<PAGE> 1
As filed with the Securities and Exchange Commission on September 12, 1996
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
INTERCARGO CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 36-3414667
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
1450 EAST AMERICAN LANE, 20TH FLOOR, SCHAUMBURG, ILLINOIS 60173
(Address, including Zip Code, of Registrant's Principal Executive Offices)
1987 NON-QUALIFIED AND INCENTIVE STOCK OPTION PLAN
OF INTERCARGO CORPORATION
(Full Title of the Plan)
JAMES R. ZUHLKE
Intercargo Corporation
1450 East American Lane, 20th Floor
Schaumburg, Illinois 60173
(847) 517-2990
(Name, Address and Telephone Number of Agent For Service)
COPIES TO:
Janet O. Love, P.C.
Keck, Mahin & Cate
77 West Wacker Drive, 42nd Floor
Chicago, Illinois 60601-1693
____________________________________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Amount Proposed maximum Proposed maximum
Title of securities to be offering price aggregate Amount of
to be registered registered(1)(2) per share(3)(4) offering price(3)(4) registration fee
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Share,
$1.00 par value 400,000 $8.75 $3,500,000 $1,206.90
- -----------------------------------------------------------------------------------------------
</TABLE>
(1) Together with an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant to
the Plan as a result of any future stock split, stock dividend or similar
adjustment of the outstanding Common Shares of the Company.
(2) Estimated pursuant to Rule 457(h) solely for the purpose of calculating
the registration fee.
(3) The registration fee is calculated upon the basis of the average high and
low prices of the Common Stock as reported on the National Association of
Securities Dealers, Inc. Automatic Quotation National Market System on
September 11, 1996.
(4) A Form S-8 Registration Statement relating to offers of shares of common
stock of the Company pursuant to the Company's 1987 Non-Qualified and
Incentive Stock Option Plan was filed with the Securities and Exchange
Commission on December 29, 1992 (Registration No. 33-56426).
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
There are hereby incorporated by reference into this Registration
Statement the following documents and information heretofore filed with the
Securities and Exchange Commission (the "Commission"):
1. The description of the shares of the Company's Common Stock,
$1.00 par value per share, contained in the Company's Registration
Statement on Form 8-A (Registration No. 0-16748) filed with the
Commission on May 6, 1988 registering such shares pursuant to
Section 12 of the Securities Exchange Act of 1934 including any
amendment or report updating such description;
2. The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995;
3. The Company's quarterly reports on Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996; and
4. All documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of
this Registration Statement and 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 part hereof from the date of filing
of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Section 145 of the Delaware General Corporation Law, the Company has
broad powers to indemnify its directors and officers against liabilities that
they may incur in such capacities, including liabilities under the Securities
Act of 1933, as amended (the "Securities Act"). The Company's By-laws provide
that the Company shall indemnify any person who was or is a party to, or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding by reason of the fact that he is or was a director, officer,
employee or agent of the Company (or was serving at the request of the Company
as a director, officer, employee or agent for another entity) against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement, actually and reasonably incurred in connection with any such
action, suit or proceeding; provided that he acted in good faith and in a
manner he believed to be in the best interests of the Company, and with respect
to any criminal action or
II-1
<PAGE> 3
proceeding, had no reasonable cause to believe that his conduct was unlawful.
Furthermore, the Company's Certificate of Incorporation provides that, to the
fullest extent permitted by the General Corporation Law of the State of
Delaware, as such law now exists or is hereafter amended, directors of the
Company shall not be personally liable to the Company or its stockholders for
monetary damages for breach of fiduciary duty as a director. The Company's
Certificate of Incorporation provides that any repeal or modification of such
provision may be prospective only and may not adversely affect any limitation on
the personal liability of a director with respect to any act or omission
occurring prior to the time of such repeal or modification.
The Company has indemnification agreements with each of the Company's
directors whereby the Company has agreed to indemnify each director from
certain losses and expenses. Certain amounts are excluded from the Company's
indemnification obligation, including any illegal payments or fraudulent,
dishonest or wilful misconduct. In addition, the directors have agreed to
reimburse the Company for all losses and expenses paid by the Company in
connection with any action, suit or proceeding in which a court in a final
adjudication decides that the director is not entitled to indemnification.
