<PAGE>
--SCHEDULE 14A--
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
First Regional Bancorp
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
[LOGO OF FIRST REGIONAL BANCORP]
1801 CENTURY PARK EAST
CENTURY CITY, CALIFORNIA 90067
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 20, 1999
NOTICE IS HEREBY GIVEN TO THE SHAREHOLDERS OF FIRST REGIONAL BANCORP (the
"Company") that, pursuant to the Bylaws of the Company and the call of its
Board of Directors, the Annual Meeting of Shareholders of First Regional
Bancorp will be held in Salon I of the Park Hyatt Hotel, 2151 Avenue of the
Stars, Century City, California on Thursday, May 20, 1999, at 11:00 a.m., for
the purpose of considering and voting upon the following matters:
1. Election of Directors. Electing the following five (5) persons to the
Board of Directors to serve until the 2000 Annual Meeting of Shareholders
and until their successors are elected and have qualified:
<TABLE>
<S> <C>
H. Anthony Gartshore Lawrence J. Sherman
Gary M. Horgan Jack A. Sweeney
Thomas E. McCullough
</TABLE>
2. Other Business. Transacting such other business as may properly come
before the Annual Meeting and any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on March 31, 1999 as
the record date for determination of shareholders entitled to notice of, and
to vote at, the Meeting.
By Order of the Board of Directors
Thomas E. McCullough, Secretary
First Regional Bancorp
Dated: April 8, 1999
<PAGE>
The Bylaws of the Company provide for the nomination of directors in the
following matter:
"Section 2.11. Nomination of Directors. Nominations for election of members
of the board of directors may be made by the board of directors or by any
shareholder of any outstanding class of capital stock of the corporation
entitled to vote for the election of directors. Notice of intention to make
any nominations (other than for persons named in the notice of the meeting at
which such nominations are to be made) shall be made in writing and shall be
delivered or mailed to the president of the corporation by the later of the
close of business twenty-one (21) days prior to any meeting of shareholders
called for the election of directors or ten (10) days after the date of
mailing of notice of the meeting to shareholders. Such notification shall
contain the following information to the extent known to the notifying
shareholder: (a) the name and address of each proposed nominee; (b) the
principal occupation of each proposed nominee; (c) the number of shares of
capital stock of the corporation owned by each proposed nominee; (d) the name
and residence address of the notifying shareholder; (e) the number of shares
of capital stock of the corporation owned by the notifying shareholder; (f)
with the written consent of the proposed nominee, a copy of which shall be
furnished with the notification, whether the proposed nominee has ever been
convicted of or pleaded nolo contendere to any criminal offense involving
dishonesty or breach of trust, filed a petition in bankruptcy, or been
adjudged bankrupt. The notice shall be signed by the nominating shareholder
and by the nominee. Nominations not made in accordance herewith shall be
disregarded by the chairman of the meeting and, upon his instructions, the
inspectors of election shall disregard all votes cast for each such nominee.
The restrictions set forth in this paragraph shall not apply to the nomination
of a person to replace a proposed nominee who had died or otherwise become
incapacitated to serve as a director between the last day for giving notice
hereunder and the date of election of directors if the procedure called for in
this paragraph was followed with respect to the nomination of the proposed
nominee"
YOU ARE URGED TO VOTE IN FAVOR OF THE PROPOSALS OF THE COMPANY'S BOARD OF
DIRECTORS BY SIGNING AND RETURNING THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE,
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON. THE ENCLOSED PROXY IS
SOLICITED BY THE COMPANY'S BOARD OF DIRECTORS. ANY SHAREHOLDER GIVING A PROXY
MAY REVOKE IT PRIOR TO THE TIME IT IS VOTED BY NOTIFYING THE SECRETARY OF THE
COMPANY IN WRITING OF REVOCATION OF YOUR PROXY, OR BY FILING A DULY EXECUTED
PROXY BEARING A LATER DATE, OR BY ATTENDING THE MEETING AND VOTING IN PERSON.
PLEASE INDICATE ON THE PROXY WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING.
