As filed with the Securities and Exchange Commission
on April 17 , 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AMRESCO, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 59-1781257
(State of Incorporation) (IRS Employer Identification No.)
700 North Pearl Street, Ste. 2400,
LB 342, Dallas, TX 75201
(Address of Principal Executive Offices) (Zip Code)
AMRESCO, INC. 1997 Stock Option and Award Plan
AMRESCO, INC. 1997 Stock Option Plan
(Full Title of Plans)
L. KEITH BLACKWELL
Vice President,General Counsel and Secretary
AMRESCO, INC.
700 North Pearl Street, Ste. 2400,
LB 342, Dallas, TX 75201
(214) 953-7700
(Name and address, including zip code, and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
PROPOSED
TITLE OF PROPOSED MAXIMUM
SECURITIES AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TO BE TO BE OFFERING PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE (1) PRICE FEE
Common Stock,
$.05 par value 856,500 $19.875 $17,022,937 $ 5,159
Common Stock,
$.05 par value 3,018,500 16.4375 49,616,594 $ 15,036
Total 3,875,000 $66,639,531 $ 20,195
(1) Determined in accordance with Rule 457(h), the
registration fee is based on the average option price per share
for shares presently subject to options and, for those shares not
presently subject to options, on the average of the high and low
prices of the Registrant's Common Stock reported on the Nasdaq
National Market on April 16, 1997.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by AMRESCO, INC. ("the Company")
with the Securities and Exchange Commission ("the Commission")
are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996.
(b) The Company's Current Report on Form 8-K dated March
12, 1997.
(c) All other reports filed pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 since the end of the
fiscal year covered by the document incorporated pursuant to (a)
above.
(d) The description of the Common Stock, $.05 par value
per share, of the Company which is contained in a registration
statement filed under Section 12 of the Securities Exchange Act
of 1934, including any amendment or report filed for the purpose
of updating such description.
All documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Securities Exchange
Act of 1934 prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or
which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part
hereof from the date of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES. Not Applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the issuance of the securities being registered
has been passed upon for the Company by Michael B. Cline, Deputy
General Counsel of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's amended and restated bylaws and restated
certificate of incorporation, as amended, obligate the Registrant
to indemnify its directors and officers to the fullest extent
provided by law. Section 145 of the Delaware General Corporation
Law ("Section 145") generally provides that a director or officer
of a corporation; (i) shall be indemnified by the corporation for
expenses actually and reasonably incurred by him in defense of
any action or proceeding in connection with his service to the
corporation, if he is successful in defense of the claims made
against him; (ii) may, in actions other than "derivative" and
similar actions, be indemnified for expenses, judgments, fines
and amounts paid in settlements actually and reasonably incurred
by him even if he is not successful on the merits, if he acted in
good faith and if he believed he was acting in the best interests
of the corporation or in a manner not opposed to the best
interests of the corporation (or in a criminal proceeding, if he
reasonably believed his conduct was not unlawful); and (iii) may
be indemnified by the corporation for expenses actually and
reasonably incurred by him (but not judgments or settlements) of
any action by the corporation or of a derivative action (such as
a suit by a shareholder alleging breach by a director or officer
of a duty owed to the corporation), even if he is not successful,
provided that he acted in good faith and believed he was acting
in the best interests of the corporation or in a manner not
opposed to the best interests of the corporation; provided that
no indemnification is permitted without court approval if the
director was found to be liable to the corporation.
Before the permissive indemnification described in clauses
(ii) and (iii) above may be made pursuant to Section 145, either
(i) a majority vote of the directors who are not parties to such
action, suit or proceeding, even though less than a quorum of
disinterested directors, (ii) the stockholders or (iii) under
certain circumstances, independent legal counsel in a written
opinion must determine that indemnification is appropriate in the
circumstances because the applicable standards of conduct have
been met.
The Registrant has entered into Indemnity Agreements with
certain of its directors and officers (the "Indemnified
Parties"). Under the terms of the Indemnity Agreements, the
Registrant is required to indemnify the Indemnified Parties
against certain liabilities arising out of their service for the
Registrant or its subsidiaries. The Indemnity Agreements require
the Registrant (I) to indemnify each Indemnified Party to the
fullest extent permitted by law; (ii) to provide coverage for
each Indemnified Party under the Registrant's directors and
officers liability insurance policy ; (iii) to advance certain
expenses incurred by an Indemnified Party; and (iv) to contribute
to the amount of expenses, judgments, fine and settlements paid
or payable by an Indemnified Party when indemnification is
unavailable (including instances in which indemnification is
found unlawful by a court of competent jurisdiction) other than
for the reasons expressed in the Indemnity Agreements. The
Indemnity Agreements provide limitations on the Indemnified
Party's rights to indemnification in certain circumstances. The
Registrant may enter into Indemnity Agreements providing similar
rights to any future director, officer or key employee of the
Registrant or its subsidiaries.
The Registrant's directors and officers are insured against
losses arising from any claim against them as such for wrongful
acts or omissions, subject to certain limitations.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable.
