Purchasing Stock Under the Plan
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19.
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What is the source of shares to be purchased under the Plan?
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At Old Republic’s option, shares may be purchased in the open market through a registered broker, or directly from Old Republic in the form of newly issued or treasury shares. Share purchases in the open market may be made on any stock exchange where Old Republic shares are traded or by negotiated transactions on terms as the Plan Administrator may reasonably determine. Neither Old Republic nor any participant will have any authority or power to direct the date, time or price at which Old Republic shares may be purchased, or the selection of the broker through or from whom purchases are to be made.
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20.
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At what price will my shares be purchased?
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For Old Republic shares purchased on the open market, the price will be the weighted average of the purchase price of all Old Republic shares purchased for the Plan for that investment date.
If new shares or treasury shares are issued, the price will be the average of the high and low sales prices of the Old Republic shares as reported in the New York Stock Exchange Composite Transactions for that investment date.
Please note that you will not be able to instruct the Plan Administrator to purchase shares at a specific time or at a specific price. If you prefer to have control over the exact timing and price of your purchase, you will need to use your own broker.
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21.
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What is the “investment date”?
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The investment date is the date or dates on which shares of our Common Stock are purchased with reinvested dividends, optional cash investments, initial investments, automatic investments and payroll deductions. The investment date under the Plan depends on how you purchase the shares and whether we issue new shares to you or the Plan obtains your shares by purchasing them from parties other than Old Republic.
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Reinvested Dividends:
The investment date for reinvested dividends is the date or dates on which our quarterly dividends are paid,
and no later than 30 trading days following the dividend payable date
. The record date associated with a particular dividend is referred to in this Plan as a “dividend record date.”
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Optional Cash Investments, Initial Investments and Automatic Investments:
The investment date for optional cash investments, initial investments by non-shareholders and automatic investments will be the date of payment of dividends for months in which a dividend is paid and generally
within five (5) trading days
(or next business day if a weekend or holiday)
, and no later than 35 trading days, except where postponement is necessary to comply with Regulation M under the Securities Exchange Act of 1934 or other applicable provisions of securities law
.
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Payroll Deductions:
For employees of Old Republic or its subsidiaries participating with payroll deductions, funds will be aggregated and remitted to the Plan Administrator and invested with any dividend funds on the dividend payment date.
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22.
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When will investments be made under the Plan?
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The Plan Administrator will credit shares of our Common Stock purchased with reinvested dividends to your account on the applicable investment date. The Plan Administrator will credit shares to your account for optional cash investments on the next investment date after it receives your cash investment. The Plan Administrator must receive your payment at least one business day before the next investment date in order to invest your payment on that investment date.
When the Plan Administrator makes purchases from parties other than Old Republic, those purchases may be made on any securities exchange where shares of our Common Stock are traded, in the over-the-counter market or by negotiated transactions. The Plan Administrator will make these purchases on terms that it approves. Neither we nor any participant will have any power to direct the time or price at which the Plan Administrator will purchase shares.
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23.
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How many shares of Common Stock will I be purchasing through the Plan?
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The number of shares of Common Stock that you purchase depends on several factors including:
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the amount of dividends you reinvest;
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the amount of any optional cash investments you make; and
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the purchase price of the Common Stock on the applicable investment date.
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The Plan Administrator will credit your account with the number of shares equal to the total amount to be invested divided
by the applicable purchase price. The only limit on the number of shares available for purchase directly from us is the number of shares of Common Stock registered for issuance under the Plan.
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24.
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How will I be notified of my purchases of Common Stock?
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The Plan Administrator will send you an account statement following each investment showing your activity and balance in your Plan account. Your account statement will show the number of shares purchased and their purchase price. Your account statement will also show the total number of shares you purchased through the Plan to date during the calendar year, as well as the total number of shares held in your account as of the investment date.
The final statement for each year will show all pertinent information for that calendar year. You should keep this statement for tax purposes. The Plan Administrator will charge you a fee if you request additional copies of your prior account statements.
We will also send you copies of each prospectus and any amendments or supplements to prospectuses describing the Plan, and we will send you the same information that we send to other shareholders, including quarterly reports, annual reports, notices of shareholders meetings, proxy statements, and income tax information for reporting dividends paid.
