As filed with the Securities and Exchange Commission on January 12, 1998
Registration No. 333-
==========================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
_________________________
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
_________________________
COVER-ALL TECHNOLOGIES, INC.
(FORMERLY WARNER INSURANCE SERVICES, INC.)
(Exact name of Registrant as specified in its charter)
Delaware 13-2698053
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
18-01 Pollitt Drive, Fair Lawn, New Jersey 07410
(Address of Principal Executive Offices) (Zip Code)
COVER-ALL TECHNOLOGIES, INC.
(FORMERLY WARNER INSURANCE SERVICES, INC.)
1995 EMPLOYEE STOCK OPTION PLAN
(Full title of the plan)
Brian Magowan With a copy to:
Chief Executive Officer
Cover-All Technologies, Inc. Leonard Gubar, Esq.
18-01 Pollitt Drive Reid & Priest LLP
Fair Lawn, New Jersey 07410 40 West 57th Street
(Name and address of agent for service) New York, New York 10019
(201) 794-4800 (212) 603-2000
(Telephone number, including area code,
of agent for service)
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CALCULATION OF REGISTRATION FEE
--------------------------------------------------------------------------
PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED(1) PER SHARE PRICE FEE
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Common Stock 1,370,000 shs. $1.45(2) $1,986,500.00 $586.02(3)
-------------------------------------------------------------------------
Common Stock 30,000 shs. $4.16(4) $124,800.00 $ 36.82(5)
-------------------------------------------------------------------------
Total 1,400,000 shs. ---- $2,111,300.00 $622.84
=========================================================================
(1) Pursuant to Rule 416(a) and Rule 416(c) under the Securities Act of
1933, as amended (the "Securities Act"), this Registration Statement
also covers such indeterminate number of shares as may become
deliverable as a result of stock splits, stock dividends or similar
transactions and as may become subject to options under the Cover-All
Technologies, Inc. 1995 Employee Stock Option Plan (the "Plan") as a
result of the adjustment provisions contained therein.
(2) The proposed maximum offering price per share was calculated pursuant
to Rule 457(h) under the Securities Act based upon the average
exercise price at which such options to purchase shares of common
stock, $.01 par value per share, of the Company (the "Common Stock"),
under the Plan may be exercised.
(3) The amount of the registration fee for shares of Common Stock issuable
upon exercise of outstanding options under the Plan was calculated
pursuant to Rule 457(h) using the prices at which such options may be
exercised.
(4) The proposed maximum offering price per share was calculated pursuant
to Rule 457(h) under the Securities Act based upon the average of the
bid and asked prices of the Common Stock as quoted on the Nasdaq
National Market on January 8, 1998.
(5) The amount of the registration fee for shares of Common Stock issuable
with respect to options that may be granted in the future under the
Plan was calculated pursuant to Rule 457(c) under the Securities Act.
===========================================================================
In accordance with the provisions of Rule 462 promulgated under
the Securities Act of 1933, as amended, the Registration Statement will
become effective upon filing with the Securities and Exchange Commission.
<PAGE>
COVER-ALL TECHNOLOGIES, INC.
1995 EMPLOYEE STOCK OPTION PLAN
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This Registration Statement on Form S-8 is prepared pursuant
to General Instruction E to Form S-8. This Registration
Statement is being filed by Cover-All Technologies, Inc.
(formerly Warner Insurance Services, Inc.) (the "Company" or
"Registrant") to reflect certain amendments to the Company's 1995
Employee Stock Option Plan (the "Plan") approved by the
stockholders of the Company (the "Stockholders"). Specifically,
the amendment to the Plan (i) increased the number of shares of
the Company's common stock, par value $.01 per share (the "Common
Stock"), under the Plan by 1,400,000 shares and (ii) included
non-employee directors and consultants to the Company as
participants eligible to receive options under the Plan.
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed below are hereby incorporated by
reference into this registration statement, and all documents
subsequently filed by the Company pursuant to Section 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
respective dates of filing of such documents:
(a) The Registrant's Registration Statement on Form S-8
(Registration No. 333-02567), as filed by the Company
with the Securities and Exchange Commission (the
"Commission") on April 17, 1996, pursuant to the
Securities Act of 1933, as amended (the "Securities
Act"), registering an aggregate of 900,000 shares of the
Company's Common Stock, $.01 par value per share, under
the Plan and the 1994 Stock Option Plan for Independent
Directors.
(b) The Registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996.
(c) The Registrant's Proxy Statement filed with the
Commission on April 30, 1997.
(d) The Registrant's Quarterly Report on Form 10-Q for the
Quarter ended March 31, 1997.
(e) The Registrant's Quarterly Report on Form 10-Q for the
Quarter ended June 30, 1997.
(f) The Registrant's Quarterly Report on Form 10-Q for the
Quarter ended September 30, 1997.
(g) The Registrant's Current Report on Form 8-K filed with
the Commission on January 7, 1997.
(h) The Registrant's Current Report on Form 8-K filed with
the Commission on March 21, 1997.
(i) The Registrant's Current Report on Form 8-K filed with
the Commission on April 15, 1997.
