<PAGE> 1
As filed with the Securities and Exchange Commission on December 13, 1996
Registration No. 333-
-----
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Allied Capital Advisers, Inc.
(Exact name of registrant as specified in its charter)
Maryland 52-0812307
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1666 K Street, N.W.
Washington, D.C. 20006
- --------------------------------- ----------------------------
(Address of principal executive offices) (Zip Code)
Allied Capital Advisers, Inc. Incentive Stock Option Plan
(Full title of the plan)
David Gladstone
1666 K Street, N.W.
Washington, D.C. 20006
(Name and address of agent for service)
(202) 331-1112
(Telephone number, including area code, of agent for service)
Calculation of Registration Fee
<TABLE>
<CAPTION>
=====================================================================================================
Proposed Proposed Maximum
Title of Amount to Maximum Aggregate Amount of
Securitiesto be be Offering Price Per Offering Price Registration Fee
Registered Registered Unit
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
common stock 1,999,580 $5.5625 $11,122,663.75* $3,370.50
=====================================================================================================
</TABLE>
*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 are based upon the average of the high and
low price per share of Allied Capital Advisers, Inc. Common Stock on the Nasdaq
National Market System on December 10, 1996.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan(s) described herein.
<PAGE> 2
PROSPECTUS
1,844,852 SHARES
ALLIED CAPITAL ADVISERS, INC.
COMMON STOCK
(PAR VALUE $.001 PER SHARE)
Allied Capital Advisers, Inc., a Maryland corporation ("Advisers" or the
"Company"), is an investment adviser registered under the Investment Advisers
Act of 1940, as amended (the "Advisers Act"). Its principal business is acting
as investment adviser to public and private investment companies and real
estate investment trusts that specialize in investing in, and lending to, small
businesses. The Company's principal office is located at 1666 K Street, N.W.,
Suite 901, Washington, D.C. 20006. Its telephone number is (202) 331-1112.
The 1,844,852 shares of Advisers common stock (the "Shares") covered by
this Prospectus have been or will be acquired upon exercise of options granted
under the Allied Capital Advisers, Inc. Incentive Stock Option Plan (the
"Plan") and may be offered for sale on behalf of the stockholders named herein
(the "Selling Stockholders") from time to time on any securities exchange on
which the Company's shares are listed, in the over-the-counter market or
otherwise at market prices and on terms then prevailing, in negotiated
transactions at prices then obtainable, or otherwise. Shares may be sold in
regular brokerage transactions or may be sold directly to brokers, dealers and
others buying for their own account. Advisers common stock is listed on the
Nasdaq National Market under the symbol "ALLA."
FOR A DISCUSSION OF THE RISKS RELATING TO AN INVESTMENT IN THE SHARES,
SEE "INVESTMENT CONSIDERATIONS."
Although the Company has received or will receive proceeds from the
exercise of options granted under the Plan, the Company will not receive any of
the proceeds from the sale of the Shares by the Selling Stockholders. The
expenses of preparing this Prospectus are being paid by the Company, but
brokerage fees and other expenses of sales hereunder will be borne by the
appropriate Selling Stockholders.
Certain of the persons who sell or distribute securities covered by this
Prospectus may be deemed to be underwriters within the meaning of the
Securities Act of 1933, as amended (the "1933 Act"). It is expected that the
securities offered hereby will be available for sale from time to time
commencing on or about December 13, 1996.
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offer contained in this Prospectus, and, if given or made, such
information or representations must not be relied upon as having been
authorized by the Company. This Prospectus does not constitute an offer to
sell or the solicitation of an offer to buy any of the securities offered
hereby in any state to any person to whom or from whom it is unlawful to make
such offer or solicitation. Neither the delivery of this Prospectus nor any
sales made hereunder shall under any circumstances create any implication that
there has been no change in the information contained herein since the date
hereof.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is December 13, 1996
- 2 -
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Investment Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Determination of Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Incorporation of Certain Documents By Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Indemnification of Officers and Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
</TABLE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and in accordance
therewith files reports, proxy statements, and other information with the
Securities and Exchange Commission (the "Commission"). All reports, proxy
statements and other information filed by the Company can be inspected and
copied at the Commission's public reference facilities at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549 and at the following Regional Offices:
Midwest Regional Office: 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511; and Northeast Regional Office: 7 World Trade Center, Suite 1300,
New York, New York 10048. Copies of these materials may also be obtained free
of charge by accessing the EDGAR archives at the Commission's Internet home
page at www.sec.gov. They may also be obtained from the Commission at the
prescribed rates by mailing a request to: Public Reference Branch, Securities
and Exchange Commission, Washington, D.C. 20549.
The Company's common stock is listed on the Nasdaq National Market,
and reports, proxy statements and other information concerning the Company can
be inspected at the offices of the National Association of Securities Dealers,
Inc. located at 1735 K Street, N.W., Washington, D.C. 20006.
