-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HR+6KnHMrG2UImFMZ+B7Omwb/TvqIr50nwVtdutsOCGUbHr6mdMEDTkc3pgAWFCM lOwwMbWI3weHQeTk5i1h7A== 0001047469-98-034133.txt : 19980910 0001047469-98-034133.hdr.sgml : 19980910 ACCESSION NUMBER: 0001047469-98-034133 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19980909 EFFECTIVENESS DATE: 19980909 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED FIRE & CASUALTY CO CENTRAL INDEX KEY: 0000101199 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 420644327 STATE OF INCORPORATION: IA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-63103 FILM NUMBER: 98706242 BUSINESS ADDRESS: STREET 1: 118 SECOND AVE SE CITY: CEDAR RAPIDS STATE: IA ZIP: 52407 BUSINESS PHONE: 3193995700 MAIL ADDRESS: STREET 1: P O BOX 73909 CITY: CEDAR RAPIDS STATE: IA ZIP: 52407 S-8 1 S-8 SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ------------------------------ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------------ UNITED FIRE & CASUALTY COMPANY ----------------------------------------------------------- (Exact name of registrant as specified in its certificate) IOWA 42-0644327 --------------------------------- -------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 118 SECOND AVENUE, SE, CEDAR RAPIDS, IOWA 52407 ----------------------------------------------- (Address of Principal Executive Offices) UNITED FIRE & CASUALTY COMPANY NONQUALIFIED EMPLOYEE STOCK OPTION PLAN ---------------------------------------------------------------------- (Full title of the plan) JOHN A. RIFE, PRESIDENT 118 SECOND AVENUE, SE CEDAR RAPIDS, IA 52407 --------------------------------------- (Name and address of agent for service) (319) 399-5700 ------------------------------------------------------------ (Telephone number, including area code, of agent for service) MICHAEL K. DENNEY, ESQ. BRADLEY & RILEY, P. C. 100 FIRST STREET, SW CEDAR RAPIDS, IOWA 52404 (319) 363-0101 ------------------------------ (Recipient of copies)
CALCULATION OF REGISTRATION FEE - ----------------------------------------------------------------------------------------- Proposed Proposed Amount maximum maximum Amount of Title of securities to be offering price aggregate registration to be registered registered per unit(1) offering price(1) fee(1) - ----------------------------------------------------------------------------------------- Common Stock, par value $3.33 1/3 500,000 $33.625 $16,812,500 $5,095 - -----------------------------------------------------------------------------------------
(1) Estimated solely for the purposes of calculating the amount of the registration fee, pursuant to Rule 457(h) under the Securities Act of 1933, as amended (the "Securities Act"), on the basis of the average of the bid and asked price for shares of the Registrant's Common Stock as reported on September 4, 1998 on the NASDAQ National Market System. Registration Fee is further calculated based on a 1/33 of 1% fee, as required by Section 6(b) of the Securities Act. PART I - INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS The documents containing the information specified in Part I will be sent or given to employees as specified by Rule 428(b)(1) of the Securities Act. In accordance with the instructions to Part I of Form S-8, such documents will not be filed with the Securities and Exchange Commission (the "Commission") either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424 of the Securities Act. PART II - INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE. United Fire & Casualty Company (the "Registrant") hereby incorporates by reference into this Registration Statement the following documents filed by it with the Commission: (a) The Registrant's Annual Report on Form 10-K for the year ended December 31, 1997; (b) The Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998; The Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998; The Registrant's Form 8-K filed with the Securities Exchange Commission on June 30, 1998; (c) Not applicable as the class of securities to be offered is not registered under Section 12 of the Exchange Act. In addition, all reports and other documents filed by the Registrant subsequent to the date hereof pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (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 then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such reports or documents. Item 4. DESCRIPTION OF SECURITIES The Registrant is authorized to issue 20,000,000 shares of Common Stock, par value $3.33 1/3 per share. The holders of shares of Common Stock are entitled to receive dividends when, as and if declared by the Board of Directors from funds legally available for the payment of dividends. Upon liquidation, the holders of Common Stock are entitled to share on a pro rata basis the net assets after payment of any amounts due to creditors. -2- Each share of Common Stock has one vote on all matters submitted to a vote of the stockholders. Holders of shares of Common Stock have no cumulative voting rights and are not entitled as a matter of right to any preemptive or subscriptive rights. Directors are divided into three classes. Each year the terms of the members of a different class of directors expire and directors