As filed with the Securities and Exchange Commission on September 30, 2003
Registration No.___________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
Investors Title Company
(Exact name of registrant as specified in its charter)
North Carolina 6361 56-1110199
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or Classification Code No.) Identification No.)
organization)
121 North Columbia Street,
Chapel Hill, North Carolina 27514
(Address, including zip code, of
registrant's principal executive offices)
INVESTORS TITLE COMPANY 2001 STOCK OPTION AND RESTRICTED STOCK PLAN
(Full title of the plan)
-------------------------
J. Allen Fine, Chief Executive Officer
Investors Title Company
121 North Columbia Street (27514)
P. O. Drawer 2687
Chapel Hill, North Carolina 27515-2687
(919) 968-2200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------------
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Title of Securities to Amount to be Offering Price per Aggregate Offering Amount of
be Registered Registered Share(1) Price(1) Registration Fee
Common Stock, no par
value (2) 248,700 $30.27 $7,528,149.00 $609.03
------------------------ ---------------------- ---------------------- ---------------------- ----------------------
Common Stock, no par 1,200 $30.27 $ 36,324.00 $ 2.94
value (3)
------------------------ ---------------------- ---------------------- ---------------------- ----------------------
(1) In accordance with Rule 457(h), the registration fee is based upon the
average of the high and low prices of the common stock of Investors Title
Company on the NASDAQ National Market on September 25, 2003.
(2) Based on the total number of shares of common stock of Investors Title
Company issuable pursuant to the terms of the above-named plan.
(3) These shares were issued to certain employees upon the exercise of stock
options granted to them under the above-named plan before the filing of this
Registration Statement.
EXPLANATORY NOTE
This Registration Statement on Form S-8 relates to shares of common
stock, no par value, of Investors Title Company issuable pursuant to the terms
of the Investors Title Company 2001 Stock Option and Restricted Stock Plan (the
"Plan"). The documents constituting the prospectus under Part I of this
Registration Statement will be sent or given to the participants in the Plan as
specified by Rule 428(b) under the Securities Act of 1933, as amended. That
prospectus has been omitted from this Registration Statement as permitted by
Part I of Form S-8. The reoffer prospectus filed as part of this Registration
Statement as required by Form S-8 has been prepared in accordance with the
requirements of Part I of Form S-3 and may be used for reofferings or resales of
shares of the Registrant's common stock previously acquired by the participants
in the Plan.
REOFFER PROSPECTUS
INVESTORS TITLE COMPANY
1,200 Shares of Common Stock
This reoffer prospectus relates to up to one thousand two hundred
(1,200) shares of the common stock of Investors Title Company, a North Carolina
corporation, which may be offered from time to time by the selling shareholders
who are employees of Investors Title. The selling shareholders acquired the
shares upon the exercise of stock options granted to them under Investors
Title's 2001 Stock Option and Restricted Stock Plan.
Our common stock is traded on the NASDAQ Stock Market under the symbol
"ITIC." On September 29, 2003, the average of the high and low prices of our
stock on NASDAQ was $29.96 per share.
The selling shareholders may sell their shares from time to time at
prevailing prices on the NASDAQ Stock Market on the date of sale or in
negotiated transactions. We will not receive any proceeds from the sale of
shares by the selling shareholders. We paid the costs of preparing this reoffer
prospectus and registering the shares. The selling shareholders will bear all
brokerage commissions, discounts and other selling expenses they incur.
Please read the "Risk Factors" beginning on page 3 of this reoffer
prospectus.
You should rely only on the information provided or incorporated by
reference in this reoffer prospectus. Investors Title has not authorized anyone
else to provide you with different information. The shares of common stock are
not being offered in any state where the offer is not permitted. You should not
assume that the information in this reoffer prospectus is accurate as of any
date other than the date set forth below.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this reoffer prospectus. Any representation to the
contrary is a criminal offense.
The date of this reoffer prospectus is September 30, 2003.