ITEM 8. EXHIBITS.*
4(a) Registrant's Restated Certificate of Incorporation, as
amended, is hereby incorporated by reference from Exhibit
3(a) to the Registrant's Form 10-Q for the quarter ended
September 30, 1995.
4(b) Registrant's Amended and Restated Bylaws is hereby
incorporated by reference from Exhibit 3(c) to the
Registrant's Annual Report on Form 10-K dated for the year
ended December 31, 1996.
4(c) AMRESCO, INC. 1997 Stock Option and Award Plan is hereby
incorporated by reference from Exhibit 10(ac) to the
Registrants Annual Report on Form 10-K for the year ended
December 31, 1996.
4(d) AMRESCO, INC. 1997 Stock Option Plan.
5 Opinion of counsel of Registrant.
23(a) Consent of counsel (included in Exhibit 5).
23(b) Consent of Deloitte & Touche LLP
24 Power of Attorney (contained on page II-8).
* Exhibits are numbered in accordance with Item 601 of Regulation
S-K.
ITEM 9. UNDERTAKINGS.
(a) 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; and
(iii) To include any material information
with respect to the plan of
distribution not previously
disclosed in the registration
statement or any material change in
such information in the
registration statement;
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) above
do not apply if the registration statement is on Form S-3 or Form
S-8, and 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 the 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.
(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.
(b) The undersigned issuer hereby undertakes that, for
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 the registration statement
shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(h) 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 provisions described in Item 6 of this Part II, 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 Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer,
or controlling person of the registrant in the successful defense
of any action, suit, or proceeding) is asserted by such director,
officer, or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
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-8 and
has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Dallas, State of Texas, on the 17th day of April, 1997.
AMRESCO, INC.
By:/s/ Robert H. Lutz, Jr.
Robert H. Lutz, Jr.
Chairman of the Board of Directors and Chief
Executive Officer (Principal Executive Officer)
Each person whose signature appears below does hereby make,
constitute and appoint, Robert H. Lutz, Jr., Robert L. Adair III,
and L. Keith Blackwell and each of them his true and lawful
attorney with full power of substitution to execute, deliver and
file with the Securities and Exchange Commission, for and on his
behalf and in his capacity or capacities as stated below, any
amendment (including post-effective amendments) to the
Registration Statement with all exhibits thereto, making such
changes in the Registration Statement as the Registrant deems
appropriate.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.<PAGE>
SIGNATURE TITLE
/s/ Robert H. Lutz , Jr. Chairman of the Board of
Robert H. Lutz, Jr. Directors and Chief
Executive Officer
(Principal Executive Officer)
/s/ Robert L. Adair III President, Chief Operating
Robert L. Adair III Officer and a Director
/s/ Barry L. Edwards Executive Vice President and
Barry L. Edwards Chief Financial Officer
Barry L. Edwards (Principal Financial Officer)
/s/ James P. Cotton,Jr. Director
James P. Cotton, Jr.
/s/ Richard L. Cravey Director
Richard L. Cravey
/s/ Gerald E. Eickhoff Director
Gerald E. Eickhoff
/s/ Edwin A. Wahlen, Jr. Director
Edwin A. Wahlen, Jr.
/s /Amy J. Jorgensen Director
Amy J. Jorgensen
/s/ John J. McDonough Director
John J. McDonough
/s/ Bruce W. Schnitzer Director
Bruce W. Schnitzer
/s/ Ronald B. Kirkland Vice President and Chief
Ronald B. Kirkland Accounting Officer
(Principal Accounting Officer)
EXHIBIT INDEX
EXHIBIT NUMBER* DESCRIPTION
4(d) AMRESCO, INC. 1997 Stock Option Plan
5 Opinion of Counsel to Registrant
23(a) Consent of Counsel
(included in Exhibit 5).
23(b) Consent of Deloitte & Touche LLP
24 Power of Attorney
(contained on page II-4)
*Exhibits are numbered in accordance with Item 601 of Regulation
S-K.
AMRESCO, INC.
1997 STOCK OPTION PLAN
ARTICLE 1. Establishment, Purpose and Duration
1.1 Establishment of the Plan. AMRESCO, INC., a Delaware
corporation (hereinafter referred to as "AMRESCO"), hereby
establishes a stock option plan to be known as the "AMRESCO, INC.
1997 Stock Option Plan" (the "Plan"), as set forth in this
document. The Plan permits the grant of Nonqualified Stock
Options and Incentive Stock Options.
The Plan shall become effective as of February 25, 1997 (the
"Effective Date") and shall remain in effect as provided in
Section 1.3.
1.2 Purpose of the Plan. The purpose of the Plan is to
secure for AMRESCO and its stockholders the benefits of the
incentive inherent in stock ownership in AMRESCO by key
employees, directors and other persons who are largely
responsible for its future growth and continued success. The
Plan promotes the success and enhances the value of AMRESCO by
linking the personal interests of Participants to those of
AMRESCO's stockholders and by providing Participants with an
incentive for outstanding performance.
The Plan is further intended to provide flexibility to
AMRESCO in its ability to motivate, attract and retain the
services of Participants upon whose judgment, interest and
special effort the successful conduct of its operation largely
depends.