Certain documents filed with the Commission are incorporated by
reference in this Prospectus. The Company hereby undertakes to provide,
without charge, to each person, including any beneficial owner of Advisers
common stock, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any and all of the information that has been
incorporated by reference in this Prospectus (excluding exhibits to any
documents incorporated by reference, unless such exhibits have specifically
been incorporated by reference), but not delivered with it. Such requests
should be made to Suzanne Sparrow, Allied Capital Advisers, Inc., 1666 K Street
N.W., 9th Floor, Washington, D.C. 20006 (telephone: (202) 331-1112).
INVESTMENT CONSIDERATIONS
LIMITED OPERATING HISTORY AS AN INDEPENDENT COMPANY. Until December
31, 1990, the Company operated as a wholly owned subsidiary and, in effect, a
division of Allied Capital Corporation ("Allied I"). On December 31, 1990,
pursuant to the terms of certain exemptive relief granted by the Commission to
the Company and Allied I, all of the shares of the Company were distributed to
the shareholders of Allied I on a one-for-one basis. At the time of that
distribution, the Company did not have any substantial tangible assets or net
worth and had approximately $259 million under management. Since that
distribution, the Company has increased its total assets under management by
192% to approximately $755 million (as of September 30, 1996) and has been
profitable during every year of its operations, except for the year ended
December 31, 1992, in which the Company reported a net loss of approximately
$0.07 per share. Such loss was largely the result of the foregone investment
management fees waived that year for Allied Capital Commercial Corporation
("Allied Commercial"), a fund organized by
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<PAGE> 4
Advisers in 1992 for which Advisers agreed to waive the investment management
fee for its first six months of operations. Although the Company generally has
been profitable during the early stages of its operations, there can be no
assurance that the Company will continue to be profitable or that its assets
under management will increase in the future.
DEPENDENCE ON MANAGEMENT. The Company believes that the past
performance of its advisee companies is attributable largely to the experience
and ability of David Gladstone, its Chairman and Chief Executive Officer, who
has been associated with Allied I since 1974. With respect to the more recent
performance of its advisee companies, the Company has depended increasingly on
the efforts of its senior executive officers, including Katherine E. Marien,
John M. Scheurer and G. Cabell Williams, III. In addition, the Company relies
increasingly on the significant contributions of its President, Joan M.
Sweeney. While the Company's officers spend all their available work hours in
activities for the Company and its advisee companies, the Company does not have
employment contracts with any of its officers. The loss of one or more of
these officers could have a material adverse effect on the Company's future
performance. The Company carries insurance to the extent of $1 million on the
life of Mr. Gladstone.
MARKET FOR SHARES. Prior to August 1995, the Company's shares were
listed on Nasdaq's Small-Cap Market. Since that date, however, the Company's
shares have been quoted on Nasdaq's National Market. As of November 1, 1996,
the Company had approximately ten market makers. There can be no assurance
that market makers will continue to make a market in the Company's stock or
that the Company's shares will continue to be listed on the Nasdaq National
Market.
DEPENDENCE ON ADVISORY FEES. The prices at which the Company's
outstanding shares have been quoted in the over-the-counter market or at which
the Shares offered hereby are being offered do not necessarily bear a direct
relationship to the Company's net worth or historical earnings. Such prices
may be based on anticipated revenues that the Company is expected to earn from
fees payable under its advisory and management agreements. Such fees, however,
are based on the value and composition from time to time of the advisee
companies' assets. The value of such assets are subject to fluctuations based
on investment performance and the accounting treatment relating to certain
investments; the composition of such assets will change depending upon the
Company's ability to invest assets in accordance with the advisee company's
investment objective. Moreover, because most of the advisee companies are
closed-end investment companies or real estate investment trusts, increases in
asset size of such companies (other than performance-related increases)
generally occur only when such companies make offerings of debt or equity
securities. For a variety of reasons, there can be no guarantee that such
companies will make such offerings or, if made, that such offerings will raise
a sufficient amount of capital to allow the Company to benefit from economies
of scale. In addition, the agreements themselves are subject to periodic
reapproval or renegotiation and to termination at any time on short notice by
the advisee companies' board of directors or shareholders, in the case of
Allied Capital Corporation, Allied Capital Corporation II, and Allied Capital
Lending Corporation, and under certain circumstances by the limited partners,
in the case of Allied Venture and Allied Technology, or by the shareholders in
the case of Allied Capital Commercial Corporation and Business Mortgage
Investors, Inc. There can be no assurance that such agreements will remain in
effect, although the Company has no reason to believe that any such agreement
is likely to be terminated in the foreseeable future.
NATURE OF INVESTMENTS. The portfolios of the Company's advisee
companies consist primarily of securities issued by small and developing,
privately held companies. There is generally little or no publicly available
information about such companies. Typically, such companies depend for their
success on the management talents and efforts of one person or a small group of
persons, so that the death, disability or resignation of such person or persons
could have a materially adverse impact on them. Moreover, small companies
frequently have narrower product lines and smaller market shares than larger
companies and therefore may be more vulnerable to competitors' actions and
market conditions, as well as general economic downturns. Because these
companies will generally have highly leveraged capital structures, reduced cash
flow resulting from an adverse competitive development, shift in customer
preferences or an economic downturn may adversely affect the return on, or the
- 4 -
<PAGE> 5
recovery of, the Company's investment in them. Investment in such companies,
therefore, involves a high degree of business and financial risk, which could
result in substantial losses and should therefore be considered speculative.