(j) The Registrant's Current Report on Form 8-K filed with
the Commission on August 11, 1997.
(k) The description of the Registrant's Common Stock
contained in the Registrant's Registration Statement on
Form 8-A, filed on January 24, 1985 pursuant to Section
12(g) of the Exchange Act, including any amendments or
reports filed for the purpose of updating such
description.
Any statement contained in a document incorporated by
reference in this registration statement shall be deemed to be
modified or superseded for purposes of this registration
statement to the extent that a statement contained herein or in
any other subsequently filed document which is deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this registration statement.
II-1
<PAGE>
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Legal matters in connection with the validity of the issuance
of the securities offered hereby will be passed upon by Reid &
Priest LLP, New York, New York. Leonard Gubar, a member of such
firm, was until March 31, 1997, a member of the Board of
Directors of the Registrant.
ITEM 8. EXHIBITS.
Exhibit No. Description
---------- -----------
4(a)(1)* 1995 Employee Stock Option Plan, as amended.
4(a)(2) Form of Non-Qualified Stock Option Agreement
pursuant to the 1995 Employee Stock Option Plan
[incorporated by reference to Exhibit 10(o)(3) to
the Registrant's Annual Report on Form 10-K
(Commission File No. 0-13124) filed on April 17,
1995].
4(a)(3) Form of Incentive Stock Option Agreement pursuant
to the 1995 Employee Stock Option Plan [incorporated
by reference to Exhibit 10(o)(2) to the Registrant's
Annual Report on Form 10-K (Commission File No. 0-
13124) filed on April 17, 1995].
5* Opinion of Reid & Priest LLP
23(a)* Consent of Ernst & Young LLP
23(b)* Consent of Reid & Priest LLP (included in Exhibit 5)
24* Power of Attorney (included on signature page)
____________________________
* Filed herewith
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 thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(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;
II-2
<PAGE>
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
-------- -------
of this section do not apply if the Registration Statement is on
Form S-3, Form S-8 or Form F-3, and if the information required
to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or 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 posteffective
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 Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
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.
(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.
II-3
<PAGE>
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 Fair Lawn, State of New Jersey, on the 12th day of
January, 1998.
COVER-ALL TECHNOLOGIES, INC.
By: /s/ Brian Magowan
_____________________________________
Brian Magowan
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each director and officer
whose signature appears below constitutes and appoints Brian
Magowan and Leonard Gubar, and each of them, his true and lawful
attorney-in-fact and agent, with full power of substitution, to
sign in any and all capacities any or all amendments including
all post-effective amendments to this Registration Statement and
to file the same with all exhibits thereto and other documents in
connection therewith with the Securities and Exchange Commission,
granting to such attorneys-in-fact and agents, and each of them,
full power and authority to do all such other acts and execute
all such other documents as they, or any of them, may deem
necessary or desirable in connection with the foregoing, as fully
as the undersigned might or could do in person, hereby ratifying
and confirming all that such attorneys-in-fact and agents, or any
of them, or their substitutes may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Brian Magowan Chairman of the Board January 12, 1998
---------------------- and Chief Executive
Brian Magowan Officer (Principal
Executive Officer)
/s/ Mark D. Johnston Director and Chief January 12, 1998
---------------------- Financial Officer
Mark D. Johnston (Principal Financial
Officer)
/s/ Raul F. Calvo Vice President January 12, 1998
---------------------- (Principal Accounting
Raul F. Calvo Officer)
/s/ Earl Gallegos Director January 12, 1998
----------------------
Earl Gallegos
/s/ Ian Meredith Director January 12, 1998
----------------------
Ian Meredith
/s/ James R. Stallard Director January 12, 1998
----------------------
James R. Stallard
/s/ Steve Hough Director January 12, 1998
----------------------
Steve Hough
II-4
<PAGE>
INDEX TO EXHIBITS
-----------------
Exhibit Number Description of Exhibit
-------------- ----------------------
4(a)(1) 1995 Employee Stock Option Plan, as
amended
5 Opinion of Reid & Priest LLP
23(a) Consent of Ernst & Young LLP
23(b) Consent of Reid & Priest LLP
(included in Exhibit 5)
Exhibit 4(a)(1)
COVER-ALL TECHNOLOGIES INC.
1995 EMPLOYEE STOCK OPTION PLAN,
AS AMENDED
_______________
EFFECTIVE AS OF MARCH 22, 1995
<PAGE>
COVER-ALL TECHNOLOGIES INC.
1995 EMPLOYEE STOCK OPTION PLAN,
AS AMENDED ON APRIL 29, 1997
INTRODUCTION
Cover-All Technologies Inc., a Delaware corporation
(formerly Warner Insurance Services, Inc., hereinafter referred
to as the "Corporation"), hereby establishes an incentive
compensation plan to be known as the "Cover-All Technologies Inc.
1995 Employee Stock Option Plan" (hereinafter referred to as the
"Plan"), as set forth in this document. The Plan permits the
grant of Non-Qualified Stock Options and Incentive Stock Options.