1.3 Duration of the Plan. The Plan shall commence on the
Effective Date and shall remain in effect, subject to the right
of the Board of Directors to amend or terminate the Plan at any
time pursuant to Article 11, until the day prior to the tenth
(10th) anniversary of the Effective Date.
ARTICLE 2. Definitions
Whenever used herein, the following terms shall have the
meanings set forth below and, when the meaning is intended, the
initial letter of the word is capitalized:
(a) "Award" means, individually or collectively, a grant
under this Plan of Nonqualified Stock Options or Incentive Stock
Options.
(b) "Award Agreement" means an agreement entered into by
each Participant and AMRESCO, setting forth the terms and
provisions applicable to Awards granted to Participants
hereunder.
(c) "Beneficial Owner" or "Beneficial Ownership" shall have
the meaning ascribed to such term in Rule 13d-3 of the General
Rules and Regulations under the Exchange Act.
(d) "Board" or "Board of Directors" means the board of
directors of AMRESCO.
(e) "Cause" means: (i) willful misconduct on the part of a
Participant that is materially detrimental to AMRESCO; or (ii)
the indictment of a Participant for the commission of a felony.
The existence of "Cause" under either (i) or (ii) shall be
determined by the Committee. Notwithstanding the foregoing, if
the Participant has entered into an employment agreement that is
binding as of the date of employment termination, and if such
employment agreement defines "Cause" and/or provides a means of
determining whether "Cause" exists, the definition of "Cause" and
the means of determining whether "Cause" exists provided for in
the employment agreement shall apply to the Participant for
purposes hereof.
(f) "Change in Control" shall be deemed to have occurred
if:
(i) An acquisition by any Person of Beneficial
Ownership of the Shares then outstanding ("AMRESCO Common
Stock Outstanding") or the voting securities of AMRESCO then
outstanding entitled to vote generally in the election of
directors ("AMRESCO Voting Securities Outstanding");
provided such acquisition of Beneficial Ownership would
result in the Person's beneficially owning (within the
meaning of Rule 13d-3 promulgated under the Exchange Act)
twenty-five percent (25%) or more of AMRESCO Common Stock
Outstanding or twenty-five percent (25%) or more of the
combined voting power of AMRESCO Voting Securities
Outstanding; and provided further, that immediately prior to
such acquisition such Person was not a direct or indirect
Beneficial Owner of twenty-five percent (25%) or more of
AMRESCO Common Stock Outstanding or twenty-five percent
(25%) or more of the combined voting power of AMRESCO Voting
Securities Outstanding, as the case may be; or
(ii) The approval of the stockholders of AMRESCO of a
reorganization, merger, consolidation, complete liquidation
or dissolution of AMRESCO, the sale or disposition of all or
substantially all of the assets of AMRESCO or similar
corporate transaction (in each case referred to in this
Section 2(f) as a "Corporate Transaction") or, if
consummation of such Corporate Transaction is subject, at
the time of such approval by stockholders, to the consent of
any government or governmental agency, the obtaining of such
consent (either explicitly or implicitly); or
(iii) A change in the composition of the Board such
that the individuals who, as of the Effective Date,
constitute the Board (such Board shall be hereinafter
referred to as the "Incumbent Board") cease for any reason
to constitute at least a majority of the Board; provided,
however, for purposes of this Section 2(f), that any
individual who becomes a member of the Board subsequent to
the Effective Date whose election, or nomination for
election by AMRESCO's stockholders, was approved by a vote
of at least a majority of those individuals who are members
of the Board and who were also members of the Incumbent
Board (or deemed to be such pursuant to this proviso) shall
be considered as though such individual were a member of the
Incumbent Board; but, provided, further, that any such
individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest
(as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act, including any successor
to such Rule) or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than
the Board shall not be so considered as a member of the
Incumbent Board.
Notwithstanding the provisions set forth in subparagraphs (i) and
(ii) of this Section 2(f), the following shall not constitute a
Change in Control for purposes hereof: (1) any acquisition of
shares of common stock of AMRESCO by, or consummation of a
Corporate Transaction with, any Subsidiary or an employee benefit
plan (or related trust) sponsored or maintained by AMRESCO or an
affiliate; or (2) any acquisition of shares of common stock of
AMRESCO, or consummation of a Corporate Transaction, following
which more than fifty percent (50%) of the shares of common stock
then outstanding of the corporation resulting from such
acquisition or Corporate Transaction and more than fifty percent
(50%) of the combined voting power of the voting securities then
outstanding of such corporation entitled to vote generally in the
election of directors, is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and
entities who were Beneficial Owners of AMRESCO Common Stock
Outstanding and AMRESCO Voting Securities Outstanding,
respectively, immediately prior to such acquisition or Corporate
Transaction in substantially the same proportions as their
ownership, immediately prior to such acquisition or Corporate
Transaction, of AMRESCO Common Stock Outstanding and AMRESCO
Voting Securities Outstanding, as the case may be.
(g) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(h) "Committee" means the committee appointed by the Board
to administer the Plan with respect to grants of Awards, as
specified in Article 3.
(i) "Director" means any individual who is a member of the
Board of Directors.