Table of Contents
ABOUT THE COMPANY.............................................................3
RISK FACTORS..................................................................3
Competition in the title insurance and exchange service industries
could cause us to lose market share and have a materially adverse
effect on our revenues and profits.........................................3
Changes in the extensive regulations under which we operate could
increase our costs of operations and reduce our profitability..............3
A ratings downgrade would materially affect our ability to expand,
compete and operate........................................................4
Our profitability is significantly affected by the performance of
our investment portfolio...................................................4
There is a limited market for our common stock, which makes it
difficult for investors to sell shares of our common stock on
the open market............................................................4
SELLING SHAREHOLDERS..........................................................5
USE OF PROCEEDS...............................................................5
PLAN OF DISTRIBUTION..........................................................5
LEGAL MATTERS.................................................................5
EXPERTS.......................................................................5
INDEMNIFICATION OF DIRECTORS AND OFFICERS.....................................6
WHERE YOU CAN FIND MORE INFORMATION...........................................6
FORWARD-LOOKING STATEMENTS....................................................7
ABOUT THE COMPANY
Investors Title Company is a North Carolina corporation and insurance
holding company engaged primarily in the business of issuing and underwriting
title insurance. Through two subsidiaries, Investors Title Insurance Company and
Northeast Investors Title Insurance Company, it underwrites land title insurance
for owners and mortgagees as a primary insurer and as a reinsurer for other
title insurance companies. Title insurance protects against loss or damage
resulting from defects that affect the title to real property.
Investors Title also provides services through subsidiaries in
connection with tax-free exchanges of like-kind property. Investors Title
Exchange Corporation acts as a qualified intermediary in tax-free exchanges of
property held for productive use in a trade or business or for investments.
Investors Title Accommodation Corporation serves as exchange accommodation
titleholder, offering a vehicle for accomplishing a reverse exchange when a
taxpayer must acquire replacement property before selling the relinquished
property.
Investors Title's principal offices are located at 121 North Columbia
Street, Chapel Hill, North Carolina 27514 (Telephone: (919) 968-2200).
RISK FACTORS
You should be aware of particular risks and uncertainties that are
applicable to an investment in Investors Title common stock.
Competition in the title insurance and exchange service industries could cause
us to lose market share and have a materially adverse effect on our revenues and
profits.
The title insurance industry is highly competitive. Key elements that
affect competition are price, expertise, timeliness, quality of service and the
financial strength and size of the insurer. There are numerous industry-related
regulations and statutes that set out conditions and requirements to conduct
title insurance business. Changes to or the removal of such regulations and
statutes could result in additional competition from alternative title insurance
products or new entrants into the industry, which could materially affect our
business operations and financial condition.
The exchange services industry is also highly competitive. In addition
to facing competition from other title insurance companies, Investors Title
faces competition from some major banks that offer exchange services.
Competitiveness in the exchange services business is affected by various
factors, including price, expertise, timeliness, quality of service and the
financial strength and size of the company.
There can be no assurance that Investors Title will be able to compete
successfully against current and future competitors or that competitive
pressures faced by Investors Title will not materially and adversely affect our
business, operating results and financial condition.
Changes in the extensive regulations under which we operate could increase our
costs of operations and reduce our profitability.
Investors Title is subject to extensive state regulatory oversight in
the jurisdictions in which its insurance subsidiaries do business. This
regulatory oversight could adversely affect our ability to sustain adequate
returns. Investors Title's business also could be adversely affected by changes
in state law relating to licensing, rates, policy forms, financial reporting,
dividend restrictions, and reserve valuation requirements, limitations on
investments, audits and examinations and, at the federal level, by laws and
regulations that may affect various other aspects of the insurance industry.
3
The exchange services business is dependent upon current Internal
Revenue Service regulations that provide taxpayers a safe harbor by using a
qualified intermediary to structure tax free exchanges of property and using an
exchange accommodation title holder to hold property in reverse exchange
transactions. Changes to current IRS regulations could materially adversely
affect Investors Title's operations.
A ratings downgrade would materially affect our ability to expand, compete and
operate.
Ratings are an important factor in the competitive position of title
insurance companies. Ratings organizations regularly review the financial
performance and condition of insurers, including Investors Title's subsidiaries.
