As filed with the Securities and Exchange Commission on May 14, 1999
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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THE FIRST AMERICAN FINANCIAL CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
California 95-1068610
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
114 East Fifth Street
Santa Ana, California 92701-4642
(Address of Principal Executive Offices)
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AMENDED AND RESTATED NATIONAL INFORMATION GROUP
1986 STOCK OPTION PLAN
(Full title of the plan)
----------------
Mark R Arnesen, Esq. (Copy to)
Secretary Neil W. Rust, Esq.
The First American Financial Corporation White & Case
114 East Fifth Street 633 West Fifth Street
Santa Ana, California 92701 Los Angeles, California 90071
(714) 558-3211 (213) 620-7700
(Name, Address and Telephone
Number of Agent For Service)
----------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
======================================= ======================= ==================== =================== =================
Proposed
Proposed Maximum
Amount Maximum Aggregate Amount Of
Title of Securities To Be Offering Price Offering Registration
To Be Registered Registered (1) Per Share (2) Price (2) Fee (3)
======================================= ======================= ==================== =================== =================
<S> <C> <C> <C> <C>
Common shares, $1.00 par value 360,930 shares $17,782 $6,418,057 $1,784
======================================= ======================= ==================== =================== =================
</TABLE>
(1) This Registration Statement also covers an indeterminate number of
Common shares that may be issuable by reason of stock splits, stock
dividends or similar transactions in accordance with Rule 416 under the
Act.
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rules 457(c) and 457(h) under the Act, based on the
average of the high and low prices of the Common stock registered on
the New York Stock Exchange as of May 12, 1999.
(3) Computed in accordance with Section 6(b) of the Act by multiplying
0.000278 by the proposed maximum aggregate offering price.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Registrant hereby states that the documents listed in (1), (2),
(3) and (4) below are incorporated by reference in this Registration Statement
and all documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), prior to the filing of a post-effective amendment that
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part hereof from the date of
filing of such documents.
(1) Annual Report on Form 10-K for the fiscal year ended December 31,
1998.
(2) Quarterly Report on Form 10-Q for the fiscal quarter ended March
31, 1999.
(3) The description of First American's Common shares, $1.00 par
value, contained in its Registration Statement on Form 8-A, dated
November 19, 1993, which registers the shares under Section 12(b)
of the Exchange Act.
(4) The description of Rights to Purchase Series A Junior
Participating Preferred Shares, which may be transferred with
First American's Common shares, contained in its Registration
Statement on Form 8-A, dated November 7, 1997, which registers
the rights under Section 12(b) of the Exchange Act.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
Subject to certain limitations, Section 317 of the California
Corporations Code provides in part that a corporation shall have the power to
indemnify any person who was or is a party or is threatened to be made a party
to any proceeding (other than an action by or in the right of the corporation to
procure a judgment in its favor) by reason of the fact that the person is or was
an agent (which term includes officers and directors) of the corporation,
against expenses, judgments, fines, settlements, and other amounts actually and
reasonably incurred in connection with the proceeding if that person acted in
good faith and in a manner the person reasonably believed to be in the best
interests of the corporation and, in the case of a criminal proceeding, had no
reasonable cause to believe the conduct of the person was unlawful.
The California indemnification statute set forth in Section 317 of the
California Corporations Code (noted above) is nonexclusive and allows a
corporation to expand the scope of indemnification provided, whether by
provisions in its Bylaws or by agreement, to the extent authorized in the
corporation's articles.
The articles of incorporation of the Registrant provide that: "The
liability of the directors of the Corporation for monetary damages shall be
eliminated to the fullest extent permissible under California law." The effect
of this provision is to exculpate directors from any liability to the
Registrant, or anyone claiming on the Registrant's behalf, for breaches of the
directors' duty of care. However, the provision does not eliminate or limit the
liability of a director for actions taken in his capacity as an officer. In
addition, the provision applies only to monetary damages and is not intended to
impair the rights of parties suing on behalf of the Registrant to seek equitable
remedies (such as actions to enjoin or rescind a transaction involving a breach
of the directors' duty of care or loyalty).