The Plan shall become effective on March 22, 1995.
However, it shall be rendered null and void and have no effect,
and all Options granted hereunder shall be canceled, if the Plan
is not approved by a majority vote of the Corporation's
stockholders within twelve (12) months of such date. [The Plan
was approved by a majority vote of the Corporation's stockholders
on June 15, 1995.]
The purpose of the Plan is to promote the success and
enhance the value of the Corporation by linking the personal
interests of Participants to those of the Corporation's
stockholders, customers and employees, by providing Participants
with an incentive for outstanding performance. The Plan is
further intended to provide flexibility to the Corporation in its
ability to motivate, and retain the services of, participants
upon whose judgment, interest and special effort the successful
conduct of its operations is largely dependent.
<PAGE>
DEFINITIONS
For purposes of this Plan, the following terms shall be
defined as follows unless the context clearly indicates
otherwise:
(a) "Code" shall mean the Internal Revenue Code of
----
1986, as amended, and the rules and regulations thereunder.
(b) "Committee" shall mean the full Board of Directors
---------
of the Corporation.
(c) "Common Stock" shall mean the common stock, par
------------
value $0.01 per share, of the Corporation.
(d) "Corporation" shall mean Cover-All Technologies
-----------
Inc., a Delaware corporation.
(e) "Disability" shall have the same meaning as the
----------
term permanent and total disability under Section 22(e)(3) of the
Code.
(f) "Exchange Act" shall mean the Securities Exchange
------------
Act of 1934, as amended, and the rules and regulations
thereunder.
(g) "Fair Market Value" of the Corporation's Common
-----------------
Stock on a Trading Day shall mean the last reported sale price
for Common Stock or, in case no such reported sale takes place on
such Trading Day, the average of the closing bid and asked prices
for the Common Stock for such Trading Day, in either case on the
principal national securities exchange on which the Common Stock
is listed or admitted to trading, or if the Common Stock is not
listed or admitted to trading on any national securities
exchange, but is traded in the over-the-counter market, the
closing sale price of the Common Stock or, if no sale is publicly
reported, the average of the closing bid and asked quotations for
the Common Stock, as reported by the National Association of
Securities Dealers Automated Quotation System ("NASDAQ") or any
comparable system or, if the Common Stock is not listed on NASDAQ
or a comparable system, the closing sale price of the Common
Stock or, if no sale is publicly reported, the average of the
closing bid and asked prices, as furnished by two members of the
National Association of Securities Dealers, Inc. who make a
market in the Common Stock selected from time to time by the
Corporation for that purpose. In addition, for purposes of this
definition, a "Trading Day" shall mean, if the Common Stock is
listed on any national securities exchange, a business day during
which such exchange was open for trading and at least one trade
of Common Stock was effected on such exchange on such business
day, or, if the Common Stock is not listed on any national
securities exchange but is traded in the over-the-counter market,
a business day during which the over-the-counter market was open
for trading and at least one "eligible dealer" quoted both a bid
and asked price for the Common Stock. An "eligible dealer" for
any day shall include any broker-dealer who quoted both a bid and
asked price for such day, but shall not include any broker-dealer
who quoted only a bid or only an asked price for such day. In
the event the Corporation's Common Stock is not publicly traded,
the Fair Market Value of such Common Stock shall be determined by
the Committee in good faith.
(h) "Good Cause" shall mean (i) a Participant's
----------
willful or gross misconduct or willful or gross negligence in the
performance of his duties for the Corporation or for any Parent
or Subsidiary after prior written notice of such misconduct or
negligence and the continuance thereof for a period of 30 days
after receipt by such Participant of such notice, (ii) a
Participant's intentional or habitual neglect of his duties for
the Corporation or for any Parent or Subsidiary after prior
written notice of such neglect, or (iii) a Participant's theft or
misappropriation of funds of the Corporation or of any Parent or
Subsidiary or commission of a felony.
(i) "Incentive Stock Option" shall mean a stock option
----------------------
satisfying the requirements for tax-favored treatment under
Section 422 of the Code.
(j) "Non-Qualified Option" shall mean a stock option
--------------------
which does not satisfy the requirements for tax-favored treatment
under Section 422 of the Code.
(k) "Option" shall mean an Incentive Stock Option or a
------
Non-Qualified Stock Option granted pursuant to the provisions of
Section V hereof.
(l) "Optionee" shall mean a Participant who is
--------
granted an Option under the terms of this Plan.
(m) "Parent" shall mean a parent corporation of the
------
Corporation within the meaning of Section 424(e) of the Code.
(n) "Participant" shall mean any employee or other
-----------
individual (including a Director Participant) participating under
the Plan.
(o) "Plan Award" shall mean an Option granted pursuant
----------
to the terms of this Plan.
(p) "Section 16" shall mean Section 16 of the Exchange
----------
Act and the rules and regulations promulgated thereunder.
(q) "Securities Act" shall mean the Securities Act of
--------------
1933, as amended, and the rules and regulations thereunder.
(r) "Subsidiary" shall mean a subsidiary corporation
----------
of the Corporation within the meaning of Section 424(f) of the
Code.
