<PAGE> 1
As filed with the Securities and Exchange Commission on February 3, 1998
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ALLIED CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
Maryland 52-1081052
------------------------------- --------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number
incorporation or organization)
1666 K Street, N.W.
Washington, D.C. 20006
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(Address of principal executive offices) (Zip Code)
ALLIED CAPITAL CORPORATION STOCK OPTION PLAN
(Full title of the plan)
William L. Walton Copy to: Steven B. Boehm, Esq.
Chief Executive Officer Sutherland, Asbill & Brennan LLP
Allied Capital Corporation 1275 Pennsylvania Avenue, N.W.
1666 K Street, N.W. Suite 600
Washington, D.C. 20006 Washington, D.C. 20004-2415
(202) 331-1112 (202) 383-0176
(Name, address and telephone number
of agent for service)
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, check the following box. / x /
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================================================================================
Title of Proposed Maximum Proposed Maximum
Securities to be Amount to be Offering Price Per Aggregate Offering Amount of
Registered Registered Share Price Registration Fee
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 6,250,000 (1) 22.071 (2) $137,943,750 (2) $40,693.41
=========================================================================================================
</TABLE>
(1) Together with an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant to the
Allied Capital Corporation Stock Option Plan as the result of a stock dividend
or similar adjustment of the outstanding Common Stock pursuant to 17 C.F.R.
Section 230.416(a).
(2) Included solely for the purpose of calculating the registration fee. Such
estimate has been calculated in accordance with Rule 457(h) and Rule 457(c)
under the Securities Act of 1933 and is based upon the exercise price of stock
options already granted under the Allied Capital Corporation Stock Option Plan
and upon the average of the high and low prices per share of Allied Capital
Corporation Common Stock on the Nasdaq National Market System on January 29,
1998 with respect to shares not yet subject to options granted under such Plan.
This registration statement shall become effective upon filing in
accordance with Section 8(a) of the Securities Act of 1933, as amended and 17
C.F.R. Section 230.462.
<PAGE> 2
PART I
ITEM 1. PLAN INFORMATION
This Registration Statement relates to the registration of 6,250,000
shares of common stock, $0.0001 par value per share, of Allied Capital
Corporation (formerly known as "Allied Capital Lending Corporation") (the
"Registrant") reserved for issuance and delivery under the Allied Capital
Corporation Stock Option Plan (the "Plan"). Documents containing the
information required by Part I of the Registration Statement will be sent or
given to participants in the Plan as specified by Rule 428(b)(1) of the
Securities Act of 1933. Such documents are not filed with the Securities and
Exchange Commission (the "Commission") either as part of this Registration
Statement or as prospectus supplements pursuant to Rule 424 in reliance on Rule
428 of the Securities Act of 1933.
ITEM 2. REGISTRANT INFORMATION
The required statement is contained in the Prospectus for the Plan.
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The Registrant, Allied Capital Corporation, incorporates herein by
reference the documents listed in (a) through (d) below:
(a) The Registrant's Annual Report on Form 10-K filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended (the "1934 Act") for the fiscal year ended December
31, 1996;(1)
(b) The Annual Report on Form 10-K of Allied Capital Corporation
("Allied I") filed pursuant to Section 13(a) or 15(d) of the
1934 Act for the fiscal year ended December 31, 1996(1);
(c) The Annual Report on Form 10-K of Allied Capital Corporation
II ("Allied II") filed pursuant to Section 13(a) or 15(d) of
the 1934 Act for the fiscal year ended December 31, 1996(1);
(d) The Annual Report on Form 10-K of Allied Capital Commercial
Corporation ("Allied Commercial") filed pursuant to Section
13(a) or 15(d) of the 1934 Act for the fiscal year ended
December 31, 1996(1);
(e) The Annual Report on Form 10-K of Allied Capital Advisers,
Inc. ("Advisers") filed pursuant to Section 13(a) or 15(d) of
the 1934 Act for the fiscal year ended December 31, 1996(1);
(f) All other reports of the Registrant and the Plan filed
pursuant to Section 13(a) or 15(d) of the 1934 Act since
December 31, 1996;
- --------------------
(1) On December 31, 1997, Allied I, Allied Capital Corporation II,
Allied Capital Commercial Corporation and Allied Capital Advisers, Inc. merged
with and into the Registrant. In conjunction with the Merger, the Registrant
changed its name from "Allied Capital Lending Corporation" to "Allied Capital
Corporation."