A downgrade in their ratings could have an adverse effect on our business,
financial condition and operating results. In addition, a downgrade in their
ratings could adversely affect:
o our ability to sell certain products;
o the return on the insurance products we issue; and
o ultimately, the results of our operations.
Ratings organizations assign ratings based upon several factors. While most of
the factors relate to the rated company, some of the factors relate to general
economic conditions and circumstances outside the rated company's control.
Our profitability is significantly affected by the performance of our investment
portfolio.
Investors Title's investment portfolio consists primarily of debt
securities, and to a lesser extent, equity securities. The main risks inherent
in the portfolio are interest rate risk and equity price risk.
Interest rate risk is the risk of loss due to changes in interest
rates. This risk arises from our investments in interest-sensitive debt
securities, primarily fixed-rate municipal and corporate bonds. Interest rate
risk is managed by monitoring liquidity needs and by targeting a specific range
for the portfolio's duration or weighted average activity.
Equity price risk is the risk that Investors Title will incur economic
losses due to adverse changes in a particular stock or stock index. At December
31, 2002, we had approximately $7.9 million in common and nonredeemable
preferred stocks. Equity price risk is addressed in part by varying the specific
allocation of equity investments over time pursuant to management's assessment
of market and business conditions and ongoing liquidity needs analysis. Our
largest equity exposure is declines in the S&P 500; our portfolio of equity
instruments is similar to those that comprise this index. Although we take steps
to mitigate the potential effects of such risk, it is impossible to eliminate
all risk.
There is a limited market for our common stock, which makes it difficult for
investors to sell shares of our common stock on the open market.
Although Investors Title common stock is traded on the NASDAQ National
Market, the volume of trading has traditionally been low. Therefore, there can
be no assurance that a purchaser of Investors Title shares who wishes to sell
those shares would be able to do so immediately or at an acceptable price.
Finally, there are risks and uncertainties relating to an investment in
Investors Title common stock or to economic and regulatory matters generally
that should affect other title insurance companies in similar ways. These
aspects are discussed under "Forward-Looking Statements."
4
SELLING SHAREHOLDERS
The shares to which this reoffer prospectus relates are "restricted
securities" under the Securities Act of 1933 and are being registered for
reoffers or resales by the selling shareholders. The selling shareholders are
employees and former employees of Investors Title who received the shares upon
the exercise of stock options granted to them under Investor Title's 2001 Stock
Option and Restricted Stock Plan. Each of the selling shareholders holds fewer
than 1,000 shares acquired upon the exercise of such stock options and offered
for sale. None is an affiliate of Investors Title.
USE OF PROCEEDS
Investors Title will not receive any proceeds from the sale of our
common stock by the selling shareholders.
PLAN OF DISTRIBUTION
The shares of our common stock are being registered for reoffers and
resales by the selling shareholders for their own accounts. The shares may be
resold from time to time by any of the selling shareholders in one or more
transactions on the Nasdaq National Market, in separately negotiated
transactions or in a combination of such transactions, at market prices
prevailing at the time of such sale, at prices related to such prevailing prices
or at prices otherwise negotiated. The selling shareholders may effect such
transactions by selling the shares to or through broker-dealers and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the selling shareholders or the purchasers of
the shares for whom such broker-dealers may act as agent (which compensation may
be less than or in excess of customary commissions).
The selling shareholders also may sell all or a portion of their shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of that rule.
All selling and other expenses incurred by the selling shareholders will be
borne by the selling shareholders. Investors Title is responsible for all costs,
expenses and fees incurred in registering the shares offered hereby.
There can be no assurances that any of the selling shareholders will
sell any or all of the shares of our common stock offered.
LEGAL MATTERS
Certain legal matters in connection with the sale of the shares of our
common stock offered hereby will be passed upon for Investors Title by Schell
Bray Aycock Abel & Livingston P.L.L.C., 230 North Elm Street, Suite 1500,
Greensboro, North Carolina 27401.
EXPERTS
The consolidated financial statements and the related financial
statement schedules as of December 31, 2002 and 2001 and for each of the three
years in the period ended December 31, 2002, included and incorporated by
reference in this reoffer prospectus have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their reports, which are included and
incorporated by reference herein, and have been so included and incorporated in
reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.
