, restrictive legends on the stock certificates, required holding periods, and stop transfer orders.

Subscriber understands that these substantial restrictions on transferability mean that Subscriber must bear the economic risk of this investment for an indefinite period of time. In the event Subscriber requests an opinion from counsel concerning the transferability of the Shares, or any portion thereof, Subscriber shall pay all costs, including, without limitation, reasonable attorneys’ fees, related to such opinion.

(c)

Restrictive Legend. Since Subscriber is not acquiring the Shares with any view to subsequent distribution, Subscriber understands that (i) stop transfer instructions will be given to Company’s transfer agent or the officer in charge of Company’s stock records and noted on the appropriate records of Company to the effect that neither the Shares, nor any portion thereof, may be transferred out of Subscriber’s name unless approval is first obtained from Company; and (ii) the stock certificates, which will be issued, shall bear the following or a substantially similar legend restricting the transfer:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES LAWS, BUT HAVE BEEN ISSUED IN RELIANCE UPON EXEMPTIONS THEREFROM. NO TRANSFER OF THESE SECURITIES OR ANY INTEREST THEREIN MAY BE MADE EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND UNDER APPLICABLE STATE SECURITIES LAWS, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.

(d)

Piggyback Registration Rights. If Company shall determine to register any of its securities under the Securities Act on any registration form prescribed by the Securities and Exchange Commission (the “SEC”) either for its own account or the account of a security holder or holders exercising their respective demand registration rights, other than a registration on Form S-4 or S-8, a registration relating solely to a Rule 145 transaction, or a registration on any registration form that does not permit secondary sales, Company will:

(i)

promptly give to Subscriber written notice of the proposed registration, including notice deadlines; and

(ii)

use its commercially reasonable efforts to include in such registration (and any related filing or qualification under applicable blue sky laws) all the Shares granted under this Subscription (“Unregistered Securities”) which are specified in a written request or requests made by Subscriber and received by Company within seven (7) days after the written notice from Company described in clause (i) above is mailed or delivered by Company; provided, that in the event such registration is an underwritten offering on behalf of Company and the managing underwriter(s) advise Company that, in their opinion, the number of securities requested to be included in such registration exceeds the number which can be reasonably sold in such offering, or if certain marketing factors require limitation of the number of shares to be registered, then the number of Subscriber’s Shares which have been requested to be included in such registration may be reduced

or excluded to the extent necessary. Subscriber’s written request may specify all or a part of Subscriber’s Unregistered Securities but no less than 25% of Subscriber’s Unregistered Securities.

Provided, however, Subscriber shall only be entitled to such piggyback registration rights on two (2) occasions and the piggyback registration rights granted herein shall terminate at such time all of Subscriber’s Shares have been sold pursuant to an effective registration statement under the Securities Act or when all of Subscriber’s Unregistered Securities may be sold without volume restrictions pursuant to Rule 144 as determined by counsel to Company pursuant to a written opinion letter to such effect, addressed and acceptable to Company’s transfer agent.

(e)

Access to Information. The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith files reports and other information (the “Company’s SEC Filings”) with the SEC. Subscriber acknowledges and agrees that it has been provided with copies of or has access to such filings and has reviewed such filings as Subscriber has deemed necessary or desirable including Company’s Annual Report on Form 10-KSB for the period ended June 30, 2002, Company’s Quarterly Reports on Form 10-QSB for the periods ended September 30, 2002, December 31, 2002 and March 31, 2003, Company’s Proxy Statement on Form 14A filed May 17, 2002, Company’s Form S-3 Registration Statement filed on February 25, 2002, and Company’s Current Report on Form 8-K filed September 20, 2002. Subscriber and its representatives have been afforded full and free access to books, records, contracts, documents, and other information concerning Company and the contemplated transaction and further have been afforded an opportunity to ask such questions of the officers, employees, agents, accountants and representatives of Company concerning the business, operations, financial condition, assets, liabilities, prospects and other relevant matters as Subscriber and its representatives have deemed necessary or desirable, and Subscriber hereby confirms that it or its agents have been given all such information as has been requested in order to evaluate the merits and risks of the prospective investment contemplated hereby and that it does not desire any additional information. Without limiting the foregoing, Subscriber specifically acknowledges that Subscriber has had the opportunity to review Company’s SEC Filings. Subscriber acknowledges that certain of the information provided to Subscriber and information relating to Company is confidential and proprietary and is being provided to Subscriber solely for Subscriber’s confidential use with the express understanding that Subscriber will not disclose such information to any person or use such information other than for the purpose of evaluating Subscriber’s purchase of the Shares.