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<PAGE> 3
(g) All other reports of Allied I filed pursuant to Section 13(a)
or 15(d) of the 1934 Act since December 31, 1996;
(h) All other reports of Allied II filed pursuant to Section 13(a)
or 15(d) of the 1934 Act since December 31, 1996;
(i) All other reports of Allied Commercial filed pursuant to
Section 13(a) or 15(d) of the 1934 Act since December 31,
1996;
(j) All other reports of Advisers filed pursuant to Section 13(a)
or 15(d) of the 1934 Act since December 31, 1996;
(k) The description of the Registrant's common stock contained in
the registration statement on Form 8-A filed on the
Registrant's behalf on November 12, 1993, as such description
may be modified by the changes to the Registrant's Amended and
Restated Articles of Incorporation (the "Articles of
Incorporation") that are discussed in the Registrant's
registration statement on Form N-14 (Registration No.
333-36459) filed on the Registrant's behalf with the
Commission on September 26, 1997 (the "N-14 Registration
Statement") and set forth in the Articles of Merger attached
as Appendix B to the joint proxy statement/prospectus
contained in the N-14 Registration Statement; and
(l) The N-14 Registration Statement.
All reports and documents filed with the Commission by the Registrant
subsequent to the date of this registration statement pursuant to Section
13(a), 13(c), 14 and 15(d) of the 1934 Act prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which de-registers all securities then remaining unsold, shall be
deemed to be incorporated by reference into this Registration Statement and to
be part hereof from the date of filing of those documents.
ITEM 4. DESCRIPTION OF SECURITIES
The securities being registered are shares of the Registrant's common
stock.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The corporation law of the State of Maryland, under which the
Registrant is incorporated, permits the articles of incorporation of a Maryland
corporation to include a provision limiting the liability of its directors and
officers to a corporation and its stockholders for money damages, subject to
specified restrictions. The law does not, however, allow the liability of
directors and officers to a corporation or its stockholders to be limited to
the extent that: (1) it is proved that the person actually received an improper
benefit or profit from the transactions or matter at issue; or (2) a judgment
or other final adjudication is entered in a proceeding based on a finding that
the person's action, or failure to act, was the result of active and deliberate
dishonesty and was material to the cause of action adjudicated in the
proceeding. The Articles of Incorporation of the Registrant contain a
provision limiting the liability of its directors and officers to the
Registrant and its shareholders to the fullest extent permitted by Maryland
statutory or decisional law, as amended or interpreted and as limited by the
Investment Company Act of 1940, as amended (the "1940 Act").
The Maryland corporation law also permits a corporation to indemnify
its directors and officers, among others, against judgments, penalties, fines,
settlements and reasonable expenses actually incurred by them in connection
with
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<PAGE> 4
any proceeding to which they have been made a party by reason of their service
in those or other capacities unless it is established that the act or omissions
of the director or officer was material to the matter giving rise to the
proceeding and was committed in bad faith or was the result of active and
deliberate dishonesty, or the director or officer actually received an improper
personal benefit, or, in the case of any criminal proceeding, the director or
officer had reasonable cause to believe that the act or omission was unlawful.
The Maryland corporation law also provides that where such a proceeding is one
by or in the right of the corporation, indemnification may not be made in
respect of such proceeding in which the officer or director shall have been
adjudged liable to the corporation. The Registrant's Articles of
Incorporation, as amended by Articles of Merger filed with the Maryland State
Department of Assessments and Taxation that became effective on December 31,
1997, provide that the Registrant shall indemnify its directors and officers to
the full extent permitted from time to time by the General Laws of the State of
Maryland, provided, however, that such indemnification is limited by the 1940
Act or by any valid rule, regulation or order of the Commission thereunder.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The following exhibits are filed with or incorporated by reference
into this Registration Statement on Form S-8 (numbering corresponds to Exhibit
Table in Item 601 of Regulation S-K):
4 Allied Capital Corporation Stock Option Plan
5 Opinion and Consent of Sutherland Asbill & Brennan LLP
15 Omitted -- Not applicable
23 (a) Consent of Arthur Andersen LLP
(b) Consents of Matthews, Carter and Boyce, P.C.
