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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: December 11, 1997
(Date of earliest event reported)
LAWYERS TITLE CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Virginia 0-13990 54-1589611
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
6630 West Broad Street
Richmond, Virginia 23230
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code:
(804) 281-6700
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Item 5. Other Events.
Acquisition of Commonwealth Land Title Insurance Company and
Transnation Title Insurance Company. As previously reported in a Current Report
on Form 8-K, filed with the Securities and Exchange Commission on September 2,
1997, Lawyers Title Corporation (the "Company"), Lawyers Title Insurance
Corporation, a Virginia corporation ("LTIC"), Reliance Insurance Company, a
Pennsylvania corporation ("RIC"), and Reliance Group Holdings, Inc., a Delaware
corporation ("Reliance"), entered into a Stock Purchase Agreement, dated as of
August 20, 1997 (the "Stock Purchase Agreement"), under which the Company will
acquire from RIC all of the issued and outstanding shares of the capital stock
of Commonwealth Land Title Insurance Company, a Pennsylvania corporation, and of
Transnation Title Insurance Company, an Arizona corporation (the "Acquisition").
On December 11, 1997, the parties to the Stock Purchase Agreement entered into
an Amended and Restated Stock Purchase Agreement (the "Amended and Restated
Stock Purchase Agreement").
The Amended and Restated Stock Purchase Agreement reduced the number of
shares of the Company's common stock, without par value ("Common Stock"), that
RIC would receive upon consummation of the Acquisition (the "Closing") and
increased the number of shares to be offered and sold by the Company in a public
or private offering on or before Closing in order to increase the number of
shares of Common Stock to be held by the public and to increase the amount of
cash to be paid to RIC at Closing. Specifically, the parties amended the Stock
Purchase Agreement to (i) decrease the number of shares of Common Stock
deliverable to RIC at the Closing from 4,473,684 to 4,039,473 (a reduction of
434,211 shares); (ii) increase the number of shares of Common Stock to be
offered and sold in a public or private offering from 1,315,789 to 1,750,000
shares of Common Stock (an increase of 434,211 shares); (iii) provide that the
public or private offering of 1,750,000 shares of Common Stock must be completed
on or before the Closing; (iv) eliminate the Company's option of Closing through
the delivery of an unsecured subordinated note rather than through the delivery
of the net proceeds of a public or private offering of shares of Common Stock
(an option that had been available to the Company under the Stock Purchase
Agreement); and (v) delete the provision relating to the deferred delivery of
575,000 shares of Common Stock to RIC in the event that the Company had
delivered the subordinated note at Closing. Certain other conforming and
technical changes also were made.
Amendment to Rights Plan. In connection with the Amended and Restated
Stock Purchase Agreement, the Company amended the Rights Agreement (as
hereinafter defined) on December 11, 1997.
Each outstanding share of Common Stock (a "Common Share") has
associated with it one preferred share purchase right (a "Right"). Each Right
entitles the registered holder to purchase from the Company one one-hundredth of
a share of the Company's Series A Junior Participating Preferred Stock, without
par value (the "Series A Preferred Shares"), at a price of $85 per one
one-hundredth of a Series A Preferred Share (the "Purchase Price"), subject to
adjustment. The terms of the Rights were originally set forth in a Rights
Agreement, dated October 1, 1991, between the Company and Sovran Bank, N.A., as
Rights Agent, as amended by the Amendment to Rights Agreement, dated June 22,
1992, between the Company, NationsBank, N.A. (formerly Sovran Bank, N.A.) and
Wachovia Bank of North Carolina, N.A., as successor Rights Agent. The terms of
the Rights are currently set forth in an Amended and Restated Rights Agreement,
dated August 20, 1997 (the "Amended and Restated Rights Agreement"), between the
Company and Wachovia Bank, N.A. (formerly Wachovia Bank of North Carolina, N.A.)
as Rights Agent ("Wachovia"), as amended by a First Amendment to Amended and
Restated Rights Agreement, dated December 11,
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1997, between the Company and Wachovia (the "First Amendment" and, together with
the Amended and Restated Rights Agreement, the "Rights Agreement").