(f)

Risk Factors. Subscriber understands and acknowledges that an investment in the Shares is highly speculative and includes a high degree of risk, including, but not limited to, those risks specifically set forth in Company’s Quarterly Report or Form 10-QSB for the period ending March 31, 2003 and Company’s Form S-3 Registration Statement filed on February 25, 2002, each of which, by its signature below, Subscriber acknowledges it has reviewed. Subscriber specifically acknowledges that (i) the price of Company Common Stock has been volatile and future sales of Shares by Company could increase such volatility, (ii) the exercise of outstanding options and warrants could substantially dilute existing stockholders and could have a negative effect on Company’s stock price, (iii) the future sales of restricted securities could have a negative effect on Company’s stock price, (iv) Company’s Common Stock is presently listed and trading on AMEX. The Company believes that it meets the standards for continued listing but such a determination is subjective and no assurance can be given that AMEX will agree or that Company will be trading on AMEX at the time any Subscriber is able to sell the shares under applicable securities laws, (v) Company and its subsidiaries have been incurring operating losses and may not achieve or sustain profitability, (vi) Company may be unable to successfully execute its acquisition strategy, (vii) Company’s acquisition strategy has and will continue to dilute current stockholders’ ownership, (viii) Company depends on certain important employees, and the loss of any of those employees may harm its business, (ix) a large portion of debt matured in August, 2003 and Company did not have sufficient cash to repay such debt, accordingly, Company is currently negotiating with debt holders to extend or convert such indebtedness and may be unsuccessful in extending a substantial portion of the debt; alternatively, the conversion of debt by existing debt holders of Company and its subsidiaries could substantially dilute existing stockholders and have a negative effect on the stock price, (x) If Company is unable to raise

funds through a private placement or obtain other financing, Company may not be able to continue its operations, (xi) Lifestyle Innovations, Inc. (“LFSI”) lacks an active market for its common stock and the price of LFSI Common Stock has been volatile, (xii) LFSI and its subsidiaries’ limited operating histories makes it difficult to evaluate future prospects and accordingly, future results are uncertain, (xiii) LFSI and its subsidiaries have been incurring operating losses and may not achieve or sustain profitability, (xiv) if LFSI is unable to raise funds through a private placement or obtain other financing, LFSI and its subsidiaries may not be able to continue its operations, (xv) if Company’s aviation travel services business does not produce revenue as forecasted, then Company will need to raise additional capital sooner than expected, and (xvi) aviation services contracts of Company’s aviation travel services business may result in losses.

(g)

Independent Action. Subscriber and its representatives have been solely responsible for Subscriber’s own “due diligence” investigation of this investment, for Subscriber’s own analysis of the merits and risks of this investment and for its own analysis of the fairness and desirability of the terms of the investment. In taking any action or performing any role relative to the arranging of the proposed investment, Subscriber has acted solely in its own interest and neither Subscriber nor any of Subscriber’s agents or employees has acted as an agent of Company.

(h)

Tax Effects. Subscriber acknowledges that Subscriber has relied solely upon Subscriber’s own tax advisors with respect to all tax matters related to this investment.

(i)

Subscriber. Subscriber represents and warrants that (i) Subscriber is an “accredited investor” (as noted in Appendix A hereto), (ii) Subscriber has such knowledge and experience in business and financial matters to enable Subscriber to utilize the information given to Subscriber in connection with this investment in order for Subscriber to evaluate the merits and risks of the investment and to make an informed investment decision, (iii) Subscriber has no need for liquidity in this investment, (iv) Subscriber is aware of and able to bear the risks of the investment for an indefinite period of time, (v) currently, and based on existing conditions, Subscriber is able to afford a complete loss of such investment, and (vi) this investment is not disproportionate to Subscriber’s net worth.

