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Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8 REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
CINCINNATI FINANCIAL CORPORATION
(Exact name of registrant as specified in charter)
OHIO 31-0746871
(State of Incorporation) (IRS Employer Identification No.)
Cincinnati Financial Center
6200 S. Gilmore Road
Fairfield, Ohio 45014
(Address of principal executive offices)
P. O. Box 145496
Cincinnati, Ohio 45250-5496
(Mailing Address)
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Cincinnati Financial Corporation
Stock Option Plan No. V
(Full Title of the Plan)
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THEODORE F. ELCHYNSKI
Senior Vice President
6200 S. Gilmore Road
Fairfield, Ohio 45014
(Name and address of agent for service)
Agent's telephone number, including area code: (513) 870-2000
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Approximate Date of Commencement of Proposed Sale to Employees:
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From time to time after this registration
statement becomes effective.
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================================================================================================
Title of Amount Proposed Proposed Amount of
Securities to be maximum maximum Registration
to be Registered offering aggregate Fee
Registered price per offering price
share
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 313,325 $67.50 (1) $21,149,437 $6,409
par value $2 141,000 $61.50 (2) $ 8,671,500 2,628
per share, 45,675 $61.43 (2) $ 2,805,815 850
of _______ ___________ ______
Cincinnati
Financial 500,000 $32,626,752(3) $9,887 (3)
Corporation shares
=========================================================================================================================
</TABLE>
(1) These shares are to be issued upon the exercise of stock options
granted to the employees of the issuer and its subsidiary companies
pursuant to the Cincinnati Financial Corporation Stock Option Plan No.
V. The per share offering price shown above is equal to the average of
the high and low prices of the issuer's shares on the NASDAQ National
Market System on April 4, 1997.
(2) These shares are currently subject to options under the Cincinnati
Financial Corporation Stock Option Plan No. V. The per share offering
prices for these shares is equal to the exercise prices of those
options.
(3) The aggregate offering price and the amount of the registration fee
are computed upon the basis of the price at which the outstanding
options may be exercised and for the securities not yet subject to
outstanding options, upon the per share price shown above.
================================================================================
Pursuant to Rule 427 and Rule 429 of Regulation C under the Securities Act of
1933, the Prospectus to be used with this Registration Statement is also being
used to update the Prospectus contained in Registration Statement No. 2-71575
filed on April 1, 1981, and Registration Statement No. 33-34127 filed on April
4, 1990, as required by Section 10(a)(3) of the Securities Act of 1933.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1996 and the definitive Proxy Statement dated March 3, 1997, with regard to its
Annual Meeting of Shareholders on April 5, 1997, both of which have been filed
with the Securities and Exchange Commission are, as of their respective dates,
incorporated by reference in this Registration Statement.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 after the date hereof and prior to
the termination of the offering of the securities offered hereby shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing such documents.
The consolidated financial statements and the related supplemental schedules
incorporated in this Registration Statement by reference from the Company's
Annual report on Form 10-K have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their reports, which are incorporated herein
by reference, and are included in reliance upon the reports of such firm given
upon the authority of that firm as experts in accounting and auditing.
ITEM 4. DESCRIPTION OF SECURITIES
The authorized capital stock of the Company consists of 80,000,000 shares of
Common Stock, par value $2.00 per share. The holders of Common Stock have equal
rights to participate in dividends, and in case of any distribution of assets,
the holders of Common Stock share pro rata in the distribution of all assets of
the Company remaining after payment of creditors. The holders of Common Stock do
not have conversion or preemptive rights and the Common Stock is not subject to
redemption. The shares of Common Stock issuable from time to time pursuant to
the exercise of options will be, when issued and delivered as contemplated by
the Stock Option Plan, fully paid and non-assessable. The Company acts as
transfer agent for its own stock.
Each share of Common Stock entitles the holder thereof to one vote in elections
of Directors and all other matters submitted to a vote of the shareholders. The
Common Stock does not have cumulative voting rights, which means that the
holders of a majority of the
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outstanding Common Stock voting for the election of Directors can elect all
Directors then being elected. The Amended Articles of Incorporation of the
Company provide that the Board of Directors shall be divided into three classes
which shall be as nearly equal in number as possible, with the Directors of each
class holding office for staggered terms of 3 years each. As a result, a
shareholder or group of shareholders possessing a majority of the voting power
of the Company would not be able to replace a majority of the Directors in any
one year, since only one-third of the Directors stand for election each year. It
should be noted that one result of this provision is that it takes longer for
shareholders to change a majority of the Board of Directors, even if they feel
such a change is desirable.