The Bylaws of the Registrant provide that, subject to certain
qualifications, "(i) The corporation shall indemnify its Officers and Directors
to the fullest extent permitted by law, including those circumstances in which
indemnification would otherwise be discretionary; (ii) the corporation is
required to advance expenses to its Officers and Directors as incurred,
including expenses relating to obtaining a determination that such Officers and
Directors are entitled to indemnification, provided that they undertake to repay
the amount advanced if it is ultimately determined that they are not entitled to
indemnification; (iii) an Officer or Director may bring suit against the
corporation if a claim for indemnification is not timely paid; (iv) the
corporation may not retroactively amend this Section 1 in a way which is adverse
to its Officers and Directors; (v) the provisions of subsections (i) through
(iv) above shall apply to all past and present Officers and Directors of the
corporation." "Officer" includes the following officers of the Registrant:
Chairman of the Board, President, Vice President, Secretary, Assistant
Secretary, Chief Financial Officer, Treasurer, Assistant Treasurer and such
other officers as the board shall designate from time to time. "Director" of the
Registrant means any person appointed to serve on the Registrant's board of
directors either by its shareholders or by the remaining board members.
Each of the Registrant's 1996 Stock Option Plan, 1997 Directors' Stock
Plan, 401(k) Savings Plan, Pension Plan, Pension Restoration Plan and Employee
Profit Sharing and Stock Ownership Plan (for purposes of this paragraph, each
individually, the "Plan") provides that, subject to certain conditions, the
Registrant may, through the purchase of insurance or otherwise, indemnify each
member of the Board (or board of directors of any affiliate), each member of the
committee charged with administering the Plan, and any other employees to whom
any responsibility with respect to the Plan is allocated or delegated, from and
against any and all claims, losses, damages, and expenses, including attorneys'
fees, and any liability, including any amounts paid in settlement with the
Registrant's approval, arising from the individual's action or failure to act,
except when the same is judicially determined to be attributable to the gross
negligence or willful misconduct of such person.
The Registrant's Deferred Compensation Plan (for purposes of this
paragraph, the "Plan") provides that, "To the extent permitted by applicable
state law, the Company shall indemnify and save harmless the Committee and each
member thereof, the Board of Directors and any delegate of the Committee who is
an employee of the Company against any and all expenses, liabilities and claims,
including legal fees to defend against such liabilities and claims arising out
of their discharge in good faith of responsibilities under or incident to the
Plan, other than expenses and liabilities arising out of willful misconduct.
This indemnity shall not preclude such further indemnities as may be available
under insurance purchased by the Company or provided by the Company under any
bylaw, agreement or otherwise, as such indemnities are permitted under state
law."
Each of the Registrant's Management Supplemental Benefit Plan and
Executive Supplemental Benefit Plan (for purposes of this paragraph, each
individually, the "Plan") provides that, subject to certain conditions, the
Registrant may, through the purchase of insurance or otherwise, indemnify and
hold harmless, to the extent permitted by law, the members of the Board of
Directors and any other employees to whom any responsibility with respect to the
administration of the Plan has been delegated against any and all costs,
expenses and liabilities (including attorneys fees) incurred by such parties in
performing their duties and responsibilities under the Plan, provided that such
party or parties were not guilty of willful misconduct.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that, in the opinion of the Securities and
Exchange Commission, such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
4.1. Description of the Registrant's capital stock in article
Sixth of the Restated Articles of Incorporation of The First
American Financial Corporation, incorporated by reference to
Exhibit 3.1 of the Registrant's Quarterly Post-Effective
Amendment No. 1 to Registration Statement on Form S-4 dated
July 28, 1998 and Exhibit 3 of the Registrant's Quarterly
Report on Form 10-Q for the fiscal quarter ended March 31,
1999.
4.2. Rights Agreement, incorporated by reference to Exhibit 4 of
the Registrant's Registration Statement on Form 8-A dated
November 7, 1997.
4.3. Amended and Restated National Information Group 1986 Stock
Option Plan.
5. Opinion of White & Case LLP regarding legality.
23.1. Consent of PricewaterhouseCoopers.
23.2. Consent of White & Case LLP (contained in Exhibit 5).
24. Power of Attorney.
Item 9. Undertakings.
