<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-1
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
(AMENDMENT NO. 2)
----------
AMERICAN RESIDENTIAL HOLDING CORPORATION
(Name of Subject Company)
----------
CHAMRES, INC.
CHASE MANHATTAN MORTGAGE HOLDINGS, INC.
THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION)
THE CHASE MANHATTAN CORPORATION
(Bidders)
----------
Common Stock, par value $.04 per share
(Title of Class of Securities)
02926R107
(CUSIP Number of Class of Securities)
----------
ROBERT J. JACOBS, ESQ.
Senior Vice President and Secretary
Chase Manhattan Mortgage Holdings, Inc.
4915 Independence Parkway
FSII-2
Tampa, Florida 33634-7523
Telephone Number (813) 891-2038
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidders)
----------
with copies to:
ALBERT F. LILLEY, ESQ.
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005-1413
Telephone: (212) 530-5754
<PAGE>
CUSIP NO. 02926R107 14D-1 Page 2 of 5
<TABLE>
<S> <C> <C>
1 Name of Reporting Persons: Chamres, Inc.
S.S. or I.R.S. Identification No. of Above Persons: 59-3257990
- --------------------------------------------------------------------------------------
2 Check the Appropriate box if a Member of a Group (See Instructions) (a) [__]
(b) [__]
- --------------------------------------------------------------------------------------
3 SEC Use Only (b) [__]
- --------------------------------------------------------------------------------------
4 Source of Funds (See Instructions)
AF (b) [__]
- --------------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f). [__]
- --------------------------------------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- --------------------------------------------------------------------------------------
7 Aggregate Amount Beneficially Owned by Each Reporting Person
11,326,534
- --------------------------------------------------------------------------------------
8 Check if the Aggregate Amount in Row 7 Excludes Certain Shares
(See Instructions). [__]
- --------------------------------------------------------------------------------------
9 Percent of Class Represented by Amount in Row 7
96.3%
- --------------------------------------------------------------------------------------
10 Type of Reporting Person (See Instructions)
CO
- --------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CUSIP NO. 02926R107 14D-1 Page 3 of 5
<TABLE>
<S> <C> <C>
1 Name of Reporting Persons: Chase Manhattan Mortgage Holdings, Inc.
S.S. or I.R.S. Identification No. of Above Persons: 59-3187852
- --------------------------------------------------------------------------------------
2 Check the Appropriate box if a Member of a Group (See Instructions) (a) [__]
(b) [__]
- --------------------------------------------------------------------------------------
3 SEC Use Only
- --------------------------------------------------------------------------------------
4 Source of Funds (See Instructions)
AF
- --------------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f). [__]
- --------------------------------------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- --------------------------------------------------------------------------------------
7 Aggregate Amount Beneficially Owned by Each Reporting Person
11,326,534
- --------------------------------------------------------------------------------------
8 Check if the Aggregate Amount in Row 7 Excludes Certain Shares
(See Instructions). [__]
- --------------------------------------------------------------------------------------
9 Percent of Class Represented by Amount in Row 7
96.3%
- --------------------------------------------------------------------------------------
10 Type of Reporting Person (See Instructions)
CO
- --------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CUSIP NO. 02926R107 14D-1 Page 4 of 5
<TABLE>
<S> <C> <C>
1 Name of Reporting Persons: The Chase Manhattan Bank (National Association)
S.S. or I.R.S. Identification No. of Above Persons: 13-2633612
- --------------------------------------------------------------------------------------
2 Check the Appropriate box if a Member of a Group (See Instructions) (a) [__]
(b) [__]
- --------------------------------------------------------------------------------------
3 SEC Use Only
- --------------------------------------------------------------------------------------
4 Source of Funds (See Instructions)
WC
- --------------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f). [__]
- --------------------------------------------------------------------------------------
6 Citizenship or Place of Organization
Organized under the laws of the United States
- --------------------------------------------------------------------------------------
7 Aggregate Amount Beneficially Owned by Each Reporting Person
11,326,534
- --------------------------------------------------------------------------------------
8 Check if the Aggregate Amount in Row 7 Excludes Certain Shares
(See Instructions). [__]
- --------------------------------------------------------------------------------------
9 Percent of Class Represented by Amount in Row 7
96.3%
- --------------------------------------------------------------------------------------
10 Type of Reporting Person (See Instructions)
BK
- --------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CUSIP NO. 02926R107 14D-1 Page 5 of 5
