As filed with the Securities and Exchange Commission on June 24, 1999
Registration No. 333-81465
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1 TO
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
RES-CARE, INC.
(Exact name of registrant as specified in its charter)
Kentucky 61-0875371
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
10140 Linn Station Road
Louisville, Kentucky 40223
(Address of principal executive offices)
AGREEMENT AND PLAN OF MERGER, DATED APRIL 2, 1999, BY AND AMONG
RES-CARE, INC., RES-CARE SUB, INC. AND PEOPLESERVE, INC.
(Full title of plan)
(Name, address and telephone
number of agent for service) (Copy to:)
Ronald G. Geary Henry D. Kahn, Esquire
Chairman, President and Chief Executive Officer Piper & Marbury L.L.P.
Res-Care, Inc. 36 South Charles Street
10140 Linn Station Road Baltimore, Maryland 21201-3018
Louisville, Kentucky 40223 (410) 576-1686
(502) 394-2100
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Amount Maximum Maximum Amount of
to be Offering Aggregate Registration
Title of Securities to be Registered Registered Price Per Share(1) Offering Price(1) Fee(1)
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Common Shares, no par value 408,980 $22.4375 $9,176,489 $2,552
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(c) and (h). The proposed maximum offering price
per share, proposed maximum aggregate offering price and the amount of
the registration fee are based on the average of high and low prices on
June 17, 1999, as reported by the Nasdaq National Market System, was
used.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents which have been filed by the Registrant with
the Securities and Exchange Commission (the "Commission") are incorporated
herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1998, filed on March 23, 1999, as
amended by Form 10-K/A filed on April 30, 1999;
(b) The Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1999, filed on May 14, 1999;
(c) All other reports filed pursuant to Sections 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended ("Exchange
Act"), since the end of the fiscal year covered by the
document referred to in (a) above; and
(d) Description of Common Shares of the Registrant contained or
incorporated in the registration statements filed by the
Registrant under the Exchange Act, including any amendments or
reports filed for the purpose of updating such description.
All documents subsequently filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities remaining unsold,
shall be deemed to be incorporated by reference into this Registration Statement
and to be a part of this Registration Statement from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
None.
<PAGE>
Item 6. Indemnification of Directors and Officers.
Section 271B.8-510 of the Kentucky Business Corporation Act (the "Act")
permits the indemnification by a corporation of any director who is made party
to a threatened, pending or completed action, suit or proceeding because he is
or was a director of such corporation. To be eligible for indemnification, such
person must have conducted himself in good faith and reasonably believed that
his conduct, if undertaken in his official capacity with the corporation, was in
the corporation's best interests, and, if not in his official capacity, was at
least not opposed to the corporation's best interests. In the case of a criminal
proceeding, the director must also not have reasonable cause to believe his
conduct was unlawful. A director may not be indemnified under the
above-referenced section in connection with a proceeding by or in the right of
the corporation in which the director was adjudged liable to the corporation or
in connection with any other proceeding charging improper personal benefit by
him, whether or not involving action in his official capacity, in which he was
adjudged liable on the basis that personal benefit was improperly received by
him. Indemnification permitted under Section 271B.8-510 of the Act in connection
with a proceeding by or in the right of the corporation shall be limited to
reasonable expenses incurred in connection with the proceeding. Section
271B.8-560 of the Act provides that a Kentucky corporation may indemnify its
officers, employees and agents to the same extent as directors. Mandatory
indemnification against reasonable expenses incurred in connection with a
proceeding is provided for by the Act, unless otherwise limited by the
corporation's articles of incorporation, where a director or officer has been
wholly successful on the merits or otherwise, in the defense of any proceeding
to which he was a party because he is or was a director or officer of the
corporation. A court of competent jurisdiction may also order indemnification if
the director is fairly and reasonably entitled thereto in view of all relevant
circumstances, whether or not he met the applicable standard of conduct or was
adjudged liable to the corporation, but if he was adjudged liable, his
indemnification shall be limited to reasonable expenses incurred.
The Act provides that indemnification pursuant to its provisions is not
exclusive of other rights of indemnification to which a person may be entitled
under any bylaw, agreement, vote of shareholders or disinterested directors, or
otherwise. Additionally, the Act provides that a corporation may purchase and
maintain insurance on behalf of directors, officers, employees or agents of the
corporation against liability asserted against or incurred by such parties in
their respective capacity with the corporation.
Article X of the Registrant's Amended and Restated Articles of
Incorporation, as amended, and Article X of the Registrant's Bylaws provide for
indemnification of its directors, officers, employees and other agents to the
maximum extent permitted by law.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
<PAGE>
EXHIBIT
NUMBER DESCRIPTION
4.1 Amended and Restated Articles of Incorporation of the Registrant
(incorporated by reference from Exhibit 3.1 of the Registrant's
Annual Report on Form 10-K for the fiscal year ended December 31,
1998)
4.2 Bylaws of the Registrant (incorporated by reference from Exhibit
3.2 of the Registrant's Registration Statement on Form S-1 (No.
33-48749))
4.3 Agreement and Plan of Merger, dated April 2, 1999, by and among
Res-Care, Inc., Res-Care Sub, Inc. and PeopleServe, Inc.
(incorporated by reference from Appendix A of Registrant's Proxy
Statement/Prospectus on Form S-4, as amended (No. 333-75875))
4.4 VOCA Holdings, Inc. 1996 Stock Option Plan
5.0 Opinion of Reed Weitkamp Schell & Vice PLLC
23.1 Consent of Counsel (included in Exhibit 5.0)
23.2 Consent of Independent Auditors
24.0 Power of Attorney (included in Signature Page)
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933 (the
"Securities Act");
(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 this 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.
Paragraphs (l)(i) and (l)(ii) above do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) 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.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, as amended, 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 Louisville, State of Kentucky, on the 24th day of
June, 1999.
RES-CARE, INC.
