As filed with the Securities and Exchange Commission on May 31, 1996
Registration No. ________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
THE ALLSTATE CORPORATION
(Exact Name of Issuer as Specified in its Charter)
DELAWARE 36-3871531
(State of Incorporation) (I.R.S. Employer Identification No.)
Allstate Plaza
Northbrook, Illinois 60062
(Address and Zip Code of principal executive offices)
THE ALLSTATE CORPORATION
EQUITY INCENTIVE PLAN FOR NON-EMPLOYEE DIRECTORS
(Full title of the Plan)
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ROBERT W. PIKE
Vice President, Secretary and General Counsel
The Allstate Corporation
Allstate Plaza
Northbrook, Illinois 60062
(708) 402-6075
(Name, address, and telephone number of agent for service)
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CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share (1) Price (1) Fee
---------- ---------- --------- ----- ---
Common 300,000 $41.6875 $12,506,250 $4,312.53
Stock, par shares
value $.01 per
share
================================================================================
(1) Estimated pursuant to Rule 457(h) solely for the purpose of calculating
the aggregate offering price and the amount of the registration fee
based upon the average of the high and low prices reported for the
shares on the New York Stock Exchange on May 29, 1996.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents containing information specified in Part I (plan
information and registrant information) will be sent or given to directors of
The Allstate Corporation ("Allstate" or the "Company") eligible to participate
in Allstate's Equity Incentive Plan for Non-Employee Directors (the "Plan") as
specified by Rule 428(b)(1) under the Securities Act of 1933, as amended (the
"Securities Act"). Such documents need not be filed with the Securities and
Exchange Commission (the "Commission") either as part of this Registration
Statement or as prospectuses or prospectus supplements pursuant to Rule 424
under the Securities Act. These documents and the documents incorporated by
reference in this Registration Statement pursuant to Item 3 of Part II of this
Registration Statement, taken together, constitute a prospectus that meets the
requirements of Section 10(a) of the Securities Act.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3: INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by Allstate with the Commission are
incorporated in and made a part of this Registration Statement by reference, as
of their respective dates:
(1) Allstate's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995 and Allstate's Proxy Statement dated March 30, 1996
relating to the Annual Meeting of Stockholders on May 21, 1996 at which
the Plan was approved;
(2) Allstate's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996;
(3) the description of Allstate's common shares under the caption
"Description of Capital Stock" contained in Allstate's prospectus dated
June 2, 1993, filed with the Commission on June 4, 1993 pursuant to
Rule 424(b) under the Securities Act and deemed to be a part of
Allstate's Registration Statement on Form S-1 (File No. 33- 59676); and
(4) from the date of filing of such documents, all documents filed by
Allstate with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), subsequent to the date of this Registration Statement and prior
to the filing of a post-effective amendment to this Registration
Statement which indicates that all securities offered hereby have been
sold or which deregisters all securities then remaining unsold.
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 Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or replaces such
statement. Except as so modified or superseded, such statement shall not be
deemed to constitute a part of this Registration Statement.
ITEM 4: DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5: INTERESTS OF NAMED EXPERTS AND COUNSEL
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The validity of the Company's Common Stock being registered hereby has
been passed upon by Joseph T. Kane, Counsel, Corporate Law Department of
Allstate Insurance Company, a wholly-owned subsidiary of the Company.
ITEM 6: INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law (the "DGCL"), inter
alia, empowers a Delaware corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding (other than an action by or in the right of
the corporation) by reason of the fact that such person is or was a director,
officer, employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. Similar
indemnity is authorized for such persons against expenses (including attorneys'
fees) actually and reasonably incurred in connection with the defense or
settlement of any such threatened, pending or completed action or suit if such
person acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and provided further that
(unless a court of competent jurisdiction otherwise provides) such person shall
not have been adjudged liable to the corporation. Any such indemnification may
be made only as authorized in each specific case upon a determination by the
shareholders or disinterested directors or by independent legal counsel in a
written opinion that indemnification is proper because the indemnitee has met
the applicable standard of conduct.
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would otherwise have the power to indemnify him under Section 145. The Company
maintains policies insuring its and its subsidiaries' officers and directors
against certain liabilities for actions taken in such capacities, including
liabilities under the Securities Act.
Article IV of the By-laws of the Company provides for indemnification
of the directors and officers of the Company to the fullest extent permitted by
law, as now in effect or later amended. In addition, the By-laws provide for
indemnification against expenses incurred by a director or officer to be paid by
the Company in advance of the final disposition of such action, suit or
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proceeding; provided, however, that an advancement of expenses will be made only
upon receipt of an undertaking by or on behalf of the director or officer to
repay such amount unless it shall be ultimately determined that he is entitled
to be indemnified by the Company. The By-laws further provide for a contractual
cause of action on the part of directors and officers of the Company with
respect to indemnification claims which have not been paid by the Company.
The Company also has provided liability insurance for each director and
officer for certain losses arising from claims or charges made against them
while acting in their capacities as directors or officers of the Company.