You may elect to have your statements and other information sent to you automatically by initiating eDelivery through
shareowneronline.com
.
Selling Shares of Stock Held in the Plan
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25.
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How can I sell stock held in my Plan account?
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You may sell some or all of your stock held in your Plan account, even if you are withdrawing from this Plan.
You can sell your shares either through your broker or through the Plan Administrator.
To sell shares through a broker of your choice, you may request the broker to transfer shares electronically from your Plan account to your brokerage account. Alternatively, a stock certificate can be requested in writing that you can deliver to your broker. The Plan Administrator will process requests for certificates for your shares as soon as administratively possible after it receives your request.
Alternatively, you may send the Plan Administrator a request to sell online, by telephone or through the mail (see
Contact Information
).
Sales are usually made through an affiliated broker, who will receive brokerage commissions. Typically, the shares are sold through the exchange on which the Common shares of Old Republic are traded. Depending on the number of Old Republic shares to be sold and current trading volume, sale transactions may be completed in multiple transactions and over the course of more than one day. All sales are subject to market conditions, system availability, restrictions and other factors. The actual sale date, time or price received for any shares sold through the Plan cannot be guaranteed.
Participants may instruct the Plan Administrator to sell shares under the Plan through a Batch Order, Market Order, Day Limit Order, Good-‘Til-Date/Canceled Limit Order or Stop Order.
Batch Order (online, telephone, mail)
- The Plan Administrator will combine each request to sell through the Plan with other Plan participant sale requests for a Batch Order. Shares are then periodically submitted in bulk to a broker for sale on the open market. Shares will be sold no later than five business days (except where deferral is necessary under state or federal regulations). Bulk sales may be executed in multiple transactions and over more than one day depending on the number of shares being sold and current trading volumes. Once entered, a Batch Order request cannot be canceled.
Market Order (online or telephone)
- The participant’s request to sell shares in a Market Order will be at the prevailing market price when the trade is executed. If such an order is placed during market hours, the Plan Administrator will promptly submit the shares to a broker for sale on the open market. Once entered, a Market Order request cannot be canceled. Sales requests submitted near the close of the market may be executed on the next trading day, along with other requests received after market close.
Day Limit Order (online or telephone)
- The participant’s request to sell shares in a Day Limit Order will be promptly submitted by the Plan Administrator to a broker. The broker will execute as a Market Order when and if the stock reaches, or exceeds the specified price on the day the order was placed (for orders placed outside of market hours, the next trading day). The order is automatically canceled if the price is not met by the end of that trading day. Depending on the number of shares being sold and current trading volumes, the order may only be partially filled and the remainder of the order canceled. Once entered, a Day Limit Order request cannot be canceled by the participant.
Good-‘Til-Date/Canceled (GTD/GTC) Limit Order (online or telephone)
- A GTD/GTC Limit Order request will be promptly submitted by the Plan Administrator to a broker. The broker will execute as a Market Order when and if the stock reaches, or exceeds the specified price at any time while the order remains open (up to the date requested or 90 days for GTC). Depending on the number of shares being sold and current trading volumes, sales may be executed in multiple transactions and may be traded on more than one day. The order or any unexecuted portion will be automatically canceled if the price is not met by the end of the order period. The order may also be canceled by the applicable stock exchange or the participant.
Stop Order (online or telephone)
- The Plan Administrator will promptly submit a participant’s request to sell shares in a Stop Order to a broker. A sale will be executed when the stock reaches a specified price, at which time the Stop Order becomes a Market Order and the sale will be at the prevailing market price when the trade is executed. The price specified in the order must be below the current market price (generally used to limit a market loss).
Sales proceeds will be net of any fees to be paid by the participant (see
Investment Summary and Fees
for details). The Plan Administrator will deduct any fees or applicable tax withholding from the sale proceeds. Sales processed on accounts without a valid Form W-9 for U.S. citizens or Form W-8BEN for non-U.S. citizens will be subject to Federal Backup Withholding. This tax can be avoided by furnishing the appropriate and valid form prior to the sale. Forms are available online at
shareowneronline.com
.