(j) "Disability" shall have the meaning ascribed to such
term in the AMRESCO long-term disability plan covering the
Participant, or in the absence of such plan, a meaning consistent
with Section 22(e)(3) of the Code.
(k) "Employee" means any full-time, salaried employee of
AMRESCO, or AMRESCO's Subsidiaries.
(l) "Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, or any successor act thereto.
(m) "Fair Market Value" shall be determined as follows:
(i) If, on the relevant date, the Shares are traded on
a national or regional securities exchange or on The Nasdaq Stock
Market ("Nasdaq") and closing sale prices for the Shares are
customarily quoted, on the basis of the closing sale price on the
principal such securities exchange on which the Shares may then
be traded or, if there is no such sale on the relevant date, then
on the immediately preceding day on which a sale was reported;
(ii) If, on the relevant date, the Shares are not
listed on any securities exchange or traded on Nasdaq, but
nevertheless are publicly traded and reported on Nasdaq
without closing sale prices for the Shares being customarily
quoted, on the basis of the mean between the closing bid and
asked quotations in such other over-the-counter market as
reported by Nasdaq; but, if there are no bid and asked
quotations in the over-the-counter market as reported by
Nasdaq on that date, then the mean between the closing bid
and asked quotations in the over-the-counter market as
reported by Nasdaq on the immediately preceding day such bid
and asked prices were quoted; and
(iii) If, on the relevant date, the Shares are not
publicly traded as described in (i) or (ii), on the basis of
the good faith determination of the Committee.
(n) "Incentive Stock Option" or "ISO" means an option to
purchase Shares, granted under Article 6 which is designated as
an Incentive Stock Option and is intended to meet the
requirements of Section 422 of the Code.
(o) "Insider" shall mean a Person who is, on the relevant
date, a director, officer or ten percent (10%) beneficial owner
of any class of AMRESCO's equity securities that is registered
pursuant to Section 12 of the Exchange Act, all as defined under
Section 16 of the Exchange Act.
(p) "Named Executive Officer" means a Participant who, as
of the date of vesting and/or payout of an Award is one of the
group of "covered employees," as defined in the regulations
promulgated under Code Section 162(m), or any successor statute.
(q) "Nonqualified Stock Option" or "NQSO" means an option
to purchase Shares granted under Article 6 which is not intended
to meet, or does not meet, the requirements of Code Section 422.
(r) "Option" means an Incentive Stock Option or a
Nonqualified Stock Option.
(s) "Option Price" means the price at which a Share may be
purchased by a Participant pursuant to an Option, as determined
by the Committee.
(t) "Participant" means an Employee, director or other
Person who has been granted an Award which is outstanding.
(u) "Person" shall have the meaning ascribed to such term
in Section 3(a)(9) of the Exchange Act and used in Section 13(d)
and 14(d) thereof, including a "group" as defined in Section
13(d) thereof.
(v) "Retirement" shall have the meaning ascribed to such
term in the AMRESCO, INC. Retirement Savings and Profit Sharing
Plan and Trust.
(w) "Shares" means the shares of common stock of AMRESCO,
par value $0.05 per share.
(x) "Subsidiary" means any corporation, partnership, joint
venture or other entity in which AMRESCO has a fifty percent
(50%) or greater voting interest.
ARTICLE 3. Administration
3.1 The Committee. The Plan shall be administered by the
Stock Option and Bonus Committee of the Board, or by any other
Committee appointed by the Board consisting of not less than two
(2) Directors who meet the "disinterested administration"
requirements of Rule 16b-3 or any successor thereto under the
Exchange Act. The members of the Committee shall be appointed
from time to time by, and shall serve at the discretion of, the
Board of Directors.
The Committee shall be comprised solely of Directors who are
eligible to administer the Plan pursuant to Rule 16b-3(c)(2) or
any successor thereto under the Exchange Act. However, if for
any reason any member of the Committee does not qualify to
administer the Plan, as contemplated by Rule 16b-3(c)(2) of the
Exchange Act, the Board of Directors may appoint a new Committee
member who complies with Rule 16b-3(c)(2).
3.2 Authority of the Committee. Subject to the provisions
hereof, the Committee shall have full power to select the
Employees and other Persons who are responsible for the future
growth and success of AMRESCO, who may include, without
limitation, consultants, independent contractors or other
providers of services to AMRESCO, who shall participate herein
(who may change from year to year); determine the size and types
of Awards; determine the terms and conditions of Awards in a
manner consistent herewith (including vesting provisions and the
duration of the Awards); construe and interpret the Plan and any
agreement or instrument entered into hereunder; establish, amend
or waive rules and regulations for the Plan's administration; and
(subject to the provisions of Article 11) amend the terms and
conditions of any outstanding Award to the extent such terms and
conditions are within the discretion of the Committee as provided
herein, including to establish different terms and conditions
relating to the effect of the termination of employment or other
service to AMRESCO. Further, the Committee shall make all other
determinations which may be necessary or advisable for the
administration hereof. As permitted by law, the Committee may
delegate its authority hereunder.
3.3 Decisions Binding. All determinations and decisions
made by the Committee pursuant to the provisions hereof and all
related orders and resolutions of the Board shall be final,
conclusive and binding on all Persons, including AMRESCO, the
stockholders, Employees, Participants and their estates and
beneficiaries.