<TABLE>
<S> <C> <C>
1 Name of Reporting Persons: The Chase Manhattan Corporation
S.S. or I.R.S. Identification No. of Above Persons: 13-2633613
- --------------------------------------------------------------------------------------
2 Check the Appropriate box if a Member of a Group (See Instructions) (a) [__]
(b) [__]
- --------------------------------------------------------------------------------------
3 SEC Use Only
- --------------------------------------------------------------------------------------
4 Source of Funds (See Instructions)
AF
- --------------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f). [__]
- --------------------------------------------------------------------------------------
6 Citizenship or Place of Organization
Delaware
- --------------------------------------------------------------------------------------
7 Aggregate Amount Beneficially Owned by Each Reporting Person
11,326,534
- --------------------------------------------------------------------------------------
8 Check if the Aggregate Amount in Row 7 Excludes Certain Shares
(See Instructions). [__]
- --------------------------------------------------------------------------------------
9 Percent of Class Represented by Amount in Row 7
96.3%
- --------------------------------------------------------------------------------------
10 Type of Reporting Person (See Instructions)
HC
- --------------------------------------------------------------------------------------
</TABLE>
<PAGE>
This Amendment No. 2 to Schedule 14D-1 relates to the offer by Chamres,
Inc., a Delaware corporation (the "Purchaser") and an indirect wholly-owned
subsidiary of The Chase Manhattan Bank (National Association), a national
banking association ("Parent"), to purchase all outstanding shares of Common
Stock, par value $.04 per share (the "Common Stock"), of American Residential
Holding Corporation, a Delaware corporation (the "Company"), at a price of
$28.25 per share of Common Stock, net to seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated August 9,
1994 and in the related Letter of Transmittal, copies of which were attached as
Exhibits 99.(a)(1) and 99.(a)(2) to the Schedule 14D-1 filed with the Securities
and Exchange Commission on August 9, 1994. The purpose of this Amendment No. 2
is to amend and supplement Items 3,4,5,6 and 10 to include the additional
information set forth below, and to amend and supplement Item 11 of the
Schedule 14D-1 to add the exhibit(s) set forth below.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY
Item 3 is hereby amended and supplemented as follows:
On September 7, 1994, the Purchaser entered into an Employment Agreement
with James P. Gilcrest who is currently Executive Vice President and Chief
Operating Officer of the Company. A copy of this Employment Agreement is filed
as Exhibit 99.(c)(2) hereto and is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 4 hereby amended and supplemented as follows:
On September 6, 1994, the Purchaser received a capital contribution of
$350 million from Parent for the purpose of purchasing the Common Stock pursuant
to the Offer.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE
BIDDERS.
Item 5 is hereby amended and supplement as follows:
On September 8, 1994, following the Purchaser's acquisition of
approximately 11,300,000 shares of Common Stock, representing approximately 96%
of the outstanding Common Stock, the Purchaser effected the merger of the
Purchaser with and into the Company as a short-form merger pursuant to the
applicable provisions of the Delaware General Corporation Law.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
Item 6 is hereby amended and supplemented as follows:
On September 8, 1994, the Purchaser was informed that a total of
approximately 11,300,000 shares of Common Stock had been validly tendered
pursuant to the Offer and not withdrawn. The Purchaser accepted for payment, and
paid for, all such shares of Common Stock by depositing the purchase price
therefore with the Depositary, as agent for the tendering stockholders. A copy
of the press release relating to the foregoing is filed as Exhibit 99.(a)(11)
hereto and is incorporated herein by reference.
ITEM 10. ADDITIONAL INFORMATION
Item 10 is hereby amended and supplemented as follows:
On August 26, 1994, the class action lawsuit, styled 7547 Partners, a
----------------
Florida partnership v. American Residential Holding Corporation, John M.
- ------------------------------------------------------------------------
Robbins, Jr., Matthew J. Shevlin, Jr., Samuel A. Alvarado, Bruce K. Anderson,
- -----------------------------------------------------------------------------
James A. Conroy, Thomas E. McInerney, Mark J. Riedy and The Chase Manhattan
- ---------------------------------------------------------------------------
Corporation, Case No. 13655, was dismissed by Order of the Delaware Chencery
- -----------
Court, without prejudice, upon application of the attorneys for the plaintiff in
that action.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
99.(a)(11) Text of Press Release issued by The Chase Manhattan Corporation,
dated September 8, 1994.
99.(c)(2) Employment Agreement, dated as of September 7, 1994, between the
Purchaser and James P. Gilcrest
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: September 8, 1994
CHAMRES, INC.