A. Rule 415 Offering. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered) and any deviation from the low and
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
B. Filings Incorporating Subsequent Exchange Act Documents by
Reference. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
C. Securities and Exchange Commission Position on Indemnification.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Santa Ana, State of California, on May 14, 1999.
THE FIRST AMERICAN FINANCIAL
CORPORATION
By: /s/ Parker S. Kennedy
-----------------------------
Parker S. Kennedy, President
(Principal Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Date: May 14, 1999 By: /s/ D.P. Kennedy
-----------------------------
D.P. Kennedy, Chairman and Director
Date: May 14, 1999 By: /s/ Parker S. Kennedy
-----------------------------
Parker S. Kennedy, President and Director
Date: May 14, 1999 By: /s/ Thomas A. Klemens
-----------------------------
Thomas A. Klemens, Executive Vice
President, Chief Financial Officer
(Principal Financial and Accounting
Officer)
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Date: By:
-----------------------------
George L. Argyros, Director
Date: May 14, 1999 By: /s/ Gary J. Beban *
-----------------------------
Gary J. Beban, Director
Date: May 14, 1999 By: /s/ J. David Chatham *
-----------------------------
J. David Chatham, Director
Date: By:
-----------------------------
William G. Davis, Director
Date: May 14, 1999 By: /s/ James L. Doti *
-----------------------------
James L. Doti, Director
Date: May 14, 1999 By: /s/ Lewis W. Douglas, Jr. *
-----------------------------
Lewis W. Douglas, Jr., Director
Date: May 14, 1999 By: /s/ Paul B. Fay, Jr. *
-----------------------------
Paul B. Fay, Jr., Director
Date: By:
-----------------------------
Anthony R. Moiso, Director
Date: May 14, 1999 By: /s/ Frank O'Bryan *
-----------------------------
Frank O'Bryan, Director
Date: May 14, 1999 By: /s/ Roslyn B. Payne *
-----------------------------
Roslyn B. Payne, Director
Date: May 14, 1999 By: /s/ D. Van Skilling *
-----------------------------
D. Van Skilling, Director
Date: May 14, 1999 By: /s/ Virginia Ueberroth *
-----------------------------
Virginia Ueberroth, Director
*By:/s/ Mark R Arnesen
-----------------------------
Mark R Arnesen
Attorney-in-Fact
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
4.1. Description of the Registrant's capital stock in article Sixth of the
Restated Articles of Incorporation of The First American Financial
Corporation, incorporated by reference to Exhibit 3.1 of the
Registrant's Post-Effective Amendment No. 1 to Registration Statement
on Form S-4 dated July 28, 1998 and Exhibit 3 of the Registrant's
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
1999.
4.2. Rights Agreement, incorporated by reference to Exhibit 4 of the
Registrant's Registration Statement on Form 8-A dated November 7,
1997.
4.3. Amended and Restated National Information Group 1986 Stock Option
Plan.
5. Opinion of White & Case LLP regarding legality.
23.1. Consent of PricewaterhouseCoopers.
23.2. Consent of White & Case LLP (contained in Exhibit 5).
24. Power of Attorney.
EXHIBIT 4.3
AMENDED AND RESTATED
NATIONAL INFORMATION GROUP
1986 STOCK OPTION PLAN
1. Purposes of the Plan. The purpose of this Stock Option Plan is to
provide additional incentive to Employees and Consultants to work to maximize
shareholder value. This Stock Option Plan also utilizes vesting periods to
encourage key Employees and Consultants to continue in the employ of or service
to the Company. The Plan and/or the granting of any option under the Plan to any
employee shall not be construed to be any form of employment contract or
guarantee of future employment or compensation.
Options granted hereunder shall be "nonstatutory stock options."
2. Definitions. As used herein, the following definitions shall apply:
(a) "Board" shall mean the Committee, if one has been appointed, or
the Board of Directors of the Company, if no Committee is appointed.
(b) "Common Stock" shall mean the Common shares, $1.00 par value, of
The First American Financial Corporation.
(c) "Company" shall mean National Information Group, a California
corporation.