Article Ninth of the Company's Restated Certificate of Incorporation
limits, to the fullest extent permitted by the DGCL, as the same exists or may
be amended, the personal liability of the Company's directors to the Company or
its stockholders for monetary damages for a breach of their fiduciary duty as
directors. Section 102(b)(7) of the DGCL currently provides that such provisions
do not eliminate the liability of a director (i) for a breach of the director's
duty of loyalty to the Company or its stockholders, (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law, (iii) under Section 174 of the DGCL (relating to the declaration of
dividends and purchase or redemption of shares in violation of the DGCL), or
(iv) for any transaction from which the director derived an improper personal
benefit.
ITEM 7: EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8: EXHIBITS
The Exhibits to this Registration Statement are listed in the Exhibit
Index of this Registration Statement, which Index is incorporated herein by
reference.
ITEM 9: UNDERTAKINGS
The Company 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;
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(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 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 Company pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this 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.
(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 Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) or 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.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the 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 Company of expenses incurred or
paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities 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 Company
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 Cook County, State of Illinois, on May 21, 1996.
THE ALLSTATE CORPORATION
By: /s/Robert W. Pike
Name: Robert W. Pike
Title: Vice President, Secretary
and General Counsel
Pursuant to the requirements of the Securities Act of 1933, this report
has been signed below by the following persons on behalf of the Registrant in
the capacities and on the dates indicated. Each person whose signature appears
below constitutes and appoints Jerry D. Choate, Edward M. Liddy and Robert W.
Pike, and each of them, 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 amendments to this
Registration Statement, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents full power and
authority 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, thereby ratifying and confirming all that said
attorneys-in-fact and agents, or their substitutes, may lawfully do or cause to
be done by virtue hereof.
SIGNATURE TITLE DATE
/s/Jerry D. Choate Director, Chairman of the Board of May 21, 1996
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Jerry D. Choate Directors, and Chief Executive Officer
(Principal Executive Officer)
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/s/Thomas J. Wilson Vice President and Chief Financial May 21, 1996
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Thomas J. Wilson Officer (Principal Financial Officer)
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/s/Samuel H. Pilch Controller (Principal Accounting Officer) May 21, 1996
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Samuel H. Pilch
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/s/James G. Andress Director May 21, 1996
James G. Andress
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/s/Warren L. Batts Director May 21, 1996
Warren L. Batts
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/s/Edward A. Brennan Director May 21, 1996
Edward A. Brennan
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/s/James M. Denny Director May 21, 1996
James M. Denny
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/s/Christopher F. Edley Director May 21, 1996
Christopher F. Edley
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/s/William E. LaMothe Director May 21, 1996
William E. LaMothe
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/s/Michael A. Miles Director May 21, 1996
Michael A. Miles
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/s/Nancy C. Reynolds Director May 21, 1996
Nancy C. Reynolds
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/s/Mary Alice Taylor Director May 21, 1996
Mary Alice Taylor
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Exhibit EXHIBIT INDEX Sequentially
Number Numbered Page
-------------
Description of Exhibit
----------------------
4(a) Restated Certificate of Incorporation of the Company
(incorporated by reference to Exhibit 3(a) of the Company's
Quarterly Report on Form 10-Q for the quarter ended September
30, 1995).
4(b) By-Laws of the Company (incorporated by reference to Exhibit
3(b) of the Company's Annual Report on Form 10-K for the year
ended December 31, 1995).
4(c) The Allstate Corporation Equity Incentive Plan for
Non-Employee Directors.
5 Opinion of Joseph T. Kane.
15 Acknowledgment of Deloitte & Touche LLP
regarding unaudited interim financial
information.
23(a) Consent of Joseph T. Kane (included in Exhibit 5).
23(b) Consent of Deloitte & Touche LLP.
28 Information from Reports Furnished to State Insurance
Regulatory Authorities (incorporated by reference to Exhibit
28 of the Company's Annual Report on Form 10-K for the year
ended December 31, 1995).
E-1
Exhibit 4(c)
THE ALLSTATE CORPORATION
EQUITY INCENTIVE PLAN FOR NON-EMPLOYEE DIRECTORS
I. PURPOSE.
The purpose of The Allstate Corporation Equity Incentive Plan for
Non-Employee Directors (the "Plan") is to promote the interests of The Allstate
Corporation (the "Company") by providing an inducement to obtain and retain the
services of qualified persons as members of the Company's Board of Directors
(the "Board") and to align more closely the interests of such persons with the
interests of the Company's stockholders by providing a significant portion of
the compensation provided to such persons in the form of equity securities of
the Company.
II. ADMINISTRATION.
The Plan shall be administered by the Committee. The Committee shall
have full power to construe and interpret the Plan and Shares and Options
granted hereunder, to establish and amend rules for its administration and to
correct any defect or omission and to reconcile any inconsistency in the Plan or
in any Share or Option granted hereunder to the extent the Committee deems
desirable to carry the Plan or any Share or Option granted hereunder into
effect. Any decisions of the Committee in the administration of the Plan shall
be final and conclusive. The Committee may authorize any one or more of its
members, the secretary of the Committee or any officer of the Company to execute
and deliver documents on behalf of the Committee. Each member of the Committee,
and, to the extent provided by the Committee, any other person to whom duties or
powers shall be delegated in connection with the Plan, shall incur no liability
with respect to any action taken or omitted to be take in connection with the
Plan and shall be fully protected in relying in good faith upon the advice of
counsel, to the fullest extent permitted under applicable law.