The indemnification provisions discussed above and any indemnification
agreements entered into between the Company and its directors may be
sufficiently broad to permit indemnification of the Company's directors for
liabilities arising under the Securities Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See the Index to Exhibits immediately following the signature page.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
A. (1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement (i) to
include any prospectus required by Section 10(a)(3) of the Securities Act of
1933 (the "Securities Act"); (ii) to reflect in the prospectus any facts or
events arising after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in 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 (1)(i) and (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 by the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
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<PAGE> 4
(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. That, for purposes of determining any liability under the
Securities Act, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE> 5
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Schaumburg, State of Illinois, on
August 31, 1996.
INTERCARGO CORPORATION
By: /s/ James R. Zuhlke
----------------------------------
James R. Zuhlke
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James R. Zuhlke and Dean T. Bruner, or
either of them each with power to act without the other, as his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign
any or all subsequent pre- and post-effective amendments and supplements to
this Registration Statement, and to file the same, or cause to be filed the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto each said
attorney-in-fact and agent full power to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that any said attorney-in-fact and agent or his substitute
or 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.
NAME AND CAPACITY DATE
- ----------------- ----
/s/ James R. Zuhlke August 31, 1996
- --------------------------------
James R. Zuhlke, Chief Executive
Officer, President, Chairman of
the Board and Director
(Principal Executive Officer)
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<PAGE> 6
/s/ Dean T. Bruner August 31, 1996
- ------------------------------------
Dean T. Bruner, Principal Accounting
Officer
/s/ Kenneth A. Bodenstein August 8, 1996
- ------------------------------------
Kenneth A. Bodenstein, Director
/s/ Arthur J. Fritz August 31, 1996
- ------------------------------------
Arthur J. Fritz, Director
/s/ Albert J. Gallegos August 31, 1996
- ------------------------------------
Albert J. Gallegos, Director
/s/ Arthur L. Litman August 31, 1996
- ------------------------------------
Arthur L. Litman, Director
/s/ Robert B. Sanborn August 8, 1996
- ------------------------------------
Robert B. Sanborn, Director
/s/ Michael L. Sklar August 8, 1996
- ------------------------------------
Michael L. Sklar, Director
/s/ Michael L. Rybak August 31, 1996
- ------------------------------------
Michael L. Rybak,
Chief Financial Officer
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<PAGE> 7
INDEX TO EXHIBITS
Exhibit
No. Description
- ------- -----------
4.1 Certificate of Incorporation of the Company, including
amendments thereto (1)
4.2 Bylaws of the Company, including amendments thereto
(1)
4.3 Specimen Certificate of Common Stock (1)
4.4 1987 Non-Qualified and Incentive Stock Option Plan of
Intercargo Corporation (As Amended and Restated) (filed
herewith)
5.1 Opinion of Keck, Mahin & Cate (filed herewith)
23.1 Consent of KPMG Peat Marwick LLP (filed herewith)
23.2 Consent of Counsel (contained in Exhibit 5.1)
24.1 Power of Attorney (included on signature page)
_________________________
(1) Previously filed with the Company's Registration Statement on Form S-18,
Registration No. 33-21270C, and incorporated herein by reference.
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<PAGE> 1
EXHIBIT 4.4
1987 NON-QUALIFIED AND INCENTIVE STOCK OPTION PLAN
OF INTERCARGO CORPORATION
(AS AMENDED AND RESTATED)
1. Purpose of the Plan. This 1987 Non-Qualified and Incentive Stock
Option Plan of INTERCARGO CORPORATION, a Delaware corporation (the "Company")
adopted on the 28th day of July, 1987, is intended to encourage officers,
directors and key employees of the Company to acquire or increase their
ownership of common stock of the Company on reasonable terms. The opportunity
so provided is intended to foster in participants a strong incentive to put
forth maximum effort for the continued success and growth of the Company and
its Subsidiaries, to aid in retaining individuals who put forth such efforts
and to assist in attracting the best available individuals to the Company and
its Subsidiaries in the future.
2. Definitions. When used herein, the following terms shall have the
meaning set forth below:
2.1 "Affiliate" means, with respect to any specified person or entity, a
person or entity that directly or indirectly, through one or more
intermediaries, controls, or is controlled by, or is under common control with,
the person or entity specified.
2.2 "Award" means an Option.