(c) Consent of Counsel -- See Exhibit 5
24 Powers of Attorney (located in the signature page)
ITEM 9. UNDERTAKINGS
(a) Rule 415 Offering. The 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. Notwithstanding the foregoing, any
increase or decrease in volume of securities
offered (if the total dollar value of
securities offered would not exceed that
which was registered) and any deviation from
the low or high end of the estimated maximum
offering range may be reflected in the form
of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no
more than 20 percent change in the maximum
aggregate offering price set forth in the
"Calculation of Registration Fee" table in
the effective registration statement; and
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the registration
statement or any material change to such
information in the registration statement;
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<PAGE> 5
provided, however, that paragraphs (a)(1)(i) and
(a)(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 with
or furnished to the Commission by the Registrant
pursuant to Section 13 or 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 registrant 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 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
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the 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.
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<PAGE> 6
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 Washington, District of Columbia, on the 21st
day of January, 1998.
ALLIED CAPITAL CORPORATION
By: /s/ William L. Walton
-------------------------------
Name: William L. Walton
Title: Chairman, President, and
Chief Executive Officer
Each officer or director whose signature appears below hereby appoints
Joan M. Sweeney and Jon A. DeLuca, jointly and severally, his/her
attorneys-in-fact, with power of substitution, for him/her in all capacities,
to sign amendments and post-effective amendments to the Registration Statement
of the Allied Capital Corporation Stock Option Plan and to file such amendments
with exhibits with the Securities and Exchange Commission, hereby ratifying all
that each attorney-in-fact may do or cause to be done by virtue of this power.
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.
<TABLE>
<S> <C> <C>
/s/ William L. Walton Chairman, President, and January 21, 1998
- ------------------------------ Chief Executive Officer
William L. Walton
/s/ Jon W. Barker Director January 21, 1998
- ------------------------------
Jon W. Barker
/s/ Eleanor Deane Bierbower Director January 21, 1998
- ------------------------------
Eleanor Deane Bierbower
/s/ Brooks H. Browne Director January 25, 1998
- ------------------------------
Brooks H. Browne
/s/ Joseph A. Clorety III Director January 26, 1998
- ------------------------------
Joseph A. Clorety III
/s/ Swep T. Davis Director January 21, 1998
- ------------------------------
Swep T. Davis
/s/ John D. Firestone Director January 25, 1998
- ------------------------------
John D. Firestone
/s/ Robert V. Fleming, II Director January 21, 1998
- ------------------------------
Robert V. Fleming II
/s/ Michael I. Gallie Director January 24, 1998
- ------------------------------
Michael I. Gallie
</TABLE>
<PAGE> 7
<TABLE>
<S> <C> <C>
/s/ Anthony T. Garcia Director January 21, 1998
- ------------------------------
Anthony T. Garcia
/s/ Lawrence I. Hebert Director January 21, 1998
- ------------------------------
Lawrence I. Hebert
/s/ Arthur H. Keeney III Director January 22, 1998
- ------------------------------
Arthur H. Keeney III
/s/ John I. Leahy Director January 21, 1998
- ------------------------------
John I. Leahy
/s/ Robert E. Long Director January 21, 1998
- ------------------------------
Robert E. Long
/s/ Robin B. Martin Director January 21, 1998
- ------------------------------
Robin B. Martin
/s/ Warren K. Montouri Director January 20, 1998
- ------------------------------
Warren K. Montouri
/s/ John D. Reilly Director January 21, 1998
- ------------------------------
John D. Reilly
/s/ Guy T. Steuart II Director January 21, 1998
- ------------------------------
Guy T. Steuart II
/s/ T. Murray Toomey Director January 21, 1998
- ------------------------------
T. Murray Toomey
/s/ Laura W. vanRoijen Director January 22, 1998
- ------------------------------
Laura W. vanRoijen
/s/ George C. Williams Director January 21, 1998
- ------------------------------
George C. Williams
/s/ Smith T. Wood Director January 21, 1998
- ------------------------------
Smith T. Wood
/s/ Jon A. DeLuca Principal, Treasurer January 21, 1998
- ------------------------------ and Chief Financial
Jon A. DeLuca Officer (Principal
Financial and Accounting Officer)
</TABLE>
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Number Exhibit Name
<S> <C>
4 Allied Capital Corporation Stock Option Plan
5 Opinion and consent of Sutherland Asbill &
Brennan LLP
15 Omitted -- Not applicable
23 (a) Consent of Arthur Andersen LLP
(b) Consents of Matthews, Carter and Boyce, P.C.