<PAGE>
[LOGO OF FIRST REGIONAL BANCORP]
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 20, 1999
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
Proxies for use at the Annual Meeting of Shareholders (the "Meeting") of First
Regional Bancorp (the "Company") to be held in Salon I of the Park Hyatt
Hotel, 2151 Avenue of the Stars, Century City, California, on Thursday,
May 20, 1999, at 11:00 a.m. and at any and all adjournments thereof.
It is anticipated that this Proxy Statement will be mailed to shareholders
eligible to receive notice of and vote at the Meeting on or about April 8,
1999.
The matters to be considered and voted upon at the Meeting will be:
1. Election of Directors. Electing the following five (5) persons to the
Board of Directors to serve until the 2000 Annual Meeting of Shareholders
and until their successors are elected and have qualified:
<TABLE>
<S> <C>
H. Anthony Gartshore Lawrence J. Sherman
Gary M. Horgan Jack A. Sweeney
Thomas E. McCullough
</TABLE>
2. Other Business. Transacting such other business as may properly come
before the Meeting and any adjournment or adjournments thereof.
Revocability of Proxies
A form of Proxy for voting your shares at the Meeting is enclosed. Any
shareholder who executes and delivers such a Proxy has the right to and may
revoke it at any time before it is exercised by filing with the Secretary of
the Company an instrument revoking it or a duly executed Proxy bearing a later
date. In addition, the powers of the Proxy Holders will be revoked if the
person executing the Proxy is present at the Meeting and elects to vote in
person by advising the Chairman of the Meeting of his/her election to vote in
person, and by voting in person at the Meeting. Subject to such revocation,
all shares represented by a properly executed Proxy received in time for the
Meeting will be voted by the Proxy Holders in accordance with the instructions
on the Proxy. IF NO INSTRUCTION IS SPECIFIED WITH RESPECT TO A MATTER TO BE
ACTED UPON, THE SHARES REPRESENTED BY YOUR EXECUTED PROXY WILL BE VOTED IN
FAVOR OF THE PROPOSALS LISTED IN THE PROXY. IF ANY OTHER BUSINESS IS PROPERLY
PRESENTED AT THE MEETING, THE PROXY WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE COMPANY'S BOARD OF DIRECTORS.
<PAGE>
Persons Making The Solicitation
This solicitation of Proxies is being made by the Board of Directors of the
Company. The expense of preparing, assembling, printing and mailing this Proxy
Statement and the materials used in the solicitation of Proxies for the
Meeting will be borne by the Company. It is contemplated that Proxies will be
solicited principally through the use of the mail, but officers, directors and
employees of the Company and its subsidiary, First Regional Bank (the "Bank"),
may solicit Proxies personally or by telephone, without receiving special
compensation therefor. Although there is no formal agreement to do so, the
Company may reimburse banks, brokerage houses and other custodians, nominees
and fiduciaries for their reasonable expenses in forwarding these Proxy
Materials to shareholders whose stock in the Company is held of record by such
entities. In addition, the Company may use the services of individuals or
companies it does not regularly employ in connection with this solicitation of
Proxies, if Management determines it advisable.
VOTING SECURITIES
There were issued and outstanding 3,051,587 shares of the Company's Common
Stock on March 31, 1999, which has been fixed as the record date for the
purpose of determining the shareholders entitled to notice of and to vote at
the Meeting. Each holder of Common Stock, of which there were not less than
804 as of the record date, will be entitled to one vote, in person or by
Proxy, for each share of Common Stock held of record on the books of the
Company as of the record date for the Meeting on any matter submitted to the
vote of the shareholders, except that in connection with the election of
directors, the shares may be voted cumulatively if a shareholder present and
voting at the Meeting gives notice at the Meeting and prior to the voting of
his or her intention to so vote. Cumulative voting means that a shareholder
has the right to vote the number of shares he or she owns as of the record
date, multiplied by the number of directors to be elected. This total number
of votes may be cast for one nominee or it may be distributed on the same
principle among nominees as the shareholder sees fit. If cumulative voting is
declared at the Meeting, votes represented by Proxies delivered pursuant to
this Proxy Statement may be cumulated in the discretion of the Proxy Holders,
in accordance with the recommendations of the Board of Directors.