The Amended Articles of Incorporation of the Company provide that certain
mergers, consolidations, sales, or other dispositions of assets with any party
which is the beneficial owner of more than 10% of the outstanding shares of the
Company may only be accomplished with the approval of the holders of 75% of the
outstanding shares of the Company, unless the proposed transaction falls within
certain exemptions. The purpose of the provision is to discourage attempts by
other companies or groups to acquire control of the Company without adequate
discussions with management, on behalf of the Company's shareholders; otherwise,
a tender offer or merger might have the effect of forcing some of the
shareholders of the Company to sell their shares at a lower price than that
received by other shareholders. The provision would make it more difficult for
another company or group to effect such a tender offer or merger and may,
therefore, discourage any attempt to do so.
As an Ohio corporation, the Company is subject to the provisions of
Chapter 1704 of the Ohio Revised Code which prohibit a "Chapter 1704
transaction" between an Ohio corporation such as the Company and any person with
the right to exercise 10% or more of the voting power of such corporation. A
Chapter 1704 transaction is defined to include any merger, combination or
consolidation or any majority share acquisition and any of certain other sales,
leases, distributions, dividends, exchanges, mortgages, pledges, transfers or
other dispositions of assets between the corporation and any such 10%
shareholder. Such prohibition lasts for 3 years following the date on which such
person first became a 10% shareholder unless, prior to the time such person
first became a 10% shareholder, the board of directors of the corporation
approved either the Chapter 1704 transaction in question or the purchase of
shares which resulted in such person first becoming a 10% shareholder. After the
initial three-year moratorium, Chapter 1704 continues to prohibit such a Chapter
1704 transaction unless one of the above exceptions is available or the holders
of at least 66-2/3% of the voting shares and of at least a majority of the
voting shares not beneficially owned by the 10% shareholder approve the Chapter
1704 transaction, or the Chapter
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1704 transaction meets certain statutory criteria designed to ensure that the
corporation's remaining shareholders receive fair consideration for their
shares.
Ohio law as applied to the Company also provides that any "control share
acquisition" may be made only with the prior authorization of shareholders. A
"control share acquisition" is any acquisition, whether by tender offer, open
market purchase, privately negotiated transaction, or otherwise, of shares of
the Company, which when added to all other shares of the Company owned or
controlled by the acquiror, would entitle the acquiror directly or indirectly,
alone or with others, to exercise or direct the exercise of voting power of the
Company in the election of directors within any of the following ranges:
one-fifth or more but less than one-third; one-third or more but less than a
majority; and a majority or more. The effect of this law is generally to prevent
a person from acquiring control without prior shareholder approval. Approvals
are required by the affirmative vote of (i) a majority of the voting power of
the Company represented at such meeting in person or by proxy; and (ii) a
majority of the voting power excluding shares which may be voted by the
acquiring person, any officer of the Company elected or appointed by the Board
of Directors, or any employee of the Company who is also a director.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL Not Applicable
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1701.13(E) of the Ohio Revised Code provides that a corporation may
indemnify or agree to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending, or completed action,
suit, or proceeding whether civil, criminal, administrative, or investigative,
other than an action by or in the right of the corporation, by reason of the
fact that the person is or was a director, officer, employee, or agent of the
corporation, or is or was serving at its request as a director, trustee,
officer, employee, or agent of another corporation, partnership, joint venture,
trust, or other enterprise, against expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the person in connection with such action, suit, or proceeding if the person
is determined under the procedure described in the Section to have (a) acted in
good faith and in a manner the person reasonably believed to be in or not
opposed to the best interests of the corporation, and (b) had no reasonable
cause to believe the conduct was unlawful in the case of any criminal action or
proceeding. However, with respect to expenses actually and reasonably incurred
in connection with the defense or settlement of any action or suit by or in the
right of the corporation to procure a judgment in its favor, no indemnification
is to be made (i) in respect of any claim, issue, or matter as to
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which such person was adjudged liable for negligence or misconduct in the
performance of such person's duty to the corporation unless, and only to the
extent that, it is determined by the court upon application that, despite the
adjudication of liability, such person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper, or (ii) in respect of any
action or suit in which the only liability asserted against a director is in
connection with the alleged making of an unlawful loan, dividend or distribution
of corporate assets. The Section also provides that such person shall be
indemnified against expenses actually and reasonably incurred by the person to
the extent successful in defense of the actions referred to above, or in defense
of any claim, issue, or matter therein.
