<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 8)*
Foothill Independent Bancorp
----------------------------
(Name of Issuer)
Common Stock, par value $.01
----------------------------
(Title of Class of Securities)
344905104
---------
(CUSIP Number)
Thomas M. Cerabino, Esq., Willkie Farr & Gallagher,
787 Seventh Avenue, New York, New York 10019
(212) 728-8000
--------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
March 31, 1999
--------------
(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 which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box .
Check the following box if a fee is being paid with the statement (A fee is not
required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-l(a) for other parties to whom copies are to be
sent.
*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 ("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>
SCHEDULE 13D
- ------------------- -----------------
CUSIP No. 344905104 Page 2 of 7 Pages
- ------------------- -----------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORT PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Basswood Partners, L.L.C.
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------- --------- ------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 553,421
PERSON WITH
--------- ------------------------------------------------
8 SHARED VOTING POWER
--------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
553,421
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
553,421
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.34 %
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7 2 of 7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- ------------------- -----------------
CUSIP No. 344905104 Page 3 of 7 Pages
- ------------------- -----------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORT PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Matthew Lindenbaum
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------- --------- ------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 553,421
PERSON WITH
--------- ------------------------------------------------
8 SHARED VOTING POWER
--------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
553,421
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
553,421
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.34%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7 3 of 7
(INCLUDING EXHIBITS) OF THE SCHEDULE,
AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- ------------------- -----------------
CUSIP No. 344905104 Page 4 of 7 Pages
- ------------------- -----------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORT PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bennett Lindenbaum
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------- --------- ------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 553,421
PERSON WITH
--------- ------------------------------------------------
8 SHARED VOTING POWER
--------- ------------------------------------------------
9 SOLE DISPOSITIVE POWER
553,421
--------- ------------------------------------------------
10 SHARED DISPOSITIVE POWER
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
553,421
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.34%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7 4 of 7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
The purpose of this Amendment No. 8 to the previously filed Schedule 13D is
to report a change in the disclosure set forth in Item 4 (Purpose of
Transaction) as more fully described below.
Item 1. Security and Issuer
- ------- -------------------
No change.
Item 2. Identity and Background
- ------- -----------------------
This Statement has been filed on behalf of the Reporting Persons, namely
Basswood Partners, L.L.C. ("Basswood"), a Delaware limited liability company,
and Matthew Lindenbaum and Bennett Lindenbaum, the managing members of Basswood.
The principal business address of each of the Reporting Persons is 645 Madison
Avenue, 10th Floor, New York, New York 10022. Basswood is the general partner of
Basswood Financial Partners, L.P., a Delaware limited partnership (the
"Partnership") and Whitewood Financial Partners, L.P., a Delaware limited
partnership ("Whitewood"), and is the investment general partner of certain
partnerships (including Jet I, L.P., a Delaware limited partnership ("Jet I")),
which may from time to time acquire Shares. Basswood Capital Management, LLC (of
whom Matthew Lindenbaum and Bennett Lindenbaum are managing members) acts as
investment manager to Basswood International Fund, Inc., a Cayman Islands
exempted company ("Basswood International") and acts as advisor to several
managed accounts. The Partnership, Basswood International, Whitewood and Jet I
are referred to collectively as the "Accounts." As of the date hereof, 445,738
Shares are owned of record by the Partnership, 4,608 Shares are owned of record
by Whitewood, 22,292 Shares are owned of record by Jet, 80,683 Shares are owned
of record by Basswood International and 100 Shares are owned of record by
Bennett Lindenbaum. From time to time, Shares may be sold between Accounts in
the ordinary course of investment business.
Messrs. Matthew Lindenbaum and Bennett Lindenbaum also have investment
discretion over certain other managed accounts which do not currently own Shares
but which may in the future buy and sell Shares from time to time.
During the last five years, none of the Reporting Persons nor any of the
Accounts has been (i) convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or (ii) a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to, United
States federal or state securities laws or finding any violations with respect
to such laws.
Each of Messrs. Matthew Lindenbaum and Bennett Lindenbaum is a citizen of
the United States.