ARTICLE 4. Shares Subject to the Plan
4.1 Number of Shares. Subject to adjustment as provided in
Section 4.3, the total number of Shares available for grant of
Awards shall be an aggregate of eight hundred seventy-five
thousand (875,000). These Shares may, in the discretion of
AMRESCO, be either authorized but unissued Shares or shares held
as treasury shares, including Shares purchased by AMRESCO.
The following rules shall apply for purposes of the
determination of the number of Shares available for grant
hereunder;
(a) The grant of an Option shall reduce the Shares
available for grant hereunder by the number of shares
subject to such Award.
(b) While an Option is outstanding, it shall be
counted against the authorized pool of Shares, regardless of
its vested status.
4.2 Lapsed Awards. If any Award is canceled, terminates,
expires or lapses for any reason, any Shares subject to such
Award shall again be available for the grant of an Award.
However, in the event that prior to the Award's cancellation,
termination, expiration or lapse, the holder of the Award at any
time received one (1) or more "benefits of ownership" pursuant to
such Award (as defined by the Securities and Exchange Commission,
pursuant to any rule or interpretation promulgated under Section
16 of the Exchange Act), the Shares subject to such Award shall
not be made available for regrant hereunder.
4.3 Adjustments in Authorized Shares. In the event of any
change in corporate capitalization, such as a stock split, or a
corporate transaction, such as any merger, consolidation,
separation, including a spin-off, or other distribution of stock
or property of AMRESCO, any reorganization (whether or not such
reorganization comes within the definition of such term in Code
Section 368) or any partial or complete liquidation of AMRESCO,
such adjustment shall be made in the number and class of Shares
which may be delivered hereunder, and in the number and class of
and/or price of Shares subject to outstanding Awards, as may be
determined to be appropriate and equitable by the Committee, in
its sole discretion, to prevent dilution or enlargement of
rights; provided, however, that the number of Shares subject to
any Award shall always be a whole number and the Committee shall
make such adjustments as are necessary to insure Awards of whole
Shares.
ARTICLE 5. Eligibility and Participation
Any key Employee of AMRESCO, or of any Subsidiary, including
any such Employee who is also a director of AMRESCO, or of any
Subsidiary, or any other Person, including consultants,
independent contractors or other service providers, whose
judgment, initiative and efforts contribute or may be expected to
contribute materially to the successful performance of AMRESCO or
any Subsidiary shall be eligible to receive an Award. In
determining the Employees and other Persons to whom an Award
shall be granted and the number of Shares which may be granted
pursuant to that Award, the Committee shall take into account the
duties of the respective Person, their present and potential
contributions to the success of AMRESCO or any Subsidiary, and
such other factors as the Committee shall deem relevant in
connection with accomplishing the purpose hereof.
No person who is a member of the Committee shall be eligible
to be granted any Award hereunder while so serving.
ARTICLE 6. Stock Options
6.1 Grant of Options. Subject to the terms and provisions
hereof, Options may be granted to Employees or other Persons at
any time and from time to time as shall be determined by the
Committee. The Committee shall have discretion in determining
the number of Shares subject to Options granted to each
Participant; provided, however, that in the case of any ISO, only
an Employee may receive such grant and the aggregate Fair Market
Value (determined at the time such Option is granted) of the
Shares to which ISOs are exercisable for the first time by the
Optionee during any calendar year (hereunder and under all other
Incentive Stock Option Plans of AMRESCO and any Subsidiary) shall
not exceed $100,000. The Committee may grant a Participant ISOs,
NQSOs or a combination thereof, and may vary such Awards among
Participants.
6.2 Award Agreement. Each Option grant shall be evidenced
by an Award Agreement that shall specify the Option Price, the
duration of the Option, the number of Shares to which the Option
pertains and such other provisions as the Committee shall
determine. The Award Agreement shall further specify whether the
Award is intended to be an ISO or an NQSO. Any portion of an
Option that is not designated as an ISO or otherwise fails or is
not qualified to be treated as an ISO (even if designated as an
ISO) shall be a NQSO.
6.3 Option Price. The Option Price for each grant of an
ISO shall be not less than one hundred percent (100%) of the Fair
Market Value of a Share on the date the ISO is granted. In no
event, however, shall any Participant, who at the time he would
otherwise be granted an Option owns (within the meaning of
Section 424(d) of the Code) stock of AMRESCO possessing more than
ten percent (10%) of the total combined voting power of all
classes of stock of AMRESCO be eligible to receive an ISO at an
Option Price less than one hundred ten percent (110%) of the Fair
Market Value of a Share on the date the ISO is granted. The
price at which each Share covered by each NQSO shall be purchased
by an Optionee shall be established by the Committee, but in no
event shall such price be less than eighty-five percent (85%) of
the Fair Market Value (or such lower percentage of Fair Market
Value as may be established by Internal Revenue Service rules or
regulations as the limit for granting discounted stock options
without causing immediate tax consequences to the Participant) of
a Share on the date the Option is granted.