The Company's Amended Articles of Incorporation provide for the indemnification
of officers and directors of the Company to the fullest extent permitted by law.
The above is a general summary of certain provisions of the Ohio Revised Code
and is subject in all cases to the specific provisions thereof.
The Company maintains an insurance policy covering its directors and officers
against certain civil liabilities, including liabilities under the Securities
Act of 1933.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED Not Applicable
ITEM 8. EXHIBITS
The following exhibits are included in this Registration Statement on Form S-8.
(4) Cincinnati Financial Corporation
Stock Option Plan No. V
(5) Opinion re Legality
(23) (a) Consent of Accountants
(23) (b) Consent of Attorneys (included in Exhibit 5)
ITEM 9. UNDERTAKINGS
The undersigned issuer hereby undertakes: (1) to file during any period in which
offers or sales are being made, a post-effective amendment to this Registration
Statement 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; (2) that for
the purpose of determining any liability under the Securities Act of 1933, each
such post-effective amendment and each filing of the
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issuer's annual report pursuant to Sections 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to the
securities offered therein and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; and (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 Plan.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission, such
indemnification (except insofar as it provides for the payment by the Company of
expenses incurred or paid by a director or officer in the successful defense of
an action, suit or proceeding) is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities is asserted by such director, officer or controlling
person in connection with the securities being registered, the Company will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
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<PAGE> 8
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 S-8 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Cincinnati, State of Ohio, on this 5th day of April,
1997.
CINCINNATI FINANCIAL CORPORATION
By Robert B. Morgan
-------------------------
Robert B. Morgan
Chief Executive Officer
Pursuant to the requirement of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
CINCINNATI FINANCIAL CORPORATION
Signature Title Date
- --------- ----- ----
<S> <C> <C>
Robert B. Morgan Chief Executive Officer and April 5 , 1997
- --------------------------- Director (Principal Executive ---
Robert B. Morgan Officer)
Theodore F. Elchynski Senior Vice President April 5 , 1997
- --------------------------- (Principal Financial ---
Theodore F. Elchynski and Accounting Officer)
William F. Bahl Director April 5 , 1997
- --------------------------- ---
William F. Bahl
Michael Brown Director April 5 , 1997
- --------------------------- ---
Michael Brown
Director April___, 1997
- ---------------------------
Richard M. Burridge
John E. Field Director April 5 , 1997
- --------------------------- ---
John E. Field
</TABLE>
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<TABLE>
<S> <C> <C>
Director April___, 1997
- ---------------------------
William R. Johnson
Kenneth C. Lichtendahl Director April 5 , 1997
- --------------------------- ---
Kenneth C. Lichtendahl
James G. Miller Director April 5 , 1997
- --------------------------- ---
James G. Miller
Director April , 1997
- --------------------------- ---
Jackson H. Randolph
John J. Schiff Director April 5 , 1997
- --------------------------- ---
John J. Schiff
John J. Schiff, Jr. Director April 5 , 1997
- --------------------------- ---
John J. Schiff, Jr.
Director April , 1997
- --------------------------- ---
Robert C. Schiff
Director April , 1997
- --------------------------- ---
Thomas R. Schiff
Frank J. Schultheis Director April 5 , 1997
- --------------------------- ---
Frank J. Schultheis
Larry R. Webb Director April 5 , 1997
- --------------------------- ---
Larry R. Webb
Alan R. Weiler Director April 5 , 1997
- --------------------------- ---
Alan R. Weiler
</TABLE>
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<TABLE>
<CAPTION>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----
<S> <C> <C>
4 Cincinnati Financial Corporation
Stock Option Plan No. V 11
5, 23(b) Opinion of Beckman, Weil, Shepardson
& Faller LLC 15
23(a) Consent of Deloitte & Touche LLP
Independent Certified Public
Accountants 16
</TABLE>
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CINCINNATI FINANCIAL CORPORATION
STOCK OPTION PLAN NO. V
as amended November 17, 1995
1. PURPOSE. Stock Option Plan No. V (the "Plan") and the options
authorized hereunder are intended as an employment incentive, to retain in the
employ of Cincinnati Financial Corporation (hereinafter sometimes referred to as
"CFC") and its subsidiaries (as defined in subsection 425(f) of the Internal
Revenue Code of 1986, as amended), persons of training, experience, and ability,
to attract new employees whose services are considered unusually valuable, to
encourage a sense of proprietorship of such persons, and to stimulate the active
interest of such persons in the development and financial success of CFC and its
subsidiaries.