Directors are elected by plurality vote. Abstentions and broker non-votes do
not have the effect of a vote in opposition to the election of a director.
Abstentions are counted toward a quorum which requires a bare majority of
outstanding shares.
2
<PAGE>
SHAREHOLDINGS OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Management of the Company does not know of any persons other than those set
forth below who are the beneficial owners of more than 5% of the Company's
outstanding Common Stock as of March 31, 1999. The following table sets forth
certain information, as of March 31, 1999, concerning the beneficial ownership
of the Company's outstanding Common Stock by each of the principal
shareholders, the directors and nominees for director of the Company and by
all directors and officers(1) of the Company as a group.
<TABLE>
<CAPTION>
Common Stock Percent
Beneficially of
Name and Title Other Than Director Owned(2)(3) Class(3)
---------------------------------- ------------ --------
<S> <C> <C>
Christopher E. Edgecomb as Trustee of the
Christopher E. Edgecomb Living Trust.............. 200,000(4) 6.55%
Principal shareholder
Jeffrey Cove....................................... -0- -0-
H. Anthony Gartshore............................... 21,929(5) .71%
President
Barry L. Gutterman as Special Trustee of the New
Moon Trust........................................ 192,000(6) 6.29%
Principal shareholder
Gary M. Horgan..................................... 2,000(7) .06%
Don S. Levin....................................... 16,000 .52%
Thomas E. McCullough............................... 15,782(8) .52%
Chief Financial Officer and Secretary
Frank R. Moothart.................................. 5,000(9) .16%
Mark Rubin......................................... 487,304(10) 15.97%
Principal shareholder
Lawrence J. Sherman................................ 53,600 1.76%
Vice Chairman of the Board
Lottie Walker and Nate Walker and Linda Goodrich as
trustees of the Six Point Trust................... 199,200(11) 6.53%
Principal shareholder
Jack A. Sweeney.................................... 687,554(12) 22.53%
Chairman of the Board, Chief Executive Officer and
principal shareholder
Steven J. Sweeney as Trustee of the Steven John
Sweeney Trust, the Patricia Lynne Sweeney Trust
and the Cynthia Louise McLean Trust............... 156,000(13) 5.11%
Principal shareholder
All Directors and Officers as a Group (9 in
Number)........................................... 1,289,169(14) 41.90%
</TABLE>
- --------
(1) The term "officer" means the Chairman of the Board and Chief Executive
Officer; and the President; and the Chief Financial Officer and
Secretary.
(2) This figure includes shares beneficially owned, directly or indirectly,
together with associates or by or on behalf of minor children or children
living at the residence of the director or officer. Unless otherwise
indicated, the persons named herein have sole voting power over shares
reported.
(3) Shares subject to options held by directors and officers that were
exercisable within 60 days after the Record Date ("vested"), are treated
as outstanding for the purpose of computing the number and percentage of
outstanding securities of the class owned by such person but not for the
purpose of computing the percentage of the class owned by any other
person.
(4) The business address for the Christopher E. Edgecomb Living Trust is 223
East De La Guerra Street, Santa Barbara, California 93101.
(5) This figure, as well as percent of class, includes, as if currently
outstanding, 20,000 shares vested to Mr. Gartshore, but which have not
been exercised pursuant to the Company's Stock Option Plan. Also includes
279 shares in the Company's Employee Stock Ownership Plan (the "ESOP").
(6) New Moon Trust's business address is c/o Barry L. Gutterman, Special
Trustee, 1875 Century Park East, Suite 1500, Los Angeles, California
90067.
(7) Mr. Horgan disclaims beneficial interest in 80 shares held by him which
are not included in this figure.
(8) This figure includes 353 shares in the ESOP.
3
<PAGE>
(9) This figure, as well as percent of class, includes, as if currently
outstanding, 5,000 shares vested to Mr. Moothart, but which have not been
exercised pursuant to the Company's Stock Option Plan.