By: /s/ Ronald G. Geary
--------------------------------------
Ronald G. Geary
Chairman, President and Chief Executive Officer
POWERS OF ATTORNEY
ATTORNEY Know All Men By These Presents, that each person whose
signature appears below constitutes and appoints Ronald G. Geary and Ralph G.
Gronefeld, Jr., and each of them, his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done, as
fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or their or his substitute or substitutions, may lawfully do or cause to
be done by virtue hereof.
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<S> <C> <C>
Signature Title Date
/s/ Ronald G. Geary Chairman of the Board of Directors, President, June 24, 1999
- --------------------------- Chief Executive Officer and Director (Principal
Ronald G. Geary Executive Officer)
/s/ E. Halsey Sanford Senior Executive and Director June 24, 1999
- ---------------------------
E. Halsey Sandford
/s/ Ralph G. Gronefeld, Jr. Executive Vice President, Finance and June 24, 1999
- --------------------------- Administration, Chief Financial Officer
Ralph G. Gronefeld, Jr. (Principal Financial Officer)
/s/ James R. Fornear Director June 24, 1999
- ---------------------------
James R. Fornear
/s/ Seymour L. Bryson Director June 24, 1999
- ---------------------------
Seymour L. Bryson
/s/ W. Bruce Lunsford Director June 24, 1999
- ---------------------------
W. Bruce Lunsford
/s/ Spioro B. Mitsos Director June 24, 1999
- ---------------------------
Spiro B. Mitsos
/s/ Olivia F. Kirtley Director June 24, 1999
- ---------------------------
Olivia F. Kirtley
</TABLE>
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
4.1 Amended and Restated Articles of Incorporation of the Registrant
(incorporated by reference from Exhibit 3.1 of the Registrant's
Annual Report on Form 10-K for the fiscal year ended December 31,
1998)
4.2 Bylaws of the Registrant (incorporated by reference from Exhibit
3.2 of the Registrant's Registration Statement on Form S-1 (No.
33-48749))
4.3 Agreement and Plan of Merger, dated April 2, 1999, by and among
Res-Care, Inc., Res-Care Sub, Inc. and PeopleServe, Inc.
(incorporated by reference from Appendix A of Registrant's Proxy
Statement/Prospectus on Form S-4, as amended (No. 333-75875))
4.4 VOCA Holdings, Inc. 1996 Stock Option Plan
5.0 Opinion of Reed Weitkamp Schell & Vice PLLC
23.1 Consent of Counsel (included in Exhibit 5.0)
23.2 Consent of Independent Auditors
24.0 Power of Attorney (included in Signature Page)
EXHIBIT 4.4
VOCA HOLDINGS, INC.
1996 STOCK OPTION PLAN
January 1,1996
P R E A M B L E
1. Effective January 1,1996, VOCA Corporation, an Ohio corporation,
adopted the VOCA Corporation 1996 Stock Option Plan (the "Prior Plan").
2. Pursuant to an action by the Board of Directors of VOCA Holdings,
Inc., a Delaware corporation (the "Company"), the Prior Plan was adopted by the
Company and the provisions of the Prior Plan as adopted by the Company are set
forth in this 1996 Stock Option Plan (the "Plan").
3. The Company, by means of this 1996 Stock Option Plan (the "Plan"),
desires to attract and retain capable employees, officers, directors and
consultants and to provide them with long-term incentives to continue their
services to the Company, to maximize the value of the Company to its
stockholders and to acquire a continuing ownership interest in the Company.
4. The Company has determined that the foregoing objectives will be
promoted by granting Options (as hereinafter defined) under this Plan to certain
employees, officers, directors and consultants of the Company and of its.
affiliated entities, if any, pursuant to this Plan.
5. Pursuant to Section 3.4(b) of the Prior Plan, all options
outstanding thereunder shall be treated as options granted by the Company under
this Plan.
T E R M S
Article 1. Definitions.
Section 1.1. General. Certain words and phrases used in this Plan shall
have the meanings given to them below in this section.
"AFFILIATE" means any parent corporation of the Company, any subsidiary of
the Company or any of its parent corporations and any other entity that is
controlled by the Company or is under common control with the Company or in
which the Company has a significant equity interest.
"BOARD OF DIRECTORS " means the board of directors of the Company.
"CODE" means the Internal Revenue Code of 1986 and the regulations
thereunder, as now in effect or hereafter amended.
<PAGE>
"COMMITTEE" means the Committee of the Board of Directors that administers
the Plan under Section 2.1 below.
"COMPANY" means VOCA Corporation, an Ohio Corporation.
"CONSULTANT" means any person who provides services to any Employer (other
than in connection with the offer or sale of securities of the Employer in a
capital raising transaction), who is neither an Employee nor a Director and who
is a consultant or an adviser to the Employer within the meaning of General
Instruction A.1. to Form 5-8 promulgated by the Securities and Exchange
Commission under the Securities Act.
"DATE OF GRANT" means the date an Option is first granted.
"DIRECTOR" means a member of the Board of Directors.
"EFFECTIVE DATE" means the date this Plan is first adopted by the Board of
Directors.
"EMPLOYEE" means any common law employee of an Employer.
"EMPLOYER" means the Company or any Affiliate of the Company which employs
a given Employee or has engaged a given Consultant.
"ENGAGE IN COMPETITION" shall mean to (a)(i) engage in, assist; or have any
interest in, including as a principal, consultant, employee, owner, shareholder,
director, officer, partner, member, advisor, agent, or financier, any entity
which is or which is about to become engaged in any activity which is in
competition with Employer and (ii) in connection with such activity and without
Employer's `written consent (x) utilize written materials developed by Employer,
(y) utilize proprietary operational or financial Employer information or (z) be
in violation of any employment agreement with Employer, and (iii) the Committee
reasonably determines that such activity materially and adversely affects the
business of an Employer or any Affiliate in any state where they do business in
the United States; provided, that this provision shall not prohibit an
investment by an Employee not exceeding 1% of the outstanding securities of a
publicly traded company, (b) solicit any of an Employer's or an Affiliate's
customers except on their behalf; or direct any current or prospective customer
to anyone other than an Employer or Affiliate for goods or services which they
provide, (c) directly or indirectly influence any of an Employer's employees to
terminate their employment with the Employer or accept employment with any of
their competitors, or (d) interfere with any of an Employer's or an Affiliate's
business relationships, including those with customers, suppliers, consultants,
attorneys, and other agents, whether or not evidenced by written or oral
agreements.