5
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The bylaws of Investors Title provide for indemnification of its
directors and officers to the fullest extent permitted by law. The North
Carolina Business Corporation Act permits a corporation, with certain
exceptions, to indemnify a current or former officer or director against
liability and expenses if such person acted in good faith and in a manner he or
she reasonably believed was:
o in the case of conduct in his or her official capacity with the
corporation, in the best interests of the corporation; and
o in all other cases, in a manner that was at least not opposed
to the corporation's best interests.
In addition, in the case of any criminal action or proceeding, the officer or
director must have had no reasonable cause to believe his or her conduct was
unlawful. A corporation is required under the North Carolina Business
Corporation Act to indemnify an officer or director in the defense of any
proceeding in which he or she was a party against reasonable expenses to the
extent that he or she is wholly successful on the merits or otherwise. This
indemnification generally may be made by the corporation only upon a
determination that indemnification of the director or officer is permissible
under the circumstances because he or she met the applicable standard of conduct
set forth above.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling Investors
Title pursuant to Investors Title's articles, bylaws or the North Carolina
Business Corporation Act, Investors Title has been informed that, in the opinion
of the Securities and Exchange Commission, such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable.
WHERE YOU CAN FIND MORE INFORMATION
Investors Title is required by the Securities Exchange Act of 1934 to
file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
any reports, statements or other information we file with the Commission at the
Commission's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. You may obtain information about the operations of the Public Reference
Room by calling the Commission at 1-800-SEC-0330. The Commission maintains a
website (http://www.sec.gov) that contains reports, proxy statements and other
information regarding Investors Title and other issuers. Additional information
about Investors Title is also available at its website, http://www.invtitle.com.
The following documents and information previously filed with the
Securities and Exchange Commission by Investors Title are incorporated by
reference in this reoffer prospectus:
(1) Investors Title's Annual Report on Form 10-K for the fiscal year ended
December 31, 2002;
(2) Investors Title's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2003;
(3) Investors Title's Quarterly Report on Form 10-Q for the quarter ended
June 30, 2003;
(4) Investors Title's Current Report on Form 8-K dated April 24, 2003;
(5) Investors Title's Current Report on Form 8-K dated July 24, 2003; and
(6) the description of Investors Title's common stock set forth under the
heading "Description of Registrant's Securities to be Registered" in
its Form 10/A filed on August 18, 1997, and all amendments or reports
filed for the purpose of updating such description.
All documents hereafter filed by Investors Title pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all shares of the Common Stock
offered have been sold or which deregisters any shares then remaining unsold,
shall be deemed to be incorporated herein by reference and to be a part hereof
from the date of filing of such documents.
6
Any statement contained in a document incorporated, or deemed to be
incorporated, by reference herein shall be deemed to be modified or superseded
for purposes of this reoffer prospectus to the extent that a statement contained
herein or in any other subsequently filed document that also is or is deemed to
be incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as modified or
superseded, to constitute a part of this reoffer prospectus.
Upon written or oral request, Investors Title will provide without
charge to each person to whom a copy of this reoffer prospectus is delivered a
copy of any document incorporated herein by reference (other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
into the information that this reoffer prospectus incorporates) and copies of
its latest annual report to shareholders, proxy statement and other
communications distributed to its shareholders generally. Requests should be
directed to the Corporate Secretary, Investors Title Company, P. O. Drawer 2687,
121 North Columbia Street, Chapel Hill, North Carolina 27515-2687. Telephone:
(919) 968-2200.
FORWARD-LOOKING STATEMENTS
This reoffer prospectus, including information included or incorporated
by reference in this document, contains forward-looking statements with respect
to our financial condition, results of operations, plans, objectives, future
performance and business. These statements represent our judgment when made on
the future and involve various risks and uncertainties. Actual results may
differ materially from those contemplated by the forward-looking statements due
to, among others, the following factors:
o The demand for title insurance varies with factors beyond our
control, such as changes in mortgage interest rates, availability
of mortgage funds, level of real estate activity, cost of real
estate, consumer confidence, supply and demand for real estate,
and general economic conditions.
o Losses from claims under title insurance policies may be greater
than anticipated such that reserves for possible claims are
inadequate.
o Adverse changes in securities markets could result in material
losses on investments made by Investors Title.
o The dependence of Investors Title on key management personnel, the
loss of whom could have a material adverse effect on our business.