(d) "Committee" shall mean the Committee appointed by the Board of
Directors in accordance with paragraph (a) of Section 4 of the Plan, if one is
appointed.
(e) "Employee" shall mean any person, including officers and
directors, employed by the Company or any parent or subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.
(f) "Consultant" shall mean any person who is engaged by the Company
or any subsidiary to render consulting services and is compensated for such
consulting services, and any director of the Company whether compensated for
such services or not; provided that if and in the event the Company registers
any class of any equity security pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the term Consultant shall
thereafter not include directors who are not compensated for their services or
are paid only a director's fee by the Company.
(g) "Option" shall mean a stock option granted pursuant to the Plan.
(h) "Optioned Stock" shall mean the Common Stock subject to an Option.
(i) "Optionee" shall mean an Employee or Consultant who receives an
Option.
(j) "Plan" shall mean this Amended and Restated National Information
Group 1986 Stock Option Plan.
(k) "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
3. Stock Subject to the Plan. Subject to the provisions of Section 11
of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 360,930 Shares. The Shares may be authorized, but
unissued, or reacquired Common Stock.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were subject
thereto shall, unless the Plan shall have been terminated, become available for
future grant under the Plan.
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. If permitted by Rule 16b-3 of
the Exchange Act, the Plan may be administered by different bodies with respect
to members of the Board of Directors of the Company ("Directors"), officers of
the Company, within the meaning of Section 16 of the Exchange Act and the rules
and regulations promulgated thereunder ("Officers"), who are not Directors, and
Employees who are neither Directors nor Officers.
(ii) Administration With Respect to Directors and Officers
Subject to Section 16(b). With respect to Option grants made to Employees who
are also Officers or Directors subject to Section 16(b) of the Exchange Act, the
Plan shall be administered by (A) the Board of Directors, if the Board of
Directors may administer the Plan in compliance with the rules governing a plan
intended to qualify as a discretionary plan under Rule 16b-3, or (B) a committee
designated by the Board of Directors to administer the Plan, which committee
shall be constituted to comply with the rules governing a plan intended to
qualify as a discretionary plan under Rule 16b-3 (the "Committee"). Once
appointed, such Committee shall continue to serve in its designated capacity
until otherwise directed by the Board of Directors. From time to time the Board
of Directors may increase the size of the Committee and appoint additional
members, remove members (with or without cause) and substitute new members, fill
vacancies (however caused), and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by the
rules governing a plan intended to qualify as a discretionary plan under Rule
16b-3.
(iii) Administration With Respect to Other Persons. With respect
to Option grants made to Employees or Consultants who are neither Directors nor
Officers of the Company, the Plan shall be administered by (A) the Board of
Directors or (B) a committee designated by the Board of Directors, which
committee shall be constituted to satisfy the legal requirements relating to the
administration of stock option plans under state corporate and securities laws
and the Internal Revenue Code of 1986, as amended (the "Applicable Laws"). Once
appointed, such Committee shall serve in its designated capacity until otherwise
directed by the Board of Directors. The Board of Directors may increase the size
of the Committee and appoint additional members, remove members (with or without
cause) and substitute new members, fill vacancies (however caused), and remove
all members of the Committee and thereafter directly administer the Plan, all to
the extent permitted by Applicable Laws.
(b) Powers of the Board. Subject to the provisions of the Plan, the
Board shall have the authority, in its discretion: (i) to grant "nonstatutory
stock options"; (ii) to determine, upon review of relevant information and in
accordance with Section 8(b) of the Plan, the fair market value of the Common
Stock; (iii) to determine the exercise price per share of Options to be granted,
which exercise price shall be determined in accordance with Section 8(a) of the
Plan; (iv) to determine the Employees or Consultants to whom, and the time or
times at which, Options shall be granted and the number of shares to be
represented by each Option; (v) to interpret the Plan; (vi) to prescribe, amend
and rescind rules and regulations relating to the Plan; (vii) to determine the
terms and provisions of each Option granted (which need not be identical) and,
with the consent of the holder thereof, modify or amend each Option; (viii) to
accelerate or defer (with the consent of the Optionee) the exercise date of any
Option, consistent with the provisions of Section 5 of the Plan; (ix) to
authorize any person to execute on behalf of the Company any instrument required
to effectuate the grant of an Option previously granted by the Board; and (x) to
make all other determinations deemed necessary or advisable for the
administration of the Plan.