Item 3. Source and Amount of Funds or Other Considerations
- ------- --------------------------------------------------
As of the date hereof, each of the Reporting Persons may be deemed to
beneficially own 553,421 Shares, all of which Shares are held of record by the
Accounts (other than 100 Shares which are owned of record by Bennett
Lindenbaum). The Shares have been purchased in open market transactions at an
aggregate cost of $5,310,185.31. The funds for the purchase of the Shares held
by the Accounts and Mr. Lindenbaum have come from the various Accounts'
respective working capital. No leverage was used to purchase any of the Shares.
However, one or more of the Accounts' working capital may include the proceeds
of margin loans entered into in the ordinary course of business with Goldman,
Sachs & Co., such loans being secured by the securities owned by such Accounts.
Item 4. Purpose of Transaction
- ------- ----------------------
All Shares beneficially owned by the Reporting Persons were acquired for,
and are being held for, investment purposes.
Page 5 of 7 Pages
<PAGE>
On March 31, 1999, Basswood Financial Partners filed a Verified Petition
for Peremptory Writ of Mandate in the Superior Court of California, Los Angeles
County (the "Petition"), against Foothill pursuant to Sections 1600 and 1601 of
the California General Corporation Law and Section 1085 of the California Code
of Civil Procedure. The Petition asserts that, among other things, Foothill has
wrongfully refused to provide the list of shareholders and corporate records
that Basswood Financial Partners requested in its letter to Foothill on March
17, 1999. The Petition seeks a Writ of Mandamus commanding Foothill to, among
other things, permit inspection and copying of the shareholder and corporate
records requested by Basswood Financial Partners in its March 17, 1999 letter. A
copy of the Petition is attached hereto as Exhibit B and incorporated herein by
reference.
Except as discussed above, the Reporting Persons otherwise have no plan or
proposal which relates to, or would result in, any of the actions enumerated in
Item 4 of the instructions to Schedule 13D.
Item 5. Interest in Securities of the Company
- ------- -------------------------------------
(a)-(b) As of the date hereof, the Reporting Persons each may be deemed to be
the beneficial owners of 553,421 Shares. As of March 19, 1999 (according to the
Company's Form 10-Q for the quarter ended December 31, 1998), there were a total
of 5,923,263 Shares of Common Stock outstanding. Therefore, the Reporting
Persons collectively may be deemed to be the beneficial owners of approximately
9.34% of the outstanding Shares as of such date. The Reporting Persons
collectively have the power to vote, direct the vote, dispose of or direct the
disposition of all the Shares of which they may be deemed to be the beneficial
owners.
(c) The trading date, number of Shares purchased and price per Share (excluding
commissions, if any) for all transactions by the Reporting Persons for the
60-day period preceding March 31, 1999 through the date hereof are set forth in
Exhibit B hereto.
(d) Other than the Reporting Persons and the Accounts, with respect to the
Shares beneficially owned by them, no other person is known to have the right to
receive or the power to direct the receipt of dividends from, or the proceeds of
sale of, such Shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
- ------- ---------------------------------------------------------------------
to Securities of the Company
----------------------------
No change.
Item 7. Material to be Filed as Exhibits
- ------- --------------------------------
The following exhibits are filed hereto:
Exhibit A: An agreement relating to the filing of a joint statement as
required by Rule 13d-1(k) under the Securities Exchange Act
of 1934
Exhibit B: A copy of the Verified Petition for Peremptory Writ of
Mandate filed by Basswood Financial Partners on March 31,
1999 in Superior County, County of Los Angeles, California
Exhibit C: A description of the transactions in the Shares that were
effected by the Reporting Persons during the 60-day period
preceding March 31, 1999 through the date hereof
Page 6 of 7 Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: April 6, 1999
BASSWOOD PARTNERS, L.L.C.
By: /s/ Matthew Lindenbaum
--------------------------
Name: Matthew Lindenbaum
Title: Managing Member
By: /s/ Bennett Lindenbaum
--------------------------
Name: Bennett Lindenbaum
Title: Managing Member
/s/ Matthew Lindenbaum
----------------------
Matthew Lindenbaum
/s/ Bennett Lindenbaum
----------------------
Bennett Lindenbaum
Page 7 of 7 Pages
<PAGE>
EXHIBIT INDEX
Exhibit Title
- ------- -----
Exhibit A: An agreement relating to the filing of a joint statement as
required by Rule 13d-1(k) under the Securities Exchange Act
of 1934
Exhibit B: A copy of the Verified Petition for Peremptory Writ of
Mandate filed by Basswood Financial Partners on March 31,
1999 in Superior County, County of Los Angeles, California
Exhibit C: A description of the transactions in the Shares that were
effected by the Reporting Persons during the 60-day period
preceding March 31, 1999 through the date hereof.