SECTION I
ADMINISTRATION
The Plan shall be administered by the Committee.
Subject to the provisions of the Plan, the Committee may
establish from time to time such regulations, provisions,
proceedings and conditions of awards which, in its opinion, may
be advisable in the administration of the Plan. A majority of
the Committee shall constitute a quorum, and, subject to the
provisions of Section IV of the Plan, the acts of a majority of
the members present at any meeting at which a quorum is present,
or acts approved in writing by a majority of the Committee, shall
be the acts of the Committee. This Plan is intended to be a
bifurcated plan.
SECTION II
SHARES AVAILABLE
Subject to the adjustments provided in Section X of the
Plan, the aggregate number of shares of the Common Stock which
may be granted for all purposes under the Plan shall be two
million (2,000,000) shares. [Increased from 600,000 shares to
2,000,000 shares.] Shares of Common Stock underlying awards of
Options shall be counted against the limitation set forth in the
immediately preceding sentence and may be reused (e.g., in the
----
event that an Option to any individual expires, is terminated
unexercised, or is forfeited as to any shares covered thereby).
Incentive and Non-Qualified Stock Options under the Plan may be
fulfilled in accordance with the terms of the Plan with either
authorized and unissued shares of the Common Stock, issued shares
of such Common Stock held in the Corporation's treasury or shares
of Common Stock acquired on the open market.
SECTION III
ELIGIBILITY
Eligible participants in the Plan shall include present
and future (i) common law employees who are regularly employed on
a salaried basis, (ii) non-employee directors, and (iii)
consultants of the Corporation, or of any Parent or Subsidiary.
SECTION IV
AUTHORITY OF COMMITTEE
The Plan shall be administered by, or under the
direction of, the Committee, which shall administer the Plan so
as to comply at all times with the Exchange Act, to the extent
such compliance is required, and, subject to the Code, shall
otherwise have plenary authority to interpret the Plan and to
make all determinations specified in or permitted by the Plan or
deemed necessary or desirable for its administration or for the
conduct of the Committee's business. Subject to the provisions
of Section X hereof, all interpretations and determinations of
the Committee may be made on an individual or group basis and
shall be final, conclusive, and binding on all interested
parties. Subject to the express provisions of the Plan, the
Committee shall have authority, in its discretion, to determine
the persons to whom Plan Awards shall be granted, the times when
such Plan Awards shall be granted, the number of Plan Awards, the
purchase price or exercise price of each Plan Award, the
period(s) during which such Plan Award shall be exercisable
(whether in whole or in part), the restrictions to be applicable
to Plan Awards and the other terms and provisions thereof (which
need not be identical). In addition, the authority of the
Committee (which may be exercised in its sole discretion) shall
include without limitation the following:
(a) Financing. The arrangement of temporary financing
---------
for an Optionee by registered broker-dealers, under the rules and
regulations of the Federal Reserve Board, for the purpose of
assisting the Optionee in the exercise of an Option, such
authority to include the payment by the Corporation of the
commissions of the broker-dealer;
(b) Procedures for Exercise of Option. The
---------------------------------
establishment of procedures for an Optionee (i) to exercise an
Option by payment of cash or any other property acceptable to the
Committee, (ii) to have withheld from the total number of shares
of Common Stock to be acquired upon the exercise of an Option
that number of shares having a Fair Market Value, which, together
with such cash as shall be paid in respect of fractional shares,
shall equal the option exercise price of the total number of
shares to be acquired, (iii) to exercise all or a portion of an
Option by delivering that number of shares of Common Stock
already owned by him having a Fair Market Value which shall equal
the Option exercise price for the portion exercised and, in cases
where a Option is not exercised in its entirety, to permit the
Optionee to deliver the shares of Common Stock thus acquired by
him in payment of shares of Common Stock to be received pursuant
to the exercise of additional portions of such Option, the effect
of which shall be that an Optionee can in sequence utilize such
newly acquired shares of Common Stock in payment of the exercise
price of the entire option, together with such cash as shall be
paid in respect of fractional shares and (iv) to engage in any
form of "cashless" exercise.
(c) Withholding. The establishment of a procedure
-----------
whereby a number of shares of Common Stock or other securities
may be withheld from the total number of shares of Common Stock
or other securities to be issued upon exercise of an Option or
for the tender of shares of Common Stock owned by the Participant
to meet the obligation of withholding for taxes incurred by the
Optionee upon such exercise.
(d) Types of Plan Awards. The Committee may grant
--------------------
awards in the form of one or more of Incentive Stock Options and
Non-Qualified Stock Options.
SECTION V
STOCK OPTIONS
The Committee shall have the authority, in its
discretion, to grant Incentive Stock Options or to grant
Non-Qualified Stock Options or to grant both types of Options.
No Option shall be granted for a term of more than ten (10)
years. Notwithstanding anything contained herein to the
contrary, an Incentive Stock Option may be granted only to common
law employees of the Corporation or of any Parent or Subsidiary
now existing or hereafter formed or acquired, and not to any
director or officer who is not also such a common law employee.