"EXERCISE PRICE" means, with respect to an Option, the amount of
consideration that must be delivered to the Company in order to purchase a
single Share thereunder.
<PAGE>
"FAIR MARKET VALUE OF A SHARE" means the amount determined to be the fair
market value of a single Share by the Committee based upon the trading price of
the Shares, opinions of investment bankers and appraisers, formulas based upon
the earnings, cash flow, or assets of the Company and such other factors as it
deems relevant. In the absence of such a determination, the Fair Market Value of
a Share shall be deemed to be (a) if there is a Public Market, the per Share
closing price on the principal national securities exchange or the NASDAQ -
Market on which the Shares are listed or admitted to trading on the day prior to
the date of determination or, if no closing price can be determined for the date
of determination, the most recent date for which, such price can reasonably be
ascertained, or (b) if there is no Public Market and the Shares are quoted by
one or more market makers, the mean between the representative bid and asked per
Share prices in the over-the-counter market at the closing of the day prior to
the date of determination or the most recent such bid and asked prices then
available. Notwithstanding the foregoing, prior to the establishment of a Public
Market for the Shares, the Fair Market Value of a Share shall be presumed to
remain unchanged until such time as it is redetermined by the Committee.
"GRANTEE" means any Participant to whom an Option has been granted.
"HOLDER" means any Grantee who holds a valid Option and any beneficiary,
heir or legal representative to whom such Grantee's Option has been transferred
by a valid beneficiary designation, by will or by the laws of descent and
distribution.
"MEETING DATE" means the date of each annual meeting of the stockholders of
the Company at which Directors are elected.
"OPTION" or "STOCK OPTION" means a right granted under Article 5, 6 or 7 of
the Plan to a Grantee to purchase a stated number of Shares upon payment of the
Exercise Price.
"OPTION AGREEMENT" means an agreement setting forth the terms of an
Option substantially in the form of Exhibit B, Exhibit C or Exhibit D attached
hereto.
"PARTICIPANT" means a person who is eligible to receive an Option under the
Plan.
"PLAN" means this Plan as it may be amended or restated from time to time.
"PUBLIC MARKET FOR THE SHARES" means the Shares are listed or admitted
to trading on a national securities exchange or the NASDAQ. National Market or
the NASDAQ - Small Cap Market.
"SECURITIES ACT" means the Securities Act of 1933 and the regulations
thereunder, as now in effect or hereafter amended.
"SHARES" means common shares, without par value, of the Company.
"SHAREHOLDER'S AGREEMENT" means the Shareholder's Agreement in the form. of
Exhibit A hereto.
<PAGE>
"TERMINATION FOR CAUSE" means any act or omission which reasonably
constitutes dishonesty, fraud, deceit, gross negligence, willful misconduct, or
recklessness, and which is directly or indirectly detrimental to an Employer's
best interests, or (b) any act which reasonably constitutes a first or second
degree misdemeanor or a felony under the laws of any. state in which an Employer
does business or the United. States which adversely reflects upon an Employer's
business or reputation (it being understood that minor traffic offenses are
intended to be excluded under the foregoing language).
Section 1.2. Effect of Definitions. The definitions set forth in
Section 1.1 above shall apply equally to the singular, plural, adjectival,
adverbial and other forms of any of the words and phrases defined regardless of
whether they are capitalized.
Article 2. Administration.
Section 2.1. Committee. The Plan shall be administered by the Compensation
Committee of the Board of Directors.
Section 2.2. Authority. Subject to the express provisions of the Plan and
in addition to the powers granted by other sections of the Plan, the Committee
has the authority, in its discretion, to (a) determine the Participants, grant
Options and determine their timing, pricing and amount; (b) define, prescribe,
amend and rescind rules, regulations, procedures, terms and conditions relating
to the Plan; (c) make all other determinations necessary or advisable for the
Plan including, but not limited to, interpreting the Plan, correcting defects,
reconciling inconsistencies and resolving ambiguities; and (d) review and
resolve all claims of Employees, Consultants, Directors, Grantees, Holders and
Participants. The actions and determinations of the Committee on matters related
to the Plan shall be conclusive and binding upon the Company and all Employees,
Consultants, Directors, Grantees, Holders and Participants.
Article 3. Shares.
Section 3.1. Number. The aggregate number of Shares in respect of which
Options may be granted under the Plan shall not exceed 1,100,000, which number
of Shares is hereby reserved for issuance under the Plan out of the authorized
but unissued Shares.
Section 3.2. Rule 701. The aggregate Exercise Price or number of Shares
offered and sold under the Plan shall not exceed the greater of $500,000 or the
amount or number determined under paragraphs (a) or (b) of this Section 3.2;
provided, however, that the aggregate unpaid Exercise Price of Shares, plus the
aggregate Exercise Price of Shares sold in the preceding 12 months under the
Plan, shall in no event exceed $5,000,000.
(a) The aggregate unpaid Exercise Price of Shares, plus the
aggregateExercise Price of Shares sold in the preceding 12 months under the
Plan, shall not exceed 15 percent of the total assets of the Company, measured
at the end of its last fiscal year, or
(b) The number of Shares that have not been paid for under the Options,
plus the number of Shares sold in the preceding 12 months under the Plan, shall
not exceed 15 percent of the outstanding Shares. The outstanding Shares shall
include Shares issuable pursuant to the exercise of outstanding options,
warrants, rights or conversion of convertible securities, other than Shares not
yet paid for under Options.