Accordingly, any loss in assets by the Company's investment advisee companies
could adversely affect the Company's ability to generate revenue, or continue
to increase assets under management.
COMPETITION. The asset management industry is highly competitive and,
having relatively few barriers to entry, continues to attract new competitors.
As a result, the Company must compete with thousands of other institutions,
including banks, insurance companies and registered investment advisers, when
attempting to attract new investment dollars to manage. Many of these
competitors have more assets under management and greater resources (e.g., more
advisory personnel) than the Company, which may make it easier for such
competitors to take advantage of investment opportunities as they arise.
Moreover, many of the Company's competitors have greater access to public
investors (and, correspondingly, to assets to manage) because such competitors
advise open-end investment companies that are engaged in continuous offerings
of securities; in contrast, the Company to date has attracted new investment
dollars only through periodic offerings of securities by the entities advised
by the Company or through borrowings under various lines of credit available to
such entities. While this factor insulates the Company from decreases in asset
size and certain liquidity needs related to redemptions of investment company
shares, the Company may not be able to benefit from economies of scale
resulting from increases in asset size to the same extent that certain of its
competitors may be. In addition, while the Company believes that its focus on
investments in small businesses sets it apart from most other investment
advisers, there can be no assurance that its investment strategies will be
successful or that public investors will continue to invest in that market
sector.
LIQUIDITY OF INVESTMENTS. All of the companies managed or advised by
Advisers are engaged in various aspects of making loans to, or investments in,
small businesses. These loans and investments are generally made in a large
number of relatively small, individually structured transactions. As a result,
such loans and investments are relatively illiquid. Thus, there can be no
guarantee that the Company will be able to lock in profits, or avoid losses, on
the investments made by the companies it advises, which could affect both the
performance of the companies advised or managed by Advisers and the fees it
receives.
PERSONNEL-INTENSIVE BUSINESS. The Company's activities are highly
personnel-intensive and opportunities for economies of scale are limited. As
discussed above, loans and investments are generally made in a large number of
relatively small, individually structured transactions. Once a loan or
investment has been made, it must be carefully monitored on a continuing basis
until final realization or disposition. In particular, during difficult
periods in the economy, additional work may be required to assist portfolio
companies in the management of their businesses, to assist in the restructuring
of loans made to such companies and to take other steps to preserve value for
the investing entity's shareholders, which may require the addition of more
personnel without any immediately realizable financial benefit to the Company.
Similarly, increases in funds under management, which may require immediate
additions to personnel, generally do not result in commensurate immediate
increases in fee revenue because of the structure of the Company's investment
advisory and management agreements, under which fees on uninvested assets are
relatively modest and rise to a profitable level only after funds become
invested in accordance with the several portfolios' investment objectives.
REGULATION. The Company is registered with the Commission as an
investment adviser under the Advisers Act and is subject to the reporting
requirements of the 1934 Act. In addition, certain of the companies for which
the Company acts as investment adviser are registered with the Commission under
the Investment Company Act of 1940, as amended (the "1940 Act") and have
elected to be regulated as business development companies; another is operated
as a real estate investment trust ("REIT"). Each of the foregoing companies
are also subject to the reporting requirements of the 1934 Act. The shares of
the Company and of certain of the entities advised or managed by the Company
are qualified for sale in various states. As a result, virtually all aspects
of the Company's investment advisory activities, and the operation of the
investment companies advised by the Company, are subject to various federal and
state laws and regulations. These laws and regulations are primarily intended
to benefit investment advisory and investment company shareholders and
generally grant broad administrative powers to
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<PAGE> 6
supervisory agencies, including the ability to limit or restrict the carrying
on of business for failure to comply with such laws and regulations. While the
Company closely monitors compliance with applicable laws and regulations and
believes that it and the entities it manages or advises are in compliance with
such laws and regulations, in the event the Company is found to have violated
any such laws or regulations, the possible sanctions which may be imposed
include the suspension of individual employees, limitations on the activities
in which the investment adviser may engage, suspension or revocation of the
investment adviser's registration as an adviser, censure and fines.
SBA REGULATION. The business of one of the Company's investment
advisee companies, Allied Lending, is largely dependent upon two
government-sponsored, SBA-administered Loan Programs, the Section 7(a) Loan
Program and the Section 504 Loan Program. The Section 7(a) and 504 Loan
Programs are regulated by the SBA pursuant to laws passed by Congress. There is
no assurance that the government appropriations for these programs or for the
operations of the SBA will be continued. In addition, two of the Company's
investment advisee companies, Allied I and Allied II, have subsidiaries that
are SBA-licensed small business investment companies (SBICs) and specialized
small business investment companies (SSBICs), and as such rely on SBA funding
for a portion of their leverage capital. There is no assurance that the
government appropriations for these programs will be continued, or that such
funding will be available in the future. These programs are subject to changes
in law or regulation at any time, which changes could have an adverse impact on
the investment advisee companies' operations with regard to these programs, and
any such adverse impacts could materially affect the Company's ability to
generate additional investment advisory revenue from such investment advisee
companies.
