<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
SCHEDULE 13D
(Rule 13d-101)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
-----------------------------------------
(Amendment No. 4)*
First Alliance Corporation
-------------------------------------------------------------------------------
(Name of Issuer)
Class A Common Stock
-------------------------------------------------------------------------------
(Title of Class of Securities)
317936102
-------------------------------------------------------------------------------
(CUSIP Number)
Brian Chisick, First Alliance Corporation, 17305 Von Karman Avenue,
Irvine, CA 92614 (949) 224-8500
-------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
5/8/00
-------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 8 Pages)
---------------------------
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
CUSIP No. 317936102 13D Page 2 of 8 Pages
________________________________________________________________________________
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Brian Chisick
________________________________________________________________________________
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [X]
________________________________________________________________________________
3 SEC USE ONLY
________________________________________________________________________________
4 SOURCE OF FUNDS*
PF, OO
________________________________________________________________________________
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
Not Applicable.
________________________________________________________________________________
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
________________________________________________________________________________
7 SOLE VOTING POWER
NUMBER OF 177,042 shares of Class A Common Stock
SHARES _________________________________________________________________
8 SHARED VOTING POWER
BENEFICIALLY
14,693,667 shares of Class A Common Stock
OWNED BY
_________________________________________________________________
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 177,042 shares of Class A Common Stock
PERSON _________________________________________________________________
10 SHARED DISPOSITIVE POWER
WITH
14,693,667 shares of Class A Common Stock
________________________________________________________________________________
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
14,870,709 shares of Class A Common Stock
________________________________________________________________________________
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[_]
________________________________________________________________________________
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
82%
________________________________________________________________________________
14 TYPE OF REPORTING PERSON*
IN
________________________________________________________________________________
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP No. 317936102 13D Page 3 of 8 Pages
________________________________________________________________________________
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Sarah Chisick
________________________________________________________________________________
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [X]
________________________________________________________________________________
3 SEC USE ONLY
________________________________________________________________________________
4 SOURCE OF FUNDS*
PF, OO
________________________________________________________________________________
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
Not Applicable.
________________________________________________________________________________
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
________________________________________________________________________________
7 SOLE VOTING POWER
NUMBER OF Not applicable
SHARES _________________________________________________________________
8 SHARED VOTING POWER
BENEFICIALLY
14,693,667 shares of Class A Common Stock
OWNED BY
_________________________________________________________________
EACH 9 SOLE DISPOSITIVE POWER
REPORTING Not applicable
PERSON _________________________________________________________________
10 SHARED DISPOSITIVE POWER
WITH
14,693,667 shares of Class A Common Stock
________________________________________________________________________________
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
14,693,667 shares of Class A Common Stock
________________________________________________________________________________
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[_]
________________________________________________________________________________
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
82%
________________________________________________________________________________
14 TYPE OF REPORTING PERSON*
IN
________________________________________________________________________________
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
AMENDMENT NO. 4
TO SCHEDULE 13D
FILED PURSUANT TO RULE 13d-2
OF THE GENERAL RULES AND REGULATIONS
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
The undersigned hereby amend the Schedule 13D heretofore filed by them,
as amended through the date hereof.
ITEM 1. SECURITY AND ISSUER.
This statement relates to shares of the Class A Common Stock, $.01 par
value per share (the "Class A Common Stock"), of First Alliance Corporation, a
Delaware corporation (the "Company"), whose principal executive offices are
located at 17305 Von Karman Avenue, Irvine, California 92614.
ITEM 2. IDENTITY AND BACKGROUND.
I. Brian Chisick.
(a) The name of the person filing this statement is Brian
Chisick.
(b) The business address of Mr. Chisick is 17305 Von Karman
Avenue, Irvine, CA 92614.
(c) The principal occupation of Mr. Chisick is Chairman and
Chief Executive Officer of the Company. The principal business of the Company
has been mortgage lending. On March 23, 2000, the Company and several of its
subsidiaries filed for voluntary petitions under Chapter 11 of the United States
Bankruptcy Code in the U. S. Bankruptcy Court for the Central District of
California. As a result, the Company has closed its entire loan origination
operations, but will continue some loan servicing operations pending approval of
the Company's reorganization and/or liquidation plan. The principal address of
the Company is stated above in Item 1.
(d) Mr. Chisick has not been convicted in a criminal
proceeding during the last five years.
(e) During the last five years, Mr. Chisick has not been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction resulting in a judgment, decree, or final order enjoining future
violations of, or prohibiting or mandating activities subject to, Federal or
State securities laws or finding any violations with respect to such laws. (f)
Mr. Chisick is a citizen of the United States.
(f) Mr. Chisick is a citizen of the United States.
II. Sarah Chisick.
(a) The name of the other person filing this statement is
Sarah Chisick. Mr. and Mrs. Chisick are husband and wife.
(b) The business address of Mrs. Chisick is none.
(c) The principal occupation of Mrs. Chisick is none.
(d) Mrs. Chisick has not been convicted in a criminal
proceeding during the last five years.
4 of 8
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(e) During the last five years, Mrs. Chisick has not been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction resulting in a judgment, decree, or final order enjoining future
violations of, or prohibiting or mandating activities subject to, Federal or
State securities laws or finding any violations with respect to such laws.
(f) Mrs. Chisick is a citizen of the United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
During May 2000, Brian and Sarah Chisick, as co-trustees of the Brian
and Sarah Chisick Revocable Estate Trust U/A 3-7-79 (the "Trust"), purchased
using Trust funds, an aggregate of 2,047,600 shares of the Company's Class A
Common Stock for an aggregate purchase price of $470,439 (or a weighted average
price of approximately $0.23 per share). The beneficiaries of the Trust are
Brian and Sarah Chisick (the "Chisicks") under the terms of the Trust.
During June 2000, the Trust purchased, using Trust Funds, an aggregate
of 100,000 shares of the Company's Class A Common Stock, for an aggregate
purchase price of $25,000 (or a weighted average price of approximately $0.25
per share).