for that class are elected to three-year terms. A stockholder or group of stockholders, jointly or severally, of not less than one-fifth but less than a majority of the outstanding shares of Common Stock may nominate and elect that number of directors, ignoring fractions, which bears the same ratio to the number of directors to be elected as the number of shares of Common Stock held by such stockholders bears to the total shares of Common Stock outstanding, but the total number of directors so elected by minority stockholders may not exceed one less than a majority of the aggregate number of directors to be elected. Unless minority common stockholders exercise their right to nominate and elect a proportionate number of directors as described above, the holders of a majority of the outstanding shares of Common Stock voting in any election of directors at which a quorum is present can elect all of the directors. Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL Bradley & Riley, P.C. has given its opinion upon the validity of the securities begin registered. Mr. Byron G. Riley is an attorney and a shareholder of Bradley & Riley, P.C. He is a director of the Registrant. Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS The Articles of Incorporation and Bylaws of the Registrant provide for indemnification by the Registrant of each of its directors to the fullest extent permitted by the Iowa Business Corporation Act (the "Act") for liability of such director arising by reason of his or her status as a director of the Registrant. The Articles of Incorporation of the Registrant and the Act provide that a director shall not be personally liable to the Registrant or its shareholders for monetary damages for breach of fiduciary duty except for liability (i) for any breach of the director's duty of loyalty to the Registrant or its shareholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or knowing violation of law, (iii) for any transaction from which the director derived an improper personal benefit, or (iv) for liability for an unlawful distribution under Section 490.833 of the Act. Under the Act, a corporation is required to indemnify a director who is wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because the director is or was a director of the corporation against reasonable expenses incurred by the director in connection with the proceeding. Item 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable. -3- Item 8. EXHIBITS Exhibit Number Description 4.1 Articles of Incorporation of the Registrant (Filed as Exhibit 4.1 to the Registrant's Registration Statement on Form S-8 (File No. 333-42895), and incorporated herein by reference) 4.2 Bylaws of the Registrant (Filed as Exhibit 4.2 to the Registrant's Registration Statement on Form S-8 (File No. 333-42895), and incorporated herein by reference) 4.3 United Fire & Casualty Company Employee Stock Option Plan 5.1 Opinion Re Legality of Shares to be Issued and Consent 15.1 Letter Re Unaudited Interim Financial Information 23.1 Consent of Arthur Andersen, LLP. 23.2 Consent of Bradley & Riley, P.C. (Contained in the Opinion filed as Exhibit 5.1) 24.1 Power of Attorney (Contained on signature pages) Item 9. UNDERTAKINGS (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment hereof) 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 with or furnished to the Securities and Exchange Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new -4- 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 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 herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) 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. -5- SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Cedar Rapids, Iowa, on August 21 ,1998. UNITED FIRE & CASUALTY COMPANY By /s/ J. Scott McIntyre, Jr. ----------------------------------------- J. SCOTT McINTYRE, JR., Chairman of the Board By /s/ John A. Rife ----------------------------------------- JOHN A. RIFE, President By /s/ Kent G. Baker ----------------------------------------- KENT G. BAKER, Vice President, Chief Financial Officer and Principal Accounting Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints JOHN A. RIFE and J. SCOTT McINTYRE, JR., jointly and severally, each in his own capacity, as true and lawful attorneys-in-fact, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any amendments to this Registration Statement (including post-effective amendments), and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ J. Scott McIntyre Chairman of the Board August 21, 1998 - --------------------------- J. SCOTT McINTYRE, JR. /s/ John A. Rife President August 21, 1998 - --------------------------- JOHN A. RIFE /s/ Kent G. Baker Vice President, Chief August 21, 1998 - --------------------------- Financial Officer and KENT G. BAKER Principal Accounting Officer /s/ Robert J. Bevenour Director August 21, 1998 - --------------------------- ROBERT J. BEVENOUR /s/ Byron G. Riley Director August 21, 1998 - --------------------------- BYRON G. RILEY /s/ James T. Brophy Director August 21, 1998 - --------------------------- JAMES T. BROPHY /s/ Christopher R. Drahozal Director August 21, 1998 - --------------------------- CHRISTOPHER R. DRAHOZAL /s/ Roy L. Ewen Director August 21, 1998 - --------------------------- ROY L. EWEN /s/ Casey D. Mahon Director August 21, 1998 - --------------------------- CASEY D. MAHON /s/ Leonard J. Marshall Director August 21, 1998 - --------------------------- LEONARD J. MARSHALL /s/ Thomas K. Marshall Director August 21, 1998 - --------------------------- THOMAS K. MARSHALL /s/ Jack Evans Director August 21, 1998 - --------------------------- JACK EVANS
