<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 9, 1996
REGISTRATION NO. 333-00157
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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AMRESCO, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 59-1781257
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1845 WOODALL RODGERS FREEWAY
SUITE 1700
DALLAS, TEXAS 75201
(214) 953-7700
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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L. KEITH BLACKWELL
GENERAL COUNSEL AND SECRETARY
1845 WOODALL RODGERS FREEWAY
SUITE 1700
DALLAS, TEXAS 75201
(214) 953-7700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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COPIES TO:
MICHAEL M. BOONE ROBERT C. SCHWARTZ
HAYNES AND BOONE, L.L.P. SMITH, GAMBRELL & RUSSELL
3100 NATIONSBANK PLAZA 3343 PEACHTREE ROAD, N.E.
901 MAIN STREET SUITE 1800
DALLAS, TEXAS 75202-3789 ATLANTA, GEORGIA 30326-1010
(214) 651-5000 (404) 264-2620
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
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. /X/
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 statement unmber of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
OF SECURITIES TO BE REGISTERED REGISTERED (1) SHARE (2) PRICE (2) FEE (3)
- ------------------------------ -------------- ------------------ ------------------ -----------
<S> <C> <C> <C> <C>
Common Stock, par value $0.05 per
share............................ 944,000 shares $17.00 $16,048,000 $5,534
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</TABLE>
(1) The shares of Common Stock being registered hereby are issuable upon
conversion of the Registrant's 8% Convertible Subordinated Debentures
Due 2005 (the "Debentures"). Pursuant to Rule 416, the Registration
Statement also covers such indeterminate additional shares of Common
Stock as may become issuable on conversion of the Debentures as a result
of any future adjustments in the conversion price in accordance with the
terms of the Debentures.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c).
(3) A fee of $15,983 was previously paid in connection with this Registration
Statement.
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<PAGE>
PROSPECTUS
AMRESCO, INC.
944,000 SHARES OF COMMON STOCK
The shares of Common Stock, $0.05 par value per share (the "Common
Stock"), of AMRESCO, INC. (the "Company") covered by this Prospectus are shares
which may be offered and sold (the "Offering"), from time to time, by certain
shareholders of the Company (collectively, the "Selling Shareholders"). See
"Selling Shareholders." The shares of Common Stock covered by this Prospectus
are issuable to the Selling Shareholders upon conversion of the Company's 8%
Convertible Subordinated Debentures Due 2005 (the "Debentures"). All of the
shares covered hereby will only be sold by the Selling Shareholders. This
Prospectus does not purport to cover the initial issuance by the Company of the
shares of Common Stock upon conversion of the Debentures, but only the reoffer
and resale of such shares by the Selling Shareholders. The Company will not
receive any of the proceeds from the sale of the shares of Common Stock by the
Selling Shareholders.
The Selling Shareholders may from time to time sell the shares of Common
Stock covered by this Prospectus to or through one or more underwriters, and may
also sell shares of Common Stock directly to other purchasers or through agents,
on the Nasdaq National Market in ordinary brokerage transactions, in negotiated
transactions, or otherwise, at market prices prevailing at the time of sale, at
prices related to the then prevailing market price or at negotiated prices. See
"Plan of Distribution."
The Company's Common Stock is traded on the Nasdaq National Market under
the symbol "AMMB."
SEE "RISK FACTORS" BEGINNING ON PAGE 9 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK
OFFERED HEREBY.
----------------------
THESE SECURITIES HAVE NOT BEEN 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 THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
----------------------
The date of this Prospectus is May 9, 1996
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO
WHICH IT RELATES OR ANY OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY
SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT ITS DATE.
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TABLE OF CONTENTS
Page
----
Available Information. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents by Reference. . . . . . . . . . . . . . 3
Certain Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Selling Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Description of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . 13
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Independent Accountants. . . . . . . . . . . . . . . . . . . . . . . . . . 16
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). In accordance
with the Exchange Act, the Company files reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). The
reports, proxy statements and other information can be inspected and copied at
the public reference facilities that the Commission maintains at Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's regional
offices located at 7 World Trade Center, 13th Floor, New York, New York 10048,
and Northwestern Atrium Center, Suite 1400, 500 West Madison Street, Chicago,
Illinois 60661. Copies of these materials can be obtained at prescribed rates
from the Public Reference Section of the Commission at the principal offices of
the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
The Company has filed with the Commission a registration statement on
Form S-3 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Common Stock. This
Prospectus, which constitutes a part of the Registration Statement, does not
contain all the information set forth in the Registration Statement, certain
items of which are contained in schedules and exhibits to the Registration
Statement as permitted by the rules and regulations of the Commission.
Statements made in the Prospectus concerning the contents of any documents
referred to herein are not necessarily complete. With respect to each such
document filed with the Commission as an exhibit to the Registration Statement,
reference is made to the exhibit for a more complete description, and each such
statement shall be deemed qualified in its entirety by such reference.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with the
Commission pursuant to the Exchange Act, are hereby incorporated by reference in
this Prospectus: (i) Annual Report on Form 10-K for the year ended December 31,
1995 and (ii) Current Report on Form 8-K dated February 2, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the Offering shall be deemed to be incorporated by
reference herein. Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed superseded or modified
for purposes of this Prospectus to the extent that a statement contained herein
(or in any other subsequently filed document which also is incorporated by
reference herein) modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, on the written or oral
request of any such person, a copy of any or all of the documents incorporated
by reference (other than exhibits to such documents which are not specifically
incorporated by reference in such documents). Written requests for such copies
should be directed to the Company, 1845 Woodall Rodgers Freeway, Suite 1700,
Dallas, Texas 75201, Attention: L. Keith Blackwell, General Counsel and
Secretary. Telephone requests may be directed to L. Keith Blackwell, General
Counsel and Secretary of the Company, at (214) 953-7700.
3
<PAGE>
CERTAIN DEFINITIONS
The following are certain defined terms used in this Prospectus:
"ACACIA" means Acacia Realty Advisors, Inc.
"ACC" means AMRESCO Capital Corporation, a subsidiary of the Company.
"ARMC"means, collectively, AMRESCO Residential Mortgage Corporation and AMRESCO
Residential Credit Corporation, subsidiaries of the Company.
"ASSET PORTFOLIO" means a pool or portfolio of performing, non-performing or
underperforming commercial, industrial, agricultural and/or real estate loans
and real estate and other collateral acquired through foreclosure or
settlement.
"BEI" means BEI Holdings, Ltd.
"BEI MERGER" means the merger of Holdings with and into a subsidiary of BEI on
December 31, 1993.
"COMPANY" means, unless otherwise stated in this Prospectus or unless the
context otherwise requires, the Company and each of its subsidiaries.