A check for the proceeds of the sale of shares (in U.S. dollars), less applicable taxes and fees, will generally be mailed by first class mail
as soon as administratively possible
after settlement date. If a participant submits a request to sell all or part of
the Plan shares, and the participant requests net proceeds to be automatically deposited to a checking or savings account, the participant must provide a voided blank check for a checking account or blank savings deposit slip for a savings account. If the participant is unable to provide a voided check or deposit slip, the participant’s written request must have the participant’s signature(s) medallion guaranteed by an eligible financial institution for direct deposit. Requests for automatic deposit of sale proceeds that do not provide the required documentation will not be processed and a check for the net proceeds will be issued.
A participant who wishes to sell shares currently held in certificate form may send them in for deposit to the Plan Administrator and then proceed with the sale. To sell shares through a broker of their choice, the participant may request the broker to transfer shares electronically from the Plan account to their brokerage account. Alternatively, a stock certificate can be requested that the participant can deliver to their broker.
Old Republic’s share price may fluctuate between the time the sale request is received and the time the sale is completed on the open market. The Plan Administrator shall not be liable for any claim arising out of failure to sell on a certain date or at a specific price. Neither the Bank nor any of its affiliates will provide any investment recommendations or investment advice with respect to transactions made through the Plan. This risk should be evaluated by the participant and is a risk that is borne solely by the participant.
The Insider Trading Policy provides that the participant may not trade in Old Republic’s Common Stock if in possession of material, non-public information about the company. Share sales by employees, Affiliates and Section 16 officers must be made in compliance with Old Republic’s Insider Trading Policy.
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26.
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What happens when I sell or transfer all of the shares of Common Stock held outside the Plan?
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If you sell or transfer all shares of our stock registered in your name outside your Plan account, the Plan Administrator, until you give other instructions, will continue to reinvest the dividends on the Common Stock in your Plan account according to your instructions on the
Account Authorization Form
. You may also continue to participate in the optional cash investment feature of this Plan as long as there is at least one whole share of Common Stock remaining in your Plan account.
If you sell or transfer all of the shares registered in your name and all whole Common Stock held in your Plan account, the Plan Administrator will mail you a cash payment representing any fractional share in your Plan account, less applicable brokerage commissions and service fees, upon your request or at our request.
If a participant’s request to transfer all Plan shares in an account is received between a dividend record date and payable date, the request will be processed and a separate dividend check will be mailed to the participant.
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27.
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What happens to a fraction of a share of Common Stock when I withdraw from the Plan or the Plan is terminated?
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When you withdraw from this Plan or we terminate this Plan, the Plan Administrator will mail you a cash payment, less any applicable service charges and brokerage commissions, representing any fractional share of Common Stock upon your request or at our request. The cash payment will be based upon the market price on the date the Plan Administrator processes your withdrawal or termination.
Owning Stock in the Plan
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28.
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How will I be credited with dividends on stock held in my Plan account?
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We pay dividends to all holders of record of our stock, when and as declared. The Plan Administrator will receive and credit Plan participants with dividends for all stock you hold in the Plan, including any fractional share. The Plan Administrator will reinvest dividends in additional shares of our Common Stock or distribute dividends, according to your instructions.
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29.
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What happens if Old Republic declares a stock split?
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The Plan Administrator will add any shares resulting from a stock split, on shares you hold in your Plan account, to your Plan account. We will issue any shares resulting from a stock split, on stock held by you outside the Plan, in the same manner as we would if you were not participating in this Plan. If you send a notice of termination or a request to sell to the Plan Administrator between the record date and the payable date for a stock distribution, the request will not be processed until the stock distribution is credited to your account.
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30.
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If Old Republic issues rights to purchase securities to the holders of Common Stock, how will the rights on Plan shares be handled?
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In the event we make available to its shareowners rights to purchase additional common stock or other securities, the Plan Administrator will sell such rights accruing in common stock for the participant. The funds will be combined with the next regular dividend or optional cash investment for reinvestment. If a participant desires to independently exercise the purchase rights, the participant should request that whole common stock be issued in book-entry DRS.
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31.
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How will the stock held under this Plan be voted at meetings of shareholders?