(10) This figure, as well as percent of class, includes 411,604 shares held by
the Rubin Family Trust, 48,700 shares held by the Rubin Family
Foundation, and, as if currently outstanding, 15,000 shares vested to
Mr. Rubin but which have not been exercised pursuant to the Company's
Stock Option Plan. Mr. Rubin's business address is c/o Regional
Properties, 1875 Century Park East, Suite 1350, Los Angeles, California
90067.
(11) Six Point Trust's business address is 19456 Ventura Boulevard, Tarzana,
California 91356
(12) This figure, as well as percent of class, includes 48,700 shares held by
the Sweeney Foundation, 146,250 shares held as trustee of the ESOP, (the
trustee has voting rights over these shares to the extent not exercised
by the ESOP participants), and, as if currently outstanding 15,000 shares
vested to Mr. Sweeney, but which have not been exercised pursuant to the
Company's Stock Option Plan. Mr. Sweeney's business address is 1801
Century Park East, 8th Floor, Century City, California 90067. While Mr.
Sweeney exercises certain voting authority over the ESOP shares, Mr.
Sweeney does not participate in the ESOP.
(13) Steven Sweeney has voting power over 156,000 shares but disclaims
beneficial interest in all but 52,000 shares. Steven Sweeney's business
address is c/o First Regional Bank, 1801 Century Park East, Suite 800,
Century City, California 90067.
(14) This figure, as well as percent of class, includes, as if currently
outstanding, 55,000 shares vested or which will vest within sixty (60)
days of the Record Date to all officers and directors as a group, but
which have not been exercised pursuant to the Company's Stock Option
Plan.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the names and certain information as of March
31, 1999, concerning the directors and the officers of the Company:
<TABLE>
<CAPTION>
Year
First
Appointed
or
Elected
Director
Name and Title (Other Business Experience of the
Than Director) Age During the Past Five Years Company
--------------------- --- ------------------------------------------------------------------------ ---------
<S> <C> <C> <C>
Jeffrey Cove............ 52 Vice President of PathFinder Mortgage since May 1995; President 1998
of George Elkins Company from October 1993 to May 1995
H. Anthony Gartshore.... 55 President, First Regional Bancorp and First Regional Bank 1996
President
Gary M. Horgan.......... 51 Attorney, Horgan, Rosen, Beckham & Coren, L.L.P. 1997
Don S. Levin............ 67 President of DSL Construction Corp. 1998
Thomas E. McCullough.... 46 Chief Financial Officer and Secretary, First Regional Bancorp; Executive 1993
Chief Financial Officer Vice President and Chief Operating Officer, First Regional Bank
and Secretary
Frank R. Moothart....... 80 Consultant 1981
Mark Rubin.............. 62 President, Regional Properties, Inc. (real estate development); formerly
Vice Chairman of the Board of First Regional Bancorp 1981
Lawrence J. Sherman..... 75 President, Sherman Industries, Inc. 1981
Vice Chairman of the (investments)
Board
Jack A. Sweeney......... 69 Chairman of the Board and Chief Executive Officer, First Regional 1981
Chairman of the Board Bancorp; Chairman of the Board and Chief Executive Officer,
and Chief Executive First Regional Bank
Officer
</TABLE>
4
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
Nominees
The Company's Bylaws currently provide for a range of five (5) to nine (9)
directors, and permit the exact number of directors of the Company to be fixed
by Board or shareholder action. The Board of Directors has fixed the number of
directors at five (5) effective as of May 20, 1999. The five (5) persons named
below, all of whom are currently members of the Company's Board of Directors,
will be nominated for election as directors to serve until the 2000 Annual
Meeting of Shareholders and until their successors are elected and have
qualified. Votes will be cast in such a way as to effect the election of all
five (5) nominees, or as many thereof as possible under the rules of
cumulative voting (see "Voting Securities" herein). In the event that less
than all five nominees can be elected under cumulative voting, votes
represented by proxies solicited by the Board of Directors will be cast as
determined by majority vote of the Board of Directors and the proxy holders
shall be obligated to follow the instructions of the Board pertaining thereto.
In the event that any of the nominees should be unable to serve as a director,
it is intended that the Proxy will be voted for the election of such
substitute nominees, if any, as shall be designated by the Board of Directors.