The terms and conditions of the Options shall be determined from
time to time by the Committee; provided, however, that the
-------- -------
Options granted under the Plan shall be subject to the following:
(a) Exercise Price. The Committee shall establish the
--------------
exercise price at the time any Option is granted at such amount
as the Committee shall determine; provided, however, that the
-------- -------
exercise price for each share of Common Stock purchasable under
any Incentive Stock Option granted hereunder shall be such amount
as the Committee shall, in its best judgment, determine to be not
less than one hundred percent (100%) of the Fair Market Value per
share of Common Stock at the date the Option is granted; and
provided, further, that in the case of an Incentive Stock Option
granted to a person who, at the time such Incentive Stock Option
is granted, owns shares of stock of the Corporation or of any
Parent or Subsidiary which possess more than ten percent (10%) of
the total combined voting power of all classes of shares of stock
of the Corporation or of any Parent or Subsidiary, the exercise
price for each share of Common Stock shall be such amount as the
Committee, in its best judgment, shall determine to be not less
than one hundred ten percent (110%) of the Fair Market Value per
share of Common Stock at the date the Option is granted. The
exercise price will be subject to adjustment in accordance with
the provisions of Section VI of the Plan.
(b) Payment of Exercise Price. The price per share of
-------------------------
Common Stock with respect to each Option shall be payable at the
time the Option is exercised. Such price shall be payable in
cash or, upon the discretion of the Committee, pursuant to any of
the methods set forth in Sections IV(a) or (b) hereof. Shares of
Common Stock delivered to the Corporation in payment of the
exercise price shall be valued at the Fair Market Value of the
Common Stock on the date preceding the date of the exercise of
the Option.
(c) Exercisability of Options. Each Option shall be
-------------------------
exercisable in whole or in installments, and at such time(s), and
subject to the fulfillment of any conditions on exercisability as
may be determined by the Committee at the time of the grant of
such Options. The right to purchase shares of Common Stock shall
be cumulative so that when the right to purchase any shares of
Common Stock has accrued such shares of Common Stock or any part
thereof may be purchased at any time thereafter until the
expiration or termination of the Option.
(d) Expiration of Options. No Option by its terms
---------------------
shall be exercisable after the expiration of ten (10) years from
the date of grant of the Option; provided, however, in the case
-------- -------
of an Incentive Stock Option granted to a person who, at the time
such Option is granted, owns shares of stock of the Corporation
or of any Parent or Subsidiary possessing more than ten percent
(10%) of the total combined voting power of all classes of shares
of stock of the Corporation or of any Parent or Subsidiary, such
Option shall not be exercisable after the expiration of five (5)
years from the date such Option is granted.
(e) Exercise Upon Death of Optionee. Subject to the
-------------------------------
provisions of Section V(h) hereof, in the event of the death of
the Optionee prior to his termination of employment with the
Corporation or with any Parent or Subsidiary, or within three (3)
months of the date of such termination (other than for Good
Cause), his estate (or other beneficiary, if so designated in
writing by the Participant) shall have the right, within one (1)
year after the date of death (but in no case after the expiration
date of the Option(s)), to exercise his Option(s) with respect to
all or any part of the shares of Common Stock as to which the
deceased Optionee had not exercised his Option at the time of his
death, but only to the extent such Option or Options were
exercisable on the date of his death (or, if provided in an
Option Agreement with respect to a particular Optionee, at the
date of exercise determined as if the Optionee died on such
date).
(f) Exercise Upon Disability of Optionee. Subject to
------------------------------------
the provisions of Section and V(h) hereof, if the employment by
the Corporation or by any Parent or Subsidiary of an Optionee is
terminated because of Disability, he shall have the right, within
one (1) year after the date of such termination (but in no case
after the expiration of the Option), to exercise his Option(s)
with respect to all or any part of the shares of Common Stock as
to which he had not exercised his Option at the time of such
termination, but only to the extent such Option or Options were
exercisable on the date of his termination of employment.
(g) Exercise Upon Optionee's Termination of
---------------------------------------
Employment. With respect to Incentive Stock Options, if the
----------
employment of an Optionee by the Corporation or by any Parent or
Subsidiary is terminated for any reason (including, but not
limited to, Good Cause) other than those specified in Sections
V(e) and (f) above, then the Optionee shall, at the time of such
termination of employment, forfeit his rights to exercise all of
such Option(s). With respect to any Non-Qualified Stock Options,
if the Optionee's employment or other relationship with the
Corporation or any Parent or Subsidiary is terminated for any
reason other than for death or disability (as governed by
Sections V(e) and (f) above), then, except as otherwise expressly
provided in an agreement covering an option granted to an
Optionee, the Optionee's right to exercise such Option shall also
terminate on the date on which such Optionee's employment or
other relationship terminated. In each case an option shall only
be exercisable to the extent it was exercisable on the date of
termination. In all cases, however, if the termination of the
Optionee's employment or other relationship with the Corporation
or any Parent or Subsidiary is determined by the Committee to
have been for Good Cause, then the Option and all rights
thereunder shall terminate on the date of termination of
employment or such other relationship.