GRADUATED FEES. Under its investment advisory or management
agreements with its existing advisee companies, the Company is, and under its
anticipated agreements with future entities expects to be, entitled to receive
investment advisory or management fees generally at the rate of 2.5% per annum
on the value of the respective entity's "invested assets"; with respect to one
advisee company, Allied Commercial, Advisers has agreed to receive fees ranging
from 1% to 3.5% per annum on certain of its invested assets, subject to a
quarterly cap, at the rate of 2.5% per annum. With respect to such entities'
cash and cash equivalents ("interim investments"), fees are receivable at
substantially lower levels, generally at the rate of 0.5% per annum. "Invested
assets" means investments made in accordance with the respective entity's
investment objectives, such as investments made in, and loans made to, small
business concerns, in the case of Allied I, Allied II, and Allied Lending, and
acquired mortgage loans to small businesses in the case of Allied Commercial
and BMI. When an entity is first organized, its assets are usually comprised
entirely of interim investments and cash and it may take several years before
such cash and the proceeds of such interim investments can be invested
predominantly in invested assets. Achieving investment in invested assets
requires substantial effort and expense on the part of the Company, for which
the Company is not adequately compensated until such investment is actually
achieved. The foregoing fee structures were in place as of November 1, 1996.
There can be no assurance that, in the case of one or the other of the entities
for which the Company currently acts or in the future may act as investment
adviser or manager, this type of fee structure will be used or retained,
substantially full investment in invested assets will ever be achieved or, if
it is achieved, that the value of such assets will not decline, or that the
2.5% per annum fee thereon (or any other applicable fee) will not be
renegotiated downward.
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<PAGE> 7
CONFLICTS OF INTEREST. Under the 1940 Act, the Company has a
fiduciary duty with respect to the receipt of compensation for services that
the Company may charge to the investment companies for which it acts as
investment adviser and may be deemed to have a similar duty to the other
companies that it manages. Accordingly, in advising the board of directors of
the entities advised or managed by the Company (a majority of the members of
which is independent of the Company) as to the desirability of making or
disposing of loans or investments, the officers of the Company who are also
directors of the managed entities are required to put the interests of such
entities ahead of the Company's interest in collecting fees.
THE OFFERING
This Prospectus is intended for use in connection with resales of the
Shares by the Selling Stockholders, some of whom may be considered "affiliates"
of the Company (as that term is defined in rules of the Commission). The
1,844,852 Shares covered by this Prospectus include: (i) 192,425 shares of
Advisers common stock previously issued to certain officers and directors of
the Company upon exercise of stock options granted under the Allied Capital
Advisers, Inc. Incentive Stock Option Plan (the "Plan"); and (ii) 1,652,427
shares of common stock that may be issued to certain officers and directors of
the Company upon exercise of stock options granted under the Plan. The Shares
already issued under the Plan were issued in reliance upon exemptions from
registration under the 1933 Act for private transactions. Certain of those
Shares were subsequently resold to certain of the Selling Stockholders. The
Shares that may be issued in the future upon the exercise of options granted
under the Plan are being simultaneously registered with the Commission on Form
S-8. As described below, use of this Prospectus is not the exclusive way
Shares may be resold by Selling Stockholders.
The Shares covered by this Prospectus may be sold from time to time by
the Selling Stockholders on any securities exchange on which the Shares are
listed, in the over-the-counter market or otherwise, at market prices and on
terms then prevailing or in negotiated transactions at prices then obtainable,
or otherwise. Shares may be sold in regular brokerage transactions or may be
sold directly to brokers, dealers and others buying for their own accounts. In
addition, any Shares covered by this Prospectus which qualify for sale pursuant
to Rule 144 under the 1933 Act ("Rule 144") may be sold under Rule 144 rather
than pursuant to this Prospectus. The Selling Stockholders also may pledge the
shares registered hereunder to a broker, dealer or other entity, and upon a
default the broker, dealer or other entity may effect sales of the pledged
shares pursuant to Rule 144.
Brokers, dealers or agents may receive compensation in the form of
commissions, discounts or concessions from Selling Stockholders in amounts to
be negotiated in connection with the sale. Such brokers, dealers and any other
participating in the resales of the Shares may be deemed to be "underwriters"
within the meaning of the 1933 Act in connection with such sales, and any such
commission, discount or concession may be deemed to be underwriting discounts
or commissions under the 1933 Act.