The Board of Directors has no reason to believe that any of the nominees will
be unavailable to serve if elected. Additional nominations can only be made by
complying with the notice provision set forth in the Bylaws of the Company, an
extract of which is included in the Notice of Annual Meeting of Shareholders
accompanying this Proxy Statement. This Bylaw provision is designed to give
the Board of Directors advance notice of competing nominations, if any, and
the qualifications of competing nominees, and may have the effect of
precluding third-party nominations if the notice provisions are not followed.
None of the directors or officers of the Company were selected pursuant to
any arrangement or understanding, other than with the directors and officers
of the Company and the Bank, acting within their capacities as such. There are
no family relationships between the directors and officers of the Company, and
none of the directors or officers of the Company serve as directors of any
company which has a class of securities registered under, or which is subject
to the periodic reporting requirements of, the Securities Exchange Act of 1934
or any investment company registered under the Investment Company Act of 1940.
The following five persons are the nominees for election to the Company's
Board of Directors:
<TABLE>
<C> <S>
H. Anthony Gartshore Lawrence J. Sherman
Gary M. Horgan Jack A. Sweeney
Thomas E. McCullough
</TABLE>
Board of Directors and Committees of the Board
During 1998, the Board of Directors of the Company held seven (7) regular
meetings and the Board of Directors of the Bank held twelve (12) regular
meetings.
The Boards of Directors of the Company has an Audit Committee composed of
Messrs. Horgan, Moothart and Sherman. This committee is responsible for
overseeing internal audit functions and for interfacing with the Company's
independent certified public accountants, Deloitte & Touche LLP. The Audit
Committee met six (6) times during 1998.
The Company has a Stock Option Committee, which consists of Messrs. Horgan,
Moothart and Sherman. The Committee makes recommendations regarding the
granting of stock options, authorizes specific grants and establishes the
terms and conditions upon which stock options can be exercised.
The Company's Board of Directors does not have a standing nominating
committee.
During 1998, with the exception of Messrs. Cove and Levin, no director of
the Company attended less than 75% of the aggregate meetings of the Company's
Board of Directors and its Committees on which such director served during the
period for which they had been a director.
5
<PAGE>
COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT
Directors who are also officers of the Bank or the Company do not receive
fees for service on the Board or the Committees. During 1998, each outside
director received $400 for each regular meeting of the Board of Directors of
the Bank attended; $100 for each meeting of the Company's Board attended; and
$300 for each meeting of the Loan Committee attended. Lawrence J. Sherman
receives a monthly payment of $1,500 for his work as director of the Company's
shareholder relations program. On this basis, the directors received the
following aggregate fees during 1998: Jeffrey Cove, $100; Gary M. Horgan,
$11,000; Don S. Levin, $100; Frank R. Moothart, $5,300; Mark Rubin, $200; and
Lawrence J. Sherman, $31,700.
The following table sets forth a summary of annual and long term
compensation for the Chief Executive Officer of the Company and all executive
officers with compensation, paid or accrued, in excess of $100,000.
<TABLE>
<CAPTION>
Awards Payouts
Annual Compensation -------------------- --------------------
----------------------------------------- Restricted Option
Name and Principal Other Annual Stock Shares LTIP All Other
Position Year Salary(15) Bonus Compensation (16) Awards SAR's(17) Payouts Compensation
------------------ ---- ---------- ------- ----------------- ---------- --------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Jack A. Sweeney 1998 $265,237 $20,000 N/A None None N/A N/A
Chairman of the Board 1997 $252,485 $15,000 N/A None None N/A N/A
and Chief Executive 1996 $166,789 $15,000 N/A None None N/A N/A
of the Company and the
Bank
H. Anthony Gartshore 1998 $139,717 $15,000 N/A None None N/A N/A
President of the 1997 $127,731 $10,000 N/A None None N/A N/A
Company and the Bank 1996 $113,727 $10,000 N/A None None N/A N/A
Thomas E. McCullough 1998 $138,939 $15,000 N/A None None N/A N/A
Chief Financial Officer 1997 $130,045 $10,000 N/A None None N/A N/A
and Secretary of the 1996 $123,228 $10,000 N/A None None N/A N/A
Company, Executive Vice
President and Chief
Operating Officer of
the Bank
</TABLE>
- -------
(15) These figures include the Company's matching contributions to the 401(k)
Plan ($5,004, $4,749 and $4,383 for Mr. Sweeney; $3,194, $3,900 and
$2,612 for Mr. Gartshore), the Company's matching contributions to the
Income Deferral Plan ($80,233, $72,736 and $22,406 for Mr. Sweeney;
$4,431, $3,831 and $1,115 for Mr. Gartshore; and $2,292, $2,045 and $618
for Mr. McCullough), and the fair market value ($7.50 per share) of the
shares of Company common stock issued to Messrs. Gartshore ($2,092) and
McCullough ($2,647) pursuant to the Employee Stock Ownership Plan in
1998.