(c) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and any
other holders of any Options granted under the Plan.
5. Eligibility.
(a) Options may be granted only to Employees and Consultants. An
Employee or Consultant who has been granted an Option may, if he is otherwise
eligible, be granted an additional Option or Options.
(b) The Plan shall not confer upon any Optionee any right with respect
to continuation of employment, compensation or consulting relationship with the
Company, nor shall it interfere in any way with his right or the Company's right
to terminate his employment or consulting relationship at any time.
(c) The following limitations shall apply to grants of Options to
Employees:
(i) No Employee shall be granted, in any fiscal year of the
Company, Options to purchase more than 150,000 Shares.
(ii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 11.
(iii) If an Option is canceled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 11), the cancelled Option will be counted against the limit
set forth in Section 5(c). For this purpose, if the exercise price of an Option
is reduced, the transaction will be treated as a cancellation of the Option and
the grant of a new Option.
6. Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company as described in Section 17 of the Plan. It shall
continue in effect for a term of twenty (20) years unless sooner terminated
under Section 13 of the Plan.
7. Term of Option. The term of each Option shall be ten (10) years
from the date of grant thereof or such shorter term as may be provided in the
Stock Option Agreement.
8. Exercise Price and Consideration.
(a) The per Share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be such price as is determined by the Board, but
shall be no less than 100% of the fair market value per Share on the date of
grant.
(b) The fair market value shall be determined by the Board in its
discretion; provided, however, that where there is a public market for the
Common Stock, the fair market value per Share shall be the mean of the bid and
asked prices of the Common Stock for the date of grant, as reported in the Wall
Street Journal (or, if not so reported, as otherwise reported by the National
Association of Securities Dealers Automated Quotation (NASDAQ) System) or, in
the event the Common Stock is listed on a stock exchange, the fair market value
per Share shall be the closing price on such exchange on the date of grant of
the Option, as reported in the Wall Street Journal.
(c) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Board and may consist entirely of either cash or check in United States
currency.
9. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Board, including performance criteria with respect to the
Company and/or the Optionee, and as shall be permissible under the terms of the
Plan.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section 8(c) of the Plan.
Until the Company receives written notice of such exercise and full payment for
the Shares, no right to vote or receive dividends or any other rights as a
shareholder shall exist with respect to Optioned Stock. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 11 of the
Plan.
Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(b) Termination of Status as an Employee or Consultant. If an Employee
or Consultant ceases to serve as an Employee or Consultant, he may, but only
within thirty (30) days (or such longer period of time as is determined by the
Board, but in no event later than the expiration date of the term of such Option
as set forth in the Option Agreement) after the date he ceases to be an Employee
or Consultant of the Company, exercise his Option to the extent that he was
entitled to exercise it at the date of such termination. To the extent that he
was not entitled to exercise the Option at the date of such termination, or if
he does not exercise such Option (which he was entitled to exercise) within the
time specified herein, the Option shall terminate.
(c) Disability of Optionee. Notwithstanding the provisions of Section
9(b) above, in the event an Employee or Consultant is unable to continue his
employment or consulting relationship (as the case may be) with the Company as a
result of his total and permanent disability (as defined in section 22(e)(3) of
the Internal Revenue Code), he may, but only within six (6) months (or such
longer period of time as is determined by the Board, but in no event later than
the expiration date of the term of such Option as set forth in the Option
Agreement) from the date of termination, exercise his Option to the extent he
was entitled to exercise it at the date of such termination. To the extent that
he was not entitled to exercise the Option at the date of termination, or if he
does not exercise such Option (which he was entitled to exercise) within the
time specified herein, the Option shall terminate.