All costs, expenses and fees in connection with the registration of
the Shares will be borne by the Company. Commissions and discounts, if any,
attributable to the sales of the Shares by the Selling Stockholders will be
borne by the Selling Stockholders. The Selling Stockholders may agree to
indemnify any broker, dealer or agent that participates in transactions
involving sales of the Shares against certain liabilities, including
liabilities arising under the 1933 Act.
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<PAGE> 8
SELLING STOCKHOLDERS
The following table sets forth certain information with respect to the Selling
Stockholders, the number of shares of the Company's common stock beneficially
owned by each on September 30, 1996 and the number of shares of Company's
common stock which may be acquired upon the exercise of options granted under
the Plan.
<TABLE>
<CAPTION>
Maximum
number of
shares of Shares and % of
Positions and Shares of common stock common stock
material common stock which may be beneficially owned
relationships with beneficially offered for if all shares that
the Company during owned as of sale pursuant may be sold pursuant
last September 30, to this to this Prospectus
Name and Address three years* 1996 Prospectus are sold
- ----------------------------------------------------------------------------------------------------------
Shares Percent
------ -------
<S> <C> <C> <C> <C> <C>
Allied Employee Stock Greater than 10% Holder
Ownership Trust 1,481,265 46,364 1,481,265 16.5%
Harry T. Brill, Jr. Former employee 247,604 36,364 247,604 2.75%
Brooks H. Browne Director 76,728 13,333 76,728 0.85%
Jon A. DeLuca Executive Vice 20,941 55,000 61,941 0.68%
President, Chief
Financial Office and
Treasurer
William F. Dunbar Executive Vice 243,682 146,030 243,682 2.67%
President
David Gladstone Chairman and Chief 924,995 774,943 1,273,993 13.05%
Executive Officer
Robert E. Long Director 34,329 13,333 34,329 0.38%
Katherine C. Marien Executive Vice 39,099 26,667 51,099 0.57%
President
Kathleen T. Ryan Former employee 55,043 10,000 55,043 0.61%
John M. Scheurer Executive Vice 93,428 56,364 99,428 1.10%
President
Dianna L. Seaborn Former employee 23,677 10,000 23,677 0.26%
George Stelljes II Executive Vice 103,683 43,364 103,683 1.15%
President
Jack A. Sullivan ** Greater than 5% Holder 484,904 89,697 484,904 5.39%
Joan M. Sweeney President or 93,098 210,000 221,618 2.41%
Executive Vice
President
William L. Walton Director 21,145 13,333 21,145 0.23%
G. Cabell Williams III Executive Vice 325,279 157,030 325,279 3.56%
President
George C. Williams Director or Vice 312,550 143,030 312,550 3.42%
Chairman
</TABLE>
* Certain Selling Stockholders also serve as officers and/or directors of
certain other companies advised by Advisers.
** An amendment to this registration statement may be filed at a later date to
identify the successor individual, estate or trust to the shares herein
registered in the name of Jack A. Sullivan
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<PAGE> 9
The Plan was approved by the Company's shareholders on October 24,
1991 and adopted by its Board of Directors (the "Board") on October 30, 1991;
it was subsequently amended by the Board on February 17, 1994, and such
amendment was approved by the Company's shareholders on June 8, 1994. Another
amendment to the Plan was approved by the Board on February 13, 1996 and by
the Company's shareholders on May 23, 1996. The original effective date of the
Plan was October 30, 1991.
USE OF PROCEEDS
Although the Company has received or will receive proceeds from the
exercise of options granted under the Plan, none of the proceeds from the sale
by the Selling Stockholders of the Shares offered hereby will be received by
the Company.
LEGAL PROCEEDINGS
The Company is a party to litigation in the normal course of its
business. At this time, management of the Company is unable to estimate any
loss that may be associated with such litigation; however, management does not
believe that the resolution of this litigation will materially affect the
financial position or liquidity of the Company.
DETERMINATION OF OFFERING PRICE
The Shares covered by this Prospectus may be sold from time to time by
the Selling Stockholders on any securities exchange on which the Shares are
listed, in the over-the-counter market or otherwise, at market prices and on
terms then prevailing or in negotiated transactions at prices then obtainable,
or otherwise. Currently, shares of the Company's common stock are quoted on
the Nasdaq National Market.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are incorporated by reference herein:
(a) The Company'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,
1995;
(b) All other reports of the Company filed pursuant to Section 13(a)
or 15(d) of the 1934 Act since December 31, 1995; and
(c) The description of the Company's common stock contained in the
registration statement on Form 10 filed by Advisers on September
20, 1990, including the amendments filed on November 13, 1990 and
December 6, 1990 for the purpose of updating that description.
All reports and documents subsequently filed with the Commission by
the Company subsequent to the date of this Prospectus pursuant to Section
13(a), 13(c), 14 and 15(d) of the 1934 Act prior to the termination of this
offering shall be deemed to be incorporated by reference into this Prospectus
and to be part hereof from the date of filing of those documents. The Company
will deliver without charge, upon written or oral request, a copy of any and
all information that is incorporated herein by reference. Such request should
be made to Suzanne Sparrow, Vice President, Director of Investor Relations, at
(202) 331-1112.