(16) The Bank furnishes and plans to continue to furnish to certain officers
the use of Bank-owned automobiles which are used primarily for Bank
business purposes. The Bank has provided and plans to continue to provide
certain of its officers with specified life and medical insurance
benefits. Since portions of the automobile expenses and insurance
premiums attributable to personal use are not believed to exceed $50,000
or ten percent (10%) of the compensation reported in the table per
individual, such amounts have not been included in the foregoing figures.
(17) Option shares only; the Company has not issued any Stock Appreciation
Rights ("SARs").
Stock Options
The following table sets forth certain information regarding stock options
granted during 1998 to the Chief Executive Officer and all executive officers
with compensation in excess of $100,000. The Company has not issued Stock
Appreciation Rights ("SARs").
<TABLE>
<CAPTION>
Percentage
of Total
Options Options
Granted Granted to
During Employees Exercise Expiration
Name 1998 During 1998 Price Date
---- ------- ----------- -------- ----------
<S> <C> <C> <C> <C>
Jack A. Sweeney...................... -0- -0- N/A N/A
H. Anthony Gartshore................. -0- -0- N/A N/A
Thomas E. McCullough................. -0- -0- N/A N/A
</TABLE>
6
<PAGE>
The following table sets forth certain information regarding stock options
exercised during 1998 by the Chief Executive Officer and all executive
officers with compensation in excess of $100,000.
<TABLE>
<CAPTION>
Number of Value of
Unexercised Unexercised Options
Options at 12/31/98
Shares ------------- -------------------
Acquired Value Exercisable/ Exercisable/
Name on Exercise Realization Unexercisable Unexercisable
---- ----------- ----------- ------------- -------------------
<S> <C> <C> <C> <C>
Jack A. Sweeney......... 12,000 $120,000(18) -0-/30,000 N/A/$225,000(19)
H. Anthony Gartshore.... -0- -0- 13,000/12,000 $97,500/$90,000(19)
Thomas E. McCullough.... -0- -0- 15,000/10,000 $112,500/$75,000(19)
</TABLE>
- --------
(18) Based on a fair market price of $10.00 per share at time of exercise.
(19) Based on a closing price on December 31, 1998 of $7.50 per share.
401(k) Plan and Employee Stock Ownership Plan
The Company sponsors a defined contribution 401(k) plan benefiting
substantially all employees. At the discretion of the Board of Directors, the
Company matches employee contributions. Currently, the Company provides 50%
matching up to the first 6% of wages contributed by an employee. Company
contributions are used to buy the Company's common stock on the open market
for allocation to the employee's accounts in the plan. The Company contributed
approximately $47,000 in 1998.
During 1998, the Company established for eligible employees an Employee
Stock Ownership Plan and Trust ("ESOP"). Eligible full-time and part-time
employees employed with the Bank who have been credited with at least 1,000
hours during a 12-month period and who have attained age 21 are eligible to
participate.
Shares of the Company's common stock purchased by the ESOP are held in a
trust account for allocation among participants as the loan is repaid. The
number of shares allocated each plan year is dependent upon the ratio of that
year's total loan payment to the aggregate payments scheduled to occur
throughout the term of the loan. The annual allocation of shares is
apportioned among participants on the basis of compensation in the year of
allocation. ESOP benefits generally become 100% vested after an employee
completes seven years of credited service. Benefits are payable upon death,
retirement, or disability. The number of shares of common stock allocated to
employee accounts was 3,750 shares at December 31, 1998.