EXHIBIT INDEX Exhibit Number Description Page - -------------- ----------- ---- 4.1 Articles of Incorporation of the Registrant (Filed as Exhibit 4.1 to the Registrant's Registration Statement on Form S-8 (File No. 333-42895), and incorporated herein by reference) 4.2 Bylaws of the Registrant (Filed as Exhibit 4.2 to the Registrant's Registration Statement on Form S-8 (File No. 333-42895), and incorporated herein by reference) 4.3 United Fire & Casualty Company Employee Stock Option Plan 5 Opinion re Legality of Shares Being Issued and Consent 15 Letter Re Unaudited Interim Financial Information 23.1 Consent of Arthur Andersen, LLP. 23.2 Consent of Bradley & Riley, P.C. (Contained in the Opinion filed as Exhibit 5.1) 24 Power of Attorney (Contained on signature pages)
EX-4.3 2 EXHIBIT 4.3 EXHIBIT 4.3 UNITED FIRE & CASUALTY COMPANY EMPLOYEE STOCK OPTION PLAN UNITED FIRE & CASUALTY COMPANY, INC. NONQUALIFIED EMPLOYEE STOCK OPTION PLAN August 21, 1998 1. PURPOSE. United Fire & Casualty Company, Inc. (the "Company") is implementing this Nonqualified Employee Stock Option Plan (the "Plan") to promote the growth and general prosperity of the Company and its Affiliated Companies. The Plan will permit the Company to grant options ("Options") to purchase shares of its common stock ("Common Stock"). The granting of Options will help to attract and retain the best available persons for positions of substantial responsibility and will provide certain employees with an additional incentive to contribute to the success of the Company and its Affiliated Companies. The options are "nonstatutory stock options" that are not intended to qualify as incentive stock options within the meaning of Section 422A of the Internal Revenue Code, as amended (the"Code"). For purposes of this Plan, the term "Affiliated Companies" shall mean any component member of a controlled group of corporations, as defined under Section 1563 of the Code, in which the Company is also a component member. 2. ADMINISTRATION. The Plan shall be implemented and administered by the Board of Directors of the Company (the "Board"). The Board shall have the authority, in its absolute discretion, and subject to the express provisions and restrictions of this Plan, to determine: (i) which of the employees of the Company and its Affiliated Companies shall receive Options ("Optionees"), (ii) when Options shall be granted, (iii) the terms and conditions of an Option other than those terms and conditions fixed under this Plan, and (iv) the number of shares which may be issued upon the exercise of an Option. The Board may also adopt and revise rules and regulations, and take any other action it deems necessary or appropriate to administer the Plan. The Board's actions, including any interpretation or construction of any provisions of the Plan or any Option granted hereunder, shall be final, conclusive and binding. No member of the Board shall be liable for any action or determination made in good faith with respect to the Plan or any Option granted under it. The Board may appoint a Stock Option Committee (the "Committee") of two or more directors of the Company which may act on behalf of the Board in administering the Plan. The Committee may be delegated any authority of the Board in the administration of the Plan. 3. ELIGIBILITY, PARTICIPATION, SPECIAL LIMITATIONS. The Board (or the Committee, if so authorized by the Board), may, in its discretion, grant one or more Options to any employee of the Company or its Affiliated Companies, including any employee who is a Director of the Company or of any of its Affiliated Companies presently existing or hereinafter organized or acquired and who is designated by the Board as eligible to participate in the Plan. Such Options may be granted to one or more such persons without being granted to other eligible persons, as the Board may deem fit. 4. SHARES OF STOCK SUBJECT TO THE PLAN. The number of shares that may be issued pursuant to all Options granted under the Plan shall not exceed five hundred thousand (500,000) shares of Common Stock, subject to adjustment as herein provided. Any shares of Common Stock that: (i) are repurchased by the Company after issuance hereunder pursuant to the exercise of an Option, or (ii) are not purchased by the Optionee prior to the expiration or termination of the applicable Option, shall again become available to be covered by Options to be issued hereunder and shall not, as of the effective date of such repurchase or expiration, be counted as covered by an outstanding Option for purposes of the above-described maximum number of shares which may be optioned hereunder. 