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Participants in the Plan will receive voting materials and have the sole right to vote the common stock of Old Republic represented by the shares held for them in the Plan. In the event the participant does not provide direction for voting, the Plan shares will not be voted.
The participant is encouraged to read the information carefully. Votes may be submitted online, by telephone or by returning the signed, dated proxy card. A participant’s shares will be voted in accordance with the most recent submitted instructions.
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32.
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Will stock certificates be issued for Common Stock purchased under the Plan?
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We will not issue certificates for shares that you purchase under the Plan. Your account statement will show the number of shares held in your Plan account. In addition to minimizing the costs of this Plan, this additional service protects against loss, theft or destruction of stock certificates.
However, you may at any time request in writing that the Plan Administrator issue a certificate for any whole number of shares of Common Stock, up to the number of full shares credited to your Plan account. Your request should be addressed to the Plan Administrator.
Future dividends on any shares for which you request a stock certificate will be treated according to your instructions indicated on the
Account Authorization Form
. If you request certificates for less than all of the stock in your Plan account, any remaining full shares and fractional share in your Plan account will continue to be invested in accordance with the instructions given on your
Account Authorization Form
. We retain the right to automatically withdraw you from the Plan if your Plan account is less than one whole share as a result of withdrawals or sales of stock and you are not reinvesting dividends from any stock registered in your name.
Certificate(s) will be issued to a participant for Old Republic Common Stock in the participant’s account upon written request to the Plan Administrator. No certificate for a fractional share will be issued.
Optional Mail Loss Insurance
The participant is advised that choosing registered, express or certified mail alone will not provide full protection, should the certificates become lost or stolen. Mail loss insurance provides the coverage needed to replace and reissue the shares should they become lost or stolen through the mail. As the Plan Administrator, we can provide low-cost loss insurance for certificates being returned for conversion to book-entry form. Replacement transaction fees may also apply.
To take advantage of the optional mail loss insurance, simply include a check in the amount of $10.00, made payable to ‘WFSS Surety Program’, along with the certificates and instructions. Choose an accountable mail delivery service such as Federal Express, United Parcel Service, DHL, Express Mail, Purolator, TNT, or United States Postal Service Registered Mail. Any one shipping package may not contain certificates exceeding a total value of $100,000. The value of certificate shares is based on the closing market price of the Common Stock on the trading day prior to the documented mail date.
Claims related to lost certificates under this service must be made within 60 days of the documented delivery service mail date. A copy of the certificate(s) mailed, along with proof that it was sent by trackable mail should be submitted with the claim. This is specific coverage for the purpose of converting shares to book-entry form and the surety is not intended to cover certificates being tendered for certificate breakdown or exchange for other certificates.
When necessary, you can simply request that certificates be issued as your needs require.
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33.
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In whose name will certificates be registered when issued?
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We will issue stock certificates registered in your name as it appears on your Plan account.
You may ask the Plan Administrator to issue certificates in names other than the Plan account name, but you must comply with any applicable laws. You must make this request in writing, and your signature must be guaranteed by a qualified medallion guarantee member.
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34.
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Is a safekeeping service available to hold my shares?
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Yes. A participant may elect to deposit physical Old Republic Common Stock certificate(s) for safekeeping, by sending the certificate(s) to the Plan Administrator together with instructions to deposit the certificate(s). The certificate(s) will show as surrendered with the corresponding credit to Plan shares. The transaction will appear on the Plan account statement, and shares will be held by the Plan Administrator in its name or nominee name. These shares will be held until the participant sells, withdraws or terminates participation in the Plan. Because the participant bears the risk of loss in sending stock certificate(s), it is recommended that the participant sends them registered, insured for at least 3% of the current market value and request a return receipt.
You may also transfer other shares of our stock that are registered in your name to your Plan account at no cost. This eliminates the need for safekeeping of the certificates for those shares. You may mail certificates to the Plan Administrator.
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35.
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Can I pledge shares in my Plan account?
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No. You may not pledge any shares of our stock that you hold in your Plan account. Any pledge of shares in a Plan account is null and void. If you wish to pledge shares, you must first withdraw those shares from the Plan and request that the Plan Administrator send you certificates for those shares.
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36.
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Can I access my account and perform transactions online?