6.4 Duration of Options. Each Option shall expire at
such time as the Committee shall determine at the time of grant;
provided, however, that no Option shall be exercisable later than
the tenth (10th) anniversary date of its grant; provided,
further, however, that any ISO granted to any Participant who at
such time owns (within the meaning of Section 424(d) of the Code)
stock of AMRESCO possessing more than ten percent (10%) of the
total combined voting power of all classes of stock in AMRESCO,
shall be exercisable not later than the fifth (5th) anniversary
date of its grant.
6.5 Exercise of Options. Options shall be exercisable
at such times and be subject to such restrictions and conditions
as the Committee shall in each instance approve, which need not
be the same for each grant or for each Participant. Each Option
shall be exercisable for such number of Shares and at such time
or times, including periodic installments, as may be determined
by the Committee at the time of the grant. Except as otherwise
provided in the Award Agreement or Article 10, the right to
purchase Shares that are exercisable in periodic installments
shall be cumulative so that when the right to purchase any Shares
has accrued, such Shares or any part thereof may be purchased at
any time thereafter until the expiration or termination of the
Option.
6.6 Payment. Options shall be exercised by the delivery of
a written notice of exercise to AMRESCO, setting forth the number
of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares. The Option Price
upon exercise of any Option shall be payable to AMRESCO in full
either: (a) in cash, or (b) if approved by the Committee, by
tendering previously acquired Shares having an aggregate Fair
Market Value at the time of exercise equal to the total Option
Price (provided that the Shares which are tendered must have been
held by the Participant for at least six (6) months prior to
their tender to satisfy the Option Price), or (c) by a
combination of (a) and (b). The Committee also may allow
cashless exercises as permitted under Federal Reserve Board's
Regulation T, subject to applicable securities law restrictions,
or by any other means which the Committee determines to be
consistent with the Plan's purpose and applicable law.
As soon as practicable after receipt of a written
notification of exercise and full payment, AMRESCO shall deliver
to the Participant, in the Participant's name, Share certificates
in an appropriate amount based upon the number of Shares
purchased under the Option(s).
6.7 Termination of Employment Due to Death, Disability or
Retirement. Unless otherwise provided by the Committee in an
Award Agreement, the following rules shall apply in the event of
the Participant's termination of employment due to death,
Disability, or Retirement. With respect to a Participant that is
a non-employee director of AMRESCO or is otherwise not an
Employee, the following references to employment shall be deemed
to be references to service as a director or in such other
capacity as is determined by the Committee:
(a) Termination by Death. In the event the
Participant dies while actively employed, all outstanding
Options granted to that Participant shall immediately vest
and shall remain exercisable at any time prior to their
expiration date, or for two (2) years after the date of
death, whichever period is shorter, by (i) such Person(s) as
shall have been named as the Participant's beneficiary, (ii)
such Person(s) that have acquired the Participant's rights
under such Options by will or by the laws of descent and
distribution, (iii) the Participant's estate or
representative of the Participant's estate or (iv) by a
transferee of the Option who has acquired the Option in a
transaction that is permitted by Section 6.9.
(b) Termination by Disability. In the event the
employment of a Participant is terminated by reason of
Disability, all outstanding Options granted to that
Participant shall immediately vest as of the date the
Committee determines the definition of Disability to have
been satisfied and shall remain exercisable at any time
prior to their expiration date, or for one (1) year after
the date that the Committee determines the definition of
Disability to have been satisfied, whichever period is
shorter, by the Participants duly appointed guardian or
other legal representative.
(c) Termination by Retirement. In the event the
employment of a Participant is terminated by reason of
Retirement, all outstanding Options granted to that
Participant shall immediately vest and shall remain
exercisable at any time prior to their expiration date, or
for three (3) months after the effective date of Retirement,
whichever period is shorter.
(d) Employment Termination Followed by Death. In the
event that a Participant's employment terminates by reason
of Disability or Retirement, and within the exercise period
following such termination the Participant dies, then the
remaining exercise period for outstanding Options shall be
one (1) year following death. Such Options shall be
exercisable by the persons specified in subsection (a)
above.
6.8 Termination of Employment for Other Reasons. If the
employment of a Participant shall terminate for any reason other
than the reasons set forth in Section 6.7, all Options held by
the Participant which are not vested as of the effective date of
employment termination immediately shall be forfeited to AMRESCO
(and shall once again become available for grant hereunder).
However, the Committee, in its sole discretion, shall have the
right to immediately vest all or any portion of such Options,
subject to such terms as the Committee, in its sole discretion,
deems appropriate.
In the event an Employee's employment is terminated by
AMRESCO for Cause, or an Employee voluntarily terminates his
employment (other than upon retirement), the rights under any
then vested outstanding Options shall terminate immediately upon
such termination of employment. If the Employee's employment is
terminated by AMRESCO without Cause, any Options vested as of the
date of termination shall remain exercisable at any time prior to
their expiration date or for three (3) months after his date of
termination of employment, whichever period is shorter.