2.3 "Award Agreement" means a written agreement in such form as may be,
from time to time, hereafter approved by the Committee, which shall be duly
executed by the Company and the Grantee and which shall set forth the terms and
conditions of an Award under the Plan.
2.4 "Board" means the Board of Directors of the Company.
2.5 "Change in Control" means the occurrence of one of the following: (i)
without prior approval of the Board, a single entity or group of affiliated
entities acquires more than 50% of the Company's outstanding Shares, (ii) the
Company is involved in a merger or a sale of all or substantially all of its
assets so that its stockholders before the merger or sale own less than 50% of
the voting power of the surviving or acquiring corporation, (iii) a liquidation
or dissolution of the Company occurs, or (iv) a change in the majority of the
Board of Directors occurs during any 24-month period without the approval of a
majority of directors in office at the beginning of such period.
2.6 "Code" means the Internal Revenue Code of 1986, as in effect at the
time of reference, or any successor revenue code which may hereafter be adopted
in lieu thereof, and reference to any specific provisions of the Code shall
refer to the corresponding provisions of the Code as it may hereafter be
amended or replaced.
2.7 "Committee" means the Stock Option Committee of the Board or any other
committee appointed by the Board whose members meet the requirements for
eligibility to serve, set forth in Section 4, which is invested by the Board
with responsibility for the administration of the Plan.
2.8 "Company" means Intercargo Corporation.
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<PAGE> 2
2.9 "Employees" means officers (including officers who are members of the
Board) and other key employees of the Company or any of its Subsidiaries.
2.10 "Fair Market Value" with respect to the Company's Shares means: (i)
for options granted on or before the effective day of any Registration
Statement the Company may file with the Securities and Exchange Commission an
amount based on an average of fair market value as of the date of grant set
forth in the opinion of such independent well-qualified experts as the
Committee may from time to time select; and (ii) for options granted
thereafter, the closing price of the Shares on the last business day prior to
the date of grant on which transactions in Shares occurred, as reported on such
source of quotation for, or reports of, trading activity in Shares as the
Committee may from time to time select.
2.11 "Grantee" means an individual who has been granted an Award.
2.12 "Incentive Stock Option" means an Option meeting the requirements and
containing the limitations and restrictions set forth in Section 422A of the
Code.
2.13 "Non-Qualified Stock Option" means an Option other than an Incentive
Stock Option.
2.14 "Option" means the right to purchase, at a price and for a term fixed
by the Committee in accordance with the Plan, and subject to such other
limitations and restrictions as the Plan and the Committee impose, the number
of Shares specified by the Committee.
2.15 "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of the
granting of the option, each of the corporations other than the Company owns
stock possessing fifty percent (50%) or more of the total combined voting power
of all classes of stock in one of the other corporations in such chain.
2.16 "Plan" means the Company's 1987 Non-Qualified and Incentive Stock
Option Plan.
2.17 "SEC" means the U.S. Securities and Exchange Commission.
2.18 "Shares" means shares of the Company's $1.00 par value common stock
or, if by reason of the adjustment provisions hereof any rights under an Award
under the Plan pertaining to any other security, such other security.
2.19 "Subsidiary" means any corporation other than the Company in an
unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain.
2.20 "Successor" means the legal representative of the estate of a
deceased Employee or the person or persons who shall acquire the right to
exercise an Award by bequest or inheritance or by reason of the death of the
Employee.
2.21 "Term" means the period during which a particular Award may be
exercised.
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<PAGE> 3
3. Stock Subject to the Plan. There will be reserved for use, upon the
exercise of Awards to be granted from time to time under the Plan, an aggregate
of 600,000 Shares, which Shares may be, in whole or in part, as the Board shall
from time to time determine, authorized but unissued Shares, or issued Shares
which shall have been reacquired by the Company. Any Shares subject to
issuance upon exercise of Options but which are not issued because of a
surrender, lapse, expiration or termination of any such Option prior to
issuance of the Shares shall once again be available for issuance in
satisfaction of Awards.