5. TERMS AND CONDITIONS OF OPTIONS. a. OPTION AGREEMENT. Each Option granted pursuant to the Plan shall be evidenced by an agreement ("Option Agreement") between the Company and the Optionee. The Option Agreement shall state that the Option is a nonstatutory stock Option, shall designate the number of shares and the exercise price of the Option, shall set forth the vesting schedule of the Option or state that the Option vests immediately, shall include a provision incorporating therein this Plan by reference and shall include any other restriction (in addition to those established under this Plan) as may be established by the Board (or the Committee) with respect to the exercise of the Option and/or the transfer of the shares purchased by exercise of the Option, provided that such restrictions are not in conflict with this Plan. The Option Agreement shall be in writing, dated as of the date the Option is granted, shall be executed on behalf of the Company by such officers as the Board shall authorize, and shall generally be in such form and contain such additional provisions as the Board shall prescribe. b. EXERCISE OF OPTIONS. Subject to the specific provisions of this Section 5, Options shall become exercisable at such times and in such installments (which may be cumulative) as the Board shall provide in the terms of each Option; provided, however, each Option granted under the Plan shall become exercisable in installments of not less than twenty percent (20%) of the number of shares covered by such Option each year from the date the Option is granted; and provided, further, that by a resolution adopted after an Option is granted the Board may, on such terms and conditions as it may determine to be appropriate and subject to the specific provisions of this Section 5, accelerate the time at which such Option or installment thereof may be exercised. For purposes of this Plan any accrued installment of an option granted hereunder shall be referred to as an "Accrued Installment". An Option may be exercised when Accrued Installments accrue, as provided in the terms under which such Option was granted, for a period of up to ten (10) years from the date the Option is granted. In no event shall any Option be exercised on or after the expiration of said maximum applicable period, regardless of the circumstances then existing (including but not limited to the death or termination of employment of the Optionee). Optionees may exercise Options granted pursuant to the Plan by delivering to the Company at its principal office written notice of such exercise (i) stating the Optionee's election to exercise such Option and the number of shares of Common Stock being purchased thereby; (ii) signed by the Optionee, and (iii) specifying a date, not less than ten (10) nor more than thirty (30) days from the date of such notice, as the date on which such shares will be purchased. As soon as practicable following the receipt of such written notice, the Company shall deliver to the Optionee exercising an option a certificate or certificates representing such shares, providing that payment has been made therefor at the principal office of the Company, and that the Optionee has made appropriate arrangements with the Company for any federal, state or local taxes required to be withheld. An Option may be exercised as to all or any portion of the shares covered by any Accrued Installment of the Option from time to time during the applicable Option Period, but shall not be exercisable with respect to fractions of a share. The time of issuance and delivery of the shares may be postponed by the Company for such period as may be required for it with reasonable diligence to comply -2- with any applicable listing requirements of any national or regional securities exchange and any law or regulation applicable to the issuance and delivery of such shares. c. OPTION PRICE. The price for shares of Common Stock to be issued under this Plan shall be such amount as determined by the Board of Directors of the Company on the date on which the Option covering such shares is granted by the Board (or the Committee, if authorized by the Board). The price of shares of common Stock for all purposes of this Plan is to be determined by the Board (or the Committee, if so authorized by the Board) in its sole discretion, exercised in good faith. d. TERMINATION OF OPTIONS. Subject to earlier termination as may be provided herein, Options shall expire and all rights granted under Option Agreements shall become null and void upon the termination dates specified by the Board and set forth in the related Option Agreements, provided that such termination dates shall not exceed ten (10) years after the date the Options are granted. e. NONTRANSFERABILITY OF OPTIONS. Options granted pursuant to this Plan may not be sold, pledged, hypothecated, assigned, encumbered or otherwise transferred in any manner, either voluntarily or involuntarily by operation of law, except by will or the laws of descent and distribution, and each Option shall be exercisable during the Optionee's lifetime only by him. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of such Options or of such rights contrary to the provisions hereof, or to subject such Options or such rights to execution, attachment or similar process, such Options and such rights shall immediately terminate and become null and void. f. ADJUSTMENT PROVISIONS. In the event of changes in the Common Stock by reason of any stock split, combination of shares, stock dividend, reclassification, merger, consolidation, reorganization, recapitalization or similar adjustment, or by reason of the dissolution or liquidation of the Company, appropriate adjustments may be made in (i) the aggregate number and class of shares available under the Plan, and (ii) the number, class and exercise price of shares remaining subject to all outstanding options. Whether any adjustment or modification is to be made as a result of the occurrence of any of the events specified in this Section, and the extent thereof, shall be determined by the Board, whose determination shall be binding and conclusive. Existence of the Plan or of Option Agreements pursuant to the Plan shall in no way impair the right of the Company or its stockholders to make or effect any adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger, consolidation, dissolution or liquidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock of the Company, or any grant of Options on its stock not pursuant to the Plan. 6. RULES APPLICABLE TO CERTAIN DISPOSITIONS. a. Notwithstanding the foregoing provisions of Section 5, in the event the Company or the Stockholders of the Company enter into an agreement to dispose of all or substantially all of the assets or capital stock of the Company by means of a sale, merger, consolidation, reorganization, liquidation, or otherwise, an Option shall become immediately exercisable with respect to the full number of shares subject to that Option during the period -3- commencing as of the later of (x) date of execution of such agreement or (y) six (6) months after the date the Option is granted, and ending as of the earlier of: (i) the Option Expiration Date; or (ii) the date on which the disposition of assets or capital stock contemplated by the agreement is consummated. The exercise of any Option that was made exercisable solely by reason of this Subsection 6(a) shall be conditioned upon the consummation of the disposition of assets or stock under the above referenced agreement. Upon the consummation of any such disposition of assets or stock, this Plan and any unexercised Options issued hereunder (or any unexercised portion thereof) shall terminate and cease to be effective. b. Notwithstanding the foregoing, in the event that any such agreement shall be terminated without consummating the disposition of said stock or assets: (i) any unexercised non-vested installments that had become exercisable solely by reason of the provisions of Subsection 6(a) shall again become non-vested and unexercisable as of said termination of such agreement, and (ii) the exercise of any option that had become exercisable solely by reason of this Subsection 6(a) shall be deemed ineffective and such installments shall again become non-vested and unexercisable as of said termination of such agreement. c. Notwithstanding the provisions set forth in Subsection 6(a), the Board (or the Committee, if so authorized by the Board) may, at its election and subject to the approval of the corporation purchasing or acquiring the stock or assets of the Company (the "surviving corporation"), arrange for the Optionee to receive upon surrender of Optionee's Option a new option covering shares of the surviving corporation in the same proportion, at an equivalent option price and subject to the same terms and conditions as the old Option. For purposes of the preceding sentence, the excess of the aggregate fair market value of the shares subject to such new option immediately after consummation of such disposition of stock or assets over the aggregate option price of such shares of the surviving corporation shall not be more than the excess of the aggregate fair market value of all shares subject to the old Option immediately before consummation of such disposition of stock and assets over the aggregate Option Price of such shares of the Company, and the new option shall not give the Optionee additional benefits which such Optionee did not have under the old Option or deprive the Optionee of benefits which the Optionee had under the old Option. If such substitution of options is effectuated, the Optionee's rights under the old Option shall thereupon terminate. 7. MERGERS AND ACQUISITIONS. a. If the Company at any time should succeed to the business of another corporation through a merger or consolidation, or through the acquisition of stock or assets -4- of such corporation, Options may be granted under the Plan to option holders of such corporation or its subsidiaries, in substitution for options or rights to purchase stock of such corporation held by them at the time of succession. The Board (or the Committee, if so authorized by the Board) shall have sole and absolute discretion to determine the extent to which substitute Options shall be granted (if at all), the person or persons within the eligible group to receive such substitute Options (who need not be all option holders of such corporation), the number of Options to be received by each such person, the Option price of such Option, and the terms and conditions of such substitute Options; provided, however, that the terms and conditions of the