During July 2000, the Trust purchased, using Trust Funds, an aggregate
of 50,000 shares of the Company's Class A Common Stock, for an aggregate
purchase price of $7,500 (or a weighted average price of approximately $0.25 per
share).
During August 2000, the Trust purchased, using Trust funds, an
aggregate of 25,000 shares of the Company's Class A Common Stock, for an
aggregate purchase price of $6,250 (or a weighted average price of approximately
$0.25 per share).
No funds used in making any of such purchases were borrowed.
ITEM 4. PURPOSE OF TRANSACTION.
The shares of the Class A Common Stock of the Company purchased by the
Trust in May, June, July and August 2000 were purchased pursuant to a Master
Custodian and Escrow Agreement dated May 8, 2000, by and between the Trust and
U. S. Trust Company, National Association, a national bank organized and
existing under and by the laws of the United States of America, as Escrow Agent
(the "Agreement").
The purpose of the Agreement was to place the purchased shares of the
Company's Common Stock (the "Stock") in escrow pending the evaluation of the
purchase opportunity by the Company and pending review of the transaction by the
United States Bankruptcy Court, Santa Ana for the Central District of California
(the "Bankruptcy Court"). The Bankruptcy Court is the body that is supervising
the Chapter 11 proceedings of First Alliance Company and its affiliates. A copy
of the Agreement has been filed as an Exhibit hereto and is incorporated herein
by this reference. Pending the resolution of the opportunity of the Company to
purchase the Stock, the Stock will not be voted by the Chisicks in their
capacities as co-trustee of the Trust. The Company, subsequently, reviewed the
purchases of the Stock and declined to repurchase the Stock. If the Bankruptcy
Court determines that the Company should repurchase the Stock, the Company may
be obligated to reimburse the Chisicks or the Trust the amount of the money used
to purchase the Shares. If the Bankruptcy Court does not order the repurchase of
the Stock by the Company then potentially the Chisicks or an affiliate of the
Chisicks or some other entity may retain or purchase all or a portion of the
Stock, as the case may be. If the Bankruptcy Court requires some alternate
method of distribution, then the Chisicks intend to comply with such order of
the Bankruptcy Court.
5 of 8
<PAGE>
The Stock has been acquired by the Trust for investment purposes as
defined in the Agreement and for no other reasons required to be reported in
Item 4.
Depending upon market price, availability, and other factors deemed
relevant, the Trust may from time to time purchase additional shares or sell
shares of the Class A Common Stock in the open market, in privately negotiated
transactions, or otherwise. The Trust reserves the right to increase or decrease
its beneficial ownership of the Class A Common Stock on such terms and at such
times as it may decide and the Trust reserves the right to cease purchasing or
selling shares of the Class A Common Stock at any time.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
I. Brian Chisick.
(a) As of August 30, 2000, Mr. Chisick beneficially owned an
aggregate of 14,870,709 shares of Class A Common Stock (the "Aggregate Shares"),
representing 82% of the outstanding shares of Class A Common Stock. This amount
includes 8,668,800 shares held by the Brian and Sarah Chisick Revocable Estate
Trust U/A 3-7-79 of which Brian Chisick and Sarah Chisick are co-trustees,
includes 3,000,000 shares held by the Chisick Trust No. 3 U/A/D 4-30-99 of which
Brian Chisick is the sole trustee, and includes 3,000,000 shares held by the
Chisick Trust No. 4 U/A/D 4-30-99 of which Brian Chisick is the sole trustee.
Also includes 24,867 shares held by grantor trusts established for the benefit
of four of the Chisicks grandchildren, of which trusts Mr. Chisick is the sole
trustee. Under Rule 13d-3(d), Mr. Chisick is deemed to be the beneficial owner
of 177,042 shares of Class A Common Stock (the "Vested Shares") which Mr.
Chisick has the right to acquire as of August 30, 2000 (or within 60 days
thereafter), pursuant to the stock options described below in Item 6. The Vested
Shares are included in the Aggregate Shares. The calculation of such percentage
is based on 17,864,788 shares of Class A Common Stock which were outstanding as
of August 30, 2000, plus the Vested Shares which are deemed to be outstanding
for the purpose of such calculation.
(b) As of August 30, 2000, Mr. Chisick has sole voting and
dispositive power over the Vested Shares. Mr. Chisick shares voting and
dispositive power over 14,693,667 shares of Class A Common Stock with Mrs.
Chisick. This amount includes 8,668,800 shares held by Trust of which the
Chisicks are co-trustees, 3,000,000 shares held by the Chisick Trust No. 3 U/A/D
4-30-99 of which Brian Chisick is the sole trustee, and includes 3,000,000
shares held by the Chisick Trust No. 4 U/A/D 4-30-99 of which Brian Chisick is
the sole trustee. Also includes 24,867 shares held by grantor trusts established
for the benefit of four of the Chisicks grandchildren, of which trusts Mr.
Chisick is the sole trustee.
(c) The information provided above in Item 3 is incorporated
herein by this reference.
(d) No person other than Mr. and Mrs. Chisick is known to have
the right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, such shares.
(e) Not applicable.
II. Sarah Chisick.
(a) As of August 30, 2000, Mrs. Chisick beneficially owned an
aggregate of 14,693,667 shares of Class A Common stock, representing 82% of the
outstanding shares of Class A Common Stock. The calculation of such percentage
is based on 17,864,788 shares of Class A Common Stock which were outstanding as
of August 30, 2000.
6 of 8
<PAGE>
(b) As of August 30, 2000, Mrs. Chisick shares voting and
dispositive power over 14,693,667 shares of Class A Common Stock with Mr.
Chisick. This amount includes 8,668,800 shares held by Trust of which the
Chisicks are co-trustees, 3,000,000 shares held by the Chisick Trust No. 3 U/A/D
4-30-99 of which Brian Chisick is the sole trustee, and includes 3,000,000
shares held by the Chisick Trust No. 4 U/A/D 4-30-99 of which Brian Chisick is
the sole trustee. Also includes 24,867 shares held by grantor trusts established
for the benefit of four of the Chisicks grandchildren, of which trusts Mr.