III. ELIGIBILITY.
Each Non-Employee Director shall be eligible to participate in the
Plan.
IV. LIMITATION ON AGGREGATE SHARES.
A. Maximum Number of Shares. The aggregate maximum number of Shares
that may be granted pursuant to the Plan or issued upon exercise of Options
granted pursuant to the Plan shall be 300,000 shares. Such maximum number of
Shares is subject to adjustment under the provisions of Section IV.B. The Shares
to be granted or issued upon exercise of Options may be authorized but unissued
Shares or Shares previously issued which have been reacquired by the Company. In
the event any Option or Reload Option shall, for any reason, terminate or expire
or be surrendered without having been exercised in full, the Shares subject to
such Option or Reload Option but not
purchased thereunder shall be available for future Options or Reload Options to
be granted under the Plan.
B. Adjustment. The maximum number of Shares referred to in
Section IV.A of the Plan, the number of Shares granted pursuant to Section VI of
the Plan, the number of Options granted pursuant to Section VII of the Plan, and
the option price and the number of Shares which may be purchased under any
outstanding Option granted under Section VII of the Plan shall be
proportionately adjusted for any increase or decrease in the number of issued
and outstanding Shares as the result of (i) the declaration and payment of a
dividend payable in Common Stock, or the division of the Common Stock
outstanding at the date hereof (or the date of the grant of any such outstanding
Option, as applicable) into a greater number of Shares without the receipt of
consideration therefor by the Company, or any other increase in the number of
such Shares of the Company outstanding at the date hereof (or the date of the
grant of any such outstanding Option, as applicable) which is effective without
the receipt of consideration therefor by the Company (exclusive of any Shares
granted by the Company to employees of the Company or any of its Subsidiaries
without receipt of separate consideration by the Company), or (ii) the
consolidation of the Shares outstanding at the date hereof (or the date of the
grant of any such outstanding Option, as applicable) into a smaller number of
Shares without the payment of consideration thereof by the Company, or any other
decrease in the number of such Shares outstanding at the date hereof (or the
date of the grant of any such outstanding Option, as applicable) effected
without the payment of consideration by the Company; provided, however, that the
total option price for all Shares which may be purchased upon the exercise of
any Option granted pursuant to the Plan (computed by multiplying the number of
Shares originally purchasable thereunder, reduced by the number of such Shares
which have theretofore been purchased thereunder, by the original option price
per share before any of the adjustments herein provided for) shall not be
changed.
In the event of a change in the Common Stock as presently constituted
which is limited to a change of the Company's authorized shares with a par value
into the same number of shares with a different par value or without par value,
the shares resulting from any such change will be deemed to be the Common Stock
within the meaning of this Plan and no adjustment will be required pursuant to
this Section IV.B.
The foregoing adjustments shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive. Except as
expressly provided in this Section IV.B, a Non-Employee Director shall have no
rights by reason of any subdivision or consolidation of shares of stock of any
class or the payment of any stock dividend or any other increase or decrease in
the number of shares of stock of any class.
V. DEFINITIONS.
The following terms shall have the meanings set forth below when used
herein:
"Code" means the Internal Revenue Code of 1986, as amended.
2
"Committee" means the Compensation and Nominating Committee of the
Board, any successor committee of the Board performing similar functions or, in
the absence of such a committee, the Board.
"Common Stock" means the Common Stock, par value $.01 per share, of the
Company.
"Disability" means a mental or physical condition which, in the opinion
of the Committee, renders a Non-Employee Director unable or incompetent to carry
out his or her duties as a member of the Board and which is expected to be
permanent or for an indefinite duration.
"Election Shares" means any Shares issued to a Non-Employee Director
pursuant to the election of such person to receive such Shares in lieu of cash
compensation made in accordance with Section VIII.B.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" of any Share means, as of any applicable date, the
mean between the high and low prices of the Shares as reported on the New York
Stock Exchange-Composite Tape, or if no such reported sale of the Shares shall
have occurred on such date, on the next succeeding date on which there was such
a reported sale.
"Initial Election Date" means, for each Non-Employee Director, the
later to occur of (i) the date the Plan is approved and adopted by the Company's
stockholders pursuant to Section XIII of the Plan, and (ii) the date of such
member's initial election or appointment to the Board.
"Non-Employee Director" means each member of the Board who is not an
officer or employee of the Company or any of its Subsidiaries.
"Option" means an option to purchase shares of Common Stock.
"Shares" means shares of Common Stock.