6.9 Limited Transferability. A Participant may transfer an
Option to members of his or her Immediate Family, to one or more
trusts for the benefit of such Immediate Family members, or to
one or more partnerships where such Immediate Family members are
the only partners, if (i) the Award Agreement evidencing such
Option expressly provides that the Option may be transferred and
(ii) the Participant does not receive any consideration in any
form whatsoever for said transfer. Any Option so transferred
shall continue to be subject to the same terms and conditions in
the hands of the transferee as were applicable to said Option
immediately prior to the transfer thereof. Any reference in any
such Award Agreement to the employment by or performance of
services for AMRESCO by the Participant shall continue to refer
to the employment of or performance by the transferring
Participant. For purpose hereof, "Immediate Family" shall mean
the Participant and the Participant's spouse, and their
respective ancestors and descendants. Any Option that is granted
pursuant to any Award Agreement that did not initially expressly
allow the transfer of said Option and that has not been amended
to expressly permit such transfer, shall not be transferable by
the Participant otherwise than by will or by the laws of descent
and distribution and such Option thus shall be exercisable during
the Participant's lifetime only by the Participant.
ARTICLE 7. Beneficiary Designation
Each Participant hereunder may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit hereunder is to be paid in case
of his or her death before he or she receives any or all of such
benefit. Each such designation shall revoke all prior
designations by the same Participant, shall be in a form
prescribed by AMRESCO and shall be effective only when filed by
the Participant, in writing, with AMRESCO during the
Participant's lifetime. In the absence of any such designation,
benefits remaining unpaid at the Participant's death shall be
paid to the Participant's estate.
The spouse of a married Participant domiciled in a community
property jurisdiction shall join in any designation of
beneficiary or beneficiaries other than the spouse.
ARTICLE 8. Deferrals
The Committee may permit a Participant to defer to another
plan or program delivery of Shares that would otherwise be due to
such Participant by virtue of the exercise of an Option. If any
such deferral election is required or permitted, the Committee
shall, in its sole discretion, establish rules and procedures for
such deferrals.
ARTICLE 9. Rights of Employees
9.1 Employment. Nothing herein shall interfere with or
limit in any way the right of AMRESCO or a Subsidiary to
terminate any Participant's employment or engagement by AMRESCO
at any time, nor confer upon any Participant any right to
continue in the employ or service of AMRESCO or a Subsidiary.
For purpose hereof, transfer of employment of a Participant
between AMRESCO and any one of its Subsidiaries (or between
Subsidiaries) shall not be deemed a termination of employment.
9.2 Participation. No Employee shall have the right to be
selected to receive an Award, or, having been so selected, to be
selected to receive a future Award.
ARTICLE 10. Change in Control
Upon the occurrence of a Change in Control, except as
provided in the Award Agreement or unless otherwise specifically
prohibited by the terms of Article 15.
(a) Any and all Options granted hereunder shall become
fully vested and immediately exercisable;
(b) Subject to Article 11, the Committee shall have
the authority to make any modifications to the Awards as
determined by the committee to be appropriate before the
effective date of the Change in Control.
ARTICLE 11. Amendment, Modification and Termination
11.1 Amendment Modification and Termination. The Board may,
at any time and from time to time, alter, amend, suspend or
terminate the Plan in whole or in part.
11.2 Awards Previously Granted. No termination, amendment
or modification hereof shall adversely affect in any material way
any Award previously granted hereunder, without the written
consent of the Participant holding such Award. The Committee
with the written consent of the Participant holding such Award,
shall have the authority to cancel Awards outstanding and grant
replacement Awards therefore.
11.3 Compliance With Code Section 162(m). At all times
when the Committee determines that compliance with Code Section
162(m) is desired, all Awards shall comply with the requirements
of Code Section 162(m). In addition, in the event that changes
are made to Code Section 162(m) to permit greater flexibility
with respect to any Award or Awards, the Committee may, subject
to this Article 11, make any adjustments it deems appropriate.
ARTICLE 12. Withholding
12.1 Tax Withholding. AMRESCO shall have the power and
the right to deduct or withhold, or require a Participant to
remit to AMRESCO, an amount sufficient to satisfy federal, state
and local taxes (including the Participant's FICA obligation)
required by law to be withheld with respect to any taxable event
arising in connection with an Award.
12.2 Share Withholding. With respect to withholding
required upon the exercise of Options, or upon any other taxable
event arising as a result of Awards granted hereunder which are
to be paid in the form of Shares, a Participant may elect,
subject to the approval of the Committee, to satisfy the
withholding requirement, in whole or in part, by having AMRESCO
withhold Shares having a Fair Market Value on the date the tax is
to be determined equal to the minimum statutory total tax which
could be imposed on the transaction. All elections shall be
irrevocable, made in writing, signed by the Participant, and
elections by Insiders shall additionally comply with all legal
requirements applicable to Shares transactions by such
Participants.
ARTICLE 13. Indemnification
Each person who is or shall have been a member of the
Committee, or the Board, shall be indemnified and held harmless
by AMRESCO against and from any loss, cost, liability or expense
that may be imposed upon or reasonably incurred by him or her in
connection with or resulting from any claim, action, suit or
proceeding to which he or she may be party or in which he or she
may be involved by reason of any action taken or failure to act
hereunder and against and from any and all amounts paid by him or
her in settlement thereof, with AMRESCO's approval, or paid by
him in satisfaction of any judgment in any such action, suit or
proceeding against him, provided he shall give AMRESCO an
opportunity, at its own expense, to handle and defend the same
before he undertakes to handle and defend it on his own behalf.