By /s/ Robert J. Jacobs
--------------------------------
Name: Robert J. Jacobs
Title: Senior Vice President
and Secretary
CHASE MANHATTAN MORTGAGE HOLDINGS, INC.
By /s/ Robert J. Jacobs
----------------------------------
Name: Robert J. Jacobs
Title: Senior Vice President
and Secretary
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By /s/ Arjun K. Mathrani
----------------------------------
Name: Arjun K. Mathrani
Title: Chief Financial Officer
Executive Vice President
THE CHASE MANHATTAN CORPORATION
By /s/ Arjun K. Mathrani
----------------------------------
Name: Arjun K. Mathrani
Title: Chief Financial Officer
Executive Vice President
<PAGE>
EXHIBIT INDEX
Exhibit Page No.
99.(a)(11) Text of Press Release issued by The Chase Manhattan Corporation,
dated September 8, 1994.
99.(c)(2) Employment Agreement, dated as of September 7, 1994, between the
Purchaser and James P. Gilcrest
<PAGE>
Exhibit 99.(a)(11)
September 8, 1994
Charlotte Gilbert - Media
(212) 552-4507
William Maletz - Investor
(212) 552-5329
CHASE MANHATTAN COMPLETES ACQUISITION OF
AMERICAN RESIDENTIAL
The Chase Manhattan Corporation (CMB, NYSE) announced today the
successful completion by Chamres, Inc., its wholly-owned subsidiary, of its
all-cash tender offer for all of the outstanding shares of common stock of
American Residential Holding Corporation (AMRS, NASDAQ) at $28.25 per share. The
tender offer expired at midnight, New York City time, on Wednesday, September 7,
1994. Chamres has been informed by the depositary for the tender offer that,
based upon a preliminary count, approximately 11,285,000 AMRS shares had been
tendered into the offer and not withdrawn. Chamres has accepted and will pay
for, in accordance with the terms of the offer, all of the shares validly
tendered.
The shares tendered constitute approximately 96% of AMRS' presently
outstanding common stock. As previously announced, all AMRS common shares not
tendered and purchased pursuant to the offer will be acquired in a subsequent
merger transaction at the same $28.25 per share price.
* * * *
<PAGE>
Exhibit 99.(c)(2)
EMPLOYMENT AGREEMENT
--------------------
This Agreement (this "Agreement"), dated as of September 7, 1994, is made
by and between Chamres, Inc., a Delaware corporation (the "Corporation") and Mr.
James P. Gilcrest (the "Executive") residing at 424 Santa Dominga, Solana Beach,
California 92075.
Recitals
--------
1. The Executive is currently employed by American Residential Holding
Corporation, a Delaware corporation ("ARHC"), having its principal offices at
11119 North Torrey Pines Road, La Jolla, California 92037-1009.
2. The Corporation and ARHC have entered into a Merger Agreement, dated as
of August 3, 1994 (the "Merger Agreement"), among the Corporation, ARHC and The
Chase Manhattan Bank, N.A., a national banking association ("Chase"), of which
the Corporation is a wholly-owned subsidiary, pursuant to which, among other
things, the Corporation will acquire control of ARHC by way of a tender offer
for all of the common stock of ARHC (the "Tender Offer") followed by a merger of
the Corporation with and into ARHC (the "Merger"), with ARHC as the surviving
corporation (the "Surviving Corporation").
3. In the event that the Corporation purchases, pursuant to the Tender
Offer, shares of the common stock of ARHC constituting at least a majority of
the outstanding shares of common stock of ARHC, the Corporation desires to
employ key employees of ARHC in an effort to preserve the business of ARHC and
to protect the Corporation's investment in ARHC pursuant to the Merger
Agreement.
4. In connection with the transactions contemplated in the Merger
Agreement, the Corporation desires to employ the Executive and to enter into an
employment agreement embodying the terms of such relationship.
5. The Executive is willing to be employed by the Corporation on the terms
set forth herein.
Agreement
---------
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and for other good and valuable consideration, the Corporation
and the Executive hereby agree as follows.
1. Definitions. As used in the Agreement, the following terms shall have
------------
the meanings assigned to them below.
<PAGE>
2
1.1 "Affiliate" means, with respect to any person or entity, any person or
entity of any kind effectively controlling, effectively controlled by or under
common control with such person or entity.
1.2 "ARHC II" means ARHC, the Surviving Corporation or their successors,
after the Commencement Date (as defined in Section 3 of this Agreement).
1.3 "Board" means the Board of Directors of ARHC II.