Chisick is the sole trustee.
(c) The information provided above in Item 3 is incorporated
herein by this reference.
(d) No person other than the Chisicks are known to have the
right to receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, such shares.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Pursuant to the Company's 1996 Stock Incentive Plan, the Company has
granted to Mr. Chisick the following stock options (the "Stock Options"): (1) on
January 27, 1998, a Non-Qualified ("NQ") Stock Option to purchase 100,000 shares
of the Company's Class A Common Stock at an exercise price of $13.06 per share,
which as of August 30, 2000, was exercisable with respect to 75,000 shares; (2)
on December 4, 1998, an Incentive Stock Option ("ISO") to purchase 54,085 shares
of the Company's Class A Common Stock at an exercise price of $4.4375 per share,
which as of August 30, 2000, was exercisable with respect to 27,042 shares; (3)
on April 27, 1999, an ISO to purchase 44,135 shares of the Company's Class A
Common Stock at an exercise price of $3.625 per share, which as of August 30,
2000, was exercisable with respect to 22,068 shares; (4) on April 27, 1999, a NQ
Stock Option to purchase 55,865 shares of the Company's Class A Common Stock at
an exercise price of $3.625 per share, which as of August 30, 2000, was
exercisable with respect to 27,932 shares; and (5) on December 3, 1999, a NQ
Stock Option to purchase 100,000 shares of the Company's Class A Common Stock at
an exercise price of $2.50 per share, which as of August 30, 2000, was
exercisable with respect to 25,000 shares. The Stock Options cover options to
purchase an aggregate of 354,085 shares of the Company's Class A Common Stock
and, as of August 30, 2000, are exercisable with respect to an aggregate of
177,042 shares (i.e., the Vested Shares). Copies of the 1996 Stock Incentive
Plan and the stock option notices relating to the Stock Options have been filed
as Exhibits hereto and are incorporated herein by this reference.
Except as described herein, there are no contracts, arrangements,
understandings, or relationships among the persons named in Item 2 or between
such persons and any other person with respect to any securities of the Company.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1. 1996 Stock Incentive Plan (incorporated by reference to
Exhibit 4.1 to the Company's Registration Statement of Form S-1, Commission File
No. 333-3363).
Exhibit 2. Non-Qualified Stock Option Notice, dated January 27, 1998,
executed by the Company in favor of Brian Chisick, covering 100,000 shares
(filed herewith).
Exhibit 3. Incentive Stock Option Notice, dated December 4, 1998,
executed by the company in favor of Brian Chisick, covering 54,085 shares (filed
herewith).
Exhibit 4. Incentive Stock Option Notice, dated April 27, 1999,
executed by the Company in favor of Brian Chisick, covering 44,135 shares (filed
herewith).
7 of 8
<PAGE>
Exhibit 5. Non-Qualified Stock Option Notice, dated April 27, 1999,
executed by the Company in favor of Brian Chisick, covering 55,865 shares (filed
herewith).
Exhibit 6. Non-Qualified Stock Option Notice, dated December 3, 1999,
executed by the Company in favor of Brian Chisick, covering 100,000 shares
(filed herewith).
Exhibit 7. Master Custodian and Escrow Agreement between U. S. Trust
Company, National Association and The Brian and Sarah Chisick Revocable Estate
Trust U/A 3/7/79 (filed herewith).
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: October 10, 2000
/s/ Brian Chisick
----------------------
Brian Chisick
Date: October 10, 2000
/s/ Sarah Chisick
----------------------
Sarah Chisick
8 of 8
<PAGE>
EXHIBIT 2
1996 Stock Incentive Plan
-------------------------
EXPLORE YOUR OPTIONS
Option to Purchase: ONE HUNDRED THOUSAND SHARES
------------------- ---------------------------
Granted to: BRIAN CHISICK
-------------------------
This stock option grant has been executed as of January 27, 1998 on behalf of
First Alliance Corporation at the option price of $13.06.
/S/ Brian Chisick
[First Alliance -------------------------------------
Logo Here] Brian Chisick
President and Chief Executive Officer
THIS IS NOT A STOCK CERTIFICATE OR A NEGOTIABLE INSTRUMENT. NON-TRANSFERABLE.
<PAGE>
EXHIBIT 2
1996 Stock Incentive Plan
NON-QUALIFIED STOCK OPTION NOTICE
Optioneee: Brian Chisick
Grant Date: January 27, 1998
Shares Granted: 100,000
Stock Option Price: $13.06
Last Date to Exercise: 01/26/2008
We are pleased to inform you that the Compensation Committee of the Board has
granted you an option to purchase First Alliance Corporation common stock. Your
grant has been made under the Company's 1996 Stock Incentive Plan (the "Plan"),
which together with the terms contained in this Notice, sets forth the terms and
conditions of your grant and is incorporated herein by reference. A copy of the
Plan is attached. Please review it carefully.
Vesting:
Subject to the terms of the Plan, shares vest according to the following vesting
schedule:
<TABLE>
<CAPTION>
SHARES VESTING OVER VESTING IN PERIOD
DATE OF VEST THE PERIOD OCCURS LAST DATE TO EXERCISE
----------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C>
07/27/1998 25,000.00 End of period 01/26/2008
07/27/1999 25,000.00 End of period 01/26/2008
07/27/2000 25,000.00 End of period 01/26/2008
07/27/2001 25,000.00 End of period 01/26/2008
</TABLE>
Exercise:
You may exercise this Option, in whole or in part, to purchase a whole number of
vested shares at any time, by following the exercise procedures set up by the
Company. All exercises must take place before the Last Date to Exercise, or such
earlier date as is set out in the Plan following your death, disability or your
ceasing to be an employee. The number of shares you may purchase as of any date
cannot exceed the total number of shares vested by that date, less any shares
you have previously acquired by exercising this Option.