"CONDUIT PURCHASERS" means investment bankers and other financial intermediaries
who purchase or otherwise accumulate pools or portfolios of loans having
common features (E.G., real estate mortgages, etc.), with the intent of
securitizing such loan assets and selling them to a trust that secures its
funds by selling ownership interests in the trust to public or private
investors.
"CREDIT AGREEMENTS" means the Revolving Loan Agreement and the Warehouse
Agreements.
"DEBENTURES" means the Company's 8% Convertible Subordinated Debentures Due
2005.
"DEBENTURE INDENTURE" means that certain Indenture dated November 27, 1995,
governing the Debentures.
"FACE VALUE" means, with respect to any loan or Asset Portfolio, the aggregate
unpaid principal balance of a loan or loans.
"FDIC" means the Federal Deposit Insurance Corporation.
"HOLDINGS" means AMRESCO Holdings, Inc.
"HOLLIDAY FENOGLIO" means Holliday Fenoglio, Inc., a subsidiary of the Company.
"MASTER SERVICER" means an entity which provides administrative services to
securitized pools of mortgage-backed securities.
"NATIONSBANK OF TEXAS" means NationsBank of Texas, N.A.
"PRIMARY SERVICER" means an entity which provides various administrative
services for loans such as collecting monthly mortgage payments, maintaining
escrow accounts for the payment of ad valorem taxes and insurance premiums on
behalf of borrowers, remitting payments of principal and interest promptly to
investors in mortgages or the Master Servicer of a pool and reporting to
those investors or the Master Servicer on financial transactions related to
such mortgages.
"REVOLVING LOAN AGREEMENT" means the First Amended and Restated Revolving Loan
Agreement dated as of April 25, 1996 among the Company, NationsBank of Texas,
as Agent, and the Banks which are parties thereto from time to time.
"RTC" means the Resolution Trust Corporation.
"SECURITIZATION" and "SECURITIZED" mean a transaction in which loans originated
or purchased by an entity are sold to special purpose entities organized for
the purpose of issuing asset-backed securities.
"WAREHOUSE AGREEMENTS" means, collectively, (i) the $25.0 million credit
facility dated as of April 28, 1995, among ACC, the Company and NationsBank
of Texas, (ii) the credit facility dated as of August 15, 1995, between ACC
and Residential Funding Corporation and (iii) the $250.0 million credit
facility dated as of April 29, 1996 between ARMC and Prudential Securities
Realty Funding Corporation.
4
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THE COMPANY
The Company is a leading specialty financial services company engaged in
Asset Portfolio acquisition and resolution, mortgage banking and institutional
real estate investment advisory services. The Asset Portfolio acquisition and
resolution business involves acquiring at a substantial discount to Face Value
and managing and resolving Asset Portfolios to maximize cash recoveries. The
Company manages and resolves Asset Portfolios acquired by the Company alone,
acquired by the Company with co-investors and owned by third-parties. The
mortgage banking business involves the origination, placement and servicing of
commercial real estate mortgages and the purchase and securitization of
portfolios of residential mortgages of borrowers who do not qualify for
conventional loans. The institutional real estate investment advisory business
involves the provision of real estate investment advice to various institutional
investors (primarily pension funds) seeking to invest a portion of their funds
in real estate.
HISTORY
The Company is the product of the December 1993 merger of two Asset
Portfolio management and resolution service companies: BEI and Holdings.
Holdings was the former Asset Portfolio management and resolution unit of
NationsBank of Texas, which was created in 1988 in connection with NationsBank
Corporation's acquisition from the FDIC of certain assets and liabilities of the
collapsed First RepublicBank. BEI, a publicly-held company that was in the real
estate and asset management services businesses, began providing asset
management and resolution services to the RTC in 1990. BEI also participated in
certain non-real estate service businesses, which were not retained after the
BEI Merger. The BEI Merger created one of the largest Asset Portfolio management
and resolution service companies in the United States. Since 1987, the Company
and its predecessors have managed approximately $34.0 billion (Face Value) of
Asset Portfolios.
DEVELOPMENT OF BUSINESS STRATEGY
In early 1994, the Company made the strategic decision to diversify its
business lines and to reduce its dependence on asset management and resolution
contracts with governmental agencies and certain other entities. As a result,
the Company shifted its strategic focus in order to take advantage of business
opportunities in the specialty finance markets that capitalize on its
competitive strengths and reputation within its core business. The key elements
of this strategy include:
- increasing the amount that the Company invests for its own account in
Asset Portfolios;
- continuing to provide high quality management and resolution services
to co-investors and other third-party owners of Asset Portfolios;
- expanding its presence in the traditional mortgage banking market
through greater market penetration and by participating in the
expanding market for securitization of commercial and residential real
estate mortgages; and
- developing its institutional real estate investment advisory business
to complement the Company's existing business lines.
5
<PAGE>
ASSET ACQUISITION AND RESOLUTION
GENERAL. The Company manages and resolves Asset Portfolios acquired at
a substantial discount to Face Value by the Company alone and by the Company
with co-investors. The Company also manages and resolves Asset Portfolios owned
by third parties. Asset Portfolios generally include secured loans of varying
qualities and collateral types. The majority of the loans in the Asset
Portfolios in which the Company invests are in payment default at the time of
acquisition. Although some Asset Portfolios include foreclosed real estate and
other collateral, the Company generally seeks Asset Portfolios that do not
include such assets. Some Asset Portfolio loans are loans for which resolution
is tied primarily to the real estate securing the loan. Other loans, however,
are collateralized business loans, the resolution of which may be based either
on cash flow of a business or on real estate and other collateral securing the
loan. Collateralized business loans acquired by the Company generally have
smaller Face Values and often are more quickly resolved than more traditional
real estate loans. The Company intends to focus to a greater extent on
collateralized business loans.
ASSET PORTFOLIO INVESTMENT. The Company's business of investing in
Asset Portfolios is conducted either through it owning the Asset Portfolio alone
or with co-investors. Asset Portfolios acquired solely by the Company have
ranged between approximately $.5 million (Face Value) and approximately $96.8
million (Face Value), whereas Asset Portfolios owned by it with co-investors
have ranged up to approximately $679.0 million (Face Value). The Company
generally funds its share of any investment with a combination of borrowings
under its existing credit lines and internal cash flow. Future Asset Portfolio
purchases will depend on the availability of Asset Portfolios offered for sale,
the availability of capital and the Company's ability to submit successful
offers to purchase Asset Portfolios. As a result, Asset Portfolio purchases can
vary significantly from quarter to quarter. At December 31, 1995, the Company's
total investment in wholly-owned Asset Portfolios aggregated $361.5 million
(Face Value), which was composed of $272.4 million (Face Value) (75.4%) of
collateralized business loans, $17.1 million (Face Value) (4.7%) of real estate
loans, $66.8 million (Face Value) (18.5%) of asset-backed securities and $5.2
million (Face Value) (1.4%) of real estate.