<PAGE>
EXHIBIT A
AGREEMENT
The undersigned agree that this Schedule 13D relating to the Common
Stock of Foothill Independent Bancorp shall be filed on behalf of each of the
undersigned.
Dated: April 6, 1999
BASSWOOD PARTNERS, L.L.C.
By: /s/ Matthew Lindenbaum
--------------------------
Name: Matthew Lindenbaum
Title: Managing Member
By: /s/ Bennett Lindenbaum
--------------------------
Name: Bennett Lindenbaum
Title: Managing Member
/s/ Matthew Lindenbaum
----------------------
Matthew Lindenbaum
/s/ Bennett Lindenbaum
----------------------
Bennett Lindenbaum
<PAGE>
EXHIBIT B
LATHAM & WATKINS
Marc W. Rappel (Bar No. 097032)
Amos E. Hartston (Bar No. 186471)
633 West Fifth Street, Suite 4000
Los Angeles, California 90071-2007
Telephone: (213) 485-1234
Facsimile: (213) 891-8763
Of Counsel:
WILLKIE FARR & GALLAGHER
787 Seventh Avenue
New York, New York 10019
(212) 728-8000
Attorneys for Petitioner
Basswood Financial Partners, LP
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
BASSWOOD FINANCIAL PARTNERS, LP, CASE NO. _____________________
Petitioner,
VERIFIED PETITION FOR
PEREMPTORY WRIT OF
MANDATE
v.
Petition Filed: March 31, 1999
Trial Date: None Set
FOOTHILL INDEPENDENT BANCORP.,
Respondent.
- -------------------------------------
_______________________________________
VERIFIED PETITION FOR PEREMPTORY
WRIT OF MANDATE
<PAGE>
VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE
------------------------------------------------
For its verified petition against Respondent Foothill Independent
Bancorp ("Foothill" or the "Company"), Basswood Financial Partners, LP
("Basswood" or "Petitioner") alleges as follows:
1. Pursuant to Section 1085 of the California Code of Civil Procedure
and Sections 1600 and 1601 of the California General Corporation Law (the "CGCL"
or "Act"), Basswood petitions for a peremptory writ of mandamus compelling
Foothill to produce for inspection and copying (a) its shareholder list and
related records and (b) certain of its accounting books and records and minutes
of meetings. Despite Basswood's entitlement to such corporate records, Foothill
has without justification refused to comply with Basswood's request and its
obligations under the Act. In fact, Foothill appears to be embarked on a scheme
to deprive Basswood of its valuable voting rights under California law.
Immediate relief is required to protect Basswood's rights as a Foothill
shareholder, including its right to communicate with other shareholders.
The Parties
-----------
2. Basswood is a Delaware limited partnership with its principal place
of business at 645 Madison Avenue, New York, New York 10022. Basswood is the
record owner of 445,738 shares, or approximately 7.5%, of common stock of
Foothill. As a shareholder owning greater than 5% of Foothill's common stock,
Basswood is entitled to seek shareholder records as a matter of right pursuant
to ss. 1600(a) of the CGCL.
3. Foothill is a California corporation with its principal offices at
510 South Grand Avenue, Glendora, CA 91741. Foothill's principal operating
subsidiary is Foothill Independent Bank, which has branches throughout the Los
Angeles area.