1.4 "Cause" means (i) the commission of a crime against ARHC II, its
Affiliates, customers or employees, whether prosecuted or not; (ii) the
commission of any other crime or violation of law, statute or regulation which
creates an inability to perform job duties; (iii) the failure or inability to
perform job duties due to intoxication by drugs or alcohol; (iv) the taking of
actions that constitute a conflict of interest, not specifically waived by ARHC
II; (v) the unauthorized release of confidential information about ARHC II, its
Affiliates, customers or employees; (vi) the habitual neglect of duties; (vii)
the unsatisfactory performance of job duties; (viii) the violation of insider
trading policy; and (ix) other misconduct including but not limited to (A) the
falsification of the ARHC II's records, including timekeeping records and the
employee's application for employment, (B) illegal discrimination or harassment
of another employee, customer or supplier, (C) theft, (D) destruction of ARHC
II's or another employee's property, (E) possession of firearms, controlled
substances or illegal drugs on the premises of ARHC II, (F) gambling on the
employer's premises, and (G) concealing serious offenses by another employee.
1.5 "Parent" means any corporation which has a direct or indirect legal or
beneficial ownership interest in ARHC II, but only if any such corporation owns
or controls, directly or indirectly, stock possessing at least 50% of the total
combined voting power of all classes of stock of ARHC II.
1.6 "Subsidiary" means any corporation (other than ARHC II) in which ARHC
II or any Parent has a direct or indirect legal or beneficial ownership
interest, but only if ARHC II or the Parent, as the case may be, owns or
controls, directly or indirectly, stock possessing at least 50% of the total
combined voting power of all classes of stock in any such corporation.
2. Employment. Subject to the terms and provisions set forth in this
-----------
Agreement, the Corporation during the Term of Employment (as defined below)
agrees to employ the Executive and the Executive hereby accepts such employment.
<PAGE>
3
3. Term of Agreement.
-----------------
3.1 Term of Employment. The term of employment under this Agreement (the
------------------
"Term of Employment") shall commence as of the earlier of (i) the date of the
acquisition by the Corporation, pursuant to the Tender Offer, of shares of
common stock of ARHC, constituting more than 50% of the outstanding shares of
common stock of ARHC, and the subsequent assignment of the Corporation's rights
and duties under this Agreement to ARHC pursuant to Section 9 of this Agreement
or (ii) the completion of the Merger pursuant to Section 253 of the Delaware
General Corporation Law (the "Commencement Date"). Unless earlier terminated by
the Corporation, ARHC II or the Executive under Section 6 of this Agreement, the
Term of Employment shall continue until December 31, 1995.
3.2 Date Certain. This Agreement shall be automatically terminated if the
------------
Commencement Date does not occur on or before December 31, 1994, and the parties
hereto do not consent in writing prior to such date to extend the date for the
occurrence of the Commencement Date.
4. Title, Responsibilities and Duties.
-----------------------------------
4.1 Title and Duties. During the Term of Employment, the Executive shall
-----------------
initially have the title of President of ARHC II and shall be one of three Chief
Mortgage Origination Officers of Chase's mortgage banking business. The
Executive understands that during course of the Term of Employment his title may
be changed to that of Executive Vice President of a Chase mortgage banking
Affiliate. During the Term of Employment, the Executive shall work closely and
cooperate with Chase's two other geographic mortgage banking managers to
integrate successfully ARHC II's mortgage banking business with the other
mortgage banking businesses operated by Chase or Chase Affiliates and, in
particular, to effectively resolve overlap issues with the business of Chase or
any Chase Affiliates, to the satisfaction of the Chief Mortgage Banking
Executive of Chase. The foregoing duties and responsibilities of the Executive
may be modified from time to time during the Term of Employment by the Chief
Mortgage Banking Executive of Chase. The Executive shall have such other
duties, responsibilities and authority as are designated and assigned to him by
the Chief Mortgage Banking Executive of Chase, or his or her designees, from
time to time during the Term of Employment. The Executive shall serve under the
direction and supervision of, and shall report to, the Chief Mortgage Banking
Executive of Chase or such person's designees.
4.2 Attention to Duties and Responsibilities. During the Term of
-----------------------------------------
Employment, the Executive shall devote his full business time to the business
and affairs of ARHC II and the Executive shall use his best efforts, ability and
fidelity to perform faithfully and efficiently the duties and responsibili-
<PAGE>
4
ties contemplated by this Agreement; provided, however, that the Executive shall
-------- -------
be allowed, to the extent such activities do not substantially interfere with
the performance by the Executive of his duties and responsibilities hereunder,
to (a) manage the Executive's personal affairs, and (b) serve on boards or
committees of civic or charitable organizations or trade associations.