ASSET MANAGEMENT AND RESOLUTION SERVICES. The Company provides asset
management and resolution services to third parties pursuant to contracts with
the owner of an Asset Portfolio or a purchaser (including a partnership, joint
venture or other group in which the Company is a co-investor) of an Asset
Portfolio. Management of Asset Portfolios includes both loan resolution and
providing routine accounting services, monitoring collections of interest and
principal (if any), confirming (or advancing) insurance premium and tax payments
due on collateral and generally overseeing and managing, if necessary,
collateral condition and performance.
MORTGAGE BANKING
GENERAL. The Company performs a wide range of commercial mortgage
banking services, including originating, underwriting, placing, selling and
servicing of commercial real estate loans through its Holliday Fenoglio and ACC
mortgage banking units. Through ARMC, a residential mortgage banking business,
the Company purchases and securitizes portfolios composed of residential
mortgages of borrowers who do not qualify for conventional loans. For 1995,
$28.9 million (26.1%) of the Company's gross revenues were attributable to the
Company's mortgage banking business.
COMMERCIAL MORTGAGE BANKING BUSINESS. Holliday Fenoglio primarily
serves commercial real estate developers and owners by originating commercial
real estate loans. Holliday Fenoglio originates prospective borrowers through
its own commission-based mortgage bankers in its offices located in Atlanta,
Boca Raton, Buffalo, Dallas, Houston, New York City and Orlando. The loans
originated by Holliday Fenoglio generally are funded by institutional lenders,
primarily insurance companies, with Holliday Fenoglio retaining the Primary
Servicer rights on more than a quarter of such loans. The Company believes that
Holliday Fenoglio's relationship and credibility with the institutional lender
network provide the Company a competitive advantage in the commercial mortgage
banking industry.
6
<PAGE>
ACC, which originated approximately $447.1 million of commercial real
estate mortgages during 1995, is a mortgage banker that originates and
underwrites commercial real estate loans that are funded primarily by Conduit
Purchasers rather than by institutional lenders. ACC, therefore, makes certain
representations and warranties concerning the loans it originates. These
representations cover such matters as title to the property, lien priority,
environmental reviews and certain other matters. ACC primarily targets
originators of commercial mortgage loans for commercial real estate properties
that are suitable for sale to Conduit Purchasers accumulating loans for
securitization programs directly through ACC's offices located in Dallas, Miami,
Washington, D.C. and Winston-Salem, as well as through a network of
approximately 42 independent mortgage brokers located throughout the United
States. ACC also has a relationship with the 18-office commercial real estate
finance unit of a major insurance company whereby the insurance company has
agreed to refer prospective borrowers to the Company in instances where the
prospective loan does not meet the insurer's requirements (typically borrowers
for medium-quality commercial properties). Since ACC commenced underwriting
activities and through December 31, 1995, Holliday Fenoglio originated
approximately 29% of the loans underwritten by ACC, with Holliday Fenoglio and
ACC each receiving fees for their respective services.
COMMERCIAL LOAN SERVICING BUSINESS. The Company serves as a Primary
Servicer for whole loans and as a Master Servicer for securitized pools of
commercial mortgages. For 1995, $4.7 million (4.3%) of the Company's gross
revenues were generated by its commercial loan servicing business. The dominant
users of loan servicers are mortgage-backed bond trusts and similar securitized
asset-backed loan portfolios made up of numerous passive investors. Other
lenders often contract with the originating mortgage banker or other third-party
servicer to manage collection, accounting and other activities with respect to
the loan. The revenue stream from servicing contracts on commercial mortgages is
relatively predictable as prepayment penalties in commercial mortgages
discourage early loan payoffs, a risk that is more significant to servicers of
residential mortgage portfolios.
RESIDENTIAL MORTGAGE SECURITIZATION. Through ARMC, the Company
purchases (in bulk from independent originators), warehouses and securitizes
portfolios of residential mortgages of borrowers who do not qualify for
conventional loans and whose borrowing needs are not met by traditional
financial institutions. Such borrowers may not satisfy the more rigid
underwriting standards of the traditional residential mortgage lending market
for a number of reasons, such as blemished credit histories (from past loan
delinquencies or bankruptcy), inability to provide income verification data or
lack of established credit history. Because this market is underserved by
traditional lenders, credit is less available, there is less competition and
interest rates are higher than for higher credit quality mortgage borrowers. The
Company believes that the higher risk-adjusted profit opportunities offered by
this market are attractive. At December 31, 1995, ARMC held mortgage portfolios
aggregating approximately $142.7 million, which (together with mortgages
purchased after December 31, 1995) were securitized and sold on January 26,
1996, with the Company retaining certain interest only certificates.
INSTITUTIONAL INVESTMENT ADVISORY
Effective November 20, 1995, the Company acquired for approximately $4.2
million substantially all of the institutional real estate investment advisory
contracts and certain other assets of Acacia. Through these contracts, the
Company now provides real estate investment advice to various institutional
investors (primarily pension funds) seeking to invest a portion of their funds
in real estate. The investors establish certain investment parameters (E.G.,
amount of funds available for investment, type of property, geographic mix, form
of investment (loan, partnership, direct ownership), target rate of return and
investment term). The Company then seeks investment opportunities it believes
meet the investors' parameters. The investors exercise varying degrees of
control over these investment decisions. Depending on the amount of discretion
granted by the client, the Company also will make a recommendation, or the final
decision, concerning whether to sell a particular property and will direct the
work necessary to complete the sale. Although the Company is paid acquisition
and
7
<PAGE>
disposition fees by some of its clients, its principal source of revenue is
asset management fees, which are based on the cash flow of the investments under
management or are negotiated at the time of the client's investment in a
property.
The Company is a Delaware corporation. The Company's principal executive
offices and mailing address are 1845 Woodall Rodgers Freeway, Suite 1700,
Dallas, Texas 75201 and its telephone number is (214) 953-7700.
8
<PAGE>
RISK FACTORS
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER, AMONG OTHER THINGS, THE
FOLLOWING FACTORS IN EVALUATING THE COMPANY AND ITS BUSINESS BEFORE PURCHASING
SHARES OF THE COMMON STOCK OFFERED HEREBY.