<PAGE>
(c) The limitations imposed by this Section 3.2 are for the purpose of
ensuring the availability to the Company of the exemption from the Section 5 of
the Securities Act provided by Rule 701 thereunder. If Rule 701 is amended the
provisions of this Section 3.2 shall be deemed to be likewise amended.
Section 3.3. Cancellations; Shares as Consideration. If any Options granted
under the Plan are cancelled or terminate or expire for any reason without
having been exercised in full, the Shares related to the unexercised portion of
an Option shall be available again for the purposes of the Plan. If any Shares
acquired under the Plan are forfeited for any reason or repurchased by the
Company, the Shares shall be available again for the purposes of the Plan. If
any Shares are tendered to the Company as consideration for the exercise of an
Option, such Shares shall be available for the purposes of the Plan. If any
Shares are issued as the purchase price of an Option, such Shares will be deemed
to have been issued upon the exercise of an Option.
Section 3.4. Anti-Dilution.
(a) If the Shares are split or if a dividend of Shares is paid on the
Shares, the number of Shares on which each then outstanding Option is based and
the number of Shares as to which Options may be granted under this Plan shall be
increased automatically by the ratio between the number of Shares outstanding
immediately after such event and the number of Shares outstanding immediately
before such event (ignoring for this purpose any provision for the repurchase or
cash payment of fractional shares) and the Exercise Price thereof shall be
decreased automatically by the same ratio. If the Shares are combined into a
lesser number of Shares, the number of Shares for which each then outstanding
Option is based and the number of Shares as to which Options may be granted
under the Plan shall be decreased automatically by such ratio and the Exercise
Price thereof shall be increased automatically by such ratio.
(b) If any other change occurs in the Shares, through recapitalization,
merger, consolidation or exchange of shares or otherwise, there shall
automatically be substituted for each Share subject to an unexercised Option and
each Share available for additional grants of Options, the number and kind of
shares or other securities into which each outstanding Share was changed, and
the Exercise Price shall be increased or decreased proportionally so that the
aggregate Exercise Price for the securities subject to each Option shall remain
the same as immediately before such event. In addition, the Committee may make
such further equitable adjustments in the Plan and the then outstanding Options
as are deemed necessary and appropriate by the Committee including, but not
limited to, changing the number of Shares reserved under the Plan or covered by
outstanding Options, the Exercise Price of outstanding Options and the vesting
conditions of outstanding Options.
(c) As of the Effective Date the Company conducted its business through
sister corporations having common ownership. It is the intent of the Company and
its shareholders that the Shares and the Fair Market Value of a Share shall
represent a proportionate percentage of the entire enterprise. Therefore, to the
extent that the Company continues to operate through sister corporations, until
such time as there is a Public Market for the Shares, the Fair Market Value of a
Share under each Option shall be determined using a methodology that is
consistent with the methodology used by the Committee at the time the Option was
granted.
<PAGE>
Section 3.5. Source. Except as otherwise determined by the Board of
Directors, the Shares issued under the Plan shall be drawn from the Company's
authorized but unissued Shares. However, Shares which are to be delivered under
the Plan may be obtained by the Company from its treasury, by purchases on the
open market or from private sources, as well as by issuing authorized but
unissued Shares. The proceeds of the exercise of any Option shall be general
corporate funds of the Company and shall not increase its stated capital.
Section 3.6. Rights of a Stockholder. No Holder or other person
claiming under or through any Holder shall have any right, title or interest in
or to any Shares allocated or reserved under the Plan or subject to any Option
except as to such Shares, if any, for which certificates representing such
Shares have been issued to such Holder.
Section 3.7. Securities Laws. No Option shall be exercised nor shall any
Shares or other securities be issued or transferred pursuant to an Option unless
and until all applicable requirements imposed by federal and state securities
laws and by any stock exchanges upon which the Shares may be listed, have been
fully complied with. As a condition precedent to the exercise of an Option or
the issuance of Shares pursuant to the grant or exercise of an Option, the
Company may require the Holder to take any reasonable action to meet such
requirements including providing undertakings as to the investment intent of the
Holder, accepting transfer restrictions on the Shares issuable thereunder and
providing opinions of counsel, in form and substance acceptable to the Company,
as to the availability of exemptions from such requirements.
Section 3.8. Restricted Stock Shareholder's Agreement. The Shares issued
under the Plan are deemed to be restricted securities as defined in Rule 144 to
the extent required by Rule 701. If there is no Public Market for the Shares at
the time an Option is exercised, a Holder may not exercise an Option unless and
until he has executed and delivered to the `-Company a Shareholder's Agreement.
Article 4. Eligibility.
Section 4.1. Article 5. Only Employees who are not members of the Committee
shall be eligible to receive Options under Article 5 below.
Section 4.2. Article 6. Only Consultants shall be eligible to receive
Options under Article 6 below.
Section 4.3. Article 7. Only Directors who are not Employees shall be
eligible to receive Options under Article 7 below.
Article 5. Employees' Stock Options.
Section 5.1. Determinations. The Committee shall determine which
Participants shall be granted Options, the number of Shares for which the
Options may be exercised, the times when they shall receive them and the terms
and conditions of individual Option grants (which need not be identical).
<PAGE>
Section 5.2. Exercise Price. The Committee shall determine the Exercise
Price of each Option at the time that it is granted, but in no event shall, the
Exercise Price of an Option be less than the Fair Market Value of a Share. on
the Date of Grant. If no express determination of the Exercise Price of an
Option is made by the Committee, the Exercise Price thereof is equal to the Fair
Market Value of a Share on the Date of Grant.