4.3 Place of Employment. During the Term of Employment, the Executive's
-------------------
place of employment shall be located in (or within a 50 mile radius of) La
Jolla, California. In the event that the Corporation shall, during the Term of
Employment, require that the Executive change his place of employment by
relocating to any place outside of a 50 mile radius of La Jolla, California, the
Executive may, at his option, either (i) treat such relocation requirement as a
termination of this Agreement by the Corporation without Cause, in which event
this Agreement shall be deemed to be so terminated, or (ii) accept such
relocation, in which event the Corporation shall pay the reasonable relocation
expenses of the Executive associated with such relocation in accordance with
Chase's normal policies, and this Agreement shall continue in effect.
5. Compensation and Other Benefits.
--------------------------------
5.1 Base Salary. During the Term of Employment, the Executive shall
------------
receive a base salary of $295,000 per annum ("Base Salary") payable in
accordance with ARHC II's normal payroll practices.
5.2 Annual Bonus. In respect of the 1994 calendar year the Executive
-------------
shall be entitled to a bonus payment in the amount of $100,000, payable in
January 1995. During the 1995 calendar year, the Executive shall be entitled to
an annual bonus payment equal to at least 130% of such Executive's Base Salary,
but no more than 150% of the Executive's Base Salary, as determined by Chase's
Chief Mortgage Banking Executive in his or her sole discretion based upon, among
other things, the Executive's success in integrating ARHC II's mortgage banking
business successfully with the other mortgage banking businesses operated by
Chase or Chase Affiliates.
5.3 Expense Reimbursement. During the Term of Employment, the Executive
---------------------
shall, upon presentation to the Company of reasonable documentation, be entitled
to prompt and full reimbursement for all reasonable out-of-pocket business
expenses incurred by the Executive in the performance of his duties hereunder.
5.3 Incentive, Retirement, and Savings Plans. During the Term of
-----------------------------------------
Employment and to the extent eligible, the Executive shall participate in all
incentive, pension, retirement, savings and other employee benefit plans and
programs, if any, maintained
<PAGE>
5
from time to time by ARHC II for the benefit of senior executives and other
employees of ARHC II.
5.4 Welfare Benefit Plans. During the Term of Employment and to the
----------------------
extent eligible, the Executive, the Executive's spouse, if any, and their
eligible dependents, if any, shall participate in and be covered by all the
welfare benefit plans and programs, if any, maintained by ARHC II for the
benefit of senior executives and other employees of ARHC II.
6. Termination.
------------
6.1 Severance. The Corporation shall have the right to terminate the
---------
Executive's employment at any time for any reason. If, during the Term of
Employment, (a) the Corporation terminates the employment of the Executive
without Cause at any time, or (b) the Executive dies or becomes disabled, the
Term of Employment shall end and the Corporation shall pay the Executive, in one
lump sum not later than ten (10) business days following such termination, an
amount equal to the sum of (A) the amount of Base Salary which would have been
payable to the Executive from the date of such termination until December 31,
1995, assuming, for this purpose only, that the Term of Employment had not ended
early and the Executive remained employed with the Corporation, and (B) the
$100,000 bonus amount payable under the first sentence of Section 5.2 and the
minimum bonus amount payable under the second sentence of Section 5.2. If,
during the Term of Employment, the Corporation terminates the Executive for
Cause, or the Executive voluntarily terminates his employment with the
Corporation, the Term of Employment shall end and the Executive shall no longer
be entitled to Base Salary or bonus payments.
6.2 Severance Benefits. Upon the termination of this Agreement, pursuant
------------------
to Section 6.1(a) or (b) or the expiration of the Term of Employment, the
Executive shall be entitled to receive, in addition to any payments that may be
due to the Executive pursuant to Section 6.1, severance benefits, if any, in
accordance with the severance policies of Chase then in effect with respect to
executives of similar rank. The foregoing is expressly agreed to be in lieu of
any other severance or separation benefits to which the Executive might
otherwise be entitled as an employee of the Corporation or ARHC II.