4. Administration of the Plan. The Board shall appoint the Committee,
which shall consist of not less than three (3) members of the Board who meet
the definition of a "disinterested person" pursuant to Rule 16b-3 of the SEC
(or any successor rule) as in effect from time to time and "outside director"
pursuant to Section 162(m) of the Code and the Treasury Department regulations
issued thereunder from time to time. Subject to the provisions of the Plan,
the Committee shall have the full authority, in its discretion, with respect to
Employee Grantees, to determine the Employees to whom Awards shall be granted,
the number of Shares to be covered by each of the Awards, and the terms of any
such Award; to amend or cancel Awards (subject to Section 18 of the Plan); to
accelerate the vesting of Awards; to require the cancellation or surrender of
any previously granted options under this Plan or any other plans of the
Company as a condition to the granting of an Award; to interpret the Plan; and
to prescribe, amend, and rescind rules and regulations relating to it, and
generally to interpret and determine any and all matters whatsoever relating to
the administration of the Plan and the granting of Awards hereunder. The Board
may, from time to time, appoint members to the Committee in substitution for or
in addition to members previously appointed and may fill vacancies, however
caused, in the Committee. The Committee shall select one of its members as its
Chairman and shall hold its meetings at such times and places as it shall deem
advisable. A majority of its members shall constitute a quorum. Any action of
the Committee may be taken by a written instrument signed by all of the
members, and any action so taken shall be fully as effective as if it had been
taken by a vote of a majority of the members at a meeting duly called and held.
The Committee shall make such rules and regulations for the conduct of its
business as it shall deem advisable and shall appoint a Secretary who shall
keep minutes of its meetings and records of all action taken in writing without
a meeting. No member of the Committee shall be liable, in the absence of bad
faith, for any act or omission with respect to his service on the Committee.
Notwithstanding the foregoing, the selection of the non-employee directors to
whom Awards are to be granted, the timing of such grants, the number of shares
subject to any such Award, the exercise price of any such Award, the periods
during which any such Award may be exercised, and the term of any such Award
shall be as set forth in Section 5.2 herein, and the Committee shall have no
discretion as to such matters. This Plan is intended to allow non-employee
directors to receive Awards without such Awards causing them to cease to be
"disinterested persons" (within the meaning of Rule 16b-3 under the Securities
Exchange Act of 1934, as amended) with respect to this Plan or any other stock
plans of the Company. To the extent that any provision of the Plan or action
by the Committee with respect thereto would be inconsistent with such intent,
such provision or action shall be null and void.
5. Grant of Awards
5.1 Persons to Whom Discretionary Awards May Be Granted. Awards may be
granted in each calendar year or portion thereof while the Plan is in effect to
such of the Employees as the Committee, in its discretion, shall determine, and
shall be granted to non-employee directors pursuant to Section 5.2.
3
<PAGE> 4
In determining the Employees to whom Awards shall be granted and the
number of Shares to be subject to purchase under such Awards, the Committee
shall take into account the duties of the respective Employees, their present
and potential contributions to the success of the Company, and such other
factors as the Committee shall deem relevant in connection with accomplishing
the purposes of the Plan.
Except as provided in Section 5.2, no Award shall be granted to any member
of the Committee so long as his membership on the Committee continues or to any
member of the Board who is not also an officer or key Employee of the Company
or any Subsidiary.
5.2 Nondiscretionary Awards. Nondiscretionary Awards of Non-Qualified
Stock Options shall be granted to each non-employee director of the Company on
the following terms and conditions.
(a) Subject to approval by the stockholders of the
Company of the provisions of this Section 5.2, commencing with
the first regularly scheduled Board meeting following the
Annual Meeting of Stockholders of the Company to be held in
1995, and thereafter annually at the first regularly scheduled
Board meeting following the Annual Meeting of Stockholders,
there shall be granted automatically, and without any action
or exercise of discretion by the Committee, to each
non-employee director of the Company, an Award of Options to
purchase 1,000 Shares;
(b) Each nondiscretionary Award granted pursuant to
the provisions of this Section 5.2 shall be exercisable as to
25 percent commencing on the third anniversary of the grant
date of such Award and as to an additional 25 percent on the
fourth, fifth and sixth anniversary dates of the grant date of
such Award;
(c) The exercise price of the Awards made pursuant to
this Section 5.2 shall be the Fair Market Value of the Shares
on the date the Award is granted;
(d) The nondiscretionary Awards granted pursuant to
this Section 5.2 shall expire ten (10) years from the Grant
Date, subject to the terms and conditions of the Plan;
(e) The provisions of this Section 5.2 shall not be
amended more than once every six months, other than to comport
with changes in the Code, the Employee Retirement Income
Security Act, or the rules thereunder;
6. Stock Options.
6.1 Types of Options. Unless otherwise specified herein, options granted
under this Plan may be (i) Incentive Stock Options, (ii) Non-Qualified Stock
Options, or (iii) a combination of the foregoing. The Award Agreement shall
designate whether an Option is an Incentive Stock Option or a Non-Qualified
Stock Option.