Employment Requirements:
The Plan sets out the terms and conditions that govern this grant in the event
of your termination of employment, death or disability. In the event of your
termination of employment, including total disability or death, all further
vesting of shares under this grant stops. As set out in Plan, you will have 90
Days after your employment ceases or is suspended to exercise your vested
options, and in the event of your total disability or death, you or your estate
will have a period of 1 Year to exercise any vested options.
Taxes and Withholding:
This option is not intended to be an Incentive Stock Option, as defined under
Section 422(b) of the Internal Revenue Code. Any exercise of this option is
normally a taxable event, and if the Company determines that any federal, state,
local or foreign tax or withholding payment is required relating to the exercise
or sale of shares arising from this grant, the Company shall have the right to
require such payments from you, or withhold such amounts from other payments due
to you from the Company.
<PAGE>
EXHIBIT 3
1996 Stock Incentive Plan
-------------------------
EXPLORE YOUR OPTIONS
Option to Purchase: FIFTY FOUR THOUSAND EIGHTY FIVE SHARES
----------------------------------------------------------
Granted to: BRIAN CHISICK
-------------------------
This stock option grant has been executed as of December 4, 1998 on behalf of
First Alliance Corporation at the option price of $4.4375.
/S/ Brian Chisick
[First Alliance -------------------------------------
Logo Here] Brian Chisick
President and Chief Executive Officer
THIS IS NOT A STOCK CERTIFICATE OR A NEGOTIABLE INSTRUMENT. NON-TRANSFERABLE.
<PAGE>
EXHIBIT 3
1996 Stock Incentive Plan
INCENTIVE STOCK OPTION NOTICE
Optioneee: Brian Chisick
Grant Date: December 4, 1998
Shares Granted: 54,085
Stock Option Price: $4.4375
Last Date to Exercise: 12/03/2008
We are pleased to inform you that the Compensation Committee of the Board has
granted you an option to purchase First Alliance Corporation common stock. Your
grant has been made under the Company's 1996 Stock Incentive Plan (the "Plan"),
which together with the terms contained in this Notice, sets forth the terms and
conditions of your grant and is incorporated herein by reference. A copy of the
Plan is attached. Please review it carefully.
Vesting:
Subject to the terms of the Plan, shares vest according to the following vesting
schedule:
<TABLE>
<CAPTION>
SHARES VESTING OVER VESTING IN PERIOD
DATE OF VEST THE PERIOD OCCURS LAST DATE TO EXERCISE
----------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C>
06/04/1999 13,521.00 End of period 12/03/2008
06/04/2000 13,521.00 End of period 12/03/2008
06/04/2001 13,521.00 End of period 12/03/2008
06/04/2002 13,522.00 End of period 12/03/2008
</TABLE>
Exercise:
You may exercise this Option, in whole or in part, to purchase a whole number of
vested shares at any time, by following the exercise procedures set up by the
Company. All exercises must take place before the Last Date to Exercise, or such
earlier date as is set out in the Plan following your death, disability or your
ceasing to be an employee. The number of shares you may purchase as of any date
cannot exceed the total number of shares vested by that date, less any shares
you have previously acquired by exercising this Option.
Employment Requirements:
The Plan sets out the terms and conditions that govern this grant in the event
of your termination of employment, death or disability. In the event of your
termination of employment, including total disability or death, all further
vesting of shares under this grant stops. As set out in Plan, you will have 90
Days after your employment ceases or is suspended to exercise your vested
options, and in the event of your total disability or death, you or your estate
will have a period of 1 Year to exercise any vested options.
Taxes, Withholding and Disposition of Stock:
This option is intended to be an Incentive Stock Option, as defined under
Section 422(b) of the Internal Revenue Code. In the event that the Company
determines that any federal, state, local or foreign tax or withholding payment
is required relating to the exercise or sale of shares arising from this grant,
the Company shall have the right to require such payments from you, or withhold
such amounts from other payments due to you from the Company. You agree to
notify the Company when you sell or otherwise transfer or dispose of the shares
acquired by exercising this Option.
<PAGE>
EXHIBIT 4
1996 Stock Incentive Plan
-------------------------
EXPLORE YOUR OPTIONS
Option to Purchase: FORTY FOUR THOUSAND ONE HUNDRED THIRTY FIVE SHARES
-----------------------------------------------------------------------
Granted to: BRIAN CHISICK
-------------------------
This stock option grant has been executed as of April 27, 1999 on behalf of
First Alliance Corporation at the option price of $3.625.
/S/ Brian Chisick
[First Alliance -------------------------------------
Logo Here] Brian Chisick
President and Chief Executive Officer
THIS IS NOT A STOCK CERTIFICATE OR A NEGOTIABLE INSTRUMENT. NON-TRANSFERABLE.
<PAGE>
EXHIBIT 4
1996 Stock Incentive Plan
INCENTIVE STOCK OPTION NOTICE
Optioneee: Brian Chisick
Grant Date: April 27, 1999
Shares Granted: 44,135
Stock Option Price: $3.625
Last Date to Exercise: 04/26/2009
We are pleased to inform you that the Compensation Committee of the Board has
granted you an option to purchase First Alliance Corporation common stock. Your
grant has been made under the Company's 1996 Stock Incentive Plan (the "Plan"),
which together with the terms contained in this Notice, sets forth the terms and
conditions of your grant and is incorporated herein by reference. A copy of the
Plan is attached. Please review it carefully.
Vesting:
Subject to the terms of the Plan, shares vest according to the following vesting
schedule:
<TABLE>
<CAPTION>
SHARES VESTING OVER VESTING IN PERIOD
DATE OF VEST THE PERIOD OCCURS LAST DATE TO EXERCISE
----------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C>
10/27/1999 11,034.00 End of period 04/26/2009
10/27/2000 11,034.00 End of period 04/26/2009
10/27/2001 11,034.00 End of period 04/26/2009
10/27/2002 11,033.00 End of period 04/26/2009
</TABLE>
Exercise:
You may exercise this Option, in whole or in part, to purchase a whole number of
vested shares at any time, by following the exercise procedures set up by the
Company. All exercises must take place before the Last Date to Exercise, or such
earlier date as is set out in the Plan following your death, disability or your
ceasing to be an employee. The number of shares you may purchase as of any date
cannot exceed the total number of shares vested by that date, less any shares
you have previously acquired by exercising this Option.