(d) Death of Optionee. In the event of the death of an Optionee:
(i) during the term of the Option who is at the time of his death
an Employee or Consultant of the Company and who shall have been in continuous
status as an Employee or Consultant since the date of grant of the Option, the
Option may be exercised, at any time within twelve (12) months following the
date of death (or such longer period of time as is determined by the Board, but
in no event later than the expiration date of the term of such Option as set
forth in the Option Agreement), by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent of the right to exercise that had accrued at the date of the
Optionee's death; or
(ii) within thirty (30) days (or such longer period of time as is
determined by the Board, but in no event later than the expiration date of the
term of such Option as set forth in the Option Agreement) after the termination
of continuous status as an employee or Consultant, the Option may be exercised,
at any time within six (6) months following the date of death (or such longer
period of time as is determined by the Board, but in no event later than the
expiration date of the term of such Option as set forth in the Option
Agreement), by the Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent of the
right to exercise that had accrued at the date of termination.
10. Non-Transferability of Options. The Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee, only by the Optionee.
11. Adjustments Upon Changes in Capitalization or Merger. Subject to
any required action by the shareholders of the Company, the number of shares of
Common Stock covered by each outstanding Option, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option, as well as the price per share of
Common Stock covered by each such outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the
Company, the Option will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board. The Board may, in the
exercise of its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Board and give each Optionee the right to
exercise his Option as to all or any part of the Optioned Stock, including
Shares as to which the Option would not otherwise be exercisable. In the event
of a proposed sale of all or substantially all of the assets of the Company, or
the merger of the Company with or into another corporation, the Option shall be
assumed or an equivalent option shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sole discretion and in lieu of such
assumption or substitution, that the Optionee shall have the right to exercise
the Option as to all of the Optioned Stock, including Shares as to which the
Option would not otherwise be exercisable. If the Board makes an Option fully
exercisable in lieu of assumption or substitution in the event of a merger or
sale of assets, the Board shall notify the Optionee that the Option shall be
fully exercisable for a period of thirty (30) days from the date of such notice,
and the Option will terminate upon the expiration of such period.
12. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date on which the Board makes the determination
granting such Option. Notice of the determination shall be given to each
Employee or Consultant to whom an Option is so granted within a reasonable time
after the date of such grant.
13. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may amend or terminate the
Plan from time to time in such respects as the Board may deem advisable;
provided, however, that a following revision or amendment shall require approval
of the Shareholders of the Company in the manner described in Section 17 of the
Plan:
(i) if the Company has a class of equity security registered
under Section 12 of the Exchange Act at the time of such revision or amendment,
any material increase in the benefits accruing to participants under the Plan.
(b) Shareholder Approval. If any amendment requiring shareholder
approval under Section 13(a) of the Plan is made subsequent to the first
registration of any class of equity security by the Company under Section 12 of
the Exchange Act, such shareholder approval shall be solicited as described in
Section 17(a) of the Plan.
(c) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee and
the Board, which agreement must be in writing and signed by the Optionee and the
Company.
14. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.
15. Reservation of Shares. The First American Financial Corporation,
during the term of this Plan, will at all times reserve and keep available such
number of Shares as shall be sufficient to satisfy the requirements of the Plan.
Inability of The First American Financial Corporation and/or the
Company to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by The First American Financial Corporation and/or the
Company's counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve The First American Financial Corporation and/or the
Company of any liability in respect of the failure to issue or sell such Shares
as to which such requisite authority shall not have been obtained.
16. Option Agreement. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
17. Shareholder Approval. If and in the event that the Company
registers any class of any equity security pursuant to Section 12 of the
Exchange Act, the approval of such shareholders of the Company shall be:
(a) (1) solicited substantially in accordance with Section 14(a) of
the Exchange Act and the rules and regulations promulgated thereunder, or (2)
solicited after the Company has furnished in writing to the holders entitled to
vote substantially the same information concerning the Plan as that which would
be required by the rules and regulations in effect under Section 14(a) of the
Exchange Act at the time such information is furnished; and
(b) obtained at or prior to the first annual meeting of shareholders
held subsequent to the first registration of any class of equity securities of
the Company under Section 12 of the Exchange Act.
If such shareholder approval is obtained by written consent, it must
be obtained by the unanimous written consent of all shareholders of the Company.