The foregoing right of indemnification shall be in addition to
any other rights of indemnification to which such persons may be
entitled under AMRESCO's Certificate of Incorporation or Bylaws,
as a matter of law, or otherwise, or any power that AMRESCO may
have to indemnify them or hold them harmless.
ARTICLE 14. Successors
All obligations of AMRESCO hereunder, with respect to
Awards, shall be binding on any successor to AMRESCO, whether the
existence of such successor is the result of a direct or indirect
purchase, merger, consolidation or otherwise, of all or
substantially all of the business and/or assets of AMRESCO.
ARTICLE 15. Legal Construction
15.1 Gender and Number. Except where otherwise indicated by
the context, any masculine term used herein also shall include
the feminine; the plural shall include the singular and the
singular shall include the plural.
15.2 Severability. In the event any provision hereof shall
be held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining parts hereof, and the
Plan shall be construed and enforced as if the illegal or invalid
provision had not been included.
15.3 Requirements of Law. The granting of Awards and the
issuance of Shares under the Plan shall be subject to all
applicable laws, rules and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may
be required.
15.4 Regulatory Approvals and Listing. AMRESCO shall not be
required to issue any certificate or certificates for Shares
hereunder prior to (i) obtaining any approval from any
governmental agency which AMRESCO shall, in its discretion,
determine to be necessary or advisable, (ii) the admission of
such Shares to listing on any national securities exchange or
Nasdaq on which AMRESCO's Shares may be listed and (iii) the
completion of any registration or other qualification of such
Shares under any state or federal law or ruling or regulations of
any governmental body which AMRESCO shall, in its sole
discretion, determine to be necessary or advisable.
Notwithstanding any other provision set forth herein, if
required by the then-current Section 16 of the Exchange Act, any
"derivative security" or "equity security" offered pursuant
hereto to any Insider may not be sold or transferred for at least
six (6) months after the date of grant of such Award. The terms
"equity security" and "derivative security" shall have the
meanings ascribed to them in the then-current Rule 16(a) under
the Exchange Act.
15.5 Securities Law Compliance. With respect to Insiders,
transactions hereunder are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange
Act. To the extent any provisions hereof or action by the
Committee fails to so comply, it shall be deemed null and void,
to the extent permitted by law and deemed advisable by the
Committee.
15.6 Governing Law. To the extent not preempted by federal
law, the Plan, and all agreements hereunder, shall be construed
in accordance with and governed by the laws of the State of
Delaware.
April 17, 1997
AMRESCO, INC.
700 N. Pearl Street, Suite 2400, LB 342
Dallas, TX 75201
Re: Form S-8 Registration Statement of AMRESCO, INC.
Ladies and Gentlemen:
The undersigned has acted as counsel for AMRESCO, INC., a
Delaware corporation (the "Company"), in connection with the
above referenced Registration Statement on Form S-8 (the
"Registration Statement") being filed by the Company with the
Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended, and covering 3,875,000 shares
of the Company's Common Stock, $.05 par value ("Common Stock")
that may be offered and sold to the employees of the Company
pursuant to the AMRESCO, INC. 1997 Stock Option and Award Plan
and the AMRESCO, INC. 1997 Stock Option Plan (collectively
referred to as the "Plans"). This Opinion Letter is rendered
pursuant to Item 8 of Form S-8 and Item 601(b) (5) of Regulation
S-K.
This Opinion Letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the
ABA Section of Business Law (1991). As a consequence, it is
subject to a number of qualifications and exceptions,
definitions, limitations on coverage and other limitations, all
as more particularly described in the Accord, and this Opinion
Letter should be read in conjunction therewith.
Subject to the foregoing, I am of the opinion that the 3,875,000
shares of Common Stock issuable under the Plans and covered by
the Registration Statement, when delivered to participants in
accordance with the terms and conditions of the Plans, will be
legally and validly issued, fully paid and nonassessable.
The opinion expressed herein is limited to the laws of the State
of Delaware as codified in the General Corporation Law in the
State of Delaware. This Opinion Letter is provided to you for
your benefit and for the benefit of the Commission, in each case,
solely with regard to the Registration Statement, may be relied
upon by you and the Commission only in connection with the
Registration Statement, and may not be relied upon by any other
person or for any other purpose without the prior written consent
of the undersigned.
I hereby consent to the filing of this Opinion Letter as an
exhibit to the Registration Statement and the use of my name
whenever appearing in the Registration Statement.
Sincerely,
Michael B. Cline,
Deputy General Counsel
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration
Statement of AMRESCO, INC. on Form S-8 of our report dated
February 7, 1997, appearing in the Annual Report on Form 10-K of
AMRESCO, INC. for the year ended December 31, 1996 and to the
reference to us under the heading "Experts" in the Prospectus,
which is part of this Registration Statement.
DELOITTE & TOUCHE LLP
Dallas, Texas
April 16, 1997