Employment Requirements:
The Plan sets out the terms and conditions that govern this grant in the event
of your termination of employment, death or disability. In the event of your
termination of employment, including total disability or death, all further
vesting of shares under this grant stops. As set out in Plan, you will have 90
Days after your employment ceases or is suspended to exercise your vested
options, and in the event of your total disability or death, you or your estate
will have a period of 1 Year to exercise any vested options.
Taxes, Withholding and Disposition of Stock:
This option is intended to be an Incentive Stock Option, as defined under
Section 422(b) of the Internal Revenue Code. In the event that the Company
determines that any federal, state, local or foreign tax or withholding payment
is required relating to the exercise or sale of shares arising from this grant,
the Company shall have the right to require such payments from you, or withhold
such amounts from other payments due to you from the Company. You agree to
notify the Company when you sell or otherwise transfer or dispose of the shares
acquired by exercising this Option.
<PAGE>
EXHIBIT 5
1996 Stock Incentive Plan
-------------------------
EXPLORE YOUR OPTIONS
Option to Purchase: FIFTY FIVE THOUSAND EIGHT HUNDRED SIXTY FIVE SHARES
------------------------------------------------------------------------
Granted to: BRIAN CHISICK
This stock option grant has been executed as of April 27, 1999 on behalf of
First Alliance Corporation at the option price of $3.625.
/S/ Brian Chisick
[First Alliance -------------------------------------
Logo Here] Brian Chisick
President and Chief Executive Officer
THIS IS NOT A STOCK CERTIFICATE OR A NEGOTIABLE INSTRUMENT. NON-TRANSFERABLE.
<PAGE>
EXHIBIT 5
1996 Stock Incentive Plan
NON-QUALIFIED STOCK OPTION NOTICE
Optioneee: Brian Chisick
Grant Date: April 27, 1999
Shares Granted: 55,865
Stock Option Price: $3.625
Last Date to Exercise: 04/26/2009
We are pleased to inform you that the Compensation Committee of the Board has
granted you an option to purchase First Alliance Corporation common stock. Your
grant has been made under the Company's 1996 Stock Incentive Plan (the "Plan"),
which together with the terms contained in this Notice, sets forth the terms and
conditions of your grant and is incorporated herein by reference. A copy of the
Plan is attached. Please review it carefully.
Vesting:
Subject to the terms of the Plan, shares vest according to the following vesting
schedule:
<TABLE>
<CAPTION>
SHARES VESTING OVER VESTING IN PERIOD
DATE OF VEST THE PERIOD OCCURS LAST DATE TO EXERCISE
----------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C>
10/27/1999 13,966.00 End of period 04/26/2009
10/27/2000 13,966.00 End of period 04/26/2009
10/27/2001 13,966.00 End of period 04/26/2009
10/27/2002 13,967.00 End of period 04/26/2009
</TABLE>
Exercise:
You may exercise this Option, in whole or in part, to purchase a whole number of
vested shares at any time, by following the exercise procedures set up by the
Company. All exercises must take place before the Last Date to Exercise, or such
earlier date as is set out in the Plan following your death, disability or your
ceasing to be an employee. The number of shares you may purchase as of any date
cannot exceed the total number of shares vested by that date, less any shares
you have previously acquired by exercising this Option.
Employment Requirements:
The Plan sets out the terms and conditions that govern this grant in the event
of your termination of employment, death or disability. In the event of your
termination of employment, including total disability or death, all further
vesting of shares under this grant stops. As set out in Plan, you will have 90
Days after your employment ceases or is suspended to exercise your vested
options, and in the event of your total disability or death, you or your estate
will have a period of 1 Year to exercise any vested options.
Taxes and Withholding:
This option is not intended to be an Incentive Stock Option, as defined under
Section 422(b) of the Internal Revenue Code. Any exercise of this option is
normally a taxable event, and if the Company determines that any federal, state,
local or foreign tax or withholding payment is required relating to the exercise
or sale of shares arising from this grant, the Company shall have the right to
require such payments from you, or withhold such amounts from other payments due
to you from the Company.
<PAGE>
EXHIBIT 6
1996 Stock Incentive Plan
-------------------------
EXPLORE YOUR OPTIONS
Option to Purchase: ONE HUNDRED THOUSAND SHARES
------------------- ---------------------------
Granted to: BRIAN CHISICK
-------------------------
This stock option grant has been executed as of December 3, 1999 on behalf of
First Alliance Corporation at the option price of $2.50.
/S/ Brian Chisick
[First Alliance -------------------------------------
Logo Here] Brian Chisick
President and Chief Executive Officer
THIS IS NOT A STOCK CERTIFICATE OR A NEGOTIABLE INSTRUMENT. NON-TRANSFERABLE.
<PAGE>
EXHIBIT 6
1996 Stock Incentive Plan
NON-QUALIFIED STOCK OPTION NOTICE
Optioneee: Brian Chisick
Grant Date: December 3, 1999
Shares Granted: 100,000
Stock Option Price: $2.50
Last Date to Exercise: 06/03/2010
We are pleased to inform you that the Compensation Committee of the Board has
granted you an option to purchase First Alliance Corporation common stock. Your
grant has been made under the Company's 1996 Stock Incentive Plan (the "Plan"),
which together with the terms contained in this Notice, sets forth the terms and
conditions of your grant and is incorporated herein by reference. A copy of the
Plan is attached. Please review it carefully.