(c) Consent of Counsel -- See Exhibit 5.
24 Powers of Attorney (located in the signature page)
</TABLE>
<PAGE> 1
Exhibit 4
ALLIED CAPITAL CORPORATION
STOCK OPTION PLAN
1. PURPOSE OF THE PLAN
The purpose of this Stock Option Plan (this "Plan") is to advance the
interests of Allied Capital Corporation (the "Company") by providing to
directors of the Company and to officers of the Company who have substantial
responsibility for the direction and management of the Company additional
incentives to exert their best efforts on behalf of the Company, to increase
their proprietary interest in the success of the Company, to reward outstanding
performance and to provide a means to attract and retain persons of outstanding
ability to the service of the Company. It is recognized that the Company
cannot attract or retain these officers and directors without this
compensation. Options granted under this Plan may qualify as incentive stock
options ("ISOs"), as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
2. ADMINISTRATION
This Plan shall be administered by a committee (the "Committee")
comprised of at least two (2) members of the Company's Board of Directors who
each shall (a) be a "non-employee director," as defined in Rule 16b-3
promulgated under the Securities Exchange Act of 1934, as amended, unless
administration of the Plan by "non-employee directors" is not then required for
exemptions under Rule 16b-3 to apply to transactions under the Plan, (b) not be
an "interested person," as defined in Section 2(a)(19) of the Investment
Company Act of 1940, as amended (the "Act"), and (c) be an "outside director"
as defined under Section 162(m) of the Code, unless the action taken pursuant
to the Plan is not required to be taken by "outside directors" to qualify for
tax deductibility under Section 162(m) of the Code. The Committee shall
interpret this Plan and, to the extent and in the manner contemplated herein,
shall exercise the discretion reserved to it hereunder. The Committee may
prescribe, amend and rescind rules and regulations relating to this Plan and to
make all other determinations necessary for its administration. The decision
of the Committee on any interpretation of this Plan or administration hereof,
if in compliance with the provisions of the Act and regulations promulgated
thereunder, shall be final and binding with respect to the Company, any
optionee or any person claiming to have rights as, or on behalf of, any
optionee.
3. SHARES SUBJECT TO THE PLAN
The shares subject to option and the other provisions of this Plan shall
be shares of the Company's common stock, par value $.0001 per share ("shares").
Subject to the provisions hereof concerning adjustment, the total number of
shares which may be purchased upon the exercise or surrender of stock options
granted under this Plan shall not exceed 6,250,000 shares,
<PAGE> 2
which includes all shares with respect to which options have been granted or
surrendered for payment in cash or other consideration pursuant to this Plan or
predecessor forms of this Plan. In the event any option shall cease to be
exercisable in whole or in part for any reason, the shares which were covered
by such option, but as to which the option had not been exercised, shall again
be available under this Plan. Shares may be made available from authorized,
unissued or reacquired stock or partly from each.
4. PARTICIPANTS
(a) Officers and Directors. The Committee shall determine and designate
from time to time those directors and key officers of the Company who shall be
eligible to participate in this Plan. The Committee shall also determine the
number of shares to be offered from time to time to each optionee. In making
these determinations, the Committee shall take into account the past service of
each such director or officer to the Company, the present and potential
contributions of such director or officer to the success of the Company and
such other factors as the Committee shall deem relevant in connection with
accomplishing the purposes of this Plan; provided that the Committee shall
determine that each grant of options to an optionee, the number of shares
offered thereby and the terms of such option are in the best interests of the
Company and its shareholders. The date on which the Committee approves the
grant of any option to an officer of the Company shall be the date of issuance
of such option; provided, however, that if (1) any such action by the Committee
does not constitute approval thereof by both (A) a majority of the Company's
directors who have no financial interest in such action and (B) a majority of
the Company's directors who are not "interested persons" (as defined in Section
2(a)(19) of the Act) of the Company and (2) such approval is at such time
required by Section 61(a)(3)(B)(i)(I) or other applicable provision of the Act,
then the grant of any option by such action shall not be effective, and there
shall be no issuance of such option, until there has been approval of such
action by (A) a majority of the Company's directors who have no financial
interest in such action and (B) a majority of the Company's directors who are
not "interested persons" of the Company, on the basis that such action is in
the best interests of the Company and its shareholders, and the last date on
which such required approval is obtained shall be the date of issuance of such
option. The date on which the Committee approves the grant of any option to a
director of the Company who is not also an officer or employee of the Company
shall be the date of issuance of such option; provided, however, that if (1)
the proposal to issue such options has not been approved by order of the U.S.