Section 5.3. Term. Subject to the rule set forth in the next sentence, the
Committee shall determine the times when an Option vests and the term during
which an Option is exercisable at the time that it is granted. No Option shall
be exercisable after the expiration of ten years from the Date of Grant. If no
express determination of the times when Options are vested, become exercisable
and lapse is made by the Committee:
(a) each Option shall vest as to one-half (1/2) of the Shares subject to
such Option on the second anniversary of the Date of Grant and each Option shall
vest fully on the third anniversary of the Date of Grant, if and only if, the
Grantee has been an Employee continuously during the time beginning on the Date
of Grant and ending on the date when such portion vests; provided, however, that
each option held by an Employee shall become fully-vested upon the occurrence of
the establishment of a Public Market for the Shares;
(b) each vested Option is exercisable upon the occurrence of the earlier
of:
(i) the fifth (5th) anniversary of its Date of Grant, or
(ii) the establishment of a Public Market for the Shares and
(c) each Option shall lapse and cease to be exercisable upon the earliest
of
(i) the expiration often years from the Date of Grant,
(ii) immediately if the Grantee ceases to be an Employee of any
Employer on account of Termination for Cause,
(iii) immediately if, during the eighteen (18) month period after the
Grantee ceases to be an Employee, the Committee determines that
the Grantee has Engaged in Competition with an Employer, or
(iv) three years after the Grantee ceases to be an Employee for a
reason other than that described in clause (ii) or (iii) above.
Notwithstanding the foregoing and except as otherwise provided in Section
8.5, the three year period referred to in clause (iv) above will not expire
prior to -the date that is thirty days after the earlier of (A) the fifth (5th)
anniversary of the Date of Grant of the Option or (B) the establishment of a
Public Market for the Shares.
Section 5.4. New Hires. A person to whom the Company is offering employment
may be granted an Option under this Article 5, but any such grant shall lapse if
such person does not subsequently become an Employee pursuant to such offer.
<PAGE>
Article 6. Consultants' Stock Options.
Section 6.1. Determinations. The Committee shall determine which
Participants shall be granted Options, the number of Shares for which the
Options may be exercised, the times when they shall receive them and the terms
and conditions of individual Option grants (which need not be identical).
Section 6.2. Exercise Price. The Committee shall determine the Exercise
Price of each Option at the time that it is granted, but in no event shall the
Exercise Price of an Option be less than the Fair Market Value of a Share on the
Date of Grant. If no express determination of the Exercise Price of an Option is
made by the Committee, the Exercise Price thereof is equal to the Fair Market
Value of a Share on the Date of Grant.
Section 6.3. Term. Subject to the rule set forth in the next sentence, the
Committee shall determine the times when an Option vests and the term during
which an Option is exercisable at the time that it is granted. No Option shall
be exercisable after the expiration of ten years from the Date of Grant. If no
express determination of the times when Options are vested, become exercisable
and lapse is made by the Committee:
(a) each Option shall vest as to one-half (1/2) of the Shares subject to
such Option on the second anniversary of the Date of Grant and each Option shall
vest fully on the third anniversary of the Date of Grant, if, and only if the
Grantee has been a Consultant continuously during the time beginning on the Date
of Grant and ending on the date when such portion vests; provided, however, that
each option held by a Consultant shall become fully-vested upon the occurrence
of the establishment of a Public Market for the Shares;
(b) each vested Option is exercisable upon the occurrence of the earlier
of:
(i) the fifth (5th) anniversary of its Date of Grant, or
(ii) the establishment of a Public Market for the Shares; and
(c) each Option shall lapse and cease to be exercisable upon the earliest
of:
(i) the expiration often years from the Date of Grant,
(ii) immediately if the Grantee ceases to be a Consultant on account
of Termination for Cause,
(iii) immediately if, during the eighteen (18) month period after the
termination of the consulting relation the Committee determines
that the Grantee has Engaged in Competition with an Employer, or
(iv) three years after the Grantee ceases to be a Consultant for a
reason other than that described in clause (ii) or (iii) above.
<PAGE>
Notwithstanding the foregoing and except as otherwise provided in Section
8.5, the three year -period referred to in clause (iv) above will not expire
prior to the date that is thirty days after the earlier of (A) the fifth (5th)
anniversary of the Date of Grant of. the Option or (B) the establishment of a
Public Market for the Shares.
Article 7. Directors' Options.
Section 7.1. Grant. On each Meeting Date, an Option maybe granted to each
person who is elected as a Director at the meeting of stockholders held on such
date or at any adjournment thereof and to each Director whose term of office as
a director continues through such date, if it is the Meeting Date, and who is
eligible to receive Options hereunder.
Section 7.2. Exercise Price. The Committee shall determine the Exercise
Price of each Option at the time that it is granted, but in no event shall the
Exercise Price of an Option be less than the Fair Market Value of a Share on the
Date of Grant. If no express determination of the Exercise Price of an Option is
made by the Committee, the Exercise Price thereof is equal to the Fair Market
Value of a Share on the Date of Grant.
Section 7.3. Term. Subject to the rule set forth in the next sentence, the
Committee shall determine the times when an Option vests and the term during
which an Option is exercisable at the time that it is granted. No Option shall
be exercisable after the expiration of years from the Date of Grant. If no
express determination of the times when Options are vested, become exercisable
and lapse is made by the Committee:
(a) each Option shall vest as to one-half (1/2) of the Shares originally
subject to the Option on the second anniversary of the Date of Grant and each
Option shall vest fully on the third anniversary of the Date of Grant if, and
only if, the Grantee has been a Director continuously during the time beginning
on the Date of Grant and ending on the date when such portion vests; provided,
however, that each option held by a Director shall become fully-vested upon the
occurrence of the establishment of a Public-Market for the Shares;
(b) each vested Option is exercisable upon the occurrence of the earlier of
(i) the fifth (5th) anniversary of its Date of Grant, or
(i) the fifth (5th) anniversary of its Date of Grant, or
(ii) the establishment of a Public Market for the Shares; and
(c) each Option shall .lapse and cease to be exercisable upon the earliest
of (i) the expiration of ten years from the Date of Grant,
(i) the expiration of ten years from the Date of Grant,
(ii) immediately if the Grantee ceases to be a Director on account of
Termination for Cause,
<PAGE>
(iii) immediately if; during the eighteen (18) month period after the
Grantee ceases to be a Director, the Committee determines that
the Grantee has Engaged in Competition with an Employer, or
(iv) three years after the Grantee ceases to be a Director for a
reason other than that described in clause (ii) or (iii) above.