Vesting:
Subject to the terms of the Plan, shares vest according to the following vesting
schedule:
<TABLE>
<CAPTION>
SHARES VESTING OVER VESTING IN PERIOD
DATE OF VEST THE PERIOD OCCURS LAST DATE TO EXERCISE
----------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C>
06/03/2000 25,000.00 End of period 06/3/2010
06/03/2001 25,000.00 End of period 06/03/2010
06/03/2002 25,000.00 End of period 06/03/2010
06/03/2003 25,000.00 End of period 06/03/2010
</TABLE>
Exercise:
You may exercise this Option, in whole or in part, to purchase a whole number of
vested shares at any time, by following the exercise procedures set up by the
Company. All exercises must take place before the Last Date to Exercise, or such
earlier date as is set out in the Plan following your death, disability or your
ceasing to be an employee. The number of shares you may purchase as of any date
cannot exceed the total number of shares vested by that date, less any shares
you have previously acquired by exercising this Option.
Employment Requirements:
The Plan sets out the terms and conditions that govern this grant in the event
of your termination of employment, death or disability. In the event of your
termination of employment, including total disability or death, all further
vesting of shares under this grant stops. As set out in Plan, you will have 90
Days after your employment ceases or is suspended to exercise your vested
options, and in the event of your total disability or death, you or your estate
will have a period of 1 Year to exercise any vested options.
Taxes and Withholding:
This option is not intended to be an Incentive Stock Option, as defined under
Section 422(b) of the Internal Revenue Code. Any exercise of this option is
normally a taxable event, and if the Company determines that any federal, state,
local or foreign tax or withholding payment is required relating to the exercise
or sale of shares arising from this grant, the Company shall have the right to
require such payments from you, or withhold such amounts from other payments due
to you from the Company.
<PAGE>
Exhibit 7
MASTER CUSTODIAN AND ESCROW AGREEMENT
THIS MASTER CUSTODIAN AND ESCROW AGREEMENT (the "Agreement") is dated
as of May 8, 2000, by and between U. S. TRUST COMPANY, NATIONAL ASSOCIATION, a
national bank organized and existing under and by virtue of the laws of the
United States of America, as Escrow Agent ("Escrow Agent") and THE BRIAN AND
SARAH CHISICK REVOCABLE ESTATE TRUST U/A 3/7/79 ("Trustor"). Brian Chisick and
Sarah Chisick are the co-trustees of Trustor and have the authority to make
representations and enter into this Agreement on behalf of Trustor.
INTRODUCTION:
A. Trustor has been offered the right to purchase varying amounts of
shares of the Common Stock (the "Stock") of First Alliance Corporation, Inc.
(the "Company") by Capital Guardian Trust Company and may be offered the right,
from time-to-time to purchase Company Stock by as yet unknown sellers
(collectively, the "Sellers") at purchase prices to be determined at the time of
such offers to purchase stock (the "Purchase Price").
B. Brian Chisick is the Chairman and Chief Executive Officer of the
Company. Sarah Chisick is a director of the Company.
C. On March 23, 2000, the Company and certain of its subsidiaries filed
a voluntary bankruptcy case under Chapter 11 of the United States Bankruptcy
Code in the United States Bankruptcy Court for the Central District of
California (the "Bankruptcy Court").
D. Brian Chisick and Sarah Chisick are, among other things, affiliates
of the Trustor.
E. Given the foregoing, The Chisicks have determined that the Board of
Directors of the Company and the Bankruptcy Court should approve any potential
purchase.
F. Purchaser has determined to place the Stock in escrow pending the
evaluation of the purchase opportunity by the Company and pending review of the
transaction by the Bankruptcy Court.
AGREEMENTS:
NOW THEREFORE, and in consideration of the foregoing and of the mutual
covenants herein set forth, the Escrow Agent and the Trustor agree as follows:
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1. APPOINTMENT AND TERM. The Trustor hereby appoints the Escrow Agent,
and the Escrow Agent hereby accepts said appointment, as custodian and escrow
holder to purchase, hold and disburse the Stock pursuant to the terms of this
Agreement. The custodial relationship and escrow established by this Agreement
shall commence on the date hereof and shall terminate in accordance with the
instructions and conditions set-forth in Paragraph 3 below.
The duties of the Escrow Agent are only as specified in this Agreement
and Escrow Agent has no other implied duties or obligations. Escrow Agent makes
no representations nor bears any responsibility for the adequacy or sufficiency
of the Stock or the Purchase Price that it receives from Seller or Trustor.
2. PURCHASE AND PAYMENT FOR SHARES. On any date, the Trustor may
deposit good funds with the Escrow Agent to purchase the Stock; provided
however, that the Trustor shall provide written notice to the Escrow Agent of
its intention to deposit such funds. Concurrently with such deposit of funds,
the Trustor shall provide the Escrow Agent with written instructions (the "Stock
Purchase Instructions") authorizing and directing the Escrow Agent to purchase
Stock. The Stock Purchase Instructions shall provide, among other things, (i)
the name and address of a seller of the Stock and such other identifying
information that is satisfactory to the Escrow Agent, (ii) the date of the
proposed settlement of the Stock purchase and transfer of funds, including
payment and instructions satisfactory to the Escrow Agent, and (iii) such other
information as the Escrow Agent shall demand.
Promptly following the Escrow Agent's receipt of all necessary
information and immediately available funds, the Escrow Agent deems necessary to
acquire and pay for the Stock from a given Seller, the Escrow Agent shall
forthwith pay to such Seller, but solely from funds available in this escrow
designated for such purchase pursuant to the written instructions of the
Trustor, the consideration to effect payment for the Stock. All Stock delivered
hereunder shall be delivered to the Escrow Agent on a "delivery versus payment"
basis.
All purchases of the Stock from time-to-time by the Escrow Agent in
accordance with this Agreement shall be purchased by the Escrow Agent as nominee
for the benefit of the beneficiaries of the Trustor.