Additional information with respect to factors that may cause the
results to differ materially from those contemplated by forward-looking
statements is included in Investors Title's current and subsequent filings with
the Securities and Exchange Commission. See "Where You Can Find More
Information."
7
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents and information previously filed with the
Securities and Exchange Commission by Investors Title are incorporated by
reference in this registration statement:
(1) Investors Title's Annual Report on Form 10-K for the fiscal year
ended December 31, 2002;
(2) Investors Title's Quarterly Report on Form 10-Q for the quarter
ended March 31, 2003;
(3) Investors Title's Quarterly Report on Form 10-Q for the quarter
ended June 30, 2003;
(4) Investors Title's Current Report on Form 8-K dated April 24, 2003;
(5) Investors Title's Current Report on Form 8-K dated July 24, 2003;
and
(6) the description of Investors Title's common stock set forth under
the heading "Description of Registrant's Securities to be Registered" in
its Form 10/A filed on August 18, 1997, and all amendments or reports filed
for the purpose of updating such description.
All documents hereafter filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act of 1934, as amended, prior to the
filing of a post-effective amendment which indicates that all shares of the
Common Stock issuable pursuant to the stock option plan to which this
registration statement relates have been issued or which deregisters any shares
then remaining unissued, shall be deemed to be incorporated herein by reference
and to be a 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
Article III, Section 9 of the Registrant's Amended and Restated By-Laws
provides:
Indemnification: Any person who at any time serves or has served as a
director of the corporation, or who, while serving as a director of the
corporation, serves or has served, at the request of the corporation, as a
director, officer, partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, or as a trustee or
administrator under an employee benefit plan, shall have a right to be
indemnified by the corporation to the fullest extent permitted by law against
(a) all expenses, including but not limited to attorneys' fees, the costs of any
investigation, experts and similar expenses incurred by him in connection with
any threatened, pending, or completed civil, criminal, administrative,
investigative, or arbitrative action, suit or proceeding (and any appeal
therein), whether or not brought by or on behalf of the corporation, seeking to
hold him liable by reason of the fact that he is or was acting in such capacity,
and (b) all payments made by him in satisfaction of any judgment, money decree,
fine (including an excise tax assessed with respect to an employee benefit
plan), penalty, or settlement for which he may have become liable in any such
action, suit or proceeding.
II-1
The Board of Directors of the corporation shall take all such action as
may be necessary and appropriate to authorize the corporation to pay the
indemnification required by this bylaw.
To the fullest extent from time to time permitted by law, the Company
agrees to pay as incurred all the expenses, including but not limited to
attorneys' fees and expenses of any person indemnified hereunder, incurred in
defending any action, proceeding, suit or investigation and in advance of the
final disposition of such action, proceeding, suit or investigation.
Any person who at any time after the adoption of this bylaw serves or
has served in the aforesaid capacity for or on behalf of the corporation shall
be deemed to be doing or to have done so in reliance upon, and as consideration
for, the right of indemnification provided herein. Such right shall inure to the
benefit of the legal representatives of any such person and shall not be
exclusive of any other rights to which such person may be entitled apart from
the provision of this bylaw.
The North Carolina General Statutes contain provisions prescribing the
extent to which directors and officers shall or may be indemnified. These
statutory provisions are set forth below:
CH. 55 NORTH CAROLINA BUSINESS CORPORATION ACT
Part 5. Indemnification.
ss.55-8-50. Policy statement and definitions.
(a) It is the public policy of this State to enable corporations
organized under this Chapter to attract and maintain responsible, qualified
directors, officers, employees and agents, and, to that end, to permit
corporations organized under this Chapter to allocate the risk of personal
liability of directors, officers, employees and agents through indemnification
and insurance as authorized in this Part.