GENERAL ECONOMIC CONDITIONS
Periods of economic slowdown or recession, rising interest rates or
declining demand for real estate may adversely affect certain segments of the
Company's business. Although such economic conditions may increase the number of
non-performing loans available for sale to or for management by the Company,
such conditions could adversely affect the resolution of Asset Portfolios held
by the Company for its own account or managed for others by the Company, lead to
a decline in prices or demand for collateral underlying Asset Portfolios or, in
the case of Asset Portfolios held for the Company's own account, increase the
cost of capital invested by the Company and the length of time that capital is
invested in a particular portfolio, thereby negatively impacting the rate of
return upon resolution of the portfolio. Economic downturns and rising interest
rates also may reduce the number of mortgage loan originations by the Company's
mortgage banking business and thereby may adversely affect the Company's
mortgage banking business.
UNCERTAIN NATURE OF THE ASSET ACQUISITION AND RESOLUTION BUSINESS
The outsourcing of the management and resolution of Asset Portfolios has
grown rapidly since the late 1980s; accordingly, the asset acquisition and
resolution business is relatively young and still evolving. This business is
affected by long-term cycles in the general economy. In addition, the Asset
Portfolios available for purchase by investors and/or management by third party
servicers such as the Company has declined since 1993. The Company cannot
predict what will be a normal annual volume of Asset Portfolios to be sold or
outsourced for management and resolution. Moreover, there cannot be any
assurance that Asset Portfolio purchasers/owners for whom the Company provides
Asset Portfolio management services will not build their own management and
resolution staffs and reduce or eliminate their outsourcing of these services.
As a result of these factors, it is difficult to predict the long-term future of
this business.
STRATEGIC SHIFT IN BUSINESS LINES
In early 1994, the Company made the strategic decision to diversify its
business lines and to reduce the Company's dependence on asset management and
resolution contracts with governmental agencies and certain other entities. The
Company has substantially increased its investments in Asset Portfolios. The
Company also pursues private sector Asset Portfolio management contracts,
generally through co-investing in Asset Portfolios. Since 1993, the Company has
also entered the commercial and residential mortgage banking businesses and has
purchased a pension advisory business.
As a result, the Company must simultaneously manage (i) a significant
change in its customer mix, (ii) the investment of the Company's own capital in
Asset Portfolios, and (iii) the development of new business lines in which the
Company has not previously participated. All of these activities will require
the investment of additional capital and the significant involvement of senior
management to achieve a successful outcome. There is no assurance that the
Company will successfully execute this strategic transition.
9
<PAGE>
FINANCIAL LEVERAGE AND NEED FOR ADDITIONAL FINANCING
The Company's ability to execute its business strategy depends to a
significant degree on its ability to obtain additional indebtedness and equity
capital. Factors which could affect the Company's access to the capital markets,
or the costs of such capital, include changes in interest rates, general
economic conditions, and the perception in the capital markets of the Company's
business, results of operations, leverage, financial condition and business
prospects.
The Company has substantial indebtedness and, as a result, significant
debt service obligations. The degree of the Company's leverage could have
important consequences to purchasers of the Common Stock, including: (i)
limiting the Company's ability to obtain additional financing to fund future
working capital requirements, Asset Portfolio investments, capital expenditures,
acquisitions or other general corporate requirements, (ii) requiring a
significant portion of the Company's cash flow from operations to be dedicated
to debt service requirements, thereby reducing the funds available for
operations and future business opportunities, and (iii) increasing the Company's
vulnerability to adverse economic and industry conditions. In addition, since
certain of the Company's borrowings, including borrowings under the Revolving
Loan Agreement, will be at variable rates of interest, the Company will be
vulnerable to increases in interest rates. Each of these factors is to a large
extent subject to economic, financial, competitive and other factors beyond the
Company's control.
The Credit Agreements contain numerous financial and operating covenants
that will limit the discretion of the Company's management with respect to
certain business matters. These covenants will place significant restrictions
on, among other things, the ability of the Company to incur additional
indebtedness, to create liens or other encumbrances, to make certain payments
and investments, and to sell or otherwise dispose of assets and merge or
consolidate with other entities.
DEPENDENCE ON SECURITIZATION PROGRAM
The Company likely will become more dependent upon its ability to pool
and sell loans in the secondary market in order to generate cash proceeds for
new originations and purchases. Accordingly, adverse changes in the secondary
mortgage market could impair the Company's ability to originate, purchase and
sell mortgage loans on a favorable or timely basis. Any such impairment could
have a material adverse effect upon the Company's business and results of
operations. In addition, in order to gain access to the secondary market, the
Company may rely on monoline insurance companies to provide, in exchange for
premiums, a guarantee on outstanding senior interests in the related
securitization trusts to enable it to obtain a "AAA/Aaa" rating for such
interests. Any substantial reductions in the size or availability of the
secondary market for the Company's loans, or the unwillingness of monoline
insurance companies to guarantee the senior interests in the Company's loan
pools, could have a material adverse effect on the Company's financial position
and results of operations.
RISKS OF HEDGING TRANSACTIONS
The Company has in the past and may in the future enter into interest
rate or foreign currency financial instruments used for hedging purposes. While
intended to reduce the effects of volatility in interest rate or foreign
currency price movements, such transactions could cause the Company to recognize
losses depending on the terms of the instrument and the interest rate or foreign
currency price movement.
10
<PAGE>
COMPETITION
The Asset Portfolio management and other financial services industries
in which the Company operates are highly competitive. Some of the Company's
principal competitors in certain business lines are substantially larger and
better capitalized than the Company. Because of these resources, these companies
may be better able than the Company to obtain new customers, to acquire Asset
Portfolios, to pursue new business opportunities, or to survive periods of
industry consolidation.
The Company believes that its ability to acquire Asset Portfolios for
its own account will be important to its future growth. Acquisitions of Asset
Portfolios are often based on competitive bidding, where there are dangers of
bidding too low (which generates no business), as well as of bidding too high
(which could win the portfolio at an economically unattractive price). Asset
Portfolio acquisitions also require significant capital. There currently is
substantial competition for Asset Portfolio acquisitions and such competition
could increase in the future.
INFLUENCE OF CERTAIN SHAREHOLDERS
Two shareholders of the Company, CGW Southeast Partners I, L.P. and CGW
Southeast Partners II, L.P. (collectively, "CGW"), own, as of the date of this
Prospectus, in the aggregate approximately 26% of the outstanding Common Stock.
In addition, CGW is a party to a voting agreement with two other persons (which
persons hold, as of the date of this Prospectus, an aggregate of approximately
2% of the outstanding Common Stock) whereby the parties thereto have agreed to
vote their shares of Common Stock for eight designees nominated by the parties
pursuant to the terms of such voting agreement. As a result of the
above-described ownership and relationships, CGW will be able to continue to
exercise significant influence over the affairs of the Company.
