<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): FEBRUARY 7, 1997
SIGNATURE RESORTS, INC.
(Exact Name of Registrant as
Specified in its Charter)
MARYLAND 000-21193 95-4582157
(State or Other (Commission (IRS Employer
Jurisdiction of File Identification
Incorporation) Number) No.)
5933 WEST CENTURY BOULEVARD, SUITE 210
LOS ANGELES, CALIFORNIA 90045
(Address of Principal
Executive Offices)
(310) 348-1000
(Registrant's telephone
number, including area code)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
In September 1996, Signature Resorts, Inc. ("Signature") entered into
a definitive agreement and plan of merger (as amended, the "Merger Agreement")
to acquire AVCOM International, Inc. ("AVCOM"), the parent company of All
Seasons Resorts, Inc. ("All Seasons"), a developer, marketer and operator of
timeshare resorts in Arizona, California and Texas. Prior to the consummation
of the Merger (as defined below), AVCOM operated nine resorts (including two
under construction) and held a partial ownership interest in another. Five of
these resorts are located in Sedona, Arizona, two are located in South Lake
Tahoe, California and one resort is located in each of Lake Arrowhead,
California, Lake Conroe (near Houston), Texas and Scottsdale, Arizona. Signature
currently intends to continue to operate the resorts subsequent to the Merger.
On February 7, 1997, pursuant to the Merger Agreement, ASP Acquisition
Corp., a Delaware corporation and a wholly owned subsidiary of Signature ("ASP")
merged with and into AVCOM (the "Merger"), with AVCOM surviving the Merger.
Pursuant to the Merger Agreement, Signature is required to issue approximately
$32.6 million (subject to adjustment for certain contingencies) worth of its
common stock, par value $0.01 per share ("Signature Common Stock"), at the
effective time of the Merger. Accordingly, at such time, each outstanding share
of common stock, par value $.01 per share, of AVCOM outstanding immediately
prior to the effective time of the Merger was converted into the right to
receive a specified number of shares of Signature Common Stock, resulting in a
total of approximately 883,000 shares of Signature Common Stock becoming
issuable by Signature in connection with the Merger. Signature intends to
account for the Merger as a pooling of interests.
In order to establish a procedure for the satisfaction of any claims
by Signature for indemnification pursuant to the Merger Agreement, AVCOM agreed
in the Merger Agreement to deposit 10% of the aggregate shares of the Signature
Common Stock to be issued by Signature in the Merger into an escrow to be
governed by an escrow agreement by and among, Signature, AVCOM, Gary L. Hughes
and Robert M. Eckenroth, the Chief Executive Officer and Senior Vice President
and Chief Financial Officer of AVCOM, respectively, and Chicago Title Company
(the "Escrow Agreement"). Pursuant to the Escrow Agreement, all stock splits or
dividends payable in stock or other securities of Signature that are made by
Signature with respect to the escrowed shares, will be deposited into escrow and
governed by the Escrow Agreement.
Additionally, each of AVCOM and Messrs. Hughes and John R. Stevens,
the former Director of Marketing and New Products of AVCOM, respectively, has
agreed to indemnify Signature from and against all expenses and damages
(including, without limitation, all related attorneys' fees and expenses)
arising out of any breach of a representation or warranty made by AVCOM in the
Merger Agreement, any breach of the covenants or agreements made by AVCOM in the
Merger Agreement, or any inaccuracy in any certificate delivered by AVCOM
pursuant to the Merger Agreement.
Pursuant to the terms of the Merger Agreement, upon the effectiveness
of the Merger, Signature entered into a three year employment agreement with
Gary Hughes, providing for an initial base salary of $225,000 and the grant of
certain options to purchase Signature Common Stock.
For additional information concerning a description of the Merger
Agreement, AVCOM's assets, the terms of the Escrow Agreement, the indemnity
obligations of AVCOM and Messrs. Hughes and Stevens and the employment agreement
and options granted to Mr. Hughes, reference is made to Signature's Registration
Statement on Form S-4 (No. 333-16339).
2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
---------------------------------
(a) Financial statements of businesses acquired. The financial
-------------------------------------------
statements of AVCOM required by this Item 7(a) are incorporated herein by
reference to the financial statements of AVCOM set forth in Signature's
Registration Statement on Form S-1 (No. 333-18447).
(b) Pro forma financial information. The pro forma financial
-------------------------------
information of Signature, including the effects of the Merger, required by this
Item 7(b) is incorporated herein by reference to the pro forma financial
information of Signature set forth in Signature's Registration Statement on Form
S-1 (No. 333-18447).
(c) Exhibits.
--------
2.1 Agreement and Plan of Merger dated as of September 22,
1996 by and between Signature and Avcom, as amended
(incorporated by reference to Signature's Registration
Statement on Form S-4 (No. 333-16339)).
2.2 Form of Escrow Agreement by and among, Signature, AVCOM,
Gary L. Hughes, Robert M. Eckenroth and Chicago Title
Company (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
10.1 Form of Employment Agreement between Signature and Gary L.
Hughes (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
10.2 Form of Option Agreement between Signature and Gary L.
Hughes (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
23 Consent of Ernst & Young LLP.*
* Filed herewith.
3
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
SIGNATURE RESORTS, INC.
By: \s\ Andrew D. Hutton
-----------------------------------------
Name: Andrew D. Hutton
Dated: February 14, 1997 Title: Vice President and General Counsel
S-1
<PAGE>
EXHIBIT INDEX
-------------
2.1 Agreement and Plan of Merger dated as of September 22,
1996 by and between Signature and Avcom, as amended
(incorporated by reference to Signature's Registration
Statement on Form S-4 (No. 333-16339)).
2.2 Form of Escrow Agreement by and among, Signature, AVCOM,
Gary L. Hughes, Robert M. Eckenroth and Chicago Title
Company (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
10.1 Form of Employment Agreement between Signature and Gary L.
Hughes (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
10.2 Form of Option Agreement between Signature and Gary L.
Hughes (incorporated by reference to Signature's
Registration Statement on Form S-4 (No. 333-16339)).
23 Consent of Ernst & Young LLP.*
* Filed herewith.
E-1
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Current Report on Form
8-K, dated February 7, 1997, of Signature Resorts, Inc. of our report dated May
31, 1996, except for Note 12, as to which the date is July 1, 1996, with respect
to the consolidated financial statements of AVCOM International, Inc. as of
December 31, 1994 and 1995 and for each of the three years in the period ended
December 31, 1995, included in the Registration Statement, as amended (Form S-1
No. 333-18447) of Signature Resorts, Inc.
ERNST & YOUNG LLP
Phoenix, Arizona
February 14, 1997