(b) Definitions in this Part:
(1) "Corporation" includes any domestic or foreign corporation
absorbed in a merger which, if its separate existence had continued,
would have had the obligation or power to indemnify its directors,
officers, employees, or agents, so that a person who would have been
entitled to receive or request indemnification from such corporation if
its separate existence had continued shall stand in the same position
under this Part with respect to the surviving corporation.
(2) "Director" means an individual who is or was a director of
a corporation or an individual who, while a director of a corporation,
is or was serving at the corporation's request as a director, officer,
partner, trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan,
or other enterprise. A director is considered to be serving an employee
benefit plan at the corporation's request if his duties to the
corporation also impose duties on, or otherwise involve services by,
him to the plan or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires otherwise, the estate
or personal representative of a director.
(3) "Expenses" means expenses of every kind incurred in
defending a proceeding, including counsel fees.
(4) "Liability" means the obligation to pay a judgment,
settlement, penalty, fine (including an excise tax assessed with
respect to an employee benefit plan), or reasonable expenses incurred
with respect to a proceeding.
II-2
(4a) "Officer", "employee", or "agent" includes, unless the
context requires otherwise, the estate or personal representative of a
person who acted in that capacity.
(5) "Official capacity" means: (i) when used with respect to a
director, the office of director in a corporation; and (ii) when used
with respect to an individual other than a director, as contemplated in
G.S. 55-8-56, the office in a corporation held by the officer or the
employment or agency relationship undertaken by the employee or agent
on behalf of the corporation. "Official capacity" does not include
service for any other foreign or domestic corporation or any
partnership, joint venture, trust, employee benefit plan, or other
enterprise.
(6) "Party" includes an individual who was, is, or is
threatened to be made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative,
or investigative and whether formal or informal.
ss.55-8-51. Authority to indemnify.
(a) Except as provided in subsection (d), a corporation may indemnify
an individual made a party to a proceeding because he is or was a director
against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct in his
official capacity with the corporation, that his conduct was in its
best interests; and (ii) in all other cases, that his conduct was at
least not opposed to its best interests; and
(3) In the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interests of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction, or upon a plea of no contest or its equivalent is not, of itself,
determinative that the director did not meet the standard of conduct described
in this section.
(d) A corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation; or
(2) In connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in his
official capacity, in which he was adjudged liable on the basis that
personal benefit was improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation that is concluded without a
final adjudication on the issue of liability is limited to reasonable expenses
incurred in connection with the proceeding.
(f) The authorization, approval or favorable recommendation by the
board of directors of a corporation of indemnification, as permitted by this
section, shall not be deemed an act or corporate transaction in which a director
has a conflict of interest, and no such indemnification shall be void or
voidable on such ground.
II-3
ss.55-8-52. Mandatory indemnification.
Unless limited by its articles of incorporation, a corporation shall
indemnify a director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which he was a party because he is or was a
director of the corporation against reasonable expenses incurred by him in
connection with the proceeding.
ss.55-8-53. Advance for expenses.
Expenses incurred by a director in defending a proceeding may be paid
by the corporation in advance of the final disposition of such proceeding as
authorized by the board of directors in the specific case or as authorized or
required under any provision in the articles of incorporation or bylaws or by
any applicable resolution or contract upon receipt of an undertaking by or on
behalf of the director to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the corporation against such
expenses.
ss.55-8-54. Court-ordered indemnification.
Unless a corporation's articles of incorporation provide otherwise, a
director of the corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving any
notice the court considers necessary may order indemnification if it determines:
(1) The director is entitled to mandatory indemnification
under G.S. 55-8-52, in which case the court shall also order the
corporation to pay the director's reasonable expenses incurred to
obtain court-ordered indemnification; or
(2) The director is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether or
not he met the standard of conduct set forth in G.S. 55-8-51 or was
adjudged liable as described in G.S. 55-8-51(d), but if he was adjudged
so liable his indemnification is limited to reasonable expenses
incurred.
ss.55-8-55. Determination and authorization of indemnification.