(j)

Shares; Reliance, etc. Subscriber acknowledges, represents and agrees and is aware that:

(1)

no federal or state agency has passed upon the Shares or made any finding or determination as to the fairness of an investment in the Shares;

(2)

there are significant risks of loss of investment incidental to the purchase of the Shares including, but not limited to, those risks specifically set forth in Company’s Quarterly Report on Form 10-QSB for the period ending March 31, 2003 on file with the SEC and Company’s Form S-3 Registration Statement filed with the SEC on February 25, 2002, and those risks set forth herein;

(3)

there are substantial restrictions on the transferability of the Shares and all portions thereof;

(4)

the representations, warranties, agreements, undertakings and acknowledgements made by Subscriber in this Subscription are made with the intent that they be relied upon by Company in determining the suitability of Subscriber as a purchaser of the Shares, and Subscriber undertakes to immediately notify Company of any change in any representation, warranty or other information relating to Subscriber set forth herein;

(5)

neither the financial performance of Company nor the value of the Shares has been represented, guaranteed or warranted to Subscriber by Company, its directors, officers, agents or employees or any other person either expressly or by implication; and

(6)

Subscriber has not received with respect to this investment any general or public solicitation or advertising.

(k)

Financial Position; Business Experience. Any information which Subscriber has heretofore furnished to Company with respect to its financial position and business experience is correct and complete as of the date of this Subscription and if there should be any material change in such information prior to the issuance of any portion of the Shares to Subscriber, Subscriber will immediately furnish such revised or corrected information to Company.

Subscriber hereby acknowledges and agrees that Subscriber is not entitled to cancel, terminate or revoke this Subscription or any agreements of Subscriber hereunder and that this Subscription shall survive the dissolution, death or disability of Subscriber.

Subscriber understands the meaning of legal consequences of the representations and warranties contained herein and hereby agrees to indemnify Company, its directors, officers, agents and employees from and against any and all loss, claim, damage or liability due to or arising out of a breach of any representation or warranty of Subscriber contained in this Subscription.

(a)

Arbitration of Disputes. Any dispute, claim or controversy arising out of or relating to this Subscription, or the breach, termination or invalidity hereof (referred to herein as a “Dispute”), shall be finally settled exclusively by arbitration, which shall be administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules. The interpretation and enforcement of this Section 5 shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1 et seq. All arbitrations shall take place in Charlotte, North Carolina.

(b)

Procedure. As soon as a demand for arbitration shall be made, the parties to the Dispute shall promptly seek in good faith to agree on the selection of a single arbitrator. If a single arbitrator is selected by agreement and agrees to serve, the remaining provisions of this Section 5 shall apply to the proceeding, except that references herein to the “Arbitration Panel” shall mean the single arbitrator. If no single arbitrator has been selected and agreed to serve as provided above within fifteen (15) business days after the demand for arbitration is received by the respondent(s), the parties will select a panel of three (3) arbitrators (the “Arbitration Panel”), one selected by Company, one selected by Subscriber, and one selected by mutual agreement of the arbitrators selected, respectively, by Company and Subscriber.

(c)

Powers of the Arbitration Panel. The Arbitration Panel shall be empowered to render full and complete resolution of the Dispute, but shall not be empowered to award punitive or consequential damages. Each party shall bear the costs of its respective attorneys and will share on an equal basis the costs of the Arbitration Panel. The Arbitration Panel shall also have the authority and discretion to order, as it sees fit, the payment of the attorneys’ fees of the parties to the Dispute and any and all expenses of the arbitration, including payment of the arbitrators’ compensation. In the event the Arbitration Panel finds that any party to the Dispute has abused or failed to comply with the applicable arbitration or discovery provisions in this

Subscription or in the Commercial Arbitration Rules, the Arbitration Panel shall be empowered to render any sanction that would otherwise be available under the Federal Rules of Civil Procedure.