The Statutory Framework
-----------------------
4. Sections 1600 through 1605 of the CGCL govern the obligations of
California corporations to maintain corporate records, the rights of
shareholders to inspect and copy such records, and judicial proceedings to
enforce those shareholders' rights. Section 1600 of the CGCL provides (with
emphasis supplied):
1
<PAGE>
(a) A shareholder or shareholders holding at least 5 percent
in the aggregate of the outstanding voting shares of a corporation or
who hold at least 1 percent of those voting shares and have filed a
Schedule 14A with the United States Securities and Exchange Commission
(or in case the corporation is a bank the deposits of which are
insured in accordance with the Federal Deposit Insurance Act, have
filed a Form F-6 with the appropriate federal bank regulatory agency)
shall have an absolute right to do either or both of the following:
(1) inspect and copy the record of shareholders' names and addresses
and shareholdings during usual business hours upon five business days'
prior written demand upon the corporation, or (2) obtain from the
transfer agent for the corporation, upon written demand and upon the
tender of its usual charges for such a list (the amount of which
charges shall be stated to the shareholder by the transfer agent upon
request), a list of the shareholders' names and addresses, who are
entitled to vote for the election of directors, and their
shareholdings, as of the most recent record date for which it has been
compiled or as of a date specified by the shareholder subsequent to
the date of demand. The list shall be made available on or before the
later of five business days after the demand is received or the date
specified therein as the date as of which the list is to be compiled.
A corporation shall have the responsibility to cause its transfer
agent to comply with this subdivision. (footnotes omitted) (italics in
original; emphasis added).
5. The official comment to Section 1600 explicitly states that the
section "expands inspection rights by providing a mandatory right to inspect the
stock list for shareholders who have a significant ownership interest in the
corporation or who, in addition to a certain specified ownership interest in the
corporation, have instituted a proxy contest with respect to the election of
directors." As a record stockholder of more than 5% of Foothill, Basswood has a
"significant ownership interest" within the meaning of Section 1600(a), and an
absolute right to inspect Foothill's shareholder records.
6. Section 1601(a) of the Act, entitled "Inspection of Corporate
Records," provides shareholders with a right to inspect the accounting books and
records and minutes of the corporation, and states:
The accounting books and records and minutes of proceedings of the
shareholders and the board and committees of the board of any domestic
corporation, and of any foreign corporation keeping any such records
in this state or having its principal executive office in this state,
shall be open to inspection upon the written demand on the corporation
of any shareholder or holder of a voting trust certificate at any
reasonable time during usual business hours, for a purpose reasonably
related to such holder's interest as a shareholder or as the holder of
such voting trust certificate. The right of inspection created by this
subdivision shall extend to the records of each subsidiary of a
corporation subject to this subdivision.
2
<PAGE>
7. Section 1603 of the Act permits a shareholder who has been denied
access to corporate records identified in Sections 1600 and 1601 of the Act to
seek judicial relief:
Upon refusal of a lawful demand for inspection, the superior court of
the proper county, may enforce the right of inspection with just and
proper conditions . . .
8. Section 1604, which was enacted to discourage corporations from
refusing in bad faith to comply with the right of inspection, further provides
that a petitioner can seek expenses and reasonable attorneys' fees incurred as a
result of proceeding under Sections 1600 and 1601:
In any action or proceeding under section 1600 or Section 1601, if the
court finds the failure of the corporation to comply with a proper
demand thereunder was without justification, the court may award an
amount sufficient to reimburse the shareholder or holder of a voting
trust certificate for the reasonable expenses incurred by such holder,
including attorneys' fees, in connection with such action or
proceeding.
Basswood Requested Foothill's Corporate Records.
- ------------------------------------------------
9. On March 17, 1999, Basswood wrote to Foothill's President and Chief
Executive Officer, Mr. George E. Langley, requesting "the right to inspect and
copy the records of the Company described in Sections 1600 (a)(1) and 1600(a)(2)
and in Section 1601 of the CGCL during regular business hours on or before the
sixth business day following the date of this letter." A copy of Basswood's
March 17 letter and the accompanying Annex A (the "March 17 Request") is
attached hereto as Exhibit A. The March 17 Request asked Foothill to "provide to
[Basswood] the information and permit us to take the other actions set forth in
Annex A hereto [specifying the requested stockholder information in greater
detail] as expeditiously as possible."
10. Although Basswood's entitlement to shareholder records under
Section 1600(a) of the Act was automatic, Basswood set forth its purpose in
seeking the records identified in the March 17 Request:
We wish to inspect the Company's shareholder list materials
so that we may communicate with other shareholders of the
Company on matters relating to our mutual interests as
shareholders, including methods of improving the Company's
financial performance and maximizing shareholder value.