(a) A corporation may not indemnify a director under G.S. 55-8-51
unless authorized in the specific case after a determination has been made that
indemnification of the director is permissible in the circumstances because he
has met the standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum
consisting of directors not at the time parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision (1), by
majority vote of a committee duly designated by the board of directors
(in which designation directors who are parties may participate),
consisting solely of two or more directors not at the time parties to
the proceeding;
(3) By special legal counsel (i) selected by the board of
directors or its committee in the manner prescribed in subdivision (1)
or (2); or (ii) if a quorum of the board of directors cannot be
obtained under subdivision (1) and a committee cannot be designated
under subdivision (2), selected by majority vote of the full board of
directors (in which selection directors who are parties may
participate); or
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(4) By the shareholders, but shares owned by or voted under
the control of directors who are at the time parties to the proceeding
may not be voted on the determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as the determination
that indemnification is permissible, except that if the determination is made by
special legal counsel, authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled under subsection
(b)(3) to select counsel.
ss.55-8-56. Indemnification of officers, employees, and agents.
Unless a corporation's articles of incorporation provide otherwise:
(1) An officer of the corporation is entitled to mandatory
indemnification under G.S. 55-8-52, and is entitled to apply for
court-ordered indemnification under G.S. 55-8-54, in each case to the
same extent as a director;
(2) The corporation may indemnify and advance expenses under
this Part to an officer, employee, or agent of the corporation to the
same extent as to a director; and
(3) A corporation may also indemnify and advance expenses to
an officer, employee, or agent who is not a director to the extent,
consistent with public policy, that may be provided by its articles of
incorporation, bylaws, general or specific action of its board of
directors, or contract.
ss.55-8-57. Additional indemnification and insurance.
(a) In addition to and separate and apart from the indemnification
provided for in G.S. 55-8-51, 55-8-52, 55-8-54, 55-8-55 and 55-8-56, a
corporation may in its articles of incorporation or bylaws or by contract or
resolution indemnify or agree to indemnify any one or more of its directors,
officers, employees, or agents against liability and expenses in any proceeding
(including without limitation a proceeding brought by or on behalf of the
corporation itself) arising out of their status as such or their activities in
any of the foregoing capacities; provided, however, that a corporation may not
indemnify or agree to indemnify a person against liability or expenses he may
incur account of his activities which were at the time taken known or believed
by him to be clearly in conflict with the best interests of the corporation. A
corporation may likewise and to the same extent indemnify or agree to indemnify
any person who, at the request of the corporation, is or was serving as a
director, officer, partner, trustee, employee, or agent of another foreign or
domestic corporation, partnership, joint venture, trust or other enterprise or
as a trust or administrator under an employee benefit plan. Any provision in any
articles of incorporation, bylaw, contract, or resolution permitted under this
section may include provisions for recovery from the corporation of reasonable
costs, expenses, and attorneys' fees in connection with the enforcement of
rights to indemnification granted therein and may further include provisions
establishing reasonable procedures for determining and enforcing the rights
granted therein.
(b) The authorization, adoption, approval, or favorable recommendation
by the board of directors of a public corporation of any provision in any
articles of incorporation, bylaw, contract or resolution, as permitted in this
section, shall not be deemed an act or corporate transaction in which a director
has a conflict of interest, and no such articles of incorporation or bylaw
provision or contract or resolution shall be void or voidable on such grounds.
The authorization, adoption, approval, or favorable recommendation by the board
of directors of a nonpublic corporation of any provision in any articles of
incorporation, bylaw, contract or resolution, as permitted in this section,
which occurred prior to July 1, 1990, shall not be deemed an act or corporate
transaction in which a director has a conflict of interest, and no such articles
of incorporation, bylaw provision, contract or resolution shall be void or
voidable on such grounds. Except as permitted in G.S. 55-8-31, no such bylaw,
contract, or resolution not adopted, authorized, approved or ratified by
shareholders shall be effective as to claims made or liabilities asserted
against any director prior to its adoption, authorization, or approval by the
board of directors.
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(c) A corporation may purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee or agent of the
corporation, or who, while a director, officer, employee, or agent of the
corporation, is or was serving at the request of the corporation as a director,
officer, partner, trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan, or other
enterprise, against liability asserted against or incurred by him in that
capacity or arising from his status as a director, officer, employee, or agent,
whether or not the corporation would have power to indemnify him against the
same liability under any provision of this Chapter.
ss.55-8-58. Application of Part.