Securities and Exchange Commission (the "SEC") and (2) such approval is
required at such time by Section 61(a)(3)(B)(i)(II) or other applicable
provision of the Act, then the grant of any option by such action shall not be
effective, and there shall be no issuance of such option, until there has been
approval of such proposal by order of the SEC on the basis that the terms of
the proposal are fair and reasonable and do not involve overreaching of the
Company or its shareholders, and the date on which required approval is
obtained shall be the date of issuance of such option. The agreement
documenting the award of any option granted pursuant to this paragraph 4(a)
shall contain such terms and conditions as the Committee shall deem advisable,
including but not limited to being exercisable only in such installments as the
Committee may determine.
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<PAGE> 3
(b) Option Agreements. Agreements evidencing options granted to
different optionees or at different times need not contain similar provisions.
Options that are intended to be ISOs will be designated as such; any option not
so designated will be treated as a nonqualified stock option.
5. OPTION PRICE
Each option agreement shall state the price at which the subject option
may be exercised, which shall not be less than the current fair market value of
the shares at the date of issuance of an option; provided, that the exercise
price of any option that is intended to be an ISO and that is granted to a
holder of 10% or more of the Company's shares shall not be less than 110% of
such current fair market value.
6. OPTION PERIOD
Each option agreement shall state the period or periods of time within
which the subject option may be exercised, in whole or in part, by the optionee
which shall be such period or periods of time as may be determined by the
Committee; provided, that the option period shall not exceed ten years from the
date of issuance of the option and, in the case of an option that is intended
to be an ISO and that is granted to a holder of 10% or more of the Company's
shares, shall not exceed five years.
7. PAYMENT FOR SHARES
Full payment for shares purchased shall be made at the time of
exercising the option in whole or in part. Payment of the purchase price shall
be made in cash (including check, bank draft or money order) or, if authorized
pursuant to paragraph 9 hereof, by a loan from the Company in accordance with
paragraph 9.
8. TRANSFERABILITY OF OPTIONS
Options shall not be transferable other than by will or the laws of
descent and distribution, and during an optionee's lifetime shall be
exercisable only by the optionee.
9. LOANS BY THE COMPANY
Upon the exercise of any option, the Company, at the request of an
officer-optionee, and subject to the approval of both (a) a majority of the
Company's directors who each has no financial interest in such loan and (b) a
majority of the Company's directors who each is not an "interested person," as
defined in Section 2(a)(19) of the Act, of the Company on the basis that such
loan is in the best interests of the Company and its stockholders (whether such
approval is by the Committee or otherwise), may lend to such officer-optionee,
as of the date of exercise, an amount equal to the exercise price of such
option; provided, that such loan (a) shall have a term of not more than ten
years, (b) shall become due within sixty days after the recipient of the loan
- 3 -
<PAGE> 4
ceases to be an officer of the Company, (c) shall bear interest at a rate no
less than the prevailing rate applicable to 90-day United States Treasury bills
at the time the loan is made, and (d) shall be fully collateralized at all
times, which collateral may include securities issued by the Company. Loan
terms and conditions may be changed by the Committee to comply with applicable
IRS and SEC regulations.
10. TERMINATION OF OPTION
All rights to exercise options shall terminate sixty days after any
optionee ceases to be a director or an officer of the Company. Notwithstanding
the foregoing, however, where an optionee's service as a director or officer of
the Company terminates as a result of the optionee's death or his total and
permanent disability, the optionee or the executors or administrators or
legatees or distributees of the estate, as the case may be, shall have the
right, from time to time within one year after the optionee's total and
permanent disability or death and prior to the expiration of the term of the
option, to exercise any portion of the option not previously exercised, in
whole or in part, as provided in the respective option agreement.
11. EFFECT OF CHANGE IN STOCK SUBJECT TO THE PLAN
Subject to any required action by the shareholders of the Company and
the provisions of applicable corporate law, the number of shares of represented
by the unexercised portion of an option, the number of shares which has been
authorized or reserved for issuance hereunder, and the number of shares covered
by any applicable vesting schedule hereunder, as well as the exercise price of
a share represented by the unexercised portion of an option, shall be
proportionately adjusted for (a) a division, combination or reclassification of
any of the shares of common stock of the Company or (b) a dividend payable in
shares of common stock of the Company.