"Subsidiary" means any partnership, corporation, association, limited
liability company, joint stock company, trust, joint venture, unincorporated
organization or other business entity of which (i) if a corporation, a majority
of the total voting power of shares of stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
the Company or one or more of the other Subsidiaries of the Company or a
combination thereof, or (ii) if a partnership, association, limited liability
company, joint stock company, trust, joint venture, unincorporated organization
or other business entity, a majority of the partnership or other similar equity
ownership interest thereof is at the time owned or controlled, directly or
indirectly, by the Company or one or more
3
Subsidiaries of the Company or a combination thereof. For purposes hereof, the
Company or a Subsidiary shall be deemed to have a majority ownership interest in
a partnership, association, limited liability company, joint stock company,
trust, joint venture, unincorporated organization or other business entity if
the Company or such Subsidiary shall be allocated a majority of partnership,
association, limited liability company, joint stock company, trust, joint
venture, unincorporated organization or other business entity gains or losses or
shall be or control the managing director, the trustee, the manager or the
general partner of such partnership, association, limited liability company,
joint stock company, trust, joint venture, unincorporated organization or other
business entity.
VI. FORMULA RESTRICTED STOCK GRANTS FOR NON-EMPLOYEE DIRECTORS.
A. Annual Grant of Shares. Beginning December 1, 1996, on
December 1 of each year 500 Shares shall automatically be granted to each
Non-Employee Director serving on the Board on such date who has served in such
capacity since June 1 of such year. If any person serving as a Non- Employee
Director on June 1 of any year ceases to serve as a director of the Company
prior to December 1 of such year, such director shall be automatically granted
on his or her last day of service a number of Shares equal to (i) 500 multiplied
by (ii) a fraction, the numerator of which is the number of full calendar months
such Non-Employee Director has served on the Board during the period beginning
on such June 1 and ending on such director's last date of service and the
denominator of which is 6.
B. Grant for Newly Appointed Directors. If after June 1, 1996 a
Non-Employee Director is initially elected or appointed to the Board effective
on any date other than June 1, such Non- Employee Director shall automatically
be granted, on the June 1 following the date he or she joins the Board (or such
earlier date as he or she ceases to serve as a director), a number of Shares
equal to (i) 500 multiplied by (ii) a fraction, the numerator of which is the
number of full calendar months such Non-Employee Director has served on the
Board during the period beginning on the date such director joined the Board and
ending on the following May 31 (or such earlier date as he or she ceases to
serve as a director) and the denominator of which is 6; provided that such
fraction shall in no event be greater than one.
C. Transition Grant for Existing Directors. Subject to
stockholder approval and adoption pursuant to Section XIII of the Plan, on May
31, 1996, each Non-Employee Director who was serving on the Board on March 12,
1996 shall be automatically granted a number of Shares equal to (i) 200
multiplied by (ii) a fraction, the numerator of which is the number of full
calendar months of service by such Non-Employee Director during the period
beginning on the later of (a) such director's last anniversary date for service
on the Board and (b) the date such director first attained the status of
Non-Employee Director and ending on May 31, 1996 (or such earlier date as such
director ceases to serve as a director) and the denominator of which is 12.
4
D. Rounding of Share Amounts. To the extent that application of
the foregoing formulas would result in fractional Shares being issuable, such
Non-Employee Director shall be granted a number of Shares equal to the nearest
whole number of Shares.
E. Payment for Estimated Taxes. In addition, the Company shall
pay to each Non- Employee Director, in cash, as soon as practicable after each
issuance of Shares pursuant to this Section VI, an amount equal to the estimated
increase in such Non-Employee Director's federal, state and local tax
liabilities as a result of such grant of Shares, assuming the maximum statutory
tax rates applicable to such Non-Employee Director.
F. Restrictions. The Non-Employee Directors shall have no rights
as a shareholder with respect to any Shares to be granted pursuant to this
Section VI prior to the time such Shares are granted. Upon such grant, the
Shares shall be represented by a stock certificate registered in the name of the
holder. The Shares granted pursuant to this Section VI shall be fully vested,
but shall be subject to certain restrictions during the six month period
following the date of grant (the "Restriction Period"). The holder shall have
the right to enjoy all shareholder rights during the Restriction Period
(including the right to vote the Shares and the right to receive any cash or
other dividends paid in respect thereof) with the exception that (i) the holder
may not sell, transfer, pledge or assign the Shares during the Restriction
Period, and (ii) the Company shall retain custody of the certificates
representing the Shares during the Restriction Period.
All restrictions shall lapse and the holder of the Shares shall be
entitled to the delivery of a stock certificate or certificates representing the
Shares (and to the removal of any restrictive legend set forth on such
certificates) upon the earliest of (i) six months from the date of grant of such
Shares, (ii) the date of the holder's death or Disability, and (iii) the date on
which the holder is no longer serving as a director of the Company.
VII. FORMULA STOCK OPTION GRANTS FOR NON-EMPLOYEE DIRECTORS.
A. Annual Grant of Options. On June 1 of each year, beginning June 1,
1996, Options to purchase 1,500 Shares shall automatically be granted to each
Non-Employee Director serving on the Board on such date. If any such
Non-Employee Director will be required to retire (pursuant to the policies of
the Board) during the 12 month period beginning on the date of any grant (or if
any such Non-Employee Director has notified the Board that he or she intends to
resign from the Board for any reason during the 12 month period beginning on the
date of any grant), such director shall instead be granted on June 1 of the
relevant year Options to purchase a number of Shares equal to (i) 1,500,
multiplied by (ii) a fraction, the numerator of which is the number of full
calendar months such Non-Employee Director will serve on the Board during the
period beginning on such June 1 and ending on such director's last date of
service and the denominator of which is 12.