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<PAGE> 5
6.2 Option Price. The option price per Share of any Option granted under
the Plan shall not be less than the Fair Market Value of the Shares covered by
the Option on the date the Option is granted.
Notwithstanding anything herein to the contrary, in the event an Incentive
Stock Option is granted to an Employee who, at the time such Incentive Stock
Option is granted, beneficially owns, as defined in Section 425 of the Code,
stock possessing more than ten percent (10%) of the total combined voting power
of all classes of stock of:
(i) the Company; or
(ii) if applicable, a Subsidiary; or
(iii) if applicable, a Parent,
then the option price per Share of any Incentive Stock Option granted to such
Employee shall not be less than one hundred ten percent (110%) of the Fair
Market Value of the Shares covered by the Option on the date the Option is
granted.
6.3 Term of Options. Options granted hereunder shall be exercisable for a
Term of not more than ten (10) years from the date of grant thereof, but shall
be subject to earlier termination as hereinafter provided. Each Award
Agreement issued hereunder shall specify the Term of the Option, which Term
shall be determined by the Committee in accordance with its discretionary
authority hereunder.
Notwithstanding anything herein to the contrary, in the event an Incentive
Stock Option is granted to an Employee who, at the time such Incentive Stock
Option is granted, beneficially owns, as defined in Section 425 of the Code,
stock possessing more than ten percent (10%) of the total combined voting power
of all classes of stock of:
(i) the Company;
(ii) if applicable, a Subsidiary; or
(iii) if applicable, a Parent,
then such Incentive Stock Option shall not be exercisable more than five (5)
years from the date of grant thereof, but shall be subject to earlier
termination as hereinafter provided.
7. Award Limits.
7.1 Limit on Fair Market Value of Incentive Stock Options. No Employee
may be granted an Incentive Stock Option hereunder to the extent that the
aggregate Fair Market Value (such Fair Market Value being determined as of the
date of grant of the option) of the stock with respect to which Incentive Stock
Options are exercisable for the first time by such Employee during any calendar
year (under all such plans of such Employee's employer corporation and its
Parent and Subsidiary corporations) exceeds the sum of One Hundred Thousand
Dollars ($100,000).
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<PAGE> 6
7.2 Overall Limit. Options to purchase no more than 75,000 Shares, in the
aggregate, may be granted to any Grantee in any twelve-month period.
8. Date of Grant. The date of grant of an Award shall be the date on
which the Committee acts in granting the Award or as specified in Section 5.2
hereof.
9. Exercise of Rights Under Awards. A Grantee entitled to exercise an
Award may do so by delivery of a written notice to that effect specifying the
number of Shares with respect to which the Award is being exercised and any
other information the Committee may prescribe. The notice shall be accompanied
by payment in full of the purchase price of any shares to be purchased, which
payment may be made in cash or, with the Committee's approval, in Shares valued
at Fair Market Value at the time of exercise or a combination thereof. No
Shares shall be issued upon exercise of an Option until full payment has been
made therefor. All notices or requests provided for herein shall be delivered
to the Company's president.
10. Award Terms and Conditions. Each Award and each Award Agreement
relating thereto shall contain such other terms and conditions not inconsistent
herewith as shall be approved by the Board or the Committee.
11. Rights of Award Holder. The holder of an Award shall not have any of
the rights of a stockholder with respect to the Shares subject to purchase
under an Award, except upon the due exercise of the Award.
12. Nontransferability of Awards. An Award shall not be transferable,
other than by will or the laws of descent and distribution, and an Award may be
exercised, during the lifetime of the holder of the Award, only by him.