Notwithstanding the foregoing and except as otherwise provided in Section
8.5, the three year period referred to in clause (iv) above will not expire
prior to the date that is thirty days after the earlier of (A) the fifth (5th)
anniversary of the Date of Grant of the Option or (B) the establishment of a
Public Market for the Shares.
Article 8. Provisions Applicable to all Types of Options.
Section 8.1. Option Agreement. Promptly after the Date of Grant, the
Company shall duly execute and deliver to the Grantee an Option Agreement
setting forth the terms of the Option. Option Agreements are not negotiable
instruments or securities (as such term is .defined in Article 8 of the Uniform
Commercial Code). Lost and destroyed Option Agreements may be replaced without
bond.
Section 8.2. Not Incentive Stock Options. None of the Options shall be
treated as an incentive stock option as such term is defined in Section 422(b)
of the Code.
Section 8.3. Exercise.
(a) An Option shall be exercised by the delivery of the Option Agreement
therefor, with the notice of exercise attached thereto properly completed and
duly executed by the Holder to the Secretary of the Company, together with the
aggregate Exercise Price for the number of Shares as to which the Option is
being exercised, after the Option has become exercisable and before it has
ceased to be exercisable.
(b) An Option may be exercised as to less than all of the Shares
purchasable thereunder. If an Option is exercised as to less than all of the
Shares purchasable thereunder, a new duly executed Option Agreement reflecting
the decreased number of Shares subject to such Option, but otherwise of the same
tenor, shall be returned to the Holder.
(c) The Committee may, in its sole discretion and upon such terms and
conditions as it shall determine at or after the Date of Grant, permit the
Exercise Price to be paid in cash, by the tender to the Company of Shares owned
by the Holder, or by a combination thereof. If the Committee does not make such
determination, the Exercise Price may be paid in cash, by the actual tender to
the Company of Shares owned by the Holder, or by a combination thereof.
<PAGE>
(d) If any portion of the Exercise Price of an Option is payable in cash,
it may be paid by (i) delivery of a certified or cashier's check payable to the
order of the Company, (ii) wire transfer of immediately available funds to a
bank account designated by the Company or (iii) reduction of a debt of the
Company to the Holder.
(e) If any portion of the Exercise Price of an Option is payable in Shares,
it may be paid by delivery of certificates representing a number of Shares
having a total fair market value on the date of exercise equal to or greater
than the required amount, duly endorsed for transfer with all signatures
guaranteed by a medallion signature guarantee. If there is no Public Market for
the Shares at the time an Option is exercised, payment of any portion of the
Exercise Price of an Option may be made in Shares only if the Committee has
determined the Fair Market Value of a Share within the last sixty (60) days. If
more Shares than are necessary to pay such Exercise Price based on their fair
market value on the date of exercise are delivered to the Company, it shall
return to the Holder a certificate for the balance of the whole number of Shares
and a check payable to the order of the Holder for any faction of a Share.
Shares may not be delivered to the Company as payment for the exercise of an
Option if such Shares have been owned by the Holder (together with his or her
decedent or testator) for less than six months.
(f) Promptly after an Option is properly exercised, the Company shall issue
to the Holder a certificate representing the Shares purchased thereunder.
Section 8.4. Nonconforming Grants. The Committee may grant Options having
terms and conditions which vary from those specified in the Plan if such Options
are granted in substitution for existing benefits under benefit or compensation
Plans of the Company or one or more of its predecessors existing on the
Effective Date or in substitution for, or in connection with the assumption of,
existing options granted by another business entity and assumed or otherwise
agreed to be provided for by the Company pursuant to or by reason of a
transaction involving a merger or consolidation of or acquisition of
substantially all of the assets or stock of another business entity that is not
an Affiliate of the Company before such acquisition.
Section 8.5. Merger of the Company. Notwithstanding the provisions of any
Option, if the Company merges or consolidates with or sells substantially all of
its assets to a person that was not one of its affiliates before such
transaction, or any such unaffiliated person purchases more than 50% of the
outstanding voting securities of the Company, the Committee, in its discretion,
may require that; for a period of 30 days, not extending beyond the ten year
period referred to in Sections 5.3, 6.3 and7.3, from the date of execution of
the acquisition agreement in final definitive form or the purchase of such
Shares, any or all of the then outstanding Options maybe exercised in whole or
in part during such 30 day period or that upon the termination of such 30 day
period any such Option shall expire and be null and void.
<PAGE>
Section 8.6. Withholding. The Company shall have the right to withhold from
any payments due under any Option or due to any -Holder from. the Company as
compensation or otherwise the amounts of any federal, state or local withholding
taxes not paid by the Holder at the time of the exercise of any Option. If cash
payments sufficient to allow for withholding of taxes are not made at the time
of exercise of an Option, the Holder exercising such Option shall pay to the
Company an amount equal to the withholding required to be made less the
withholding otherwise made in cash or, if allowed by the Committee in its
discretion and pursuant to rules adopted by the Committee consistent with
Section 8.3 above, Shares previously owned by the Holder. The Company may make
such other provisions as it deems appropriate to withhold any taxes the Company
determines are required to be withheld in connection with the exercise of any
Option, including, but not limited to, the withholding of Shares from an Option
upon such terms and conditions as the Committee may provide. The Company may
require the Holder to satisfy any relevant withholding requirements before
issuing Shares or delivering any Option to the Holder.
Section 8.7. Disability. If a Grantee who is an Employee or a Consultant is
absent from work because of a physical or mental disability, for purposes of the
Plan such Grantee will not be considered to have ended his or her employment or
consulting relationship with the Company while such Grantee has that disability,
unless he or she resigns or terminates such relationship or the Committee
decides otherwise. If a Grantee who is a Director is absent from meetings of the
Board of Directors because of a physical or mental disability, for purposes of
the Plan such Grantee will not be considered to have ended his or her service
with the Board of Directors while such Grantee has that disability, unless he or
she resigns or is not re-elected by the stockholders.