B. Grant for Newly Appointed Directors. If after June 1, 1996 a
Non-Employee Director is initially elected or appointed to the Board effective
on any date other than June 1, such Non- Employee Director shall automatically
be granted, on the date he or she joins the Board, Options to
5
purchase a number of Shares equal to (i) 1,500, multiplied by (ii) a fraction,
the numerator of which is the number of full calendar months such Non-Employee
Director will serve on the Board during the period beginning on the date such
director joins the Board and ending on the following May 31 and the denominator
of which is 12.
C. Option Exercise Price. The exercise price per Share for each
Option shall be 100% of the Fair Market Value of a Share on the date of grant,
subject to Section IV.B.
D. Term of Options. Each Option shall be exercisable for ten
years after the date of grant, subject to Section VII.F.
E. Conditions and Limitations on Exercise.
(i) Vesting. Each Option shall vest in three equal
installments on the first, second and third anniversaries of the date
of grant. Upon a Non-Employee Director's mandatory retirement pursuant
to the policies of the Board, the unvested portions of any outstanding
Options held by such Non-Employee Director shall fully vest. Upon the
termination of a Non-Employee Director's tenure for any other reason,
the unvested portions of any outstanding Options shall expire and no
Options granted to such Non-Employee Director shall vest after the
termination of such director's tenure on the Board.
(ii) Exercise. Each Option shall be exercisable in one or more
installments and shall not be exercisable for less than 100 Shares,
unless the exercise represents the entire remaining exercisable balance
of a grant or grants. Each Option shall be exercised by delivery to the
Company of written notice of intent to purchase a specific number of
Shares subject to the Option. The option price of any Shares as to
which an Option shall be exercised shall be paid in full at the time of
the exercise. Payment may, at the election of the Non-Employee
Director, be made in any one or any combination of the following forms:
(a) check or wire transfer of funds in such form
as may be satisfactory to the Committee;
(b) delivery of Shares valued at their Fair Market Value
on the date of exercise or, if the date of exercise is not a
business day, the next succeeding business day;
(c) through simultaneous sale through a broker
of unrestricted Shares acquired on exercise, as permitted
under Regulation T of the Federal Reserve Board; or
(d) by authorizing the Company in his or her written
notice of exercise to withhold from issuance a number of
Shares issuable upon exercise of such Option which, when
multiplied by the Fair Market Value of Common Stock on the
date of
6
exercise (or, if the date of exercise is not a business day,
the next succeeding business day), is equal to the aggregate
exercise price payable with respect to the Option so
exercised.
In the event a Non-Employee Director elects to pay the exercise price
payable with respect to an Option pursuant to clause (b) above, (i) only a whole
number of Share(s) (and not fractional Shares) may be tendered in payment, (ii)
such Non-Employee Director must present evidence acceptable to the Company that
he or she has owned any such Shares tendered in payment of the exercise price
(and that such Shares tendered have not been subject to any substantial risk of
forfeiture) for at least six months prior to the date of exercise, and (iii) the
certificate(s) for all such Shares tendered in payment of the exercise price
must be accompanied by duly executed instruments of transfer in a form
acceptable to the Company. When payment of the Option exercise price is made by
the tender of Shares, the difference, if any, between the aggregate exercise
price payable with respect to the Option being exercised and the Fair Market
Value of the Share(s) tendered in payment (plus any applicable taxes) shall be
paid by check or wire transfer of funds. No Non-Employee Director may tender
Shares having a Fair Market Value exceeding the aggregate exercise price payable
with respect to the Option being exercised.
In the event a Non-Employee Director elects to pay the exercise price
payable with respect to an Option pursuant to clause (d) above, (i) only a whole
number of Share(s) (and not fractional Shares) may be withheld in payment and
(ii) such Non-Employee Director must present evidence acceptable to the Company
that he or she has owned a number of Shares at least equal to the number of
Shares to be withheld in payment of the exercise price (and that such owned
Shares have not been subject to any substantial risk of forfeiture) for at least
six months prior to the date of exercise. When payment of the Option exercise
price is made by the withholding of Shares, the difference, if any, between the
aggregate exercise price payable with respect to the Option being exercised and
the Fair Market Value of the Share(s) withheld in payment (plus any applicable
taxes) shall be paid by check or wire transfer of funds. No Non-Employee
Director may authorize the withholding of Shares having a Fair Market Value
exceeding the aggregate exercise price payable with respect to the Option being
exercised. Any withheld Shares shall no longer be issuable under such Option.
F. Additional Provisions.
(i) Accelerated Expiration of Options Upon Termination of
Directorship. Upon the termination of a Non-Employee Director's tenure
for any reason, each outstanding vested and previously unexercised
Option shall expire three months after the date of such termination;
provided that (a) upon the termination of a Non-Employee Director's
tenure as a result of death or Disability, each outstanding vested and
previously unexercised Option shall expire two years after the date of
his or her termination as a director, and (b) upon the mandatory
retirement of a Non-Employee Director pursuant to the policies of the
Board, each outstanding vested and previously unexercised Option shall
expire five years after the date of his or her termination as a
director. In no event shall the provisions of this Section VII.F
operate to extend the original expiration date of any Option.