(a) If articles of incorporation limit indemnification or advance for
expenses, indemnification and advance for expenses are valid only to the extent
consistent with the articles.
(b) This Part does not limit a corporation's power to pay or reimburse
expenses incurred by a director in connection with his appearance as a witness
in a proceeding at a time when he has not been made a named defendant or
respondent to the proceeding.
(c) This Part shall not affect rights or liabilities arising out of
acts or omissions occurring before July 1, 1990.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
Reference is made to the Exhibit Index.
Item 9. Undertakings
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;
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change in such
information in the Registration Statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the Registration Statement is on Form S-3 or Form
S-8, and 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 Securities Exchange Act of 1934
that are incorporated by reference in the Registration
Statement.
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(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new 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.
The undersigned Registrant hereby undertakes that, for the 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.
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.
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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 Chapel Hill, North Carolina on September 30, 2003.
INVESTORS TITLE COMPANY
By /s/ J. Allen Fine
---------------------------------
J. Allen Fine
Chairman and Chief Executive Officer
POWER OF ATTORNEY
Each officer or director whose signature appears below hereby appoints J.
Allen Fine and James A. Fine, Jr., or either of them, his true and lawful
attorney-in-fact to sign on his behalf as an individual and in the capacity
stated below, any amendment or post-effective amendment to this Registration
Statement which said attorney-in-fact may deem appropriate or necessary.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the following
capacities:
Signature Title Date
/s/ J. Allen Fine Chairman, September 30, 2003
--------------------------- Chief Executive Officer
J. Allen Fine and Director
/s/James A. Fine, Jr. President, Treasurer September 30, 2003
--------------------------- and Director
James A. Fine, Jr.
/s/W. Morris Fine Executive Vice President, September 30, 2003
--------------------------- Secretary and Director
W. Morris Fine
/s/David L. Francis Director September 24, 2003
---------------------------
David L. Francis
/s/Loren B. Harrell, Jr. Director September 30, 2003
---------------------------
Loren B. Harrell, Jr.
Director September __, 2003
----------------------------
William J. Kennedy III
/s/H. Joe King, Jr. Director September 30, 2003
----------------------------
H. Joe King, Jr.
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/s/James R. Morton Director September 24, 2003
----------------------------
James R. Morton
/s/ A. Scott Parker III Director September 24, 2003
----------------------------
A. Scott Parker III
II-9
EXHIBIT INDEX
Exhibit No. Description of Exhibits
4.1 Articles of Incorporation of the Registrant, incorporated
herein by reference to Exhibit 1 to the Registrant's Form
10 Registration Statement dated June 12, 1984.
4.2 Articles of Amendment to Articles of Incorporation of the
Registrant, incorporated herein by reference to Exhibit
3(iii) to the Registrant's Form 10-Q Quarterly Report for the
quarter ended June 30, 2002.
4.3 Articles of Amendment to Articles of Incorporation of the
Registrant, incorporated herein by reference to Exhibit 3(iv)
to the Registrant's Form 10-Q Quarterly Report for the quarter
ended March 31, 2003.
4.4 Amended and Restated By-Laws of the Registrant, adopted May
21, 2003, incorporated herein by reference to Exhibit
3(ii) to the Registrant's Form 10-Q Quarterly Report for the
quarter ended June 30, 2003.
4.5 Specimen of Registrant's Common Stock Certificate,
incorporated herein by reference to Exhibit 4 to the
Registrant's Form 10/A filed on August 18, 1997.
5.1 Opinion of Schell Bray Aycock Abel & Livingston P.L.L.C.
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Schell Bray Aycock Abel & Livingston P.L.L.C.
(contained in Exhibit 5.1 hereof).
24.1 Power of Attorney (included in the signature pages hereto).
99.1 Investors Title Company 2001 Stock Option and Restricted
Stock Plan, incorporated herein by reference to Exhibit 10
(xiii) to the Registrant's Form 10-K Annual Report for the
year ended December 31, 2000.