(h) Maximum Amount of Incentive Stock Options. Each
-----------------------------------------
Plan Award under which Incentive Stock Options are granted shall
provide that to the extent the aggregate of the (i) Fair Market
Value of the shares of Common Stock (determined as of the time of
the grant of the Option) subject to such Incentive Stock Option
and (ii) the fair market values (determined as of the date(s) of
grant of the options) of all other shares of Common Stock subject
to incentive stock options granted to an Optionee by the
Corporation or any Parent or Subsidiary, which are exercisable
for the first time by any individual during any calendar year,
exceed(s) one hundred thousand dollars ($100,000), such excess
shares of Common Stock shall not be deemed to be purchased
pursuant to Incentive Stock Options. The terms of the
immediately preceding sentence shall be applied by taking options
into account in the order in which they are granted.
SECTION VI
ADJUSTMENT OF SHARES
In the event there is any change in the Common Stock of
the Corporation by reason of any reorganization,
recapitalization, stock split, stock dividend or otherwise, there
shall be substituted for or added to each share of Common Stock
theretofore appropriated or thereafter subject, or which may
become subject, to any Option the number and kind of shares of
stock or other securities into which each outstanding share of
Common Stock shall be so changed or for which each such share
shall be exchanged, or to which each such share be entitled, as
the case may be, and the per share price thereof also shall be
appropriately adjusted. Notwithstanding the foregoing, (i) each
such adjustment with respect to an Incentive Stock Option shall
comply with the rules of Section 424(a) of the Code and (ii) in
no event shall any adjustment be made which would render any
Incentive Stock Option granted hereunder to be other than an
incentive stock option for purposes of Section 422 of the Code.
SECTION VII
MISCELLANEOUS PROVISIONS
(a) Administrative Procedures. The Committee may
-------------------------
establish any procedures determined by it to be appropriate in
discharging its responsibilities under the Plan. Subject to the
provisions of Section X hereof, all actions and decisions of the
Committee shall be final.
(b) Assignment or Transfer. No grant or award of any
----------------------
Incentive Stock Option or any other "derivative security" (as
defined by Rule 16a-l(c) promulgated under the Exchange Act) made
under the Plan or any rights or interests therein shall be
assignable or transferable by a Participant except by will or the
laws of descent and distribution or pursuant to a qualified
domestic relations order. During the lifetime of a Participant
Options granted hereunder shall be exercisable only by the
Participant.
(c) Investment Representation. In the case of Plan
-------------------------
Awards paid in shares of Common Stock or other securities, the
Committee may require, as a condition of receiving such
securities, that the Participant furnish to the Corporation such
written representations and information as the Committee deems
appropriate to permit the Corporation, in light of the existence
or nonexistence of an effective registration statement under the
Securities Act to deliver such securities in compliance with the
provisions of the Securities Act.
(d) Withholding Taxes. The Corporation shall have the
-----------------
right to deduct from all cash payments hereunder any federal,
state, local or foreign taxes required by law to be withheld with
respect to such payments. In the case of the issuance or
distribution of Common Stock or other securities hereunder, the
Corporation, as a condition of such issuance or distribution, may
require the payment (through withholding from the Participant's
salary, reduction of the number of shares of Common Stock or
other securities to be issued, or otherwise) of any such taxes.
Subject to the Rules promulgated under Section 16 of the Exchange
Act (to the extent applicable), and to the consent of the
Committee, the Participant, may satisfy the withholding
obligations by paying to the Corporation a cash amount equal to
the amount required to be withheld or by tendering to the
Corporation a number of shares of Common Stock having a value
equivalent to such cash amount, or by use of any available
procedure as described under Section IV(c) hereof.
(e) Costs and Expenses. The costs and expenses of
------------------
administering the Plan shall be borne by the Corporation and
shall not be charged against any award nor to any employee
receiving a Plan Award.
(f) Funding of Plan. The Plan shall be unfunded. The
---------------
Corporation shall not be required to segregate any of its assets
to assure the payment of any Plan Award under the Plan. Neither
the Participants nor any other persons shall have any interest in
any fund or in any specific asset or assets of the Corporation or
any other entity by reason of any Plan Award, except to the
extent expressly provided hereunder. The interests of each
Participant and former Participant hereunder is unsecured and
shall be subject to the general creditors of the Corporation.
(g) Other Incentive Plans. The adoption of the Plan
---------------------
does not preclude the adoption by appropriate means of any other
incentive plan for employees.
(h) Plurals and Gender. Where appearing in the Plan,
------------------
masculine gender shall include the feminine and neuter genders,
and the singular shall include the plural, and vice versa, unless
the context clearly indicates a different meaning.
(i) Headings. The headings and sub-headings in this
--------
Plan are inserted for the convenience of reference only and are
to be ignored in any construction of the provisions hereof.
(j) Severability. In case any provision of this Plan
------------
shall be held illegal or void, such illegality or invalidity
shall not affect the remaining provisions of this Plan, but shall
be fully severable, and the Plan shall be construed and enforced
as if said illegal or invalid provisions had never been inserted
herein.