2. SHARES SUBJECT TO THE PLAN. The aggregate number of shares of the
common stock of CFC which may be issued under all options to be granted pursuant
to this Plan shall not exceed 500,000 shares of common stock with the par value
of $2.00 per share. The options granted under this Plan may be Incentive Stock
Options (as defined in Section 422A of the Internal Revenue Code of 1986, as
amended) or non-qualified options (any option which is not an Incentive Stock
Option).
3. ADMINISTRATION OF PLAN. A Committee (or Subcommittee) of at least
two disinterested, outside (as hereinafter defined) members of the Board of
Directors of CFC, appointed by and serving at the pleasure of the Board of
Directors (hereinafter called the "Committee") shall supervise the
administration of the Plan. Any questions of interpretation of the Plan or of
any options issued under it shall be determined by the Committee and such
determinations shall be final and binding upon all persons. The Committee shall
have the authority to grant Incentive Stock Options or non-qualified options to
those employees it deems appropriate. Those options shall contain such terms as
the Committee determines, subject to the limitations and requirements provided
herein. For purposes of determining who may serve as a member of the Committee,
"disinterested" shall mean a person who is not authorized to receive and who has
not, during the one year prior to service on the Committee, been granted an
option under the Plan or under any other stock option plan of CFC, and "outside"
shall mean a director who is not a current or former employee or officer of the
Company and who does not receive any "remuneration" as that term is defined in
the regulations under Internal Revenue Code Section 162(m), in any capacity,
other than as a director.
4. ELIGIBILITY FOR OPTIONS. All full-time employees of CFC and its
subsidiaries shall be eligible to receive options and the fact that an employee
may be a director of CFC or of a subsidiary
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of CFC shall not disqualify an employee from participating in this Plan. No
employee shall receive options on more than 100,000 shares over any three-year
period.
5. AMENDMENTS TO PLAN. For the purpose of meeting any changes in
pertinent law or governmental regulations, or for any other purpose which at the
time may be permitted by law, the Board of Directors, from time-to-time, may
amend or revise the terms of this Plan and the Committee may amend or revise the
terms of any outstanding option, retroactive to the date of granting of the
Option, except that the number of shares to be issued shall not increase, other
than to make appropriate adjustments in the number of shares that may be issued
pursuant to the Plan, and appropriate adjustments in the number and price of
shares covered by outstanding options hereunder, to give effect to any stock
splits, or stock dividends, or other relevant changes in capitalization.
6. TERMS OF OPTIONS. The option price per share for options granted
hereunder shall be not less than 100% of the fair market value of the shares on
the date said option was granted. The aggregate fair market value (at date of
grant of the option) of the stock with respect to which Incentive Stock Options
are first exercisable by any employee in any calendar year under this Plan and
any other plans of CFC and its subsidiaries shall not exceed $100,000. All
options granted hereunder shall expire not more than ten years from the date
granted.
Except in cases of retirement or death of the optionholder, options may not be
exercisable earlier than as provided in the following schedule:
(1) After the expiration of one year of continuous employment
immediately following the date of grant, the Option shall be exercisable to the
extent of one-third of the number of shares originally subject to the Option;
(2) After the expiration of two years of continuous employment
immediately following the date of the grant, the Option shall be exercisable to
the extent of two-thirds of the number of shares originally subject to the
Option, less the number of shares previously purchased pursuant to such Option;
and
(3) After the expiration of three years of continuous employment
following the date of grant, the Option shall be exercisable in full.
7. EXERCISE OF OPTIONS. In order for all or any portion of an option to
be exercised, CFC must receive at its principal place of business written notice
of such exercise properly executed by the employee, setting forth the number of
shares in respect of which the option is being exercised. Said notice shall be
accompanied by payment of the full option price of such shares,
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which payment shall be in cash, or in the case of non-qualified options only,
may be through the transfer by the employee to CFC of free and clear shares of
the common stock of CFC which shall be valued at the current market value of
such shares on the date of such transfer, or by a combination of cash and such
shares. The effective date of the exercise of the option ("effective date of
exercise") shall be the day the written notice of exercise is received by CFC
for non-qualified options and 30 days after the date of receipt for Incentive
Stock Options.