18. Information to Optionees. The Company shall provide to each
Optionee, during the period for which such Optionee has one or more Options
outstanding, copies of all annual reports and other information which are
provided to all shareholders of The First American Financial Corporation. The
Company shall not be required to provide such information if the issuance of
Options under the Plan is limited to key employees whose duties in connection
with the Company assure their access to equivalent information.
EXHIBIT 5
[LETTERHEAD OF WHITE & CASE LLP]
May 14, 1999
The First American Financial Corporation
114 East Fifth Street
Santa Ana, CA 92701
Ladies and Gentlemen:
We have acted as counsel to The First American Financial Corporation, a
California corporation (the "Company"), and are familiar with the proceedings
and documents relating to the proposed registration by the Company, through a
Registration Statement on Form S-8 (the "Registration Statement"), to be filed
by the Company with the Securities and Exchange Commission, of 360,930 Common
shares, $1.00 par value, of the Company and an equal number of Rights to
purchase $1.00 par value Series A Junior Participating Preferred Shares
(collectively, the "Shares"), which Shares shall be reserved for issuance under
the Amended and Restated National Information Group 1986 Stock Option Plan, as
amended (the "Plan").
For the purposes of rendering this opinion, we have examined originals
or photostatic copies of certified copies of such corporate records, agreements
and other documents of the Company as we have deemed relevant and necessary as a
basis for the opinion hereinafter set forth.
Based on the foregoing, we are of the opinion that the Shares, when
issued and paid for in accordance with the terms and conditions set forth in the
Plan and each related option agreement, will be duly authorized, validly issued,
fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ White & Case LLP
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the prospectus
constituting part of this Registration Statement on Form S-8 of The First
American Financial Corporation of our report dated February 9, 1999, appearing
on page 24 of The First American Financial Corporation's Annual Report on Form
10-K for the year ended December 31, 1998.
/s/ PricewaterhouseCoopers LLP
- ------------------------------
PricewaterhouseCoopers LLP
Costa Mesa, California
May 14, 1999
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned directors of The
First American Financial Corporation, a California corporation (the
"Corporation"), hereby constitute and appoint Parker S. Kennedy and Mark R
Arnesen, and each of them, the true and lawful agents and attorneys-in-fact of
the undersigned, with full power and authority in said agents and
attorneys-in-fact, and in either or both of them, to sign for the undersigned
and in their respective names as directors of the Corporation the Registration
Statement on Form S-8 to be filed with the United States Securities and Exchange
Commission, Washington, D.C., under the Securities Act of 1933, as amended, and
any amendment or amendments to such Registration Statement, relating to the
Common shares, par value $1.00 per share, of the Corporation to be offered
thereunder, and the undersigned ratify and confirm all acts taken by such agents
and attorneys-in-fact, or either or both of them, as herein authorized. This
Power of Attorney may be executed in one or more counterparts.
Date: December __, 1998 By:
-------------------------
George L. Argyros, Director
Date: December 10, 1998 By: /s/ Gary J. Beban
-------------------------
Gary J. Beban, Director
Date: December 10, 1998 By:/s/ J. David Chatham
--------------------------
J. David Chatham, Director
Date: December __, 1998 By:
--------------------------
William G. Davis, Director
Date: December 10, 1998 By: /s/ James L. Doti
-------------------------
James L. Doti, Director
Date: December 10, 1998 By: /s/ Lewis W. Douglas, Jr.
-------------------------
Lewis W. Douglas, Jr., Director
Date: December 10, 1998 By: /s/ Paul B. Fay, Jr.
-------------------------
Paul B. Fay, Jr., Director
Date: December 10, 1998 By: /s/ Dale F. Frey
-------------------------
Dale F. Frey, Director
Date: December __, 1998 By:
--------------------------
Anthony R. Moiso, Director
Date: December 10, 1998 By: /s/ Frank O'Bryan
--------------------------
Frank O'Bryan, Director
Date: December 10, 1998 By: /s/ Roslyn B. Payne
--------------------------
Roslyn B. Payne, Director
Date: December 10, 1998 By: /s/ D. Van Skilling
--------------------------
D. Van Skilling, Director
Date: December 10, 1998 By: /s/ Virginia Ueberroth
--------------------------
Virginia Ueberroth, Director