The Stock shall not be transferred into the name of the Trustor or the
Company or any third party until either: (i) the Company provides written notice
to the Escrow Agent that the Company has declined to purchase the Stock or if
the Company has elected to purchase the Stock, that the Bankruptcy Court has
approved such acquisition; (ii) the Trustor provides written notice, subject to
item (i) above, that it has received approval, if any, from the Bankruptcy
Court, to purchase such Stock (or absent only written from the Bankruptcy Court,
the Trustor represents and warrants the Bankruptcy Court has declined to take
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<PAGE>
any action with respect to this matter and the Company has also declined to
purchase the Stock); or (iii) the Bankruptcy Court enters an order directing
Escrow Agent to transfer the Stock to a third party and, in accordance with such
order, such third party tenders funds to Escrow Agent for the purchase of the
Stock. During the period prior to the disposition of the Stock, Trustor shall
offer to the Company's Board of Directors the right to vote the Stock but in no
event shall Trust have the right to vote the Stock.
If at any time the Company elects to purchase the Stock, the Escrow
Agent shall promptly convey the Stock to the Company upon receipt by the Escrow
Agent of the Purchase Price and any earnings thereon at the rate of ten percent
(10%) per annum on the basis of a year of 365 days commencing on the date of
this Agreement. Upon the Escrow Agent's receipt of such, the Escrow Agent shall
promptly disburse $437,500 and any earnings thereon to the Trustor.
When the right to legal ownership of the stock has been determined and
the Stock delivered to the Company, the Trustor or a third party, then upon
delivery of the Stock and disbursement of any amounts remaining under this
Agreement, this Agreement shall terminate subject to Paragraph 10 of this
Agreement.
3. DEPOSIT INTO ESCROW. The parties hereto acknowledge that the Trustor
has delivered to the Escrow Agent, and the Escrow Agent has accepted as escrow
holder and custodian, the Purchase Price and the Stock. The Trustor irrevocably
authorizes the Escrow Agent, solely in its capacity as escrow holder and
custodian and solely with respect to the delivery of the Stock and/or Purchase
Price from escrow, to accept only the written instructions of Trustor, the
Company or the Bankruptcy Court with respect to matters governed under this
Agreement.
In the event it shall be deemed necessary by the Trustor or Counsel to
the Company that the Escrow Agent should hold the Stock for the benefit of the
future owners thereof in a manner other than as scheduled herein, the Escrow
Agent shall have the right to register in its name or as a nominee or have the
Stock credited to the account of the Escrow Agent at a clearing corporation as
defined under and pursuant to the Uniform Commercial Code applicable to such
corporation which corporation shall be registered as a clearing agency under the
Securities Exchange Act of 1934, as amended and the rules and regulations
promulgated thereunder.
Absent written instructions of the Purchaser, all moneys that are on
deposit with the Escrow Agent, until application thereof as provided hereunder,
shall be invested by the Escrow Agent in the U.S. Trust Master Money Market Fund
or such other money market funds of the Escrow Agent as the Escrow Agent shall
determine, from time to time. In no event shall the Escrow Agent be liable for
any losses under this escrow which might arise from the investment of any funds
under this escrow. The Purchaser shall have the right, from time-to-time, upon
two Business Days written notice to the Escrow Agent, to direct the investment
of any funds held under this escrow in investment securities satisfactory to the
Purchaser. Moneys invested hereunder shall pay interest and mature not later
than the dates on which it is estimated that such moneys will be required by the
Escrow Agent to settle purchases of Stock. The Escrow Agent and/or its
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<PAGE>
affiliates may act as principal, sponsor, advisor, depositary or agent in the
acquisition or disposition of any investments. "Business Day" means any day
other than a Saturday, Sunday or a day on which banking institutions located in
the City of New York, New York, Los Angeles and San Francisco, California, or
the city in which the principal corporate trust office of the Escrow Agent is
located, are required or are authorized by law or executive order to close, or a
day on which the New York Stock Exchange is closed.
4. ESCROW INSTRUCTIONS. The Escrow Agent shall maintain custody of the
Stock until the Trustor or the Company has delivered written instructions that
authorize the delivery of the Stock to the Trustor or the Company or any third
party.
5. REPRESENTATIONS. The Trustor represents and warrants to the Escrow
Agent that:
a) it is a duly organized and validly existing trust under
California law;
b) it has the power and the authority to enter into and
perform its obligations under this Agreement;
c) this Agreement has been duly authorized, executed and
delivered by it and, assuming the due authorization, execution and delivery
hereof by the other parties hereto, constitutes a legal, valid and binding
obligation of it enforceable against it in accordance with the terms hereof,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally, and subject, as to enforceability, to general
principles of equity regardless of whether enforcement is sought in a proceeding
in equity or at law.
6. COMPENSATION. The Escrow Agent shall be compensated for its services
as escrow holder based on the amount of time spent performing such services at
the then current hourly rate(s) of the escrow officers performing such services
with a minimum initial fee of $3,000. Such fee shall be paid within 10 days upon
demand therefore.
7. APPLICATION OF EXCESS FUNDS. The Trustor hereby directs the Escrow
Agent and the Escrow Agent agrees that if at any time any amounts of the
Purchase Price and interest thereon are not needed to accomplish the purposes of
this Agreement, the Escrow Agent shall, upon delivery of written instructions by
the Trustor therefore, disburse any such excess funds to the Trustor, subject to
any claims of the Escrow Agent.
8. NOTICES. All notices, demands, document or other communications
hereunder shall be given or made in writing and shall be delivered personally,
or sent by certified or registered mail, postage prepaid, return receipt
requested, fax (followed immediately by a writing as described above), or
overnight courier or similar delivery service to the party to whom they are
directed at the following addresses, or at such other addresses as may be
designated by notice from such party to all other parties:
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<PAGE>
Brian and Sarah Chisick Revocable Estate Trust
U/A 3/7/79
10212 Sunrise Lane
Santa Ana, California 92705
Telephone: (949) 224-8400
To the Trustor: Facsimile: (949) 224-8408
U. S. Trust Company, National Association
515 South Flower Street, 27th Floor
Los Angeles, California 90071
Attn.: Sandra H. Leess, Senior Vice President
Telephone: (213) 861-5050
To the Escrow Agent: Facsimile: (213) 488-1370
9. JUDICIAL RELIEF. In the event that a dispute arises relating to or
arising from the Stock or the escrow thereof, between or among any of the
Trustor, the Company or the Bankruptcy Court, Trustor and the Company shall be
entitled to seek declaratory relief from any appropriate judicial body as to the
relative rights, obligations, and/or duties of the respective parties.