The Rights will be evidenced by Common Share certificates until the
earlier to occur of (i) 10 days following a public announcement that a person or
group of affiliated or associated persons have acquired beneficial ownership of
20% or more of the outstanding Common Shares (an "Acquiring Person") or (ii) 10
business days (or such later date as may be determined by action of the Board of
Directors prior to such time as any person or group of affiliated or associated
persons becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by a person or
group of 20% or more of the outstanding Common Shares (the earlier of such dates
being called the "Distribution Date"). As defined in the Rights Agreement, an
Acquiring Person is not deemed to include RIC or any Affiliate of RIC by virtue
of (i) the approval, execution, delivery or performance of the Stock Purchase
Agreement or the Voting and Standstill Agreement (as defined in the Stock
Purchase Agreement), (ii) the approval, execution, delivery or performance of
the Amended and Restated Stock Purchase Agreement or the Voting and Standstill
Agreement (as defined in the Amended and Restated Stock Purchase Agreement), or
(iii) the acquisition of Common Shares or shares of the Company's 7% Series B
Cumulative Convertible Preferred Stock, without par value (the "Series B
Preferred Shares") by RIC or any Affiliate of RIC as provided in the Rights
Agreement.
The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be transferable
with and only with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Share certificates issued
after August 20, 1997 upon transfer or new issuance of Common Shares will
contain a legend incorporating by reference the terms of the Rights Agreement
(as such may be amended from time to time). Notwithstanding the absence of the
aforementioned legend or the existence of an earlier form of legend,
certificates evidencing Common Shares outstanding on or prior to August 20, 1997
shall also evidence one Right for each Common Share evidenced thereby. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares outstanding as of
August 20, 1997, even without such legend, will also constitute the transfer of
the Rights associated with the Common Shares represented by such certificate. As
soon as practicable following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders of record
of the Common Shares as of the close of business on the Distribution Date and
such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on August 20, 2007 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged by the Company, in each case, as described below.
The Purchase Price payable, and the number of Series A Preferred Shares
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Series A Preferred Shares, (ii) upon the grant to holders of the Series A
Preferred Shares of certain rights or warrants to subscribe for or purchase
Series A Preferred Shares at a price, or securities convertible into Series A
Preferred Shares with a conversion price, less than the then-current market
price of the Series A Preferred Shares or (iii) upon the distribution to holders
of the Series A Preferred Shares of evidences of indebtedness or assets
(excluding regular periodic cash dividends paid out of earnings or retained
earnings or dividends payable in Series A Preferred Shares) or of subscription
rights or warrants (other than those referred to above).
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The number of outstanding Rights and the number of one one-hundredths
of a Series A Preferred Share issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Common Shares or a
stock dividend on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Series A Preferred Shares purchasable upon exercise of the Rights will
not be redeemable. Each Series A Preferred Share will be entitled to a minimum
preferential quarterly dividend payment of $1 per share but will be entitled to
an aggregate dividend equal to 100 times the dividend declared per Common Share.
In the event of liquidation, the holders of the Series A Preferred Shares will
be entitled to a minimum preferential liquidation payment of $100 per share but
will be entitled to an aggregate payment equal to 100 times the payment made per
Common Share. Each Series A Preferred Share will have 100 votes, voting together
with the Common Shares. Finally, in the event of any merger, consolidation or
other transaction in which Common Shares are exchanged, each Series A Preferred
Share will be entitled to receive an amount equal to 100 times the amount
received per Common Share. These rights are protected by customary antidilution
provisions.
Because of the nature of the Series A Preferred Shares' dividend,
liquidation and voting rights, the value of the one one-hundredth interest in a
Series A Preferred Share purchasable upon exercise of each Right should
approximate the value of one Common Share.
In the event that the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold after a person or group has become an Acquiring Person, proper
provision shall be made so that each holder of a Right will thereafter have the
right to receive, upon the exercise thereof at the then current exercise price
of the Right, that number of shares of common stock of the acquiring company
that at the time of such transaction will have a market value of two times the
exercise price of the Right.
In the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, proper provision shall be made so that each
holder of a Right, other than Rights beneficially owned by the Acquiring Person
(which will thereafter be void), will thereafter have the right to receive, upon
the exercise thereof at the then current exercise price of the Right, that
number of Common Shares having a market value of two times the exercise price of
the Right.
At any time after any person or group of affiliated or associated
persons becomes an Acquiring Person and prior to the acquisition by such person
or group of 50% or more of the outstanding Common Shares, the Board of Directors
of the Company may exchange the Rights (other than Rights owned by such person
or group, that will have become void), in whole or in part, at an exchange ratio
of one Common Share, or one one-hundredth of a Series A Preferred Share, per
Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional Series A Preferred Shares will be issued
(other than fractions that are integral multiples of one one-hundredth of a
Series A Preferred Share, which may, at the election of the Company, be
evidenced by depository receipts), and in lieu thereof an adjustment in cash
will be made based on the market price of the Series A Preferred Shares on the
last trading day prior to the date of exercise.