substitute Options shall comply with the provisions of Section 424 of the Code, such that the excess of the aggregate fair market value of the shares subject to such substitute Option immediately after the substitution or assumption over the aggregate option price of such shares is not more than the excess of aggregate fair market value of all shares subject to the substitute Option immediately before such substitution or assumption over the aggregate option price of such shares, and the substitute Option or the assumption of the old option does not give the holder thereof additional benefits which he or she did not have under such old option. b. Notwithstanding anything to the contrary herein, no Option shall be granted, nor any action taken, permitted or omitted, which could cause the Plan, or any Options granted hereunder as to which Rule 16b-3 under the Securities Exchange Act of 1934 may apply, not to comply with such Rule. 8. TERMINATION OF EMPLOYMENT. a. In the event that the Optionee's employment with the Company (or Affiliated Company) is terminated for any reason other than death or disability, any unexercised Accrued Installments of the Option granted hereunder to such terminated Optionee shall expire and become unexercisable as of the earlier of: (i) the applicable Option Expiration Date; or (ii) a date 30 days after such termination occurs, provided however, that the Board (or the Committee if empowered to so act) may, in the exercise of its discretion, extend said date up to and including a date one year following such termination. b. In the event that the Optionee's employment with the Company is terminated due to the death or disability of the Optionee, any unexercised Accrued Installments of the Option granted hereunder to such Optionee shall expire and become unexercisable as of the earlier of: (i) the applicable Option Expiration Date; or (ii) the first anniversary of the date of death of such Optionee (if applicable). Any such Accrued Installments of a deceased Optionee may be exercised prior to their expiration by (and only by) the person or persons to whom the Optionee's Option right -5- shall pass by will or by the laws of descent and distribution, if applicable, subject, however, to all of the terms and conditions of this Plan and the applicable Stock Option Agreement governing the exercise of Options granted hereunder; or (iii) the first anniversary of the date of the termination of employment by reason of disability (if applicable). c. For purposes of this Section 8, an Optionee shall be deemed employed by the Company (or affiliated Company) during any period of leave of absence from active employment as authorized by the Company (or Affiliated Company). 9. RIGHTS AS A SHAREHOLDER. Optionees shall not have any of the rights and privileges of shareholders of the Company in respect of any of the shares subject to any option granted pursuant to the Plan unless and until a certificate representing such shares shall have been issued and delivered. 10. PAYMENT OF EXERCISE PRICE WITH COMPANY STOCK. The Board (or the Committee, if so authorized) may provide that, upon exercise of the Option, the Optionee may elect to pay for all or some of the shares of Common Stock underlying the Option with shares of Common Stock of the Company previously acquired and owned at the time of exercise by the Optionee, subject to all restrictions and limitations of applicable laws, rules and regulations, including Section 424(c)(3) of the Code, and provided that the Optionee will make representations and warranties satisfactory to the Company regarding his or her title to the shares used to effect the purchase, including without limitation representations and warranties that the Optionee has good and marketable title to such shares free and clear of any and all liens, encumbrances, charges, equities, claims, security interests, options or restrictions and has full power to deliver such shares without obtaining the consent or approval of any person or governmental authority other than those which have already given consent or approved in a form satisfactory to the Company. The equivalent dollar value of the shares used to effect the purchase shall be the fair market value of the shares on the date of the purchase as determined by the Board (or the Committee, if so authorized) in its sole discretion, exercised in good faith. 11. WITHHOLDING OF TAXES. The grant of Options hereunder and the issuance of Common Stock pursuant to the exercise of such Options is conditioned upon the Company's reservation of the right to withhold, in accordance with any applicable law, from any compensation payable to the Optionee any taxes required to be withheld by federal, state or local law as a result of the grant or exercise of any such Option. 