VOLATILITY OF MARKET PRICE FOR COMMON STOCK
From time to time after the Offering, there may be significant
volatility in the market price for the Common Stock. Quarterly operating results
of the Company, changes in conditions in the economy or the financial services
industries, or other developments affecting the Company could cause the market
price of the Common Stock to fluctuate substantially.
ANTI-TAKEOVER CONSIDERATIONS
The Company's Amended and Restated Certificate of Incorporation and
Amended and Restated Bylaws include a number of provisions that may have the
effect of encouraging persons considering unsolicited tender offers or other
unilateral takeover proposals to negotiate with the Company's Board of Directors
rather than pursue non-negotiated takeover attempts. These provisions include a
staggered Board of Directors, authorized "blank check" preferred stock,
supermajority voting requirements on certain matters and prohibitions against
certain business combinations. The Indenture governing the Debentures requires
the Company to repurchase all outstanding Debentures in the event of certain
change of control transactions. These anti-takeover provisions could have the
effect of discouraging or making more difficult a merger, tender offer, other
business combination or proxy contest, even if such event would be favorable to
the interests of the shareholders.
11
<PAGE>
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of Common Stock
by the Selling Shareholders.
SELLING SHAREHOLDERS
This Prospectus covers offers from time to time by each Selling
Shareholder (after such person becomes a holder of Common Stock) of the
Common Stock to be owned by such person. The Selling Shareholders will hold
shares of Common Stock issued or issuable upon the conversion of the
Debentures. The Debentures were issued in a private placement conducted
outside of the United States pursuant to Regulation S promulgated pursuant to
the Securities Act and consummated on November 27, 1995. The Debentures are
convertible at any time through the close of business on December 15, 2005,
into shares of Common Stock at a price of $12.50 per share (80 shares per
$1,000 principal amount of Debentures), subject to adjustment under certain
circumstances. The Debentures are currently convertible into an aggregate of
3,600,000 shares of Common Stock. The registration of the shares of Common
Stock offered for resale hereby is pursuant to a Registration Rights
Agreement dated November 27, 1995, entered into in connection with the
original issuance of the Debentures (the "Registration Rights Agreement").
The following table lists the name of each Selling Shareholder, the
number of shares of Common Stock owned by each Selling Shareholder before this
Offering, the number of shares of Common Stock that may be offered by each
Selling Shareholder pursuant to this Prospectus and the number of shares of
Common Stock to be owned by each Selling Shareholder upon completion of the
Offering if all shares registered hereby are sold. None of the Selling
Shareholders has held any position or office or had any other material
relationship with the Company or any of its predecessors or affiliates in the
last three years. The information below is as of the date of this Prospectus and
has been furnished by the respective Selling Shareholders and the Trustee.
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES NUMBER OF SHARES
NAME OF OWNED BEFORE BEING REGISTERED OWNED AFTER
SELLING SHAREHOLDER THIS OFFERING FOR RESALE THIS OFFERING(1)
- --------------------------- -------------------- ---------------- ----------------
<S> <C> <C> <C>
CUDD & CO. AS CUSTODIAN FOR
GOVETT AMERICAN GROWTH FUND 12,000 12,000 - 0 -
CUDD & CO. AS CUSTODIAN FOR
GOVETT GLOBAL SMALLER
COMPANIES INVESTMENT TRUST
PLC 36,000 36,000 - 0 -
CUDD & CO. AS CUSTODIAN FOR
GOVETT AMERICAN SMALLER
COMPANIES TRUST 100,000 100,000 - 0 -
T.R. SMALLER COMPANIES
INVESTMENT TRUST PLC 80,000 80,000 - 0 -
CUDD & CO. AS CUSTODIAN FOR
ROYAL LIFE INSURANCE LTD 335,000 320,000 15,000
CUDD & CO. AS CUSTODIAN FOR
CHASE MANHATTAN TRUSTEES LTD
AS TRUSTEE FOR THE PROLIFIC
AMERICAN OPPORTUNITIES UNIT
TRUST 40,000 40,000 - 0 -
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES NUMBER OF SHARES
NAME OF OWNED BEFORE BEING REGISTERED OWNED AFTER
SELLING SHAREHOLDER THIS OFFERING FOR RESALE THIS OFFERING(1)
- --------------------------- -------------------- ---------------- ----------------
<S> <C> <C> <C>
CUDD & CO. AS CUSTODIAN FOR
CHASE MANHATTAN TRUSTEES LTD
AS TRUSTEE FOR THE PROLIFIC
AMERICAN INCOME UNIT TRUST 24,000 24,000 - 0 -
EGGER AND CO. F/B/O GARTMORE
CAPITAL STRATEGY U.S. SMALLER
COMPANIES FUND 7,200 7,200 - 0 -
DARIER HENTSCH & CIE 160,000 160,000 - 0 -
PICTET & CIE 32,800 32,800 - 0 -
EGGER AND CO. F/B/O COURCOUX-
BOUVET 190,750 112,000 78,750
BANQUE OBC-ODIER BUNGENER
COURVOISIER 20,000 20,000 - 0 -
---------- -------- ------
TOTAL 1,037,750 944,000 93,750(1)
---------- -------- ------
---------- -------- ------
</TABLE>
- --------------------
(1) Assumes all shares held by such Selling Shareholder acquired upon
conversion of the Debentures will be offered and sold.
DESCRIPTION OF CAPITAL STOCK
The Company is authorized to issue 50,000,000 shares of Common Stock,
par value $0.05 per share, and 5,000,000 shares of preferred stock (the
"Preferred Stock"), par value $1.00 per share. As of April 10, 1996, the Company
had issued and outstanding 26,840,082 shares of Common Stock and no shares of
Preferred Stock. As of such date, there were approximately 3,000 holders of
record of the outstanding shares of Common Stock.
The following summary of the Company's Common Stock and Preferred Stock
is qualified in its entirety by reference to the Company's Amended and Restated
Certificate of Incorporation (the "Certificate of Incorporation"), its Amended
and Restated Bylaws (the "Bylaws"), and the Delaware General Corporation Law, as
amended (the "DGCL").
COMMON STOCK
Subject to such preferential rights as may be granted by the Board of
Directors in connection with any issuances of Preferred Stock, holders of shares
of Common Stock are entitled to receive such dividends as may be declared by the
Board of Directors in its discretion from funds legally available therefor. Upon
the liquidation, dissolution or winding up of the Company, after payment of
creditors, the remaining net assets of the Company will be distributed pro rata
to the holders of Common Stock, subject to any liquidation preference of the
holders of Preferred Stock. There are no preemptive rights, conversion rights,
or redemption or sinking fund provisions with respect to the shares of Common
Stock. All of the outstanding shares of Common Stock are duly and validly
authorized and issued, fully paid and non-assessable.