(d)

Consolidation of Arbitrations. If an arbitration is pending hereunder and a subsequent arbitration of a Dispute is commenced under this Subscription that arises out of or relates to the same facts or transactions as the Dispute in the pending arbitration, the Arbitration Panel in the pending arbitration shall, at the request of any party to that arbitration, consolidate the subsequently filed arbitration with the pending arbitration unless such consolidation will result in substantial additional costs or delay or substantial prejudice to a party. If the Arbitration Panel fails to make such an order of consolidation, then the parties may apply to a court of competent jurisdiction for such an order. The Arbitration Panel in the pending arbitration shall hear and finally decide any such consolidated arbitration under the procedures provided in this Section 5.

(a)

Governing Law; Forum Selection Clause. This Subscription shall be governed by and construed in accordance with the laws of the State of Delaware. Further, the parties agree that any Disputes arising hereunder shall be governed by the arbitration provisions set forth in Section 5 hereof and any litigation relating thereto shall take place in the federal or state courts in Charlotte, North Carolina.

(b)

Severability. Any term or provision of this Subscription which is invalid or unenforceable in any jurisdiction shall be ineffective to the extent of such invalidity or unenforceability without invalidating or rendering unenforceable the remaining terms or provisions hereof. Any such invalidity or unenforceability in any such jurisdiction shall not invalidate or render unenforceable such term or provision in any other jurisdiction.

(c)

Entire Agreement. This Subscription constitutes the entire agreement among the parties hereto with respect to the subject matter hereof, and neither this Subscription nor any provisions hereof shall be waived, changed, discharged or terminated except by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought.

(d)

Binding Nature. Except as otherwise provided herein, this Subscription shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors, executors, administrators, legal representatives and permitted assigns.

(e)

Limitation on Transfer. Subscriber agrees not to transfer or assign this Subscription, or any of Subscriber’s interest or rights herein, and further agrees that the transfer or assignment of the Shares, or any portion thereof, shall be made only in accordance with this Subscription and all applicable laws, rules and regulations.

(f)

Variation of Pronouns. All pronouns and any variations thereof shall be deemed to refer to masculine, feminine, or neuter, singular or plural, as the identity of the person or entity may require.

(g)

Survival. The representations and warranties contained on this Subscription shall survive the closing of the transaction contemplated hereby.

(h)

Counterparts. This Subscription may be executed in any number of counterparts (whether by facsimile or otherwise), each of which shall be deemed an original, but all of which together shall constitute but one and the same agreement.

IN WITNESS WHEREOF, Subscriber has executed this Subscription and Investment Representation Agreement as of the day and year first above written.

The provisions of the foregoing Subscription and Investment Representation Agreement are accepted and consented to by Company this day of September, 2003.

The following summarizes the applicable provisions for determining whether an offeree is an “accredited investor” for purposes of federal securities laws. Each offeree should check the line to the left of each provision which applies to the offeree. After completing Appendix A, please sign and date the form where noted on page A-2.

For purposes of federal law, “accredited investors” are defined as any person who comes within any one of the following categories, or whom the issuer reasonably believes comes within any one of the following categories, at the time of the sale of the securities to that person:


				(1)		Any natural person whose individual net worth, or joint net worth with that person’s spouse, at the time of purchase exceeds $1,000,000;
				(2)		Any natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year;
				(3)		Any bank as defined in Section 3(a)(2) of the Act or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; any insurance company as defined in Section 15 of the Securities and Exchange Act of 1934; any insurance company as defined in Section 2(13) of the Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; any Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors;
				(4)		Any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;
				(5)		Any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;
				(6)		Any director, executive officer, or general partner of the issuer of the securities being offered or sold, or any director, executive officer, or general partner of a general partner of the issuer;
				(7)		Any trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii); or
				(8)		Any entity in which all of the equity owners are accredited investors.

Subscriber represents and warrants that it is an “accredited investor” under federal law by virtue of satisfying the category or categories checked above.