(k) Payments Due Missing Persons. The Corporation
----------------------------
shall make a reasonable effort to locate all persons entitled to
benefits under the Plan; however, notwithstanding any provisions
of this Plan to the contrary, if, after a period of one (1) year
from the date such benefit shall be due, any such persons
entitled to benefits have not been located, their rights under
the Plan shall stand suspended. Before this provision becomes
operative, the Corporation shall send a certified letter to all
such persons at their last known address advising them that their
rights under the Plan shall be suspended. Subject to all
applicable state laws, any such suspended amounts shall be held
by the Corporation for a period of one (1) additional year and
thereafter such amounts shall be forfeited and thereafter remain
the property of the Corporation.
(l) Liability and Indemnification. (i) Neither the
-----------------------------
Corporation nor any Parent or Subsidiary shall be responsible in
any way for any action or omission of the Committee, or any other
fiduciaries in the performance of their duties and obligations as
set forth in this Plan. Furthermore, neither the Corporation nor
any Parent or Subsidiary shall be responsible for any act or
omission of any of their agents, or with respect to reliance upon
advice of their counsel provided that the Corporation and/or the
appropriate Parent or Subsidiary relied in good faith upon the
action of such agent or the advice of such counsel.
(ii) Except for their own gross negligence or
willful misconduct regarding the performance of the dates
specifically assigned to them under or their willful breach
of the terms of, this Plan, the Corporation, each Parent and
Subsidiary and the Committee shall be held harmless by the
Participants, former Participants, beneficiaries and their
representatives against liability or losses occurring by
reason of any act or omission. Neither the Corporation, any
Parent or Subsidiary, the Committee, nor any agents,
employees, officers, directors or shareholders of any of
them, nor any other person shall have any liability or
responsibility with respect to this Plan, except as
expressly provided herein.
(m) Incapacity. If the Committee shall receive
----------
evidence satisfactory to it that a person entitled to receive
payment of any Plan Award is, at the time when such benefit
becomes payable, a minor, or is physically or mentally
incompetent to receive such Plan Award and to give a valid
release thereof, and that another person or an institution is
then maintaining or has custody of such person and that no
guardian, committee or other representative of the estate of such
person shall have been duly appointed, the Committee may make
payment of such Plan Award otherwise payable to such person to
such other person or institution, including a custodian under a
Uniform Gifts to Minors Act, or corresponding legislation (who
shall be an adult, a guardian of the minor or a trust company),
and the release of such other person or institution shall be a
valid and complete discharge for the payment of such Plan Award.
(n) Cooperation of Parties. All parties to this Plan
----------------------
and any person claiming any interest hereunder agree to perform
any and all acts and execute any and all documents and papers
which are necessary or desirable for carrying out this Plan or
any of its provisions.
(o) Governing Law. All questions pertaining to the
-------------
validity, construction and administration of the Plan shall be
determined in accordance with the laws of the State of New York.
(p) Nonguarantee of Employment or Other Relationships.
-------------------------------------------------
Nothing contained in this Plan shall be construed as a contract
of employment between the Corporation (or any Parent or
Subsidiary), and any employee or Participant, as a right of any
employee or Participant to be continued in the employment of or
other relationship with the Corporation (or any Parent or
Subsidiary), or as a limitation on the right of the Corporation
or any Parent or Subsidiary to discharge any of its employees,
consultants or directors with or without cause.
(q) Notices. Each notice relating to this Plan shall
-------
be in writing and delivered in person or by certified mail to the
proper address. All notices to the Corporation or the Committee
shall be addressed to it at 18-01 Pollitt Drive, Fair Lawn, New
Jersey 07410, Attn: Secretary. All notices to Participants,
former Participants, beneficiaries or other persons acting for or
on behalf of such persons shall be addressed to such person at
the last address for such person maintained in the Committee's
records.
(r) Written Agreements. Each Plan Award shall be
------------------
evidenced by a signed written agreement between the Corporation
and the Participant containing the terms and conditions of the
award.
SECTION VIII
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors of the Corporation shall have
the right to amend, suspend or terminate the Plan at any time,
provided that no amendment shall be made which shall increase
the total number of shares of the Common Stock of the Corporation
which may be issued and sold pursuant to Options reduce the
minimum exercise price in the case of an Incentive Stock Option,
or modify the provisions of the Plan relating to eligibility with
respect to Incentive Stock Options unless such amendment is made
by or with the approval of the stockholders (such approval being
granted within 12 months of the effective date of such
amendment). The Board of Directors of the Corporation shall be
authorized to amend the Plan and the Options granted thereunder
(i) to maintain qualification as "incentive stock options" within
the meaning of Section 422 of the Code, if applicable or (ii) to
comply with Rule 16b-3 (or any successor rule) promulgated under
the Exchange Act. Except as otherwise provided herein, no
amendment, suspension or termination of the Plan shall alter or
impair any Plan Awards previously granted under the Plan, without
the consent of the holder thereof.