7
(ii) Sale of the Company. In the event of a merger of the
Company with or into another corporation constituting a change of
control of the Company, a sale of all or substantially all of the
Company's assets or a sale of a majority of the Company's outstanding
voting securities (a "Sale of the Company"), the Options may be assumed
by the successor corporation or a parent of such successor corporation
or substantially equivalent options may be substituted by the successor
corporation or a parent of such successor corporation, and if the
successor corporation does not assume the Options or substitute
options, then all outstanding and unvested Options shall become
immediately exercisable and all outstanding Options shall terminate if
not exercised as of the date of the Sale of the Company (or other
prescribed period of time). The Company shall provide at least 30 days
prior written notice of the Sale of the Company to the holders of all
outstanding Options, which notice shall state whether (a) the Options
will be assumed by the successor corporation or substantially
equivalent options will be substituted by the successor corporation, or
(b) the Options are thereafter vested and exercisable and will
terminate if not exercised as of the date of the Sale of the Company
(or other prescribed period of time).
(iii) Liquidation or Dissolution. In the event of the
liquidation or dissolution of the Company, Options shall terminate
immediately prior to the liquidation or dissolution.
G. Grant of Reload Options. A Non-Employee Director who exercises all
or any portion of an Option by the tender or withholding of Shares which have a
Fair Market Value equal to not less than 100% of the exercise price for such
Options (the "Exercised Options") shall be granted, subject to Section IV, an
additional option (a "Reload Option") for a number of Shares equal to the sum of
the number of Shares tendered or withheld in payment of the exercise price for
the Exercised Options.
Reload Options shall be subject to the following terms and conditions:
(i) the grant date for each Reload Option shall be the date
of exercise of the Exercised Option to which it relates;
(ii) subject to clause (iii) below, the Reload Option may be
exercised at any time during the unexpired term of the Exercised Option
(subject to earlier termination thereof as provided in the Plan); and
(iii) the other terms of the Reload Option shall be the same
as the terms of the Exercised Option to which it relates and shall be
subject to the provisions of the Plan, except that (a) the option price
shall be the Fair Market Value of the Shares on the grant date of the
Reload Option, (b) no Reload Option may be exercised within six months
from the grant date thereof, and (c) no other Reload Option shall be
granted upon exercise of such Reload Option.
8
H. Non-Qualified Stock Options. All Options granted under the
Plan shall be non-qualified options not entitled to special tax treatment under
Code Section 422, as may be amended from time to time.
VIII. ELECTION TO RECEIVE STOCK IN LIEU OF CASH COMPENSATION.
A. General. A Non-Employee Director may elect to reduce the cash
compensation otherwise payable for services to be rendered by him or her as a
director for any period beginning on June 1 and continuing to the following May
31 (or such other period for which cash compensation is payable to Non-Employee
Directors pursuant to the policies of the Board), beginning June 1, 1996 and to
receive in lieu thereof Shares as provided in this Section VIII.
B. Election. By the later of (i) the November 30 preceding the June 1
to which such election relates and (ii) such Non-Employee Director's Initial
Election Date, each Non-Employee Director may, subject to any subsequent
approval by the stockholders of the Company required by Rule 16b-3 promulgated
under Section 16(b) of the Exchange Act, make an irrevocable election to
receive, in lieu of all or a specified percentage (which percentage shall be in
10% increments) of the cash compensation to which such director would otherwise
be entitled as a member of the Board and any committee thereof (including the
annual retainer fee and any meeting or other fees payable for services on the
Board or any committee thereof, but excluding any reimbursement for
out-of-pocket expenses) for the year beginning the following June 1 (or such
other period for which cash compensation is payable to such Non-Employee
Director pursuant to the policies of the Board), an equivalent value in Shares
granted in accordance with this Section VIII. An election shall be effective (i)
if made by the November 30 preceding the June 1 to which such election relates,
beginning on the June 1 following such election; and (ii) if made on such
Non-Employee Director's Initial Election Date, immediately (or, if later, June
1, 1996).
Each such election shall (i) be in writing in a form prescribed by the
Company, (ii) specify the amount of cash compensation to be received in the form
of Election Shares (expressed as a percentage of the compensation otherwise
payable in cash), and (iii) be delivered to the Secretary of the Company. Such
election may not be revoked or changed thereafter except as to compensation for
services to be rendered in any 12 month period beginning on any June 1 at least
six months following such revocation or new election.
C. Issuance of Common Stock. If a Non-Employee Director elects pursuant
to Section VIII.B above to receive Shares, there shall be issued to such
director promptly following each subsequent June 1 for which such election is
effective (or promptly following the first day of such other period for which
such election is effective) a number of Shares equal to the amount of
compensation otherwise payable for the 12 month period beginning on such June 1
(or the other period for which such election is effective) divided by the Fair
Market Value of the Shares on such June 1 (or on the first day of such other
period). To the extent that the application of the foregoing formula would
result in fractional shares of Common Stock being issuable, cash will be paid to
the
9
Non-Employee Director in lieu of such fractional Shares based upon the Fair
Market Value of such fractional Share.