3
<PAGE>
11. The March 17 Request explained that, in Basswood's view, the
Company's performance has been disappointing:
Basswood Financial Partners LP believes that the financial performance
of the Company has been disappointing. Foothill's core return on
equity, core return on assets and efficiency ratio are all
significantly worse than the performance of the Western Banks Average
as shown in the SNL Quarterly Bank Digest. Basswood Financial Partners
believes that the best means of maximizing value for the Company's
shareholders is to take advantage of the current consolidation trend
in the banking industry and to sell the Company.
12. Basswood also identified in detail -- in Annex A to the March 17
letter -- the corporate records that it sought. Basswood believes that the
information identified in Annex A to the March 17 letter is in the Company's
possession or can readily be obtained from outside sources. (Basswood is, of
course, willing to reimburse the Company's reasonable costs of obtaining the
information). For example, the Company has recently obtained a list of non-
objecting beneficial holders (the "NOBO" list). This is a record of Foothill's
beneficial shareholders that do not object to their identities being disclosed.
13. The shareholder information identified in Annex A to the March 17
letter includes the following:
o a magnetic computer tape list of the shareholders showing
the name, address and number of shareholders held by each
shareholder;
o daily transfer sheets showing changes in names and addresses
of, and number of shares held by, shareholders of record;
o the list of shareholders held in the name of Cede & Co., and
other similar nominees;
o information relating to the names of Non-Objecting
Beneficial Owners of shares in the form of a print-out and
magnetic tape. Upon information and belief, the Company has
recently obtained a NOBO list;
o stop lists relating to any shares and any changes, any
corrections, addition or deletions to the requested
shareholder lists;. and
o lists of all holders of record owning 1,000 or more shares
arranged in descending order as of a recent date.
4
<PAGE>
14. The other corporate records identified in Annex A to the March 17
letter include the following:
Minutes
-------
o All minutes of meetings of Foothill's board of directors and
any committees thereof from October 1, 1996 through the
present; and
o All agendas, minutes and other documents (including any
recordings or videotapes) that memorialize or record any
matters discussed at any meetings of Foothill's shareholders
(whether formal or informal), beginning October 1, 1996
through the present.
Accounting Records
------------------
o All accounting and other financial records that were
consulted or used by the Company to calculate its efficiency
ratio as of December 313, 1998 and the fourth quarter of
1998. To the extent a portion of any record was consulted or
used, the entire record should be provided.
15. The shareholder records identified in Annex A are the type of
records that virtually all publicly-traded corporations have in their possession
or can readily obtain from their agents. As stated above, the NOBO list is
already in the Company's possession.
16. Basswood's March 17 Request was joined by Whitewood Financial
Partners, LP, the record owner of 4,608 Foothill shares, and Jet I, LP, the
record owner of 22,292 Foothill shares. Additionally, the March 17 Request
supplemented two previous requests to inspect these corporate records made by
Basswood's former general partner in December 1998 and January 1999.
Foothill Fails to Comply with Basswood's Request.
- -------------------------------------------------
17. On March 23, 1999, Foothill's President and Chief Executive
Officer, Mr. Langley, replied to the March 17 Request. Mr. Langley's letter
(hereinafter, the "March 23 Response") (annexed hereto as Exhibit B) allowed
Basswood to inspect "a list setting forth the respective names, addresses and
shareholdings of all shareholders of record of Foothill (a "Record List"), as of
December 31, 1998." The list of record shareholders provided by Foothill,
however, is inadequate, because it does not allow Basswood to identify many of
Foothill's shareholders. Many of the shareholders on the "Record List" are
identified only as Cede & Co. or other similar
5
<PAGE>
nominees or brokers, indicating that a number of Foothill shareholders hold
their shares in the name of nominees or brokerage houses, and the NOBO list and
Cede breakdown are required to identify such shareholders. Thus, the Record List
alone does not allow Basswood to communicate with many of Foothill's
shareholders. As the NOBO list and other shareholder records identifing such
shareholders are in the Company's possession, and Foothill refuses to allow
inspection of these records, Foothill has an unfair advantage over Basswood in
its ability to communicate with shareholders, and is unfairly withholding
information critical to Basswood's ability to communicate with Foothill's
shareholder base.
18. The March 23 Response also stated that Basswood was not entitled
to inspect the books and records of the Company pursuant to Section 1601 by
conclusorily challenging Basswood's purpose:
Basswood has failed to assert any real purpose, reasonably related to
its