EX-5.1 4 g86467exv5w1.htm EX-5.1 OPINION OF ADORNO & YOSS, P.A. EX-5.1 Opinion of Adorno & Yoss, P.A.

As counsel to RCG Companies Incorporated, a Delaware corporation (the “Company”), we have assisted in the preparation of the Company’s Registration Statement on Form S-3 (the “Registration Statement”), filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended, covering up to 6,775,285 shares (the “Shares”), including 2,742,857 shares underlying warrants (the “ Warrant Shares”) of the Company’s common stock, par value $.04 per share (the “Common Stock”), which may be distributed, sold or otherwise transferred from time to time by and for the account of the holders thereof (the “Selling Stockholders”).

In rendering our opinion, we have examined and considered the original or copies, certified or otherwise identified to our satisfaction, of the Company’s Articles of Incorporation, as amended to date, its Bylaws, as amended to date, resolutions of its Board of Directors, the Registration Statement, and such other documents and corporate records relating to the Company and the issuance and sale of the Shares as we have deemed appropriate for purposes of rendering this opinion.

In all examinations of documents, instruments and other papers, we have assumed the genuineness of all signatures on original and certified documents and the conformity to original and certified documents of all copies submitted to us as conformed, Photostat or other copies. As to matters of fact which have not been independently established, we have relied upon representations of officers of the Company.

Based upon the foregoing examination, and the information thus supplied, it is our opinion that:

(2)

The Warrant Shares have been duly and validly authorized, and upon payment of the exercise price in accordance with the applicable agreements, and assuming no change in the applicable law or facts, will be legally issued, fully paid and non-assessable.

We hereby expressly consent to the reference to our firm in the Registration Statement under the Prospectus caption “Legal Matters,” to the inclusion of this opinion as an exhibit to the Registration Statement, and to the filing of this opinion with any other appropriate government agency. In giving such consent, we do not admit that we come within the category of persons whose consent is required by Section 7 of the Act or the rules and regulations of the Commission promulgated thereunder.

EX-23.2 5 g86467exv23w2.htm EX-23.2 CONSENT OF CRISP HUGHES EVANS LLP EX-23.2 Consent of Crisp Hughes Evans LLP

We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated October 10, 2003 with respect to the audits of the consolidated financial statements of RCG Companies Incorporated (formerly known as eResource Capital Group, Inc.) and Subsidiaries for the years ended June 30, 2003 and 2002 included in its Annual Report (Form 10-KSB) filed with the Securities and Exchange Commission on October 14, 2003. We further consent to the reference to our firm under the heading “Experts” in the prospectus contained in this Registration Statement.


Delaware		23-2265039

(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)


RISK FACTORS
FORWARD-LOOKING STATEMENTS
OFFERING SUMMARY
ABOUT THE COMPANY
USE OF PROCEEDS
DESCRIPTION OF COMMON STOCK
SELLING STOCKHOLDERS
PLAN OF DISTRIBUTION
LEGAL MATTERS
EXPERTS
WHERE YOU CAN FIND MORE INFORMATION
INFORMATION INCORPORATED BY REFERENCE
EX-4.4 Form of Subscription
EX-5.1 Opinion of Adorno & Yoss, P.A.
EX-23.2 Consent of Crisp Hughes Evans LLP

*		Indicates less than 1% beneficial ownership of the outstanding shares of common stock.

(1)		Includes 200,000 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Voting control held by Elizabeth Leonard and Michael Finkelstein.

(2)		Includes 250,000 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Voting control held by Konrad Alerman.

(3)		Includes 312,500 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Voting control held by Paul Kessler.

(4)		Includes 93,750 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Mitchell P. Koplin President of Downsview Capital, Inc., the General Partner of Cranshire Capital, L.P. has sole voting and investment control.

(5)		Includes 468,750 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Mel Craw and Maxi Brezzi, in their capacity as managers of Green Light (Switzerland) SA, the investment advisor to Crescent International Ltd., have voting control and investment discretion over the shares owned by Crescent International Ltd. Messrs. Craw and Brezzi disclaim beneficial ownership of such shares.

(6)		Includes 218,750 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004.