Certain Transactions
Some of the directors, officers and principal shareholders of the Company
and companies with which they are associated are customers of, and have had
banking transactions with, the Bank in the ordinary course of the Bank's
business and the Bank expects to have banking transactions with such persons
in the future. In Management's opinion, all loans and commitments to lend
included in such transactions were made in compliance with applicable laws on
substantially the same terms, including interest rates, collateral and
repayment schedule, as those prevailing for comparable transactions with other
persons of similar creditworthiness and did not involve more than a normal
risk of collectibility nor contained terms unfavorable to the Bank.
In late 1998, Mark Rubin, a director of the Company and its former vice
chairman, filed suit against the Company, the Bank, and individual members of
the Company's executive committee. Mr. Rubin alleges that his employment with
the Company was wrongfully terminated and that the defendants also breached
fiduciary duties owed to Mr. Rubin and committed acts of defamation and fraud
against him. In his complaint, Mr. Rubin's suit seeks compensatory and
punitive damages of approximately $59 million. In January 1999, Mr. Rubin
submitted a statutory offer of compromise under Section 998 of the California
Code of Civil Procedure offering to settle the lawsuit for $3 million. The
Company rejected this settlement proposal.
7
<PAGE>
The Company believes the claims, as alleged, are without merit. The Company
has vigorously defended against Mr. Rubin's lawsuit and will continue to do
so. Because the case is in its very early stages, it is not currently possible
to determine what impact, if any, the resolution of this matter will have on
the future financial condition and results of operations of the Company.
INDEPENDENT ACCOUNTANTS
The firm of Deloitte & Touche LLP served as independent public accountants
for the Company and the Bank for 1998 and will continue in those capacities in
1999.
It is anticipated that a representative of Deloitte & Touche LLP will be
present at the Meeting to respond to appropriate questions from shareholders.
SHAREHOLDER PROPOSALS
The deadline for shareholders to submit proposals to be considered for
inclusion in the Proxy Statement for the Company's 2000 Annual meeting of
Shareholders is December 31, 1999.
SECTION 16 (a) COMPLIANCE
Pursuant to Section 16 (a) of the Securities Exchange Act of 1934 and
Securities and Exchange Commission ("SEC") regulations, the Company's
directors, certain officers, and greater than 10 percent shareholders are
required to file reports of ownership and changes in ownership with the SEC
and to furnish the Company with copies of all such reports they file.
Based solely on its review of copies of such reports received or written
representations from certain reporting persons, the Company believes that all
filing requirements applicable to its directors, officers and 10 percent
shareholders were satisfied.
OTHER MATTERS
The Proxy confers discretionary authority to vote on any matter if the
Company did not have notice of the matter at least 45 days before the date on
which the Company first mailed its Proxy Materials for the prior year's Annual
Meeting of Shareholders. The Company mailed its Proxy Materials for the 1998
Annual Meeting on April 20, 1998 and, accordingly, discretionary authority is
conferred to the persons named in the accompanying Proxy to vote on any matter
notice of which is not received until after March 5, 1999.
The Company's Board of Directors does not know of any matters to be
presented at the Meeting other than those set forth above. However, if other
matters come before the Meeting, it is the intention of the persons named in
the accompanying Proxy to vote said Proxy in accordance with the
recommendations of the Company's Board of Directors on such matters, and
discretionary authority to do so is included in the Proxy.
MANAGEMENT OF THE COMPANY WILL SUPPLY WITHOUT COST, UPON WRITTEN REQUEST, A
COPY OF THE COMPANY'S MOST RECENT ANNUAL REPORT ON FORM 10-K INCLUDING
FINANCIAL STATEMENTS AND SCHEDULES BUT WITHOUT EXHIBITS. SAID REQUEST SHOULD
BE DIRECTED TO JACK A. SWEENEY, CHAIRMAN, FIRST REGIONAL BANCORP, 1801 CENTURY
PARK EAST, 8TH FLOOR, CENTURY CITY, CALIFORNIA 90067.