Holders of Common Stock are entitled to one vote per share of Common
Stock held of record on all such matters submitted to a vote of the
shareholders. Holders of the shares of Common Stock do not have cumulative
voting rights. As a result, the holders of a majority of the outstanding shares
of Common Stock voting for the election of directors can elect all the
directors, and, in such event, the
13
<PAGE>
holders of the remaining shares of Common Stock will not be able to elect any
persons to the Board of Directors.
PREFERRED STOCK
The Board of Directors may, without approval of the Company's
shareholders, from time to time, authorize the issuance of Preferred Stock in
one or more series for such consideration and, within certain limits, with such
relative rights, preferences and limitations as the Board of Directors may
determine. The relative rights, preferences and limitations that the Board of
Directors has the authority to determine as to any such series of Preferred
Stock include, among other things, dividend rates, voting rights, conversion
rights, redemption rights and liquidation preferences. Because the Board of
Directors has the power to establish the relative rights, preferences and
limitations of each series of Preferred Stock, it may afford to the holders of
any such series preferences and rights senior to the rights of the holders of
shares of Common Stock. Although the Board of Directors has no intention at the
present time of doing so, it could cause the issuance of Preferred Stock that
could discourage an acquisition attempt or other transaction that some, or a
majority of, the shareholders might believe to be in their best interest or in
which the shareholders might receive a premium for their shares of Common Stock
over the market price of such shares.
DELAWARE LAW AND CERTAIN CORPORATE PROVISIONS
The Company is subject to the provisions of Section 203 of the DGCL.
In general, this statute prohibits a publicly-held Delaware corporation from
engaging, under certain circumstances, in a "business combination" with an
"interested shareholder" for a period of three years after the date of the
transaction in which the person becomes an interested shareholder, unless
either (i) prior to the date at which the shareholder became an interested
shareholder the Board of Directors approved either the business combination
or the transaction in which the person becomes an interested shareholder,
(ii) the shareholder acquires more than 85% of the outstanding voting stock
of the corporation (excluding shares held by directors who are officers or
held in certain employee stock plans) upon consummation of the transaction in
which the shareholder becomes an interested shareholder or (iii) the business
combination is approved by the Board of Directors and by two-thirds of the
outstanding voting stock of the corporation (excluding shares held by the
interested shareholder) at a meeting of the shareholders (and not by written
consent) held on or subsequent to the date on which the person became an
"interested shareholder" of the business combination. An "interested
shareholder" is a person who, together with affiliates and associates, owns
(or is an affiliate or associate of the corporation and, together with
affiliates and associates, at any time within the prior three years did own)
15% or more of the corporation's voting stock. Section 203 defines a
"business combination" to include, without limitation, mergers,
consolidations, stock sales and asset based transactions and other
transactions resulting in a financial benefit to the interested shareholder.
The Company's Certificate of Incorporation and Bylaws contain a number
of provisions relating to corporate governance and to the rights of
shareholders. Certain of these provisions may be deemed to have a potential
"anti-takeover" effect in that such provisions may delay, defer or prevent a
change of control of the Company. These provisions include (i) the
classification of the Board of Directors into three classes, each class serving
for staggered three-year terms; (ii) the authority of the Board of Directors to
determine the size of the Board of Directors, subject to certain minimums and
maximums; (iii) the authority of certain members of the Board of Directors to
fill vacancies on the Board of Directors; (iv) a requirement that special
meetings of shareholders may be called only by the Board of Directors, the
Chairman of the Board or holders of at least one-tenth of all the shares
entitled to vote at the meeting; (v) the elimination of shareholder action by
written consent; (vi) the authority of the Board of Directors to issue series of
Preferred Stock with such voting rights and other powers as the Board of
Directors may determine; (vii) the requirement that the Article in the
Certificate of Incorporation creating the staggered board may only be amended by
the vote of at least 66 2/3% of the voting securities of the Company; (viii) the
prohibition on amending or rescinding, before December 31,
14
<PAGE>
1996, the Article in the Certificate of Incorporation related to the filling
of vacancies on the Board of Directors; and (ix) a requirement that any
business combination between the Company and a beneficial owner of more that
five percent of any class of an equity security of the Company must be
approved by the holders of a majority of the Company's securities, excluding
those securities held by such beneficial owner, voted at a meeting called for
the purpose of approving such business combination.
INDEMNIFICATION AND LIMITED LIABILITY
The Company's Certificate of Incorporation and Bylaws require the
Company to indemnify the directors and officers of the Company to the fullest
extent permitted by law. In addition, as permitted by the DGCL, the Company's
Certificate of Incorporation and Bylaws provide that no director of the Company
will be personally liable to the Company or its shareholders for monetary
damages for such director's breach of duty as a director. This limitation of
liability does not relieve directors from liability for (i) any breach of the
director's duty of loyalty to the Company or its shareholders, (ii) acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) any liability under Section 174 of the DGCL for unlawful
distributions, or (iv) any transaction from which the director derived an
improper personal benefit. This provision of the Certificate of Incorporation
will limit the remedies available to a shareholder who is dissatisfied with a
decision of the Board of Directors protected by this provision, and such
shareholder's only remedy in that circumstance may be to bring a suit to prevent
the action of the Board of Directors. In many situations, this remedy may not be
effective, E.G., when shareholders are not aware of a transaction or an event
prior to action of the Board of Directors in respect of such transaction or
event.
Subject to certain limitations, the Company's executive officers and
directors are insured against losses arising from claims made against them for
wrongful acts which they may become obligated to pay or for which the Company
may be required to indemnify them.
REGISTRATION RIGHTS
The Company has entered into an agreement granting registration rights
(the "Registration Rights Agreement") with certain holders of Common Stock
including the Selling Shareholders and Mr. James P. Cotton, Jr. and Mr. Gerald
E. Eickhoff (both of whom are directors of the Company). Pursuant to the
Registration Rights Agreement, these holders may exercise demand or "piggyback"
registration rights with respect to shares of Common Stock held by them. The
Company is obligated to register stock on only two occasions pursuant to the
demand registration rights. The Registration Rights Agreement has a term of
three years for demand registration rights and five years for "piggyback"
registration rights. These registration rights are subject to certain conditions
and limitations, including the right of underwriters to restrict the number of
shares offered in a registration.
OTHER MATTERS
The Common Stock is listed on Nasdaq National Market under the symbol
"AMMB." SunTrust Bank, Atlanta, Georgia, is the transfer agent and registrar for
the Common Stock.