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Yes. Subject to certain limitations, you may access your account information and perform transactions online at
shareowneronline.com
(see
Contact Information
). Accounts that are registered in the name of an investment club, corporation, or partnership will not be allowed online access. Please note that additional access restrictions may apply.
After you have successfully signed up, you will be able to access your account immediately. You will also receive written confirmation to your mailing address on file that your account has been activated for online access.
Once you have activated your account online, you can also authorize, change or stop your automatic investment; sell some or all of your Plan shares; and change your dividend reinvestment option (for example, from full to partial reinvestment). Certain restrictions may apply.
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37.
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Can I access my account and perform transactions by telephone?
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Yes. If you have established automated privileges on your account, you can change the amount of or stop automatic withdrawals; change your dividend reinvestment option (for example, from full to partial reinvestment); and sell some or all of your Plan shares.. Certain restrictions may apply.
To establish automated privileges, please call Wells Fargo and request, or view
shareowneronline.com
to download, an
Automated Request Authorization Form
.
Important Tax Consequences
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38.
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What are the federal income tax consequences of participation in the Plan?
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All the dividends paid to you, whether or not they are reinvested, are considered taxable income to you in the year they are paid by Old Republic. The total amount will be reported to you and to the Internal Revenue Service on IRS Form 1099-DIV which will be mailed to you shortly after the end of each year.
This Plan assumes that each participant will use the first-in, first-out (“FIFO”) method when determining the tax basis of any shares sold. You may designate your preference for a different method of determining the tax basis of shares by identifying this preference in writing to the Plan Administrator. You may designate your preference for “specific identification” cost basis in writing at any time.
In addition, when the Plan Administrator purchases Old Republic shares for your account on the open market rather than directly from Old Republic, you must include in your gross income, as additional dividends, your allocable shares of any brokerage commissions paid by Old Republic: this amount will be reported to you and the
U.S. Internal Revenue Service on IRS Form 1099-DIV shortly after the end of each year. Your tax basis in these Old Republic shares will be the cost of the Old Republic shares plus your share of any brokerage commissions paid by Old Republic.
All shares of stock that are sold through the Plan Administrator will be reported to the IRS as required by law. IRS Form 1099-B will be mailed to all those who sold stock through the Plan shortly at the end of each year. The 1099-B form will only include proceeds you received from the sale of your shares. You are responsible for calculating the cost basis of the shares you sold and any gain or loss on the sale.
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39.
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What provision is made for shareholders subject to income tax withholding?
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If you are a foreign shareholder whose dividends are subject to United States income tax withholding, or a domestic shareholder whose dividends are subject to backup withholding taxes, the Plan Administrator will reinvest an amount equal to the dividends less the amount of any tax required to be withheld. We will have amounts withheld from dividends paid to the United States Treasury and the respective participants will be advised of the amounts withheld.
Foreign shareholders who elect to make optional cash investments only will continue to receive cash dividends on stock registered in their names in the same manner as if they were not participating in this Plan. Funds for optional cash investments must be in United States dollars, drawn on a United States or Canadian financial institution, and will be invested in the same way as payments from other participants.
A foreign person (nonresident alien individual or foreign entity) is subject to tax withholding at a 30% rate on the gross amount of certain payments of U.S. source income including dividends, unless the beneficial owner of the payment is entitled to a reduced rate of, or exemption from, withholding tax under an income tax treaty. Foreign Entity owned accounts may also be subject to 30% withholding on all applicable U.S. sourced income, including dividends, as required by the Foreign Account Tax Compliance Act (“FATCA”). Gross proceeds received from the sale, maturity or exchange of securities that can produce U.S. sourced dividends or interest will also be subject to potential FATCA withholding effective on January 1, 2019. Foreign persons should consult with their tax advisors or counsel as to which tax certification form they are required to provide and for more specific information regarding the withholding requirements under Chapters 3 and 4 (FATCA) of the U.S. Internal Revenue Code.
Be sure to keep your account statements for income tax purposes. If you have any questions about the tax impact of any transactions you are contemplating, please consult your own tax advisor.
Other Important Provisions
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40.
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Can Old Republic change or discontinue the Plan?