Section 8.8. Surrender and Exchange. The Committee may permit the voluntary
surrender of all or a portion of any Option to be conditioned upon the granting
to the Holder of a new Option for the same or a different number of Shares as
the Option surrendered, or may require such voluntary surrender as a condition
precedent to a grant of a new Option to such Holder. Subject to the provisions
of the Plan, such new Option shall be exercisable at the price, during the
period and on such other terms and conditions as are specified by the Committee
at the time the new Option is granted. Upon surrender, the Option surrendered
shall be canceled and the Shares previously subject to it shall be available for
the grant of other Options.
Section 8.9. Acceleration. Notwithstanding anything else in the Plan, the
Committee may, in its sole discretion, at any time or from. time to time,
accelerate the time at which any Options mature or vest or waive any provisions
of the Plan relating to the manner of payment or procedures for the exercise or
maturity of any Option. Any such acceleration may be made effective (a) with
respect to one or more or all Holders, (b) with respect to some or all of the
Shares subject to or forming the basis for any Option to any Holder or (c) for a
period of time ending at or before the expiration date of any Option.
Section 8.10. Actions by Committee After Grant Purchase of Options.
(a) The Committee shall have, subject to the written consent of the Holder
where the action impairs or adversely alters the rights of the Holder, the
right, at any tune and from time to time after the Date of Grant of any Option,
to modify the terms of any Option.
<PAGE>
(b) The Company may, at any time before there is a Public Market for the
Shares, purchase any portion of any option without the consent of the Holder.
The Committee shall have right to determine which Holder's Options will be
purchased, what portions of such Options will be purchased, when such Options
will be purchased and the form of consideration to be paid for the purchase of
such Options. The Committee may not determine to purchase Options unless it has
determined the Fair Market Value of a Share within the last sixty (60) days.
Such a purchase shall be effected by a resolution of the Committee. After notice
of such purchase is sent to the Holder, the rights of the Holder under such
Option shall be limited to receiving the consideration for the purchase thereof
in the amounts and at the times determined by the Committee, but the failure to
timely or fully pay- such consideration shall not revive any other right under
the Option. Promptly after receipt of such notice, the Holder shall surrender
the Option Agreement to the Company and if less than all of the Option is being
purchased a new duly executed Option Agreement reflecting the decreased number
of Shares subject to such Option, but otherwise of the same tenor, shall be
returned to the Holder. The amount of consideration for the purchase of an
Option shall be equal to the difference between the Exercise Price and the Fair
Market Value of a Share multiplied by the number of Shares subject to the
portion of the Option that is being purchased, but shall not be less than one
cent ($0.01) per Share. The firm of consideration for the purchase of an Option
maybe cash, Shares or other property or any combination thereof and maybe paid
in installments. If the Committee determines to pay the purchase price in
installments, the obligation to make such payments shall bear interest at a rate
that is not less than the applicable federal rate determined under Section 7872
of the Code. If the Committee determines to pay any portion of the purchase
price in Shares it shall require the Holder to execute a Shareholder's Agreement
before issuing the Shares to the Holder.
Section 8.11. Determination of Value. Until such time as there is a Public
Market for the Shares, the Committee shall determine the Fair Market Value of a
Share at least annually, the Committee may not grant Options unless it has
determined the Fair Market Value of a Share within the last sixty (60) days; and
the Committee shall notify all Holders and all persons who are parties to a
Shareholders Agreement of the Fair Market Value of a Share promptly after the
Committee determines it.
Article 9. General Provisions.
Section 9.1. No Right to Employment. Nothing in the Plan or any Option or
any instrument executed pursuant to the Plan will confer upon any Grantee any
right to continue to be employed by or provide services to his or her Employer
or affect the right of his or her Employer to terminate the employment of any
Grantee or its other relationship with any Grantee. Nothing in the Plan or any
Option or any instrument executed pursuant to the Plan will confer upon any
Grantee any right to continue to be a Director of the Company or affect the
right of the stockholders to terminate the directorship of any Grantee.
<PAGE>
Section 9.2. Limited Liability. The liability of the Company, the Committee
or any member thereunder this Plan or in connection with any exercise of any
Option is limited to the obligations expressly set forth in the Plan and in the
grant of any Option, and no term or provision of this Plan nor of any Option
shall be construed to impose any duty, obligation or liability on the Company,
the Committee or any member thereof not expressly set forth in the Plan or any
grant of any Option.
Section 9.3. Assumption of Options. Upon the dissolution or liquidation of
the Company, or upon a reorganization, merger or consolidation of the Company
with one or more other entities as a result of which the Company is not the
surviving entity, or upon a sale of substantially all the assets of the Company
to another entity, any Options outstanding theretofore granted or sold hereunder
must be assumed by the surviving or purchasing entity, with appropriate
adjustments as to the number and kind of shares and price.
<PAGE>
Section 9.4. No Transfer. No Option or other benefit under the Plan may be
sold, pledged or otherwise transferred other than to a trust established by the
Grantee or by will or the laws of descent and distribution; and no Option may be
exercised during the life of the Grantee to whom it was granted except by such
Grantee or an individual appointed to act on behalf of the Grantee in the event
of the Grantee's incapacity.
Section 9.5. Expenses. All costs and expenses incurred in connection with
the administration of the Plan including any excise tax imposed upon the
transfer of Shares pursuant to the exercise of an Option shall be borne by the
Company; provided, however, that the Company shall not be responsible for the
payment of any excise taxes under Section 4999 of the Code or any successor
thereto.
Section 9.6. Other Plans. The income realized by a Grantee upon the
exercise of an Option shall not be taken into account in determining the
benefits available to any Grantee or his beneficiaries under any other pension,
welfare benefit or other compensatory plan of any Employer.