SECTION IX
TERM OF PLAN
The Plan shall remain in effect until March 21, 2005,
unless sooner terminated by such Board of Directors. No Plan
Awards may be granted under the Plan subsequent to the
termination of the Plan.
SECTION X
CLAIMS PROCEDURES
(a) Denial. If any Participant, former Participant or
------
beneficiary is denied any vested benefit to which he is, or
reasonably believes he is, entitled under this Plan, either in
total or in an amount less than the full vested benefit to which
he would normally be entitled, the Committee shall advise such
person in writing the specific reasons for the denial. The
Committee shall also furnish such person at the time with a
written notice containing (i) a specific reference to pertinent
Plan provisions, (ii) a description of any additional material or
information necessary for such person to perfect his claim, if
possible, and an explanation of why such material or information
is needed and (iii) an explanation of the Plan's claim review
procedure.
(b) Written Request for Review. Within 60 days of
--------------------------
receipt of the information stated in subsection (a) above, such
person shall, if he desires further review, file a written
request for reconsideration with the Committee.
(c) Review of Document. So long as such person's
------------------
request for review is pending (including the 60 day period in
subsection (b) above), such person or his duly authorized
representative may review pertinent Plan documents and may submit
issues and comments in writing to the Committee.
(d) Committee's Final and Binding Decision. A final
--------------------------------------
and binding decision shall be made by the Committee within 60
days of the filing by such person of this request for
reconsideration; provided, however, that if the Committee, in its
-------- -------
discretion, feels that a hearing with such person or his
representative is necessary or desirable, this period shall be
extended for an additional 60 days.
(e) Transmittal of Decision. The Committee's decision
-----------------------
shall be conveyed to such person in writing and shall include
specific reasons for the decision, written in a manner calculated
to be understood by such person, the specific references to the
pertinent Plan provisions on which the decision is based.
(f) Limitation on Claims. Notwithstanding any
--------------------
provisions of this Plan to the contrary, no Participant (nor the
estate or other beneficiary of a Participant) shall be entitled
to assert a claim against the Corporation (or against any Parent
or Subsidiary) more than three years after the date the
Participant (or his estate or other beneficiary) initially is
entitled to receive benefits hereunder.
Exhibit 5
REID & PRIEST LLP
40 West 57th Street
New York, NY 10019-4097
Telephone 212 603-2000
Fax 212 603-2001
New York, New York
January 8, 1998
Cover-All Technologies, Inc.
18-01 Pollitt Drive
Fair Lawn, New Jersey 07410
Re: Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
We have acted as counsel to Cover-All Technologies,
Inc., a Delaware corporation (the "Registrant"), in connection
with the preparation and filing with the Securities and Exchange
Commission (the "Commission") of a Registration Statement on Form
S-8 (the "Registration Statement"), in accordance with General
Instruction E of Form S-8, with respect to the registration under
the Securities Act of 1933, as amended (the "Act"), of an
additional 1,400,000 shares of the Registrant's common stock,
$.01 par value per share (the "Shares"), issuable upon the
exercise of options (the "Options") granted or to be granted
pursuant to the Registrant's 1995 Employee Stock Option Plan, as
amended (the "Plan").
For purposes of this opinion we have examined the
Registration Statement, the Certificate of Incorporation, as
amended, and the By-Laws, as amended, of the Registrant, the Plan
and such other documents, records, agreements, proceedings and
legal matters as we have deemed necessary to examine. With
respect to any documents, records or agreements (collectively,
the "Documents") that we have examined, we have assumed the
genuineness of all signatures on, and the authenticity of, all
Documents submitted to us as originals, and the conformity to the
originals of all Documents submitted to us as certified or
photostatic copies.
Based upon the foregoing and subject to the
qualifications stated herein we are of the opinion that:
1. The Registrant is a corporation duly incorporated,
validly existing and in good standing under the laws of the State
of Delaware.
2. The Shares included in the Registration Statement
that are to be issued upon the exercise of the Options granted or
to be granted pursuant to the Plan will be duly authorized and
validly issued, and fully paid and non-assessable when the
Options shall have been properly exercised and the exercise price
shall have been paid for the Shares in accordance with the terms
of the Plan.
We are members of the Bar of the State of New York and
we are not rendering any opinion with respect to any laws other
than the laws of the State of New York, the federal laws of
the United States of America and the General Corporation Law of
the State of Delaware.
We hereby consent to the filing of this opinion with
the Commission as Exhibit 5 to the Registration Statement. In
giving the foregoing consent, we do not thereby admit that we are
in the category of persons whose consent is required under
Section 7 of the Act or the rules and regulations of the
Commission promulgated thereunder.
Very truly yours,
/s/ Reid & Priest LLP
REID & PRIEST LLP
Exhibit 23(a)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8 No. 333- ) pertaining to the Cover-All
Technologies, Inc. 1995 Employee Stock Option Plan of our report
dated April 11, 1997, with respect to the consolidated financial
statements and schedule of Cover-All Technologies, Inc. included
in its Annual Report (Form 10-K) for the year ended December 31,
1996, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Hackensack, New Jersey
January 9, 1998