INDEMNIFICATION OF OFFICERS AND DIRECTORS
The corporation law of the State of Maryland, under which Advisers is
incorporated, permits the charter of a Maryland corporation to include a
provision limiting the liability of its directors and officers to the
corporation and its stockholders for money damages, subject to specified
restrictions. The law does not, however, allow the liability of directors and
officers to the 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; (2) a judgment or other final
adjudication is entered in a proceeding based on a finding that the person's
action, or failure
- 9 -
<PAGE> 10
to act, was the result of active and deliberate dishonesty and was material to
the cause of action adjudicated in the proceeding. The Amended and Restated
Articles of Incorporation of Advisers contain a provision limiting the
liability of its directors and officers to Advisers and its shareholders to the
fullest extent permitted from time to time by the laws of Maryland.
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 any proceeding to which they have been or may be 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. Advisers' Amended and Restated Articles of Incorporation require
Advisers to indemnify its directors and officers to the fullest extent
permitted from time to time by the laws of Maryland.
Such indemnification may apply to claims arising under the 1933 Act.
Insofar as indemnification for liabilities arising under the 1933 Act may be
permitted to directors, officers, or persons controlling Advisers pursuant to
the foregoing provisions, Advisers has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in that Act and therefore unenforceable.
PART II
Form S-8.
Item 3. Incorporation of Documents by Reference
The Registrant, Allied Capital Advisers, Inc. ("Advisers" or the
"Company"), and the Allied Capital Advisers, Inc. Incentive Stock Option Plan
(the "Plan") incorporate herein by reference the documents listed in (a)
through (c) below:
(a) Advisers' 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, 1995;
(b) All other reports of Advisers and the Plan filed pursuant to
Section 13(a) or 15(d) of the 1934 Act since December 31, 1995;
and
(c) The description of Advisers common stock contained in the
registration statement on Form 10 filed by Advisers on September
20, 1990, as amended on November 13, 1990 and December 6, 1990.
All reports and documents subsequently filed with the Securities and
Exchange Commission (the "Commission") by Advisers and the Plan 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 deregisters
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. Advisers will deliver without charge, upon
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<PAGE> 11
written or oral request, a copy of any and all information that is incorporated
herein by reference. Such request should be made to Suzanne Sparrow.
Item 4. Description of Securities
The securities being registered are shares of the Company'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 Advisers is
incorporated, permits the charter 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; (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 Amended and Restated
Articles of Incorporation of Advisers contain a provision limiting the
liability of its directors and officers to Advisers and its shareholders to the
fullest extent permitted from time to time by the laws of Maryland.
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 any proceeding to which they have been or may be 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. Advisers' Amended and Restated Articles of Incorporation require
Advisers to indemnify its directors and officers to the fullest extent
permitted from time to time by the laws of Maryland.
Item 7. Exemption from Registration Claimed
Sales of Company Common Stock under the Plan prior to the date hereof
were made to officers and directors of the Company in reliance on the exemption
from registration under Section 4(2) of the 1933 Act for transactions not
involving a public offering.
Item 8. Exhibits
See Exhibit Index.
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<PAGE> 12
Item 9. Undertakings
(a) Rule 415 Offering. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
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 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 (and each
filing of the Plan's annual report pursuant to section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
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<PAGE> 13
(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 Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
POWERS OF ATTORNEY
LET IT BE KNOWN that each officer or director whose signature appears
in paragraph (b) under "SIGNATURES" below 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
Advisers, Inc. Incentive 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.
- 13 -
<PAGE> 14
SIGNATURES
(a) THE REGISTRANT. 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 11th day of December, 1996.
ALLIED CAPITAL ADVISERS, INC.
By: /s/ Joan M. Sweeney
--------------------------
Name: Joan M. Sweeney
Title: President
(b) 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/ David Gladstone Chairman and December 11, 1996
- -------------------------------------- Chief Executive Officer
David Gladstone (Principal Executive Officer)
/s/ George C. Williams Vice Chairman of the Board December 11, 1996
- --------------------------------------
George C. Williams
/s/ Brooks H. Browne Director December 11, 1996
- --------------------------------------
Brooks H. Browne
/s/ Robert E. Long Director December 11, 1996
- --------------------------------------
Robert E. Long
/s/ William L. Walton Director December 11, 1996
- --------------------------------------
William L. Walton
/s/ Joan M. Sweeney Director, President, December 11, 1996
- -------------------------------------- and Chief Operating
Joan M. Sweeney Officer
/s/ Jon A. DeLuca Executive Vice President December 11, 1996
- -------------------------------------- and Chief Financial
Jon A. DeLuca Officer (Principal
Financial and Accounting Officer)
</TABLE>
- 14 -
<PAGE> 15
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Act of 1933,
the Compensation Committee of the Company's Board of Directors has duly caused
this Registration Statement to be signed by the undersigned on behalf of the
Allied Capital Advisers, Inc. Incentive Stock Option Plan, thereunto duly
authorized in the City of Washington, District of Columbia, on the 11th day of
December, 1996.