12. RESTRICTIONS ON ISSUANCE OF SHARES. The Company, during the term of this Plan, will use its best efforts to seek to obtain from the appropriate regulatory agencies any requisite authorization in order to grant Options or issue and sell such number of shares of its Common Stock as shall be sufficient to satisfy the requirements of the Plan. The inability of the Company to obtain from any such regulatory agency having jurisdiction thereof the authorization deemed by the Company's counsel to be necessary to the lawful grant of Options or the issuance and sale of any shares of its stock hereunder or the inability of the Company to confirm to its satisfaction that any grant of Options or issuance and sale of any shares of such stock will meet applicable legal -6- requirements shall relieve the Company of any liability in respect to the non-issuance or sale of such stock as to which such authorization or confirmation have not been obtained. 13. NOTICES. Any notice to be given to the Company pursuant to the provisions of this Plan shall be addressed to the Company in care of its Secretary at its principal office, and any notice to be given to a person to whom an Option is granted hereunder shall be addressed to him or her at the address given beneath his or her signature on his or her Stock Option Agreement, or at such other address as such person or his or her transferee (upon the transfer of Optioned Stock) may hereafter designate in writing to the Company. Any such notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, registered or certified, and deposited, postage and registry or certification fee prepaid, in a post office or branch post office regularly maintained by the United States Postal Service. It shall be the obligation of each Optionee and each transferee holding Optioned Stock to provide the Secretary of the Company, by letter mailed as provided hereinabove, with written notice of his or her correct mailing address. 14. REPRESENTATIONS AND WARRANTIES. As a condition to the grant of any Option hereunder or the exercise of any portion of an Option, the Company may require the person to be granted or exercising such Option to make any representation and/or warranty to the Company as may, in the judgment of counsel to the Company, be required under any applicable law or regulation, including, but not limited to, a representation and warranty that the Option and/or shares issuable or issued upon exercise of such Option are being acquired only for investment, for such person's own account and without any present intention to sell or distribute such Option or shares, as the case may be, if, in the opinion of counsel for the Company, such representation is required under Securities Act of 1933, or any other applicable law, regulation or rule of any governmental agency. 15. NO ENLARGEMENT OF EMPLOYEE RIGHTS. This Plan is purely voluntary on the part of the Company, and while the Company hopes to continue it indefinitely, the continuance of the Plan shall not be deemed to constitute a contract between the Company and any employee, or to be consideration for or a condition of the employment of any employee. Nothing contained in the Plan shall be deemed to give any employee the right to be retained in the employ of the Company or its Affiliated Companies, or to interfere with the right of the Company or an Affiliated Company to discharge or retire any employee thereof at any time. No employee shall have any right to or interest in Options authorized hereunder prior to the grant of such an Option to such employee, and upon such grant he or she shall have only such rights and interests as are expressly provided herein, subject, however, to all applicable provisions of the Company's Articles of Incorporation, as the same may be amended from time to time. Except as otherwise provided in Section 8, any change of an Optionee's duties or position with the Company shall not affect his right to exercise any Options granted pursuant to the Plan, provided, however, that nothing contained in the Plan, or in any option granted pursuant to the Plan, shall confer upon any Employee the right to continued employment or shall interfere in any way with the right of the Company to terminate the employment of such Employee at any time, with or without cause, subject to any Employment Agreement that may be in effect at such time. 16. SUCCESSORS. The provisions of the Plan shall be binding upon, and inure to the benefit of all successors of any Optionee, including, without limitation, his/her estate and the executors, administrators or trustees thereof, his/her heirs and legatees, and any receiver, trustee in bankruptcy or representative of creditors of such Optionee. -7- 17. TERMINATION AND AMENDMENT OF THE PLAN. Unless sooner terminated as hereinafter provided, the Plan shall remain in effect for ten (10) years from the date hereof. The Board shall have complete power and authority at any time to terminate the Plan or to make such modification or amendment thereof as it deems advisable and may from time to time suspend, discontinue or abandon the Plan, except that no such action by the Board shall adversely affect any right or obligation with respect to any grant theretofore made. 18. NO RESTRICTIONS ON TRANSFER OF STOCK. Common Stock issued pursuant to the exercise of an Option granted under this Plan (hereinafter "Optioned Stock"), or any interest in such Optioned Stock, may be sold, assigned, gifted, pledged, hypothecated, encumbered or otherwise transferred or alienated in any manner by the holder(s) thereof, subject, however, to any representations or warranties requested under Section 14 of this Plan and also subject to compliance with any applicable federal, state or other local law, regulation or rule governing the sale or transfer of stock or securities. 