13. Adjustments Upon Changes in Capitalization. In the event of changes
in all of the outstanding Shares by reason of stock dividends, stock splits,
recapitalizations, mergers, consolidations, combinations, exchanges of Shares,
separations, reorganizations or liquidations, the number and class of Shares
available under the Plan in the aggregate, the number and classes of Shares
subject to Awards theretofore granted, applicable purchase prices and all other
applicable provisions, shall, subject to the provisions of the Plan, be
equitably adjusted by the Committee. For employee Grantees, but not for
non-employee directors, such adjustment may, but need not, include payment in
cash or in Shares in an amount equal to the difference between the price at
which such Award may be exercised and the then current Fair Market Value of the
Shares subject to such Award as equitably determined by the Committee. The
manner of application of the foregoing provisions shall be determined by the
Committee in its sole discretion. Any such adjustment may provide for the
elimination of any fractional Share which might otherwise become subject to an
Award.
14. Effect of Change in Control. Notwithstanding anything contained
herein to the contrary, upon the occurrence of a Change in Control of the
Company, all Awards granted under the Plan shall be immediately fully
exercisable for a period of six months following such Change in Control, after
which time no further Awards may be exercised pursuant to the Plan; provided,
however, that with respect to any director, executive officer or beneficial
owner of more than 10% of the outstanding voting securities of the Company, no
shares issued upon exercise of any Award granted pursuant to the Plan may be
sold prior to six months from the date of grant of such Award.
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<PAGE> 7
15. Form of Options. Nothing contained in the Plan nor any resolution
adopted by the Board or the stockholders of the Company shall constitute the
granting of any Award. An Award shall be granted hereunder only (i) by action
duly taken by the Committee in granting an Award or (ii) pursuant to Section
5.2. Whenever the Committee shall designate an Employee for the receipt of an
Award, the Secretary or the President of the Company, or such other person as
the Committee shall appoint, shall forthwith send notice thereof to the
Employee, in such form as the Committee shall approve, stating the number of
Shares subject to Award, its Term, and the other terms and conditions thereof.
The notice shall be accompanied by a written Award Agreement in such form as
may from time to time hereafter be approved by the Committee, which shall have
been duly executed by or on behalf of the Company. If the surrender of
previously issued Awards is made a condition of the grant, the notice shall set
forth the pertinent details of such condition and the written Award Agreement
executed by or on behalf of the Company shall be delivered to the Employee on
the date such surrender is made, but it shall be dated as of the date on which
the Committee designated the Employee to receive an Award hereunder. Execution
by the Employee to whom such Award is granted of said Award Agreement in
accordance with the provisions set forth in this Plan shall be a condition
precedent to the exercise of any Award.
16. Taxes. The Company shall have the right to require a person entitled
to receive Shares pursuant to the exercise of an Award under the Plan to pay
the Company the amount of any taxes which the Company is or will be required to
withhold with respect to such Shares before the certificate for such Shares is
delivered pursuant to the Award. Furthermore, the Company may elect to deduct
such taxes from any other amounts payable then or at any time thereafter, to
the Employee. If the Employee disposes of Shares acquired pursuant to an
Incentive Stock Option in any transaction considered to be a disqualifying
transaction under Sections 421 and 422A of the Code, the Company shall have the
right to deduct any taxes required by law to be withheld from any amounts
otherwise payable to the Employee.
17. Termination of Plan. The Plan shall terminate ten (10) years from the
date hereof, and an Award shall not be granted under the Plan after that date
although the terms of any Awards may be amended at any date prior to the end of
its Term in accordance with the Plan. Any Awards outstanding at the time of
termination of the Plan shall continue in full force and effect according to
the terms and conditions of the Award and this Plan.
18. Amendment of the Plan. The Plan may be amended at any time and from
time to time by the Board, but no amendment without the approval of the
stockholders of the Company shall:
(a) increase the number of Shares as to which Options may be granted under
the Plan;
(b) expand or change the class of persons eligible to receive Awards;
(c) permit the purchase price of Shares subject to an Option
granted under the Plan to be less than the Fair Market Value of
such Shares at the time the Option is granted;
(d) extend the term of the Plan; or
(e) materially increase the benefits to the Grantees under the Plan.
7
<PAGE> 8
Notwithstanding anything to the contrary contained herein, no amendment or
cancellation of the Plan or any Award granted under the Plan shall alter or
impair any of the rights or obligations of any person, without his consent,
under any Award theretofore granted under the Plan.
19. Delivery of Shares on Exercise. Delivery of certificates for Shares
pursuant to an Award exercise may be postponed by the Company for such period
as may be required for it, with reasonable diligence, to comply with any
applicable requirements of any federal, state or local law or regulation or any
administrative or quasi-administrative requirement applicable to the sale,
issuance, distribution or delivery of such Shares.