6.3 Statements by the Executive or the Corporation. Subject to the
----------------------------------------------
requirements of any applicable securities laws, the Executive agrees that,
during and after the Term of Employment, he shall not at any time make any
statement or representation, written or oral, (a) which the Executive knows or
should know will, or which he knows or should know is reasonably likely to,
impair or adversely affect in any way the reputation, good will, business,
customer or supplier relationships, or public relations of ARHC II, any Parent,
any Affiliate, and/or any person or entity which the Executive knows or should
know is one
<PAGE>
6
of the following: (i) a member of the boards of directors of ARHC II, any
Parent, any Affiliate and/or any Subsidiary, (ii) an employee of ARHC II, any
Parent, any Affiliate and/or any Subsidiary, (iii) a person or entity who has or
has had a legal or beneficial ownership interest in the shares of ARHC II, any
Parent, any Subsidiary and/or any Affiliate (an "Owner"), and/or (iv) an owner,
employee, director, partner, representative of, and/or adviser to, any such
Owner, or (b) which the Executive knows or should know will, or is reasonably
likely to, cause to be brought into disrepute the name of ARHC II, any Parent,
any Subsidiary, any Affiliate, and/or any person or entity which the Executive
knows or should know is one of the following: (i) a member of the boards of
directors of ARHC II, any Parent, any Affiliate and/or any Subsidiary, (ii) an
employee of ARHC II, any Parent, any Affiliate and/or any Subsidiary, (iii) an
Owner, and/or (iv) an owner, employee, director, partner, representative of,
and/or advisor to, any such Owner (other than, with respect to both (a) and (b)
above, any statement or representation pursuant to or under any order or request
issued by (A) a court of competent jurisdiction, (B) any governmental authority,
or (C) any recognized subpoena power).
7. Resolution of Disputes. With the exception of proceedings for
----------------------
equitable relief brought pursuant to Section 8.4 of this Agreement or otherwise,
any disputes arising under or in connection with this Agreement, including,
without limitation, any assertion by any party hereto that the other party has
breached any provision of this Agreement, shall be resolved by arbitration in
accordance with the rules and procedures of the American Arbitration
Association. Any such arbitration shall be held in La Jolla, California or San
Diego, California or in such other location as the parties may agree; provided,
--------
that such arbitration, regardless of the situs thereof, shall apply New York law
with respect to the matters subject to such arbitration.
8. Confidential Information and Noncompetition.
-------------------------------------------
8.1 Confidential Information. The Executive shall not, during the Term of
------------------------
Employment and at any time thereafter, without the prior express written consent
of the Board, directly or indirectly, use any Confidential Information (as
defined below) in any way, or divulge, disclose or make available or accessible
any Confidential Information to any person, firm, partnership, corporation,
trust or any other entity or third party (other than when required to do so in
good faith to perform the Executive's duties and responsibilities under this
Agreement or when required to do so by a lawful order of a court of competent
jurisdiction). In addition, the Executive shall not create any derivative work
or other product based on or resulting from any Confidential Information (except
in the good faith performance of his duties under this Agreement). The
Executive shall also immediately notify the Board if he becomes aware of any
unauthorized use or disclosure of any Confidential Information by
<PAGE>
7
any third party, and the Executive agrees to cooperate fully in any attempts or
efforts by the Corporation or any Affiliate to obtain any relief or remedy in
respect of such unauthorized use or disclosure. The Executive agrees that he
shall not make any copies of any kind of any document, computer software or
other writing or recording containing any Confidential Information without the
prior approval of the Board (other than when required to do so in good faith to
perform the Executive's duties and responsibilities under this Agreement or when
required to do so by a lawful order of a court of competent jurisdiction). The
Executive shall also proffer to the Board's designee, no later than the
effective date of any termination of his employment with ARHC II for any reason,
and without retaining any copies, notes or excerpts thereof, all memoranda,
computer disks or other media, computer programs, diaries, notes, records, data,
customer or client lists, marketing plans and strategies, and any other
documents consisting of or containing any Confidential Information that are in
the Executive's actual or constructive possession or which are subject to his
control at such time. In addition, the Executive shall at all times use his
best efforts carefully to safeguard any Confidential Information in the
Executive's possession or under his control. For purposes of this Agreement,
"Confidential Information" shall mean all information respecting the business
and activities of ARHC II, any Parent and/or any Subsidiary, including, without
limitation, the terms and provisions of this Agreement, the clients, customers,
suppliers, employees, consultants, computer or other files, projects, products,
computer disks or other media, computer hardware or computer software programs,
marketing plans, financial information, methodologies, know-how, processes,
practices, approaches, projections, forecasts, formats, systems, data gathering
methods and/or strategies of ARHC II, any Parent and/or any Subsidiary.