PLAN OF DISTRIBUTION
The shares of Common Stock covered hereby may be offered and sold from
time to time by the Selling Shareholders. The Selling Shareholders will act
independently of the Company in making decisions with respect to the timing,
manner and size of each sale. Such sales may be made in the over-the-counter
market or otherwise, at market prices prevailing at the time of the sale, at
prices related to the then prevailing market price or in negotiated
transactions, including pursuant to an
15
<PAGE>
underwritten offering or pursuant to one or more of the following methods:
(i) purchases by a broker-dealer as principal and resale by such broker or
dealer for its account pursuant to this Prospectus; (ii) ordinary brokerage
transactions and transactions in which a broker solicits purchasers; and
(iii) block trades in which a broker-dealer so engaged will attempt to sell
the shares as agent but may take a position and resell a portion of the block
as principal to facilitate the transaction. In effecting sales,
broker-dealers engaged by the Selling Shareholders may arrange for other
broker-dealers to participate. Broker-dealers may receive commissions or
discounts from the Selling Shareholders in amounts to be negotiated
immediately prior to the sale.
In connection with the sale of shares of Common Stock covered hereby,
underwriters or agents may receive compensation from the Selling Shareholders or
from purchasers of the shares of Common Stock covered hereby for whom they may
act as agents, in the form of discounts, concessions or commissions.
Underwriters may sell shares of Common Stock to or through dealers and such
dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters and/or commissions from the purchasers for
whom they act as agents. Underwriters, dealers and agents that participate in
the distribution of shares of Common Stock covered hereby may be deemed to be
underwriters, and any discounts or commissions received by them from the selling
Shareholders and any profit on the resale of shares of Common Stock by them may
be deemed to be underwriting discounts and commissions under the Securities Act.
The Registration Rights Agreement provides that the Company will
indemnify the Selling Shareholders against certain liabilities, including
liabilities under the Securities Act.
This Offering will terminate on the earlier of (i) the date on which all
shares offered hereby have been sold by the Selling Shareholders and (ii)
November 27, 1998.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by L. Keith Blackwell, General Counsel of the Company.
INDEPENDENT ACCOUNTANTS
The consolidated balance sheets of the Company as of December 31, 1994
and 1995, and the related statements of income, shareholders' equity and cash
flows for the years ended December 31, 1993, 1994 and 1995, have been audited by
Deloitte & Touche LLP, independent accountants, as stated in their reports
incorporated by reference herein.
16
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission Registration Fee. . . . . . . . $15,983
Nasdaq National Market Listing Fee . . . . . . . . . . . . . . . . 17,500
Printing Expenses. . . . . . . . . . . . . . . . . . . . . . . . . 100
Accounting Fees and Expenses . . . . . . . . . . . . . . . . . . . 2,000
Legal Fees and Expenses (including fees of Selling
Shareholders' counsel) . . . . . . . . . . . . . . . . . . . . . . 10,000
Fees of Transfer Agent and Registrar . . . . . . . . . . . . . . . 100
Miscellaneous Expenses . . . . . . . . . . . . . . . . . . . . . . 2,317
-------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $48,000
-------
-------
</TABLE>
All of the above expenses except the Securities and Exchange Commission
registration fee and the Nasdaq National Market listing fee are estimated. All
of such expenses will be borne by the Company.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Amended and Restated Certificate of Incorporation (the
"Certificate") and the Company's Amended and Restated Bylaws (the "Bylaws")
provide that the Company shall indemnify, to the full extent permitted by law,
any person against liabilities arising from their service as directors,
officers, employees or agents of the Company. Section 145 of the DGCL empowers a
corporation to indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorney's fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
Section 145 also empowers a corporation to indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that such person acted in any of the
capacities set forth above, against expenses (including attorney's fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted under similar standards, except
that no indemnification may be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the corporation
unless, and only to the extent that, the Court of Chancery or the court in which
such action was brought shall determine that despite the adjudication of
liability such person is fairly and reasonably entitled to indemnify for such
expenses which the court shall deem proper.
Section 145 further provides that indemnification provided for by
Section 145 shall not be deemed exclusive of any other rights to which the
indemnified party may be entitled, and that the corporation is empowered to
purchase and maintain insurance on behalf of a director or officer of the
corporation against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liabilities under
Section 145.
II-1
<PAGE>
The Certificate and the Bylaws provide that no director of the Company
shall be personally liable to the Company or its shareholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i) for
any breach of the director's duty of loyalty to the Company or its shareholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL or
(iv) for any transaction from which the director derived an improper personal
benefit. Any repeal or modification of this provision related to director's
liability shall not adversely affect any right or protection of a director of
the Company existing immediately prior to such repeal or modification. Further,
if the DGCL shall be repealed or modified, the elimination of liability of a
director provided in the Certificate and the Bylaws shall be to the fullest
extent permitted by the DGCL as so amended.
Pursuant to Registration Rights Agreements with certain shareholders of
the Company, the Company has agreed to indemnify such shareholders (including
the Selling Shareholders) against certain liabilities, including liabilities
under the Securities Act or otherwise. For the undertaking with respect to
indemnification, see Item 17 herein.
ITEM 16. EXHIBITS
Exhibit No. Exhibit
- ----------- -------
4.1 Restated Certificate of Incorporation, filed as Exhibit 3(i) to
the Company's Form 10-Q for the quarter ended September 30, 1995,
as amended by Form 10-Q/A No. 1 dated October 25, 1995 (the
"September 1995 10-Q"), which exhibit is incorporated herein by
reference.
4.2 Amended and Restated Bylaws as of May 23, 1994, filed as Exhibit
3(f) to the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1994, which exhibit is incorporated
herein by reference.
4.3 Revolving Loan Agreement, dated as of September 29, 1995, among
the Company, certain subsidiaries of the Company, NationsBank of
Texas, N.A., as agent, and the Banks named therein, filed as
Exhibit 10(b) to the Company's September 1995 10-Q, which exhibit
is incorporated herein by reference.
4.4 First Amendment to Credit Agreement, dated as of November 21,
1995, among the Company and NationsBank of Texas, N.A., as agent,
and the Banks named therein, and consented to by certain of the
Company's subsidiaries, filed as Exhibit 4.2 to the Company's
Registration Statement on Form S-3 (No. 33-65329), which exhibit
is incorporated herein be reference.
4.5 Specimen Common Stock Certificate, filed as Exhibit 4.4 to the
Company's Registration Statement on Form S-3 (No. 33-63683),
which exhibit is incorporated herein by reference.