Allied Capital Advisers, Inc. Incentive
Stock Option Plan
By: /s/ Robert E. Long
-------------------------
Robert E. Long, Chairman of Allied Capital Advisers
Compensation Committee
- 15 -
<PAGE> 16
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Number Exhibit Name
<S> <C>
4 Allied Capital Advisers, Inc. Incentive Stock Option Plan
5 Opinion of Sutherland Asbill & Brennan, L.L.P.
15 Omitted -- Not applicable
23 (a) Consent of Arthur Andersen LLP
(b) Consent of Counsel -- See Exhibit 5.
24 Powers of Attorney
These documents form part of the
Signature Pages.
</TABLE>
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<PAGE> 1
Exhibit 4
ALLIED CAPITAL ADVISERS, INC.
INCENTIVE STOCK OPTION PLAN
1. PURPOSE OF THE PLAN
The purpose of this Incentive Stock Option Plan ("the Plan") is to advance the
interests of Allied Capital Advisers, Inc. ("the Company") by providing
directors and officers who have substantial responsibility for the direction
and management of the Company with 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 without this compensation.
2. EFFECTIVE DATE OF THE PLAN
This Plan shall become effective upon (1) approval of the plan by the
shareholders of the Company and (2) adoption by the Board of Directors.
3. ADMINISTRATION
The Plan is administered by the Compensation Committee (the "Committee")
consisting of two or more "disinterested" members of the Company's Board of
Directors in accordance with the provisions of Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "1934 Act"). The Committee
shall interpret the Plan, and to the extent and in the manner contemplated
herein, it shall exercise the discretion reserved to it hereunder. The
Committee may prescribe, amend and rescind rules and regulations relating to
the Plan and make all other determinations necessary for its administration.
The decision of the Committee on any matter affecting the Plan or the rights
and obligations arising under the Plan or any option granted thereunder shall
be final and binding upon all persons.
4. SHARES SUBJECT TO THE PLAN
The shares subject to option and the other provisions of this Plan are shares
of the Company's common stock, par value $.001 per share ("shares"). Subject
to the provisions hereof concerning adjustment, the total number of shares that
may be purchased upon the exercise or surrender of stock options granted under
this Plan shall not exceed 1,999,580 shares, which amount includes 1,649,580
shares on which options previously have been granted. 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 the Plan. Shares may be made
available from authorized unissued or reacquired stock or partly from each.
- 17 -
<PAGE> 2
5. PARTICIPANTS
The Committee shall determine and designate from time to time those key
officers of the Company, and those directors who are not officers of the
Company or employees of the Company's investor adviser ("non-officer
directors"), who shall be eligible to participate in the Plan.
6. AWARDS UNDER THE PLAN
(a) Generally. The Committee may award at any time an incentive stock option
(within the meaning of section 422 of the Internal Revenue Code of 1986, as
amended (the "Code")) or a nonqualified stock option to a participant under the
plan; provided, however, that only nonqualified stock options may be awarded to
non-officer directors.
(b) Awards to Officers. The Committee shall determine the number of shares to
be offered from time to time to each optionee who is an officer of the Company.
In making these determinations, the Committee shall take into account the past
service of the optionee to the Company, that officer's present and potential
contributions to the success of the Company and such other factors as the
Committee shall deem relevant in connection with accomplishing the purposes of
the Plan. The options 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. Options granted to different
optionees or at different times need not contain similar provisions.
(c) Awards to Non-Officer Directors. Each non-officer director, upon his or
her election as a director of the Company, shall receive a one-time grant of an
option to purchase thirteen thousand three hundred and thirty three (13,333)
shares. A non-officer director shall receive no other award under this Plan.
(d) Option Price. The price at which a share may be purchased upon the
exercise of an option shall be equal to the current fair market value of the
shares at the time an option is granted; provided, however, that with respect
to incentive stock options granted to any holder of 10% or more of the
Company's shares, the price shall not be less than 110% of such current fair
market value. The day on which the Committee approves the granting of an
option shall be considered the date on which such option is granted.
(e) Option Period. Each stock option shall state the period or periods of time
within which the 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. Notwithstanding the foregoing, the option period of each option
shall end, and the option shall cease to be exercisable, on the earliest of
(i) the date specified in the option grant, (ii) ten years (or, in the case of
incentive stock options awarded to a holder of 10% or more of the Company's
shares, five years) from the date the option is granted, (iii) the last day of
the three-month period beginning on the date on which the optionee ceases to be
an officer or director of the Company for any cause other than death or total
and permanent disability, or (iv) the first anniversary of the date on
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<PAGE> 3
which the optionee ceases to be an officer or director of the Company as a
result of the optionee's death or total and permanent disability.
(f) 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 by the Committee pursuant to paragraph 6(h) hereof, by a loan from
the Company in accordance with paragraph 6(h).
(g) 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.