Notwithstanding the immediately preceding sentence, Confidential Information
shall not include any information that is, or becomes, generally available to
the public (unless such availability occurs as a result of the Executive's
breach of any portion of this Section 8.1 or any other obligation the Executive
owes to ARHC II, any Parent and/or any Subsidiary).
8.2 Noncompetition. The Executive shall not, from the Commencement Date
--------------
through December 31, 1995, directly or indirectly, within or with respect to the
United States of America (a) engage, without the prior express written consent
of ARHC II, in any business or activity, whether as an employee, consultant,
partner, principal, agent, representative, stockholder or in any other
individual, corporate or representative capacity, or render any services or
provide any advice to any business, activity, person or entity, if such
business, activity, service, person or entity, directly or indirectly, competes
in any material manner with the residential mortgage activities of ARHC II, any
Parent or Subsidiary, and/or (b) meaningfully assist, help or otherwise support,
without the prior express written consent of ARHC II, any person, business,
corporation,
<PAGE>
8
partnership or other entity or activity, whether as an employee, consultant,
partner, principal, agent, representative, stockholder or in any other
individual, corporate or representative capacity, to create, commence or
otherwise initiate, or to develop, enhance or otherwise further, any residential
mortgage business or activity if such business or activity, directly or
indirectly, competes (or is reasonably likely to compete) in any manner with any
residential mortgage business or activity of ARHC II or any Parent or
Subsidiary. The foregoing shall not preclude the ownership by the Executive of
publicly traded securities of any issuer representing not more than one percent
(1%) of the outstanding securities of the same class of such issuer.
8.3 Nonsolicitation. The Executive shall not, directly or indirectly,
---------------
from the Commencement Date through December 31, 1995 (a) take any action to
solicit or divert any business (or potential business) or clients or customers
(or potential clients or potential customers) away from ARHC II, or any Parent
or Subsidiary, (b) induce customers, potential customers, clients, potential
clients, suppliers, agents or other persons under contract or otherwise
associated or doing business with ARHC II or any Parent or Subsidiary to
terminate, reduce or alter any such association or business with or from ARHC II
or any Parent or Subsidiary, and/or (c) induce any person in the employment of
ARHC II or any Parent or Subsidiary or any consultant to ARHC II or any Parent
or Subsidiary to (i) terminate such employment, or consulting arrangement, (ii)
accept employment, or enter into any consulting arrangement, with anyone other
than ARHC II or any Parent or Subsidiary, and/or (iii) interfere with the
customers, suppliers, or clients of ARHC II, any Subsidiary, any Parent or any
Affiliate in any manner or the business of ARHC II, any Subsidiary, any Parent
or any Affiliate in any manner. For purposes of this Section 8.3, a "potential
client" or a "potential customer" shall mean a person or entity that ARHC II,
any Parent or any Subsidiary (A), as of the date the Executive's employment
terminates, is, or will be in the reasonably foreseeable future, soliciting or
considering soliciting (or has targeted for solicitation, or will be so
targeting in the reasonably foreseeable future), and/or (B) has, at any time or
from time to time, within the 12 month period prior to the date the Executive's
employment terminates, been soliciting for or in respect of any current,
actively pending or contemplated product lines, businesses, or services offered
by ARHC II, any Parent or any Subsidiary, including, without limitation, any
licensing arrangements, manufacturing arrangements, and/or distribution
arrangements (the "Products"), and "potential business" shall mean any current
or reasonably foreseeable commercial activity or any current or reasonably
foreseeable commercial opportunities associated in any way with the Products.
8.4 Injunctive Relief. The Executive acknowledges and agrees that ARHC II
-----------------
will have no adequate remedy at law, and would be irreparably harmed, if the
Executive breaches or
<PAGE>
9
threatens to breach any of the provisions of this Section 8 of this Agreement.
The Executive agrees that ARHC II shall be entitled to equitable and/or
injunctive relief to prevent any breach or threatened breach of this Section 8,
and to specific performance of each of the terms of such Section in addition to
any other legal or equitable remedies that ARHC II may have. The Executive
further agrees that he shall not, in any equity proceeding relating to the
enforcement of the terms of this Section 8, raise the defense that ARHC II has
an adequate remedy at law.