Section 9.7. Notices. Notices and other communications required or
permitted to be made under the Plan shall be in writing and shall be deemed to
have been duly given only if personally delivered or if sent by first class mail
addressed (a) if to a Holder, at his or her residence address set forth in the
records of the Company or (b) if the Company, to its President at its principal
executive office.
Section 9.8. Third Parties. Nothing herein expressed or implied is intended
or shall be construed to give any person other than the Holders any rights or
remedies under this Plan.
Section 9.9. Saturdays, Sundays and Holidays. Where this Plan authorizes or
requires a payment or performance on a Saturday, Sunday or public holiday, such
payment or performance shall be deemed to be timely if made on the next
succeeding business day, provided, however, that this Section 9.9 shall not be
construed to extend the ten year period referred to in Sections 53, 6.3 and 7.3
above.
Section 9.10. Rules of Construction. The captions and section numbers
appearing in this Plan are inserted only as a matter of convenience. They do not
define, limit or describe the scope or intent of the provisions of this Plan. In
this Plan words in the singular number include the plural, and in the plural
include the singular and words of the masculine gender include the feminine and
the neuter and, when the sense so indicates, words of the neuter gender may
refer to any gender.
Section 9.11. Governing Law. The validity, terms, performance and
enforcement of this Plan shall be governed by laws of the State of Ohio that are
applicable to agreements negotiated, executed, delivered and performed solely in
the State of Ohio.
Section 9.12. Effective Date of the Plan. The Plan shall become effective
upon its approval by the Board of Directors.
<PAGE>
Section 9.13. Amendment and Termination. No Option shall be granted
under the Plan more than ten years after the Effective Date. The Board of
Directors may at any time terminate the Plan or make such amendment of the Plan
as it may deem advisable; -provided, .however, that no amendment shall be
effective without the approval of the stockholders of the Company by the
affirmative vote of the holders of a majority of the outstanding Shares present
or represented and entitled to vote at a meeting of stockholders duly held, if
it would materially increase the number of Shares available for issuance under
the Plan pursuant to Section 3.1 above; and, further, provided, however, that no
amendment or termination of the Plan shall be effective to alter or impair the
rights of a Holder under any Option granted before the adoption of such
amendment or termination by the Board of Directors, without the written consent
of such Holder. No termination or amendment of this Plan or any Option nor
waiver of any right or requirement under this Plan or any Option shall be
binding on the Company unless it is in a writing duly entered into its records
and executed by a duly authorized officer of the Company.
Section 9.14. Arbitration. Any disputes, controversies or claims arising
out of or relating to this Plan, or the breach thereof; shall be settled by
arbitration in accordance with the Commercial Arbitration Rules of the -
American Arbitration Association and judgment upon the award rendered by the
Arbitrator(s) may be entered in any court having jurisdiction thereof If the
amount claimed or disputed in such arbitration is equal to or more than One
Hundred Thousand Dollars ($100,000), it shall be conducted before a panel of
three arbitrators.
Section 9.15. Beneficiary Designation. At the time that an Option. is
granted and at any time thereafter, the Grantee may file a beneficiary
designation with the Committee identifying the person to whom vested Options
should be transferred upon the death of the Grantee. The Options to which such a
beneficiary designation applies shall be stated on such designation and the
designation shall apply only to the Options specifically identified thereon. The
filing of a beneficiary, designation pertaining to a particular Option shall
revoke all previous beneficiary designations filed with respect to that Option.
If no valid beneficiary designation form is on file with the Committee at the
time of a Grantee's death, any vested Options will be transferred by will or by
the laws of descent and distribution.
EXHIBIT 5.0
June 22, 1999
Res-Care, Inc.
10140 Linn Station Road
Louisville, Kentucky 40223
Re: Form S-8 Registration Statement
Ladies and Gentlemen:
We have acted as counsel for Res-Care, Inc., a Kentucky corporation
(the "Company"), in connection with the registration, by means of a Form S-8
Registration Statement under the Securities Act of 1933, as amended (the
"Registration Statement"), of 408,980 shares of the Company's common stock, no
par value (the "Shares"), which may be issued pursuant to the Agreement and Plan
of Merger, dated April 2, 1999, by and among Res-Care, Inc., Res-Care Sub, Inc.
and PeopleServe, Inc. (the "Merger Agreement"), in exchange for stock options
granted under the VOCA Holdings, Inc. 1996 Stock Option Plan and outstanding as
of the "Effective Time" as defined in the Merger Agreement.
We have examined and are familiar with the Amended and Restated
Articles of Incorporation and Bylaws of the Company, as those instruments have
been amended to date, the Registration Statement and the various corporate
records and proceedings relating to the organization of the Company and the
proposed issuance of the Shares. We have also examined such other documents and
proceedings as we have considered necessary for the purpose of this opinion.
Based on the foregoing, we are of the opinion that the Shares have been
duly authorized and, when issued in accordance with the Merger Agreement, will
be validly issued, fully paid and nonassessable. We express no opinion as to the
laws of any jurisdiction other than the laws of the Commonwealth of Kentucky and
the federal laws of the United States. We hereby consent to the filing of this
opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ REED WEITKAMP SCHELL & VICE PLLC
-------------------------------------
REED WEITKAMP SCHELL & VICE PLLC
EXHIBIT 23.2
[CONSENT OF INDEPENDENT AUDITORS]
The Board of Directors
Res-Care, Inc.:
We consent to the incorporation by reference in the registration statement on
Form S-8 of Res-Care, Inc. of our report dated February 24, 1999, relating to
the consolidated balance sheets of Res-Care, Inc. and subsidiaries as of
December 31, 1998 and 1997, and the related consolidated statements of income,
shareholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1998, which report appears in the annual report on
Form 10-K of Res-Care, Inc. for the year ended December 31, 1998.
/s/ KPMG LLP
Louisville, Kentucky
June 23, 1999