(h) Loans by the Company. Upon the exercise of any option, the Company may, at
the request of the officer-optionee and subject to the approval of the Board of
Directors, 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 (i) has a
term of not more than ten years, (ii) becomes due within sixty days after the
recipient of the loan ceases to be an officer of the Company, (iii) bears
interest at a rate no less than the prevailing applicable federal rate at the
time the loan is made, and (iv) is 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 Internal
Revenue Service and Securities and Exchange Commission regulations.
(i) Effect of Change in Shares subject to the Plan. In the event there is any
change in the shares of the Company through the declaration of stock dividends,
or through recapitalization resulting in stock splits, or combinations or
exchanges of shares, or otherwise, the number of shares available for option
and the shares subject to any option and the option prices shall be
appropriately adjusted.
(j) General Restriction. Each option shall be subject to the requirement that,
if at any time the Committee 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(e), no
option shall expire during any period when the rights reserved hereby are
invoked by the Committee, but shall be extended for such further period so as
to afford the optionee a reasonable opportunity to exercise his option.
- 19 -
<PAGE> 4
7. AMENDMENT AND TERMINATION
The Committee may modify, revise or terminate this Plan at any time and from
time to time provided, however, that no modification or revision of any
material provision of the Plan may be made without shareholder approval except
for such modifications or revisions which are necessary in order to ensure that
the options issued as incentive stock options under the Plan comply with
section 422 or any successor provision of the Code, or other applicable law.
The Plan shall terminate when the total amount of shares with respect to which
options may be granted shall have been issued upon the exercise of options or
by action of the Board of Directors pursuant to this paragraph, or on May 23,
2006, whichever shall occur first.
8. 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 an officer any optionee, and the right
of the Company to terminate the employment of any officer or other employee
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. Such stock option agreements shall contain such other
provisions as the Committee in its discretion may deem advisable.
(d) For purposes of this Plan, the fair market value of the shares shall be the
average between the closing Bid and Asked price of the shares as quoted on the
Nasdaq National Market for the business day preceding the date on which the
option is awarded. If the Company's shares are traded on a major exchange, the
price shall be the closing price of the Company's shares as reported in The
Wall Street Journal for the business day preceding the date on which the option
is awarded.
(e) All options issued pursuant to the Plan shall be granted within ten years
from the earlier of the date the amended Plan is adopted by the Board of
Directors and the date the amended Plan is approved by the shareholders of the
Company.
(f) The aggregate fair market value (determined at the time the option is
granted) of the shares with respect to which incentive stock options are
exercisable for the first time by any optionee during any calendar year (under
all incentive stock option plans of the Company, its parent and subsidiary
corporations) shall not exceed $100,000.
(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.
- 20 -
<PAGE> 5
(h) 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 Advisers, Inc.,
1666 K Street, NW, 9th floor, Washington, DC 20006; and, if to an optionee, in
care of the optionee at his or her last known address.
(i) This plan and all actions taken by those acting for the Plan shall be
governed by the laws of the State of Maryland.
(j) If an incentive stock option is issued and does not meet the terms of this
plan, then it shall continue as a stock option but it will be a non-qualified
stock option.
(k) A leave of absence granted to an employee does not constitute an
interruption in continuous employment for purposes of the Plan as long as the
leave of absence does not extend beyond one year.
(l) All costs and expenses incurred in the operation and administration of the
Plan shall be borne by the Company.
9. 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 the
sale of substantially all of the Company's assets or 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
percent (20%) 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 (i) the Company or its
subsidiaries and/or (ii) 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.
- 21 -
<PAGE> 1
Exhibit 5
SUTHERLAND, ASBILL & BRENNAN, L.L.P.
1275 Pennsylvania Avenue, N.W.
Washington, D.C. 20004
December 13, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Allied Capital Advisers, Inc. Incentive 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 Advisers, Inc., 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 shares of the Company's common stock, $.001 par
value per share under the Allied Capital Advisers, Inc. Incentive Stock Option
Plan (the "Plan"). Of the 1,999,580 shares being registered, 1,807,155 shares
will be newly issued by the Company and will hereinafter be referred to as the
"Shares." The remaining 192,425 shares constitute "restricted" shares and are
being registered for resale by the holders thereof; no opinion is being
expressed thereon.
As counsel for the Company, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of such corporate
records or 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/or 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 and the reported
opinions of Maryland courts.
- 22 -
<PAGE> 2
Based upon and subject to the foregoing, it is our opinion that the
Shares have been duly and validly authorized and, when issued 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, L.L.P.
By: /s/ STEVEN B. BOEHM
--------------------------------------------
Steven B. Boehm
- 23 -
<PAGE> 1
Exhibit 23(a)
As independent public accountants, we hereby consent to the incorporation by
reference of our report dated February 15, 1996 incorporated by reference in
Allied Capital Advisers, Inc.'s Form 10-K for the year ended December 31, 1995
and to all references to our Firm included in this Registration on Form S-8.
ARTHUR ANDERSEN LLP
Washington, D.C.
December 13, 1996
- 24 -