8.5 Special Severability. The terms and provisions of this Section 8 are
--------------------
intended to be separate and divisible provisions and if, for any reason, any one
or more of them is held to be invalid or unenforceable, neither the validity nor
the enforceability of any other provision of this Agreement shall thereby be
affected. It is the intention of the parties to this Agreement that the
potential restrictions on the Executive's future employment imposed by this
Section 8 be reasonable in both duration and geographic scope and in all other
respects. If for any reason any court of competent jurisdiction shall find any
provisions of this Section 8 unreasonable in duration or geographic scope or
otherwise, the Executive and the Corporation agree that the restrictions and
prohibitions contained herein shall be effective to the fullest extent allowed
under applicable law in such jurisdiction.
9. Successors. This Agreement is personal to the Executive and, without
-----------
the prior express written consent of the Corporation or ARHC II, shall not be
assignable by the Executive, except that the Executive's rights to receive any
compensation or benefits under this Agreement may be transferred or disposed of
pursuant to testamentary disposition, intestate succession or pursuant to a
qualified domestic relations order. This Agreement shall inure to the benefit
of and be enforceable by the Executive's heirs, beneficiaries and/or legal
representatives. This Agreement shall inure to the benefit of and be binding
upon the Corporation and its successors and assigns. In particular, the parties
agree that this Agreement is assignable by the Corporation to ARHC II, and shall
be so assigned as promptly as practicable following the acquisition by the
Corporation pursuant to the Tender Offer of shares of common stock of ARHC
constituting more than 50% of the outstanding shares of common stock of ARHC.
The Corporation shall use its reasonable best efforts to obtain from any
successor to all or substantially all of its business and/or assets, whether
direct or indirect, by purchase, merger, consolidation, acquisition of stock, or
otherwise, an assumption by such successor of the obligations of the Corporation
under this Agreement.
<PAGE>
10
10. Miscellaneous.
--------------
10.1 Applicable Law. This Agreement shall be governed by and construed in
---------------
accordance with the laws of the State of New York, without regard to principles
of conflict of laws.
10.2 Amendments/Waiver. This Agreement may not be amended, waived, or
------------------
modified otherwise than by a written agreement executed by the parties to this
Agreement or their respective successors and legal representatives. No waiver
by any party to this Agreement of any breach of any term, provision or condition
of this Agreement by the other party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same time, or any prior or subsequent
time.
10.3 Notices. All notices and other communications hereunder shall be in
--------
writing and shall be given by hand-delivery to the other party, by facsimile
transmission, by overnight courier, or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
If to the Executive:
James P. Gilcrest
424 Santa Dominga
Solana Beach, California 92075
with a copy to:
Gray Cary Ware & Freidenrich
401 B Street, Suite 1700
San Diego, California 92101-4297
Attention: Jan Fagan
If to the Corporation:
Chamres, Inc.
c/o Chase Manhattan Mortgage Corporation
4915 Independence Parkway
Tampa, Florida 33634
Attention: Fred B. Koons
Chairman, Chase Manhattan
Mortgage Corporation
<PAGE>
11
with a copy to:
Chase Manhattan Mortgage Corporation
4915 Independence Parkway
Tampa, Florida 33634
Attention: Robert J. Jacobs
Senior Vice President
and Chief Legal Officer
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.
10.4 Withholding. The Corporation or ARHC II may withhold from any
------------
amounts payable under this Agreement such taxes as shall be required to be
withheld pursuant to any applicable law or regulation, as determined by the
Corporation or ARHC II.
10.5 Severability. The invalidity or unenforceability of any
-------------
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.
10.6 Captions. The captions of this Agreement are not part of the
---------
provisions hereof and shall have no force or effect.
10.7 Entire Agreement. This Agreement contains the entire agreement
-----------------
between the parties to this Agreement concerning the subject matter hereof and
supersedes all prior agreements, understandings, discussions, negotiations and
undertakings, whether written or oral, between the parties with respect thereto.
10.8 Representation. The Executive represents and warrants that the
---------------
performance of the Executive's duties and obligations under this Agreement will
not violate any agreement between the Executive and any other person, firm,
partnership, corporation, or organization.
10.9 Survivorship. The respective rights and obligations of the
-------------
parties to this Agreement shall survive any termination of this Agreement or the
Executive's employment hereunder for any reason to the extent necessary to the
intended preservation of such rights and obligations. Notwithstanding any
termination of this Agreement, the provisions of Section 8 shall survive for the
terms stated therein.
<PAGE>
12
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's
hand and the Corporation has caused this Agreement to be executed on its behalf,
all as of the day and year first above written.
CHAMRES, INC.
/s/ Fred Koons
By: _____________________________
Title:
/s/ James P. Gilcrest
_________________________________
James P. Gilcrest