(7)		Includes 312,500 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Voting control held by Michael Scholten.

(8)		Includes 93,750 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. * See below for voting control.

(9)		Includes 456,250 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004. Voting control held by Murray Todd.

(10)		Includes 93,750 shares of common stock underlying warrants exercisable at $2.44 per share, which are exercisable commencing April 30, 2004

(11)		Issued pursuant to private placement. Mr. Byer currently serves as a director of the Company.

(12)		Includes 48,660 shares issued pursuant to a private placement and 200,000 shares issued pursuant to debt conversion. Voting control held by Richard Clark.

(13)		Shares issued pursuant to private placement.

(14)		Shares underlie warrants exercisable at $2.45 per share. Voting control held by G. David Gordon.

(15)		Shares issued pursuant to settlement agreement dated August 11, 2003 for services rendered. President of Equity Communications is Ira Weingarten.

(16)		Also includes 100,000 shares of common stock underlying warrants exercisable at $1.60 per share and 100,000 shares of common stock underlying warrants exercisable at $1.85 per share issued in consideration for legal services.

(17)		Includes up to 225,000 shares of common stock issuable pursuant to acquisition of Computer Inventory Control, Inc.’s assets. Voting control held by Michael Gold.

(18)		In addition to the securities described under Footnote 16, interests also include 275,658 shares issues for debt conversion; 100,000 shares of common stock owned by the wife of Mr. Gordon; and 135,714 shares of common stock underlying warrants. Mr. Gordon is the majority shareholder of Delvest, Inc. Securities held by Delvest, Inc. are not included under Mr. Gordon’s individual ownership interests. In addition to being a creditor of the Company, Mr. Gordon provides legal services to the Company and is a significant franchisee of Lifestyle Innovations.

(19)		Includes 85,000 shares of common stock underlying options, of which 42,500 are currently vested. 21,250 of the remaining options vest on each of March 16, 2003 and June 16, 2004.

(20)		Includes 24,000 shares of common stock underlying warrants.

(21)		Voting control of Perfect Timing, LLC held by Lisa E. Mannion.


SEC Registration Fee		$	1,203.92
Legal Fees and Expenses			*$15,000
Accounting and other Miscellaneous Fees and Expenses			*$10,000

	Total	$	26,203.92


Date: December 23, 2003		/s/ Michael D. Pruitt Michael D. Pruitt President and Chief Executive Officer Principal Executive Officer and Principal Financial Officer



Date: December 23, 2003		/s/ Jeffrey F. Willmott Jeffrey F. Willmott Chairman of the Board



Date: December 23, 2003		/s/ Dr. James A. Verbrugge Dr. James A. Verbrugge Director



Date: December 23, 2003		/s/ P. Roger Byer P. Roger Byer Director

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents


	Page

Risk Factors		1
Forward-Looking Statements		5
Offering Summary		5
About the Company		6
Use of Proceeds		10
Description of Common Stock		10
Selling Stockholders		11
Plan of Distribution		15
Legal Matters		16
Experts		16
Where You Can Find More Information		16
Incorporation of Certain Documents by Reference		16


				RCG Companies Incorporated a Delaware corporation

		By:		/s/ Michael D. Pruitt Michael D. Pruitt Chief Executive Officer and President


Exhibit
Number		Exhibit

4.4		Form of Subscription and Investment Representation Agreement, September 2003 Private Placement.

5.1		Legal Opinion with respect to due issuance and Consent of Adorno & Yoss, P.A.

23.1		Consent of Adorno & Yoss, P.A. (included in Exhibit 5.1)

23.2		Consent of Independent Accountants.


INDIVIDUAL INVESTOR:		CORPORATE (or other entity) INVESTOR:

X		Name of Entity:


Print Name:		By:


Social Security Number:		Print Name:
		Title:


		EIN:


Residence Address (if an individual):		Business Address (if not an individual):



Telephone:		Telephone:

Facsimile:		Facsimile:


		eRESOURCE CAPITAL GROUP, INC


		By:

		Name: Michael D. Pruitt Title: President