19. INVALID PROVISION. In the event that any provision of this Plan is found to be invalid or otherwise unenforceable under any applicable law, such invalidity or unenforceability shall not be construed as rendering any other provisions contained herein invalid or unenforceable, and all such other provisions shall be given full force and effect to the same extent as though the invalid or unenforceable provision was not contained herein. 20. APPLICABLE LAW. This Plan shall be governed by and construed and enforced in accordance with the laws of the State of Iowa. 21. SUCCESSORS AND ASSIGNS. This Plan shall be binding on and inure to the benefit of the Company and the Optionees to whom an Option is granted hereunder, and such Optionees' heirs, executors, administrators, legatees, personal representatives, assignees and transferees. IN WITNESS WHEREOF, pursuant to the due authorization and adoption of this Plan by the Board on ___________________________, 1998, the Company has caused this Plan to be duly executed by its duly authorized officer. UNITED FIRE & CASUALTY COMPANY, INC. By: _______________________________________ -8- EX-5 3 EXHIBIT 5 EXHIBIT 5 OPINION RE LEGALITY OF SHARES BEING ISSUED AND CONSENT
BRADLEY & RILEY, P.C. ATTORNEYS AND COUNSELORS F. JAMES BRADLEY WILLIAM T. McCARTAN BYRON G. RILEY FIRST CORPORATE PLACE TIMOTHY J. HILL MICHAEL K. DENNEY 100 FIRST STREET, S.W. MICHELE M. BUSSE PATRICK M. COURTNEY P.O. BOX 2804 JAY R. ANDREWS DONALD G. THOMPSON CEDAR RAPIDS, IOWA 52406-2804 MAUREEN G. KENNEY KELLY R. BAIER ________________ VERNON P. SQUIRES GREGORY J. SEYFER PAUL D. BURNS DEAN A. SPINA TELEPHONE: (319) 363-0101 JOSEPH E. SCHMALL FAX: (319) 363-9824 COUNSEL: BRADLEY G. HART MELISSA WEETS ANDERSON WILLIAM J. NEPPL BOSTON, MASSACHUSETTS 1-800-353-2665
___________, 1998 United Fire & Casualty Company 118 Second Avenue, S.E. Cedar Rapids, IA 52407 Re: United Fire & Casualty Company Employee Stock Option Plan We have acted as counsel to United Fire & Casualty Company in connection with the registration with the Securities and Exchange Commission on Form S-8 of shares of the United Fire & Casualty Company's common stock, par value $3.33 1/3 (the "Shares"), which will be issuable upon exercise of options granted under the above-referenced plan (the "Plan"). In connection with that registration, we have reviewed the proceedings of the Board of Directors of United Fire & Casualty Company relating to the registration and proposed issuance of the common stock, the Articles of Incorporation of United Fire & Casualty Company and all amendments thereto, the Bylaws of United Fire & Casualty Company and all amendments thereto, and such other documents and matters as we have deemed necessary to the rendering of the following opinion. Based upon that review, it is our opinion that the Shares, when issued in conformance with the terms and conditions of the Plan, will be legally issued, fully paid, and nonassessable under the Iowa Business Corporation Act. We do not find it necessary for the purposes of this opinion to cover, and accordingly we express no opinion as to, the application of the securities or blue sky laws of the various states as to the issuance and sale of the Shares. We consent to the use of this opinion in the registration statement filed with the Securities and Exchange Commission in connection with the registration of the Shares and to the reference to our firm under the heading "Interests of Named Experts and Counsel" in the registration statement. Very truly yours, BRADLEY & RILEY, P.C. EX-15.1 4 EXHIBIT 15.1 Exhibit 15.1 September 9, 1998 United Fire & Casualty Company 118 Second Avenue, SE Cedar Rapids, Iowa 52407 United Fire & Casualty Company: We are aware that United Fire & Casualty Company has incorporated by reference in its Form S-8 Registration Statement for the United Fire & Casualty Company Nonqualified Employee Stock Option Plan dated September 9, 1998 its Quarterly Reports on Form 10-Q for the quarters ended March 31, 1998 and June 30, 1998, which includes our reports dated May 5, 1998 and August 6, 1998, respectively, covering the unaudited interim financial information contained therein. Pursuant to Regulation C of the Securities Act of 1933, those reports are not considered a part of the registration statement prepared or certified by our firm or a report prepared or certified by our firm within the meaning of Sections 7 and 11 of the Act. Very truly yours, EX-23.1 5 EXHIBIT 23.1 Exhibit 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS ----------------------------------------- United Fire & Casualty Company: As independent public accountants, we hereby consent to the incorporation by reference in this Form S-8 Registration Statement for the United Fire & Casualty Company Nonqualified Employee Stock Option Plan dated September 9, 1998, our report dated February 19, 1998 included in United Fire & Casualty Company's Annual Report on Form 10-K for the year ended December 31, 1997 and to all references to our Firm included in this Registration Statement. Chicago, Illinois September 9, 1998 -----END PRIVACY-ENHANCED MESSAGE-----