At any time prior to the time that any person or group becomes an
Acquiring Person, the Board of Directors of the Company may redeem the Rights in
whole, but not in part, at a price of
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$.01 per Right (the "Redemption Price"). The redemption of the Rights may be
made effective at such time on such basis and with such conditions as the Board
of Directors in its sole discretion may establish. Immediately upon any
redemption of the Rights, the right to exercise the Rights will terminate, and
the only right of the holders of Rights will be to receive the Redemption Price.
The terms of the Rights may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights, except that (i) the
Rights Agreement prohibits certain amendments that would make RIC or any
Affiliate of RIC an Acquiring Person and (ii) from and after such time as any
person or group of affiliated or associated persons becomes an Acquiring Person,
the Rights Agreement provides that no such amendment may adversely affect the
interests of the holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The foregoing summary of certain terms of the Rights is qualified in
its entirety by reference to the Amended and Restated Rights Agreement, a copy
of which has been filed with the Commission, and the First Amendment, which is
attached hereto as an exhibit and is incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
No. Description
4.1 First Amendment to Amended and Restated Right Agreement,
dated as of December 11, 1997, between the Company and
Wachovia Bank, N.A., as Rights Agent.*
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*Filed Herewith
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
LAWYERS TITLE CORPORATION
Dated: December 23, 1997 By: /s/ G. William Evans
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G. William Evans
Vice President and Treasurer
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INDEX TO EXHIBITS
No. Description
4.1 First Amendment to Amended and Restated Right Agreement, dated as of
December 11, 1997, between the Company and Wachovia Bank, N.A., as
Rights Agent.*
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*Filed Herewith
Exhibit 4.1
FIRST AMENDMENT TO AMENDED AND RESTATED RIGHTS AGREEMENT
THIS FIRST AMENDMENT, dated as of December 11, 1997 (the "First
Amendment") to the Amended and Restated Rights Agreement, dated as of August 20,
1997 (the "Agreement"), is made between Lawyers Title Corporation, a Virginia
corporation (the "Company"), and Wachovia Bank, N.A. (the "Rights Agent").
The Company and the Rights Agent desire to amend the Agreement pursuant
to and in accordance with Section 27 thereof, as set forth herein. Accordingly,
the parties hereto agree as follows:
1. Section 1(a) of the Agreement is amended to read as follows:
(a) "Acquiring Person" shall mean any Person (as
such term is hereinafter defined) who or which, together with
all Affiliates and Associates (as such terms are hereinafter
defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 20% or more of the Common
Shares (as such term is hereinafter defined) of the Company
then outstanding, but shall not include the Company, any
Subsidiary (as such term is hereinafter defined) of the
Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any entity holding Common Shares
for or pursuant to the terms of any such plan. Notwithstanding
the foregoing, no Person shall become an "Acquiring Person" as
the result of an acquisition of Common Shares by the Company
which, by reducing the number of shares outstanding, increases
the proportionate number of shares beneficially owned by such
Person to 20% or more of the Common Shares of the Company then
outstanding; provided, however, that if a Person shall become
the Beneficial Owner of 20% or more of the Common Shares of
the Company then outstanding by reason of share purchases by
the Company and shall, after such share purchases by the
Company, become the Beneficial Owner of any additional Common
Shares of the Company, then such Person shall be deemed to be
an "Acquiring Person." Notwithstanding anything in this
Agreement to the contrary, RIC (as such term is hereinafter
defined) and any Affiliate of RIC shall not be, or be deemed
to be, an Acquiring Person by virtue of (i) the approval,
execution, delivery or performance of the Stock Purchase
Agreement (as such term is hereinafter defined) or the Voting
and Standstill Agreement (as such term is defined in the Stock
Purchase Agreement), (ii) the approval, execution, delivery or
performance of the Amended and Restated Stock Purchase
Agreement (as such term is hereinafter defined) or the Voting
and Standstill Agreement (as such term is defined in the
Amended and Restated Stock Purchase Agreement), or (iii) the
acquisition of the Transaction Shares (as such term is
hereinafter defined) by RIC or any Affiliate of RIC; provided,
however,
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that in the event RIC or any Affiliate of RIC becomes the
Beneficial Owner of any Common Shares of the Company or of any
Series B Preferred Shares (as such term is hereinafter
defined) other than the Transaction Shares, the provisions of
this sentence (other than this proviso) shall not be
applicable. Notwithstanding the foregoing, if the Board of
Directors of the Company determines in good faith that a
Person who would otherwise be an "Acquiring Person," as
defined pursuant to the foregoing provisions of this paragraph
(a), has become such inadvertently, and such Person (or its
Affiliate or Associate, as the case may be) divests as
promptly as practicable a sufficient number of Common Shares
so that such Person would no longer be an "Acquiring Person,"
as defined pursuant to the foregoing provisions of this
paragraph (a), then such Person shall not be deemed to be an
"Acquiring Person" for any purposes of this Agreement.