No failure or delay on the part of either party in exercising any right
or remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or remedy preclude any other or further
exercise thereof or the exercise of any other right or remedy. The rights and
remedies for the parties hereunder are cumulative and not exclusive to any
rights or remedies provided by law, this Agreement or otherwise.
10. HOLD HARMLESS. In the event the Escrow Agent before the termination
of the escrow receives or becomes aware of conflicting demands or claims with
respect to this escrow, or any funds deposited herein or affected hereby, the
Escrow Agent shall have the right to discontinue any or all further acts on its
part until such conflict is resolved to its satisfaction.
The Escrow Agent shall have the further right but not the obligation to
commence or defend any action or proceedings for the determination of such
conflict. The Trustor agrees to and shall indemnify and hold the Escrow Agent
harmless against any loss, claim, cost or other liability (including reasonable
attorneys' fees) relating to or arising from its service as escrow holder or for
any act or omission made in reasonable reliance upon a writing of the Trustor or
the Company regarding the Stock, including, but without limiting the generality
of the foregoing, a suit in interpleader brought by the Escrow Agent. In the
event the Escrow Agent files a suit in interpleader, the Escrow Agent shall
thereupon be fully released and discharged from all further obligations to
perform any and all duties or obligations imposed upon him by this Agreement.
The Trustor agrees that neither the Company nor the Escrow Agent assumes any
responsibility or liability to any party, person, or government agency or
instrumentality other than to hold and, when appropriate with the consent of the
Bankruptcy Court, if required, to deliver the Stock from escrow.
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<PAGE>
The Escrow Agent is herby given a lien on all right, title and interest
of the Trustor or the Company in the escrowed funds, documents, and property and
moneys arising therefrom, to protect, indemnify and reimburse itself for all
costs, expenses and liabilities arising out of this Agreement.
11. LIABILITY OF THE ESCROW AGENT. The Escrow Agent shall not be liable
to any person or entity for any error of judgment or for any act done or omitted
by the Escrow Agent in good faith, or for anything which he may in good faith do
or refrain from doing in connection herewith; nor for any negligence other than
its gross negligence, nor shall the Escrow Agent be answerable for the default
or misconduct of its agents, attorneys or employees if they were selected with
reasonable care; nor will any liability be incurred by the Escrow Agent if, in
the event of any dispute or question as to the duties or obligations of the
Escrow Agent hereunder, the Escrow Agent acts in accordance with the written
opinion of the Escrow Agents legal counsel. The Escrow Agent is authorized to
act upon any document believed by the Escrow Agent to be genuine and to be
signed by the proper party or parties, and will incur no liability in so acting.
The Escrow Agent may consult with its counsel with respect to any
question relating to its duties or responsibilities hereunder or otherwise in
connection herewith and, except as expressly provided herein, shall not be
liable for any action taken, suffered, or omitted by the Escrow Agent in good
faith upon advice of such counsel. The Escrow Agent may act through its
officers, employees, agents and attorneys.
12. BENEFIT, SUCCESSORS AND ASSIGNS. This Agreement shall bind and
inure to the benefit of the successors, assigns, personal representatives, and
legatees of the respective parties.
13. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
and understanding of the parties with respect to its subject matter and
supersedes all oral communication and prior writings with respect thereto.
14. AMENDMENTS, CHANGES AND MODIFICATIONS. The Escrow Agent shall not
be bound by any modification of this Escrow Agreement or any agreement
incorporated by reference herein, unless there is delivered to the Escrow Agent
a written modification signed by the Trustor. No such modification shall,
without the consent of the Escrow agent, modify the provisions of this Agreement
relating to the duties, obligations or rights of the Escrow Agent. The Escrow
Agent shall not amend or consent to the amendment of this Agreement or take
action which would qualify, impede or otherwise adversely affect the ability of
the Escrow Agent to perform its duties hereunder or impair the rights of the
Trustor under this Agreement.
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<PAGE>
15. SEVERABILITY. If one or more provisions of this Agreement or the
applicability of any such provisions to any set of circumstances shall be
determined to be invalid or ineffective for any reason, such determination shall
not affect the validity and enforceability of the remaining provisions or the
applicability of the same provisions or any of the remaining provisions to other
circumstances.
16. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
17. CONSTRUCTION. This Agreement shall be construed under and enforced
in accordance with the laws of the State of California.
18. RESIGNATION OF ESCROW AGENT. If the Escrow Agent shall resign or be
discharged from its duties and obligations under the Escrow Agreement, the
Escrow Agent shall assign all of its rights and duties hereunder to such
successor escrow agent as is appointed by the Trustor. Such successor Escrow
Agent shall signify its acceptance of the obligations of the Escrow Agent
hereunder by written agreement in form and substance reasonably acceptable to
the Trustor. From and after the date of such acceptance such successor Escrow
Agent shall be the Escrow Agent for all purposes hereunder.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on
the day and year first above written.
TRUSTOR: ESCROW AGENT:
BRIAN and SARAH CHISICK U. S. TRUST COMPANY, NATIONAL
REVOCABLE ESTATE Trust u/A ASSOCIATION, as Escrow Agent
3/7/79, as Trustor
By: /S/ Brian Chisick By: /S/ Deborah Gibbons
-------------------------- ----------------------------
Print Name: Brian Chisick Print Name: Deborah Gibbons
Print Title: Co-Trustee Print Title: Vice President
By: /S/ Sarah Chisick
--------------------------
Print Name: Sarah Chisick
Print Title: Co-Trustee
7