20. Fees and Costs. The Company shall pay all original issue taxes on the
exercise of any Award granted under the Plan and all other fees and expenses
necessarily incurred by the Company in connection therewith.
21. Effectiveness of the Plan. The Plan shall become effective when
approved by the Board. The Plan shall thereafter be submitted to the Company's
shareholders for approval and unless the Plan is approved by the affirmative
votes of the holders of Shares having a majority of the voting power of all
Shares represented at a meeting duly held in accordance with Delaware law
within twelve (12) months after being approved by the Board, the Plan and all
Awards made under it shall be void and of no force and effect.
22. Other Provisions. As used in the Plan, and in Awards and other
documents prepared in implementation of the Plan, references to the masculine
pronoun shall be deemed to refer to the feminine or neuter, and references in
the singular or the plural shall refer to the plural or the singular, as the
identity of the person or persons or entity or entities being referred to may
require. The captions used in the Plan, in the Awards and other documents
prepared in implementation of the Plan are for convenience only and shall not
affect the meaning of any provision hereof or thereof.
INTERCARGO CORPORATION
By:___________________________
8
<PAGE> 9
NOTICE OF AMENDMENT TO 1987 NON-QUALIFIED AND INCENTIVE STOCK
OPTION PLAN OF INTERCARGO CORPORATION
Pursuant to the 2 for 1 stock split, the total number of
shares eligible for issuance pursuant to option was
increased from 100,000 to 200,000 by Board action dated
November 14, 1991.
9
<PAGE> 1
[KECK, MAHIN & CATE LETTERHEAD]
08578-038
(312) 634-7700
Exhibit 5.1
September 12, 1996
Intercargo Corporation
1450 East American Lane
Schaumburg, Illinois 60173
Ladies and Gentlemen:
We are acting as special counsel in connection with the registration under
the Securities Act of 1933, as amended ("Act"), of 400,000 shares of common
stock, $1.00 par value per share (the "Shares") of Intercargo Corporation, a
Delaware corporation ("Company"). A registration statement on Form S-8
("Registration Statement") is being filed under the Act with respect to the
offering of the Shares.
In connection with the offering of the Shares, we have examined:
(i) the 1987 Non-Qualified and Incentive Stock Option Plan of
Intercargo Corporation (As Amended and Restated) (the "Plan") which
is incorporated by reference as Exhibit 4.4 to the Registration
Statement;
(ii) the Registration Statement including the remainder of the
exhibits thereto; and
(iii) such other documents as we deem necessary to form the
opinions hereinafter expressed.
As to various questions of fact material to such opinions, where relevant facts
were not independently established, we have relied upon statements of officers
of the Company.
Our opinion assumes that:
(a) The pertinent provisions of such blue sky and securities laws
as may be applicable have been complied with; and
(b) the Shares are issued in accordance with the terms of the
Plan.
<PAGE> 2
Intercargo Corporation
September 12, 1996
Page 2
Based and relying solely upon the foregoing, we advise you that, in our
opinion, the Shares, or any portion thereof, to the extent such Shares
represent original issuances by the Company, when issued pursuant to the Plan
after the Registration Statement has become effective under the Act, will be
validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement. In giving this consent, we do not thereby admit that
we come within the category of persons whose consent is required under Section
7 of the Act or the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.
Very truly yours,
KECK, MAHIN & CATE
/S/ Keck, Mahin & Cate
-----------------------------
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Intercargo Corporation:
We consent to incorporation by reference in the registration statement on Form
S-8 of Intercargo Corporation of our reports dated March 28, 1996 relating to
the consolidated balance sheets of Intercargo Corporation and its subsidiaries
as of December 31, 1995 and 1994 and the related consolidated statements of
income, stockholders' equity, and cash flows and related schedules for each of
the years in the three-year period ended December 31, 1995, which reports
appear or are incorporated by reference in the December 31, 1995 Annual Report
on Form 10-K of Intercargo Corporation.
As discussed in note 1 to the consolidated financial statements, the Company
changed its method of accounting for investments to adopt the provisions of the
Financial Accounting Standards Board's Statement of Financial Accounting
Standards No. 115, "Accounting for Certain Investments in Debt and Equity
Securities," at January 1, 1994.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Chicago, Illinois
September 12, 1996