2. The following Section 1(b.1) is added to the Agreement between
Sections 1(b) and 1(c) of such Agreement:
(b.1) "Amended and Restated Stock Purchase
Agreement" shall mean the Amended and Restated Stock Purchase
Agreement by and among the Company, LTIC, RIC and Reliance
dated as of December 11, 1997.
3. Section 1(p) of the Agreement is amended by revising the
second sentence of such Section to read as follows:
Notwithstanding anything in this Agreement to the contrary,
neither (i) the approval, execution, delivery or performance
of the Stock Purchase Agreement or the Voting and Standstill
Agreement (as such term is defined in the Stock Purchase
Agreement), (ii) the approval, execution, delivery or
performance of the Amended and Restated Stock Purchase
Agreement or the Voting and Standstill Agreement (as such term
is defined in the Amended and Restated Stock Purchase
Agreement), nor (iii) the acquisition of the Transaction
Shares by RIC or any Affiliate of RIC, shall cause, or be
deemed to cause, a Shares Acquisition Date to occur; provided,
however, that in the event RIC or any Affiliate of RIC becomes
the Beneficial Owner of any Common Shares of the Company or of
any Series B Preferred Shares other than the Transaction
Shares, the provisions of this sentence (other than this
proviso) shall not be applicable.
4. Section 1(s) of the Agreement is amended to read as follows:
(s) "Transaction Shares" shall mean (i) the
Company's Common Shares and Series B Preferred Shares acquired
by RIC or any Affiliate of RIC pursuant to the Amended and
Restated Stock Purchase
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Agreement or pursuant to Section 4.2 of the Voting and
Standstill Agreement (as such term is defined in the Amended
and Restated Stock Purchase Agreement), (ii) the Company's
Common Shares acquired by RIC or any Affiliate of RIC upon
conversion of the Series B Preferred Shares in accordance with
the terms of the Series B Preferred Shares, and (iii) the
Company's Common Shares acquired by RIC or any Affiliate of
RIC as a result of corporate action taken by the Board of
Directors of the Company with respect to any pro rata
distribution of Common Shares in connection with any stock
split, stock dividend, recapitalization, reclassification or
similar transaction.
5. Section 3(a) of the Agreement is amended by revising the
provisos to the first sentence of such Section to read as follows:
provided, however, that notwithstanding anything in this
Agreement to the contrary, neither (i) the approval,
execution, delivery or performance of the Stock Purchase
Agreement or the Voting and Standstill Agreement (as such term
is defined in the Stock Purchase Agreement), (ii) the
approval, execution, delivery, or performance of the Amended
and Restated Stock Purchase Agreement or the Voting and
Standstill Agreement (as such term is defined in the Amended
and Restated Stock Purchase Agreement), nor (iii) the
acquisition of the Transaction Shares by RIC or any Affiliate
of RIC shall cause, or be deemed to cause, a Distribution Date
to occur; provided, however, that in the event of RIC or any
Affiliate of RIC becomes the Beneficial Owner of any Common
Shares of the Company or of any Series B Preferred Shares
other than the Transaction Shares, the provisions of the
foregoing proviso to this sentence (other than this second
proviso) shall not be applicable.