D. Compliance with Exchange Act. The election to receive Election
Shares is intended to comply in all respects with Rule 16b-3(d)(1) promulgated
under Section 16(b) of the Exchange Act such that the issuance of Election
Shares under the Plan on a grant date occurring at least six months after the
election shall be exempt from Section 16(b) of the Exchange Act.
E. Grant Date. The grant date for each Election Share for the
Non-Employee Director electing such option shall be the first day of the period
to which such election relates and is effective.
IX. MISCELLANEOUS PROVISIONS.
A. Rights of Non-Employee Directors. No Non-Employee Director
shall be entitled under the Plan to voting rights, dividends or other rights of
a stockholder prior to the issuance of Common Stock. Neither the Plan nor any
action taken hereunder shall be construed as giving any Non-Employee Director
any right to be retained in the service of the Company.
B. Limitations on Transfer and Exercise. All Options granted under the
Plan shall not be transferable by the Non-Employee Director, other than by will
or the laws of descent and distribution or pursuant to a qualified domestic
relations order, as defined by ss.1 et seq, of the Code, Title I of ERISA or the
rules and regulations thereunder, and shall be exercisable during the Non-
Employee Director's lifetime only by such Non-Employee Director or by such
Non-Employee Director's guardian or other legal representative.
C. Compliance with Laws. No shares of Common Stock shall be issued
hereunder unless counsel for the Company shall be satisfied that such issuance
will be in compliance with applicable federal, state, local and foreign
securities, securities exchange and other applicable laws and requirements. Each
Share granted pursuant to Section VI or Section VIII and each Option granted
pursuant to Section VII shall be subject to the requirement that if at any time
the Committee shall determine, in its discretion, that the listing, registration
or qualification of the Shares granted or subject to the Option upon any
securities exchange or under any state or federal securities or other law or
regulation, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition to or in connection with the granting of
such Share, such Option or the issuance or purchase of Shares thereunder, no
such Share may be issued and no Option may be exercised or paid in Common Stock,
in whole or in part, unless such listing, registration, qualification, consent
or approval shall have been effected or obtained free of any conditions not
acceptable to the Committee. The holder of such Share or Option will supply the
Company with such certificates, representations and information as the Company
shall request and shall otherwise cooperate with the Company in obtaining such
listing, registration, qualification, consent or approval. The Committee may at
any time impose any limitations upon the sale of a Share or the exercise of an
Option or the sale of the Common Stock issued upon exercise of an Option that,
in the Committee's discretion, are necessary or desirable in order to comply
with Section 16(b) of the
10
Exchange Act and the rules and regulations thereunder. The Committee may at any
time impose additional limitations, or may amend or delete the existing
limitations, upon the exercise of Options by the tender or withholding of Shares
in accordance with Section VII.E (including an amendment or deletion of the
related ownership period for Shares specified in such Section), if such
additional, amended or deleted limitations are necessary, desirable or no longer
required (as the case may be) to remain in compliance with applicable accounting
pronouncements relating to the treatment of the plan as a fixed plan for
accounting purposes.
D. Payment of Withholding Tax. Whenever Shares are to be issued
pursuant to Section VI or Section VIII of the Plan or upon exercise of Options
issued pursuant to Section VII of the Plan, the Company shall be entitled to
require as a condition of delivery (i) that the participant remit an amount
sufficient to satisfy all federal, state and local withholding tax requirements
related thereto, (ii) the withholding of Shares due to the participant under the
Plan with a Fair Market Value equal to such amount, or (iii) any combination of
the foregoing.
E. Expenses. The expenses of the Plan shall be borne by the Company
and its Subsidiaries.
F. Deemed Acceptance, Ratification and Consent. By accepting any Common
Stock hereunder or other benefit under the Plan, each Non-Employee Director and
each person claiming under or through him or her shall be conclusively deemed to
have indicated his or her acceptance and ratification of, and consent to, any
action taken under the Plan by the Company, the Board or the Committee.
G. Securities Act Registration. The Company shall use its best efforts
to cause to be filed under the Securities Act of 1933, as amended, a
registration statement covering the Shares issued, and issuable upon exercise
of options granted, under the Plan.
H. Governing Law. The provisions of the Plan shall be governed by and
construed in accordance with the laws of the State of Delaware.
I. Election Shares. Pending the grant of Election Shares hereunder, all
compensation earned by a Non-Employee Director with respect to which an election
to receive the grant of Election Shares pursuant to Section VIII.B has been made
shall be the property of such director and shall be paid to him or her in cash
in the event that Election Shares are not granted by the Company hereunder.
J. Headings; Construction. Headings are given to the sections of the
Plan solely as a convenience to facilitate reference. Such headings, numbering
and paragraphing shall not in any case be deemed tn any way material or relevant
to the construction of the Plan or any provisions hereof. The use of the
singular shall also include within its meaning the plural, where appropriate,
and vice versa.