4.6 Indenture, dated as of November 27, 1995, between the Company and
First Interstate Bank of Texas, National Association in respect
of the Company's 8% Convertible Subordinated Debentures due 2005,
filed as Exhibit 4.5 to the Company's Registration Statement on
Form S-3 (No. 33-63683), which exhibit is incorporated herein by
reference.
4.7* Registration Rights Agreement, dated as of November 27, 1995, by
and among the Company and the Agents named therein on behalf of
the purchasers of the Company's 8% Convertible Subordinated
Debentures Due 2005.
4.8* First Supplemental Indenture, dated as of April 1, 1996, to
Indenture, dated as of November 27, 1995, between the Company and
First Interstate Bank of Texas, National Association.
5.1* Opinion of L. Keith Blackwell, General Counsel of the Company, as
to the validity of Common Stock to be offered.
23.1* Consent of L. Keith Blackwell, contained in the opinion filed as
Exhibit 5.1.
23.2** Consent of Deloitte & Touche LLP.
24.1* Power of Attorney of the Directors and certain Executive Officers
of the Company.
II-2
<PAGE>
- --------------------
* Previously filed.
** Filed herewith.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(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;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
PROVIDED, HOWEVER, that paragraphs (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 Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, 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; and
(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.
The undersigned Registrant hereby undertakes that, for the purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered herein, 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 of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission 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
II-3
<PAGE>
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.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act of 1933, 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 the 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.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of Prospectus
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.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 Pre-
Effective Amendment No. 2 to its Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Dallas,
State of Texas, on the 8th day of May, 1996.
AMRESCO, INC.
By: /s/ L. KEITH BLACKWELL
------------------------------------
L. Keith Blackwell
GENERAL COUNSEL AND SECRETARY
Pursuant to the requirements of the Securities Act of 1933, this Pre-
Effective Amendment No. 2 to the Registration Statement has been signed by the
following persons in the capacities and on the 8th day of May, 1996:
SIGNATURE TITLE
--------- -----
ROBERT H. LUTZ, JR.* Chairman of the Board and
- ------------------------------ Chief Executive Officer
Robert H. Lutz, Jr.
ROBERT L. ADAIR III* Director, President and
- ------------------------------ Chief Operating Officer
Robert L. Adair III
BARRY L. EDWARDS* Executive Vice President and
- ------------------------------ Chief Financial Officer
Barry L. Edwards (Principal Financial Officer)
JAMES P. COTTON, JR.* Director
- ------------------------------
James P. Cotton, Jr.
RICHARD L. CRAVEY* Director
- ------------------------------
Richard L. Cravey
Director
- ------------------------------
Gerald E. Eickhoff
Director
- ------------------------------
William S. Green
AMY J. JORGENSEN* Director
- ------------------------------
Amy J. Jorgensen
JOHN J. MCDONOUGH* Director
- ------------------------------
John J. McDonough
Director
- ------------------------------
Bruce W. Schnitzer
RONALD B. KIRKLAND* Vice President and Chief
- ------------------------------ Accounting Officer
Ronald B. Kirkland (Principal Accounting Officer)
II-5
<PAGE>
L. Keith Blackwell, by signing his name hereto, does sign and execute
this Pre-Effective Amendment No. 2 to the Registration Statement on behalf of
each of the above-named officers and directors of the Registrant on this 8th day
of May, 1996, pursuant to powers of attorneys executed on behalf of each of such
officers and directors, and previously filed with the Securities and Exchange
Commission.
*By: /s/ L. KEITH BLACKWELL
--------------------------
L. Keith Blackwell
ATTORNEY-IN-FACT
II-6
<PAGE>
EXHIBIT INDEX
SEQUENTIALLY
NUMBERED
EXHIBIT NO. EXHIBIT PAGE
- ----------- ------- ------------
4.1 Restated Certificate of Incorporation, filed as
Exhibit 3(i) to the Company's Form 10-Q for the
quarter ended September 30, 1995, as amended by
Form 10-Q/A No. 1 dated October 25, 1995 (the
"September 1995 10-Q"), which exhibit is
incorporated herein by reference.
4.2 Amended and Restated Bylaws as of May 23, 1994,
filed as Exhibit 3(f) to the Company's Annual Report
on Form 10-K for the fiscal year ended December 31,
1994, which exhibit is incorporated herein by reference.
4.3 Revolving Loan Agreement, dated as of September 29,
1995, among the Company, certain subsidiaries of the
Company, NationsBank of Texas, N.A., as agent, and
the Banks named therein, filed as Exhibit 10(b) to
the Company's September 1995 10-Q, which exhibit is
incorporated herein by reference.
4.4 First Amendment to Credit Agreement, dated as of
November 21, 1995, among the Company and
NationsBank of Texas, N.A., as agent, and the
Banks named therein, and consented to by certain
of the Company's subsidiaries, filed as Exhibit 4.2
to the Company's Registration Statement on Form S-3
(No. 33-65329), which exhibit is incorporated herein
be reference.
4.5 Specimen Common Stock Certificate, filed as
Exhibit 4.4 to the Company's Registration Statement
on Form S-3 (No. 33-63683), which exhibit is
incorporated herein by reference.
4.6 Indenture, dated as of November 27, 1995, between the
Company and First Interstate Bank of Texas, National
Association in respect of the Company's 8% Convertible
Subordinated Debentures due 2005, filed as
Exhibit 4.5 to the Company's Registration Statement
on Form S-3 (No. 33-63683), which exhibit is incorporated
herein by reference.
4.7* Registration Rights Agreement, dated as of
November 27, 1995, by and among the Company and
the Agents named therein on behalf of the purchasers
of the Company's 8% Convertible Subordinated Debentures
Due 2005.
4.8* First Supplemental Indenture, dated as of
April 1, 1996, to Indenture, dated as of
November 27, 1995, between the Company and First
Interstate Bank of Texas, National Association.
5.1* Opinion of L. Keith Blackwell, General Counsel of the
Company, as to the validity of Common Stock to be offered.
23.1* Consent of L. Keith Blackwell, contained in the opinion
filed as Exhibit 5.1.
23.2** Consent of Deloitte & Touche LLP.
24.1* Power of Attorney of the Directors and certain
Executive Officers of the Company.
- --------------------
* Previously filed.
** Filed herewith.
<PAGE>
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
AMRESCO, INC.
We consent to incorporation by reference in the Pre-Effective Amendment No. 2
to the Registration Statement No. 333-157 on Form S-3 of our report dated
February 6, 1996, appearing in the Annual Report on Form 10-K of AMRESCO,
INC. for the year ended December 31, 1995. We also consent to the reference
to us under the heading "Independent Accountants" in such Prospectus.
Deloitte & Touche, LLP
Dallas, Texas
May 8, 1996