6. Section 11(a)(ii) of the Agreement is amended by revising the
last sentence of the first paragraph of such Section to read as follows:
Notwithstanding anything in this Agreement to the contrary,
the provisions of this Section 11(a)(ii) (other than the
proviso contained in this sentence) shall not apply to (i) the
approval, execution, delivery or performance of the Stock
Purchase Agreement or the Voting and Standstill Agreement (as
such term is defined in the Stock Purchase Agreement), (ii)
the approval, execution, delivery or performance of the
Amended and Restated Stock Purchase Agreement or the Voting
and Standstill Agreement (as such term is defined in the
Amended and Restated Stock Purchase Agreement), or (iii) the
acquisition of the Transaction Shares by RIC or any Affiliate
of RIC; provided, however, that in the event RIC or any
Affiliate of RIC becomes the Beneficial Owner of any Common
Shares of the Company or of any Series B Preferred Shares
other than the
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Transaction Shares, the provisions of this Section 11(a)(ii)
shall be applicable.
7. Section 13 of the Agreement is amended by revising the last
sentence of such Section to read as follows:
Notwithstanding anything in this Agreement to the contrary,
this Section 13 (other than the proviso contained in this
sentence) shall not apply to (i) the approval, execution,
delivery or performance of the Stock Purchase Agreement or the
Voting and Standstill Agreement (as such term is defined in
the Stock Purchase Agreement), (ii) the approval, execution,
delivery or performance of the Amended and Restated Stock
Purchase Agreement or the Voting and Standstill Agreement (as
such term is defined in the Amended and Restated Stock
Purchase Agreement), or (iii) the acquisition of the
Transaction Shares by RIC or any Affiliate of RIC; provided,
however, that in the event RIC or any Affiliate of RIC becomes
the Beneficial Owner of any Common Shares of the Company or of
any Series B Preferred Shares other than the Transaction
Shares, the provisions of this Section 13 shall be applicable.
8. Section 24(a) of the Agreement is amended by revising the last
sentence of such Section to read as follows:
Notwithstanding anything in this Agreement to the contrary,
the provisions of this Section 24(a) (other than the proviso
contained in this sentence) shall not apply to (i) the
approval, execution, delivery or performance of the Stock
Purchase Agreement or the Voting and Standstill Agreement (as
such term is defined in the Stock Purchase Agreement), (ii)
the approval, execution, delivery or performance of the
Amended and Restated Stock Purchase Agreement or the Voting
and Standstill Agreement (as such term is defined in the
Amended and Restated Stock Purchase Agreement, or (iii) the
acquisition of the Transaction Shares by RIC or any Affiliate
of RIC; provided, however, that in the event RIC or any
Affiliate of RIC becomes the Beneficial Owner of any Common
Shares of the Company or of any Series B Preferred Shares
other than the Transaction Shares, the provisions of this
Section 24(a) shall be applicable.
9. Section 34 of the Agreement is amended to read as follows:
Effective Time. This Agreement shall be deemed to be
in full force and effective immediately prior to the execution
and delivery of the Stock Purchase Agreement.
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10. This First Amendment to Amended and Restated Rights Agreement
shall be deemed to be in full force and effective immediately prior to the
execution and delivery of the Amended and Restated Stock Purchase Agreement.
Except as amended hereby, the Amended and Restated Rights Agreement shall remain
in full force and effect and shall be otherwise unaffected hereby.
11. Unless otherwise defined herein, all defined terms used herein
shall have the same meanings given to them in the Amended and Restated Rights
Agreement.
12. This First Amendment to Amended and Restated Rights Agreement
shall be deemed to be a contract made under the laws of the Commonwealth of
Virginia and for all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts to be made and performed
entirely within such State.
13. This First Amendment to Amended and Restated Rights Agreement
may be executed in any number of counterparts and each of such counterparts
shall for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument. The parties hereto
acknowledge and agree that original signatures delivered by facsimile
transmission shall be accepted as original to evidence execution of this First
Amendment to Amended and Restated Rights Agreement.
14. In all respects not inconsistent with the terms and provisions
of this First Amendment to Amended and Restated Rights Agreement, the Amended
and Restated Rights Agreement is hereby ratified, adopted, approved and
confirmed. In executing and delivering this First Amendment to Amended and
Restated Rights Agreement, the Rights Agent shall be entitled to all the
privileges and immunities afforded to the Rights Agent under the terms and
conditions of the Amended and Restated Rights Agreement.
[SIGNATURES ON NEXT PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to Amended and Restated Rights Agreement to be duly executed and attested, all
as of the day and year first above written.
Attest: LAWYERS TITLE CORPORATION
By: ________________________ By: ___________________________
Title: ________________________ Title: _________________________
Attest: WACHOVIA BANK, N.A.
By: ________________________ By: ___________________________
Title: ________________________ Title: _________________________
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