11
XI. AMENDMENT.
The Plan may be amended at any time and from time to time by resolution
of the Board as the Board shall deem advisable; provided, however, that no
amendment shall become effective without stockholder approval if such
stockholder approval is required by law, rule or regulation; and provided
further, that to the extent required by Rule 16b-3 under Section 16 of the
Exchange Act, Plan provisions shall not be amended more than once every six
months, except that the foregoing shall not preclude any amendment to comport
with changes in the Code, ERISA or the rules thereunder. No amendment of the
Plan shall materially and adversely affect any right of any participant with
respect to any Options or Shares theretofore granted under the Plan without such
participant's written consent, except for any modifications required to maintain
compliance with any federal or state statute or regulation.
XII. TERMINATION.
The Plan shall terminate upon the earlier of the following dates or
events to occur:
(i) upon the adoption of a resolution of the Board
terminating the Plan; and
(ii) ten years from the date the Plan is initially approved
and adopted by the stockholders of the Company in accordance with
Article XIII.
Except as specifically provided herein, no termination of the Plan
shall materially and adversely affect any of the rights or obligations of any
person without his or her consent with respect to any Options or Shares
theretofore granted under the Plan.
XIII. STOCKHOLDER APPROVAL AND ADOPTION.
The Plan is dated March 12, 1996, which is the date upon which the
Board adopted the Plan. The Plan shall be submitted to the stockholders of the
Company for their approval and adoption at the meeting of stockholders of the
Company to be held May 21, 1996. The Plan shall not be effective unless and
until the Plan has been so approved and adopted. The stockholders shall be
deemed to have approved and adopted the Plan only if it is approved and adopted
at a meeting of the stockholders duly held on that date (or any adjournment of
said meeting occurring subsequent to such date) by vote taken in the manner
required by the laws of the State of Delaware.
12
Exhibit 5
THE ALLSTATE CORPORATION
2775 Sanders Road
Northbrook, Illinois
60062-6127
------------------------
Joseph T. Kane
Counsel
May 31, 1996
The Allstate Corporation
Allstate Plaza
Northbrook, IL 60062
Ladies and Gentlemen:
A Registration Statement on Form S-8 ("Registration Statement") is
being filed on or about the date of this letter with the Securities and Exchange
Commission to register 300,000 shares of common stock, par value $.01 per share
(the "Common Stock"), of The Allstate Corporation (the "Company") which may from
time to time be offered in connection with The Allstate Corporation Equity
Incentive Plan for Non-Employee Directors (the "Plan"). This opinion is
delivered in accordance with the requirements of Item 601(b)(5) of Regulation
S-K under the Securities Act of 1933, as amended.
In connection with this opinion, I have examined and am familiar with
originals or copies, certified or otherwise identified to my satisfaction, of
(i) the Registration Statement, ((ii) the Restated Certificate of Incorporation
of the Company as currently in effect, (iii) the By-laws of the Company as
currently in effect, and (iv) resolutions of the Board of Directors of the
Company relating to the filing of the Registration Statement and related
matters. I have also examined originals or copies, certified or otherwise
identified to my satisfaction, of such records of the Company and such other
agreements, instruments, and documents of the Company, and have made such other
investigations, as I have deemed necessary or appropriate as a basis for the
opinions set forth herein.
I have assumed the legal capacity of all natural persons, the
genuineness of all signatures, the authenticity of all documents submitted to me
as originals, the conformity to
original documents of all documents submitted to me as certified to photostatic
copies and the authenticity of the originals of such latter documents. In making
my examination of documents executed by parties other than the Company, I have
assumed that such parties had the power, corporate and otherwise, to enter into
and perform their respective obligations thereunder and have also assumed the
due authorization by all requisite action, corporate and otherwise, and the
execution and delivery by such parties of such documents and the validity and
binding effect thereof. As to any facts material to the opinion expressed
herein, I have relied upon oral or written statements and representations of
officers and other representatives of the Company and others.
Based upon and subject to the foregoing, it is my opinion that the
shares of Common Stock have been duly authorized and, when issued pursuant to
the Plan, will be validly issued, fully paid and non-assessable.
I consent to the inclusion of this opinion as an exhibit to the
Registration Statement referred to above and to the reference to me in such
Registration Statement.
Very truly yours,
Joseph T. Kane
Exhibit 15
The Allstate Corporation
Allstate Plaza
Northbrook, IL
We have reviewed, in accordance with standards established by the American
Institute of Certified Public Accountants, the unaudited interim financial
information of The Allstate Corporation and subsidiary for the periods ended
March 31, 1996 and 1995, as indicated in our report dated May 13, 1996; because
we did not perform an audit, we expressed no opinion on that information.
We are aware that our report referred to above, which was included in your
Quarterly Report on Form 10-Q for the quarter ended March 31, 1996, is being
used in this Registration Statement.
We are also aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
Deloitte & Touche LLP
Chicago, Illinois
May 30, 1996
Exhibit 23(b)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
The Allstate Corporation on Form S-8 of our reports dated March 1, 1996,
appearing in and incorporated by reference in the Annual Report on Form 10-K of
The Allstate Corporation for the year ended December 31, 1995.
Deloitte & Touche LLP
Chicago, Illinois
May 30, 1996