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While we currently intend to continue this Plan indefinitely, we may amend, suspend, modify or terminate this Plan at any time. We will send you notice of any amendment, suspension, modification or termination. The Plan Administrator may resign at any time upon reasonable notice to us in writing.
We may elect and appoint at any time a new Plan Administrator, including ourselves, to administer this Plan.
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41.
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What are the responsibilities of Old Republic and the Plan Administrator under the Plan?
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In administering the Plan, neither Old Republic, the Plan Administrator nor any broker selected by the Plan Administrator to execute purchases and sales on behalf of Plan participants is liable for any good faith act or omission to act, including but not limited to any claim of liability (i) arising out of the failure to terminate a participant’s account upon such participant’s death prior to receipt of a notice in writing of such death, (ii) with respect to the prices or times at which shares are purchased or sold, or (iii) as to the value of the shares acquired for participants.
The Plan Administrator is acting solely as agent of Old Republic and owes no duties, fiduciary or otherwise, to any other person by reason of this Plan, and no implied duties, fiduciary or otherwise, shall be read into this Plan. The Plan Administrator undertakes to perform such duties and only such duties as are expressly set forth herein, to be performed by it, and no implied covenants or obligations shall be read into this Plan against the Plan Administrator or Old Republic.
In the absence of negligence or willful misconduct on its part, the Plan Administrator, whether acting directly or through agents or attorneys, shall not be liable for any action taken, suffered, or omitted or for any error of judgment made by it in the performance of its duties hereunder. In no event shall the Plan Administrator be liable for special, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profit), even if the Plan Administrator has been advised of the likelihood of such loss or damage and regardless of the form of action.
The Plan Administrator shall: (i) not be required to and shall make no representations and have no responsibilities as to the validity, accuracy, value or genuineness of any signatures or endorsements, other than its own; and (ii) not be obligated to take any legal action hereunder that might, in its judgment, involve any expense or liability, unless it has been furnished with reasonable indemnity.
The Plan Administrator shall not be responsible or liable for any failure or delay in the performance of its obligations under this Plan arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fires; floods; wars; civil or military disturbances; sabotage; epidemics; riots; interruptions, loss or malfunctions of utilities; computer (hardware or software) or
communications services; accidents; labor disputes; acts of civil or military authority or governmental actions; it being understood that the Plan Administrator shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as administratively possible under the circumstances.
The Plan Administrator is authorized to choose a broker, including an affiliated broker, at its sole discretion to facilitate purchases and sales of Common Stock by Plan participants. The Plan Administrator will furnish the name of the registered broker, including any affiliated broker, utilized in share transactions within a reasonable time upon written request from you.
The Old Republic Common stock is not insured by the FDIC or any other government agency, are not deposits or other obligations of, and are not guaranteed by, Wells Fargo Shareowners Services or Old Republic, and are subject to investment risks, including possible loss of principal amount invested. Common stock held in the Plan are not subject to protection under the Securities Investor Protection Act of 1970.
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42.
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Who interprets and regulates the Plan?
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Any questions of interpretation arising under this Plan will be determined by Old Republic and any determination will be final. We may adopt rules and regulations to facilitate the administration of this Plan. Delaware law governs the terms and conditions in this document, as well as those that are described in detail on all forms and account statements.
DIRECT REGISTRATION
We are a participant in the Direct Registration System (“DRS”). DRS is a method of recording shares of stock in electronic, or book-entry form, meaning your shares are registered in your name on the books of Old Republic without the need for physical certificates. Shares held in book-entry have all the traditional rights and privileges of shares held in certificate form.
DRS eliminates the risk and cost of storing certificates, while enabling you to maintain the benefits of direct ownership, including the ability to participate in the Plan. You may at any time choose to have all or a portion of your book-entry shares transferred to your broker electronically by contacting your broker. When using your broker to facilitate a share transfer, provide them with a copy of your DRS account statement.
Shares of Old Republic stock that are issued in the future will be issued in book-entry form rather than physical certificates unless you specify otherwise. You may convert any stock certificate(s) you currently hold to book-entry form, by sending the stock certificate(s) to Wells Fargo with a request to deposit them to your DRS account. There is no cost to you for this custodial service.