12. GENERAL RESTRICTION
Each option shall be subject to the requirement that, if at any time the
Board of Directors shall determine, at its discretion, that the listing,
registration or qualification of the shares subject to such option upon any
securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such option or the issue
or purchase of the shares thereunder, such option may not be exercised in whole
or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Company. Subject to the limitations of paragraph 6, no
option shall expire during any period when exercise of such option has been
prohibited by the Board of Directors, but shall be extended for such further
period so as to afford the optionee a reasonable opportunity to exercise his
option.
- 4 -
<PAGE> 5
13. MISCELLANEOUS PROVISIONS
(a) No optionee shall have rights as a shareholder with respect to
shares covered by his option until the date of exercise of his option.
(b) The granting of any option shall not impose upon the Company any
obligation to appoint or to continue to appoint as a director or officer any
optionee, and the right of the Company to terminate the employment of any
officer or other employee, or service of any director, shall not be diminished
or affected by reason of the fact that an option has been granted to such
optionee.
(c) Options shall be evidenced by stock option agreements in such form
and subject to the terms and conditions of this Plan as the Committee shall
approve from time to time, consistent with the provisions of this Plan. Such
stock option agreements may contain such other provisions as the Committee in
its discretion may deem advisable. In the case of any discrepancy between the
terms of the Plan and the terms of any option agreement, the Plan provisions
shall control.
(d) For purposes of this Plan, the fair market value of the shares shall
be the closing sales price of the stock as quoted on the National Association
of Securities Dealers Automated Quotation System for the date of issuance of
such option, as provided herein. If the Company's shares are traded on an
exchange, the price shall be the closing price of the Company's stock as
reported in The Wall Street Journal for such date of issuance of an option.
(e) The aggregate fair market value (determined as of the date of
issuance of an option) of the shares with respect to which an option, or
portion thereof, intended to be an ISO is exercisable for the first time by any
optionee during any calendar year (under all incentive stock option plans of
the Company and subsidiary corporations) shall not exceed $100,000.
(f) All options issued pursuant to this Plan shall be granted within ten
years from the earlier of the date of adoption of this Plan (or any amendment
thereto requiring shareholder approval pursuant to the Code) or the date this
Plan (or any amendment thereto requiring shareholder approval pursuant to the
Code) is approved by the shareholders of the Company.
(g) No option may be issued if exercise of all warrants, options and
rights of the Company outstanding immediately after issuance of such option
would result in the issuance of voting securities in excess of 20% of the
Company's outstanding voting securities.
(h) A leave of absence granted to an employee does not constitute an
interruption in continuous employment for purposes of this Plan as long as the
leave of absence does not extend beyond one year.
(i) Any notices given in writing shall be deemed given if delivered in
person or by certified mail; if given to the Company at Allied Capital
Corporation, 1666 K Street, NW, 9th Floor,
- 5 -
<PAGE> 6
Washington, D.C. 20006; and, if to an optionee, in care of the optionee at his
or her last known address.
(j) This Plan and all actions taken by those acting under this Plan
shall be governed by the substantive laws of Maryland without regard to any
rules regarding conflict-of-law or choice-of-law.
(k) All costs and expenses incurred in the operation and administration
of this Plan shall be borne by the Company.
14. CHANGE OF CONTROL
In the event of a Change of Control (as hereinafter defined), all
then-outstanding options will become fully vested and exercisable as of the
Change of Control. For purposes of the Plan, "Change of Control" means (i) the
sale of substantially all of the Company's assets, (ii) the acquisition,
whether directly, indirectly, beneficially (within the meaning of Rule 13d-3 of
the 1934 Act), or of record, of securities of the Company representing
twenty-five percent (25%) or more in the aggregate voting power of the
Company's then-outstanding Common Stock by any "person" (within the meaning of
Sections 13(d) and 14(d) of the 1934 Act), including any corporation or group
of associated persons acting in concert, other than (A) the Company or its
subsidiaries and/or (B) any employee pension benefit plan (within the meaning
of Section 3(2) of the Employee Retirement Income Security Act of 1974) of the
Company or its subsidiaries, including a trust established pursuant to any such
plan, or (iii) a merger or consolidation of the Company with another entity
unless the Company is the surviving company in such merger or consolidation.
15. AMENDMENT AND TERMINATION
The Board of Directors may modify, revise or terminate this Plan at any
time and from time to time. While the Board of Directors may seek shareholder
approval of an action modifying a provision of the Plan where it is determined
that such shareholder approval is advisable under the provisions of applicable
law, the Board of Directors shall be permitted to make any modification or
revision to any provision of this Plan without shareholder approval. This Plan
shall terminate when all shares reserved for issuance hereunder have been
issued upon the exercise of options, or by action of the Board of Directors
pursuant to this paragraph, whichever shall first occur.
16. EFFECTIVE DATE OF THE PLAN
This Plan shall become effective upon the latest to occur of (1)
adoption by the Board of Directors, (2) approval of this Plan by the
shareholders of the Company, and (3) the effective time of the merger of Allied
Capital Corporation, Allied Capital Corporation II, Allied Capital Commercial
Corporation, and Allied Capital Advisers, Inc., each of which is a Maryland
corporation, into the Company with the Company as the surviving corporation.
- 6 -
<PAGE> 1
Exhibit 5
SUTHERLAND, ASBILL & BRENNAN LLP
1275 Pennsylvania Avenue, N.W.
Washington, D.C. 20004
February 3, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Allied Capital Corporation Stock Option Plan:
Registration on Form S-8
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-8
(the "Registration Statement") of Allied Capital Corporation, a Maryland
corporation (the "Company"), filed on the date hereof with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, in connection
with a proposed offering by the Company to certain of its employees, officers
and non-officer directors of 6,250,000 shares of the Company's common stock,
$0.0001 par value per share (the "Shares"), under the Allied Capital
Corporation Stock Option Plan (the "Plan").
As counsel for the Company, we have examined originals, or
copies certified or otherwise identified to our satisfaction, of such corporate
records and other documents as we have deemed relevant as a basis for our
opinion hereinafter expressed. Where factual matters material to this opinion
letter were not independently established, we have relied upon certificates and
representations of current executive officers and responsible employees and
agents of the Company and upon such other data as we deemed to be appropriate
under the circumstances.
This opinion is limited to the corporate laws of the State of
Maryland and we express no opinion with respect to the laws of any other
jurisdiction. With respect to the corporate laws of the State of Maryland, we
have examined and relied upon the Corporation Law of the State of Maryland.
Based upon and subject to the foregoing, it is our opinion
that the Shares have been duly and validly authorized and, when issued and paid
for pursuant to the offering and in the manner contemplated by the Registration
Statement, will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement.
SUTHERLAND, ASBILL & BRENNAN LLP
By: /s/ Steven B. Boehm
------------------------------------
Steven B. Boehm
<PAGE> 1
EXHIBIT 23.A
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 6, 1997
and February 16, 1997 included in Allied Capital Commercial Corporation's and
Allied Capital Advisers, Inc.'s Form 10-K, respectively for the year ended
December 31, 1996 and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen, LLP
January 30, 1998
<PAGE> 1
EXHIBIT 23.B
[MATTHEWS, CARTER AND BOYCE, P.C. LETTERHEAD]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants we hereby consent to the incorporation by
reference in the registration statement on Form S-8 of our report dated
February 7, 1997 incorporated by reference in Allied Capital Lending
Corporation's Form 10-K for the year ended December 31, 1996 and to all
references to our firm included in the registration statement.
/s/ MATTHEWS, CARTER AND BOYCE
McLean, VA
January 30, 1998
<PAGE> 2
[MATTHEWS, CARTER AND BOYCE, P.C. LETTERHEAD]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants we hereby consent to the incorporation by
reference in the registration statement on Form S-8 of our report dated
February 4, 1997 incorporated by reference in Allied Capital
Corporation's Form 10-K for the year ended December 31, 1996 and to all
references to our firm included in the registration statement.
/s/ MATTHEWS, CARTER AND BOYCE
McLean, VA
January 30, 1998
<PAGE> 3
[MATTHEWS, CARTER AND BOYCE, P.C. LETTERHEAD]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants we hereby consent to the incorporation by
reference in the registration statement on Form S-8 of our report dated
February 4, 1997 incorporated by reference in Allied Capital Corporation II's
Form 10-K for the year ended December 31, 1996 and to all references to our
firm included in the registration statement.
/s/ MATTHEWS, CARTER AND BOYCE
McLean, VA
January 30, 1998