First Regional Bancorp
Thomas E. McCullough, Secretary
First Regional Bancorp
Dated: April 8, 1999
8
<PAGE>
PROXY FIRST REGIONAL BANCORP PROXY
ANNUAL MEETING OF SHAREHOLDERS MAY 20, 1999
The undersigned shareholder of First Regional Bancorp (the "Company") hereby
nominates, constitutes and appoints Jack A. Sweeney and Lawrence J. Sherman,
and each of them, the attorney, agent, and proxy of the undersigned, with full
powers of substitution, to vote all stock of the Company which the undersigned
is entitled to vote at the Annual Meeting of Shareholders of the Company to be
held on Thursday, May 20, 1999, at 11:00 a.m. in Salon I of the Park Hyatt
Hotel, 2151 Avenue of the Stars, Century City, California, and at any and all
adjournments thereof, as fully and with the same force and effect as the
undersigned might or could do if personally present there at, as follows:
1. Election of Directors. Electing the following five persons named below and
in the Proxy Statement dated April 8, 1999, accompanying the Notice of said
Meeting, to serve until the 2000 Annual Meeting of Shareholders and until their
successors are elected and have qualified:
<TABLE>
<S> <C>
H. Anthony Gartshore Lawrence J. Sherman
Gary M. Horgan Jack A. Sweeney
Thomas E. McCullough
</TABLE>
AUTHORITY GIVEN [_] AUTHORITY WITHHELD [_]
IF YOU WISH TO WITHHOLD AUTHORITY TO VOTE FOR SOME, BUT NOT ALL OF THE
NOMINEES NAMED ABOVE, YOU SHOULD CHECK THE BOX "AUTHORITY GIVEN" AND YOU SHOULD
ENTER THE NAME(S) OF THE NOMINEE(S) WITH RESPECT TO WHOM YOU WISH TO WITHHOLD
AUTHORITY TO VOTE IN THE SPACE PROVIDED BELOW:
- --------------------------------------------------------------------------------
2. Other Business. To transact such other business as may properly come
before the Meeting and any adjournment or adjournments thereof.
PLEASE SIGN AND DATE THE OTHER SIDE
THE BOARD OF DIRECTORS RECOMMENDS A VOTE OF "AUTHORITY GIVEN" ON PROPOSAL 1.
THE PROXY CONFERS AUTHORITY AND SHALL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATION OF THE BOARD OF DIRECTORS, UNLESS A CONTRARY INSTRUCTION IS
INDICATED, IN WHICH CASE THE PROXY SHALL BE VOTED IN ACCORDANCE WITH SUCH
INSTRUCTION. THE PROXY ALSO CONFERS AUTHORITY TO CAST VOTES IN SUCH A WAY AS TO
EFFECT THE ELECTION OF ALL FIVE NOMINEES, OR AS MANY THEREOF AS POSSIBLE UNDER
THE RULES OF CUMULATIVE VOTING, IF SHARES ARE VOTED CUMULATIVELY AT THE
MEETING. IN ALL OTHER MATTERS, IF ANY, PRESENTED AT THE MEETING, THIS PROXY
SHALL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE BOARD OF
DIRECTORS.
(Please date this Proxy and sign your name as it appears on the stock
certificates. Executors, administrators, trustees, etc., should give their full
titles. All joint owners should sign.)
I do [_] do not [_] expect to attend the Meeting.
Dated: ______________________, 1999
-----------------------------------
(Number of Shares)
-----------------------------------
(Please Print Your Name)
-----------------------------------
(Signature of Shareholder)
-----------------------------------
(Please Print Your Name)
-----------------------------------
(Signature of Shareholder)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS, AND MAY BE REVOKED
BY THE SHAREHOLDER DELIVERING IT PRIOR TO ITS EXERCISE BY FILING WITH THE
CORPORATE SECRETARY OF THE COMPANY AN INSTRUMENT REVOKING THIS PROXY OR A DULY
EXECUTED PROXY BEARING A LATER DATE OR BY APPEARING AND VOTING IN PERSON AT THE
MEETING.