Upon termination of employment of the employee prior to the effective
date of exercise of an outstanding option, the unexercised portion of the option
shall terminate unless such termination of employment is due to (i) retirement
with the approval of CFC for disability or (ii) retirement due to attainment of
retirement age (in either of which events the Committee shall have discretion to
permit any unmatured installments of the options to be accelerated and the
options shall thereupon be exercisable in full. The time within which the
Company must receive the notice of exercise and payment shall be 90 days from
the date of termination of employment unless the Committee, in its discretion,
elects to grant a written extension of the time for receipt of notice and
payment) or (iii) death of the employee (in which event the unmatured
installments of the options shall be accelerated and the time within which the
Company must receive the notice of exercise and payment shall be six months from
the date of death). In any event, the effective date of the exercise of the
option must be prior to the expiration thereof.
In all other cases of termination of employment, when the employee
ceases to be employed by CFC or a subsidiary of CFC, the option shall not be
exercisable after the date upon which employment was terminated.
Subject to the foregoing, each installment of an option shall be
exercisable for the full amount or for any part thereof, including partial
exercise from time to time. Options shall be exercisable only by the employee to
whom granted, and shall not be assignable, except as provided in case of death.
All shares purchased upon exercise of options shall be fully paid for
at the time of purchase.
8. SHARES ISSUED UPON EXERCISE OF OPTIONS. Either treasury shares or
authorized but unissued shares may be issued upon exercise of options. CFC may
(as permitted by law) acquire by purchase the shares which it will need to
satisfy options, either at the time the options are exercised, or from time to
time in advance, whenever the Board of Directors may deem such purchase
advisable.
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9. IMPLIED AGREEMENT OF OPTIONEE. Every optionee shall be bound by the
terms and restrictions of this Plan and the acceptance of an option shall
constitute an agreement between the optionholder hereunder and CFC and any
successors in interest thereto. The grant of an option under the Plan shall not
limit or otherwise qualify the right of the employer of the optionholder to
terminate the employment of the optionholder at any time.
10. SECURITIES LAWS. The Board of Directors and the Committee shall
take all necessary and appropriate action to ensure that all options granted and
all shares of stock issued pursuant to exercise of those options are granted and
issued in compliance with all federal and state securities laws.
11. EFFECTIVE DATE AND TERM OF PLAN. This Plan, conditioned upon
approval by a majority vote of the Shareholders of CFC, shall be effective as of
May 1, 1995, and no options may be granted under the plan subsequent to April
30, 2005.
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BECKMAN, WEIL, SHEPARDSON AND FALLER, LLC
ATTORNEYS AT LAW
1200 Mercantile Center - 120 East Fourth Street - Cincinnati, Ohio 45202-4007
Telephone: (513) 621-2100 - Fax: (513) 621-0106
April 4, 1997
Cincinnati Financial Corporation
Cincinnati Financial Center
Post Office Box 145496
Cincinnati, Ohio 45214-5496
Gentlemen:
With respect to the Registration Statement on Form S-8 filed by
Cincinnati Financial Corporation with the Securities and Exchange Commission for
the purpose of registering under the Securities Act of 1933, as amended, 500,000
shares of Common Stock of Cincinnati Financial Corporation, we have examined
such documents and questions of law as we have considered necessary or
appropriate for the purpose of this opinion and, on the basis of such
examination, we advise you that, in our opinion, when the stock has been issued
and sold as contemplated by the Registration Statement and by the Cincinnati
Financial Corporation Stock Option Plan No. V, the stock will be legally issued,
fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very sincerely yours,
BECKMAN, WEIL, SHEPARDSON AND
FALLER, LLC
By W. Philip Shepardson, Jr.
----------------------------
W. Philip Shepardson, Jr.
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INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Cincinnati Financial Corporation on Form S-8 of our reports dated February 5,
1997 appearing in and incorporated by reference in the Annual Report on Form
10-K of Cincinnati Financial Corporation for the year ended December 31, 1996
and to the reference to us as experts in this Registration Statement.
DELOITTE & TOUCHE LLP
Cincinnati, Ohio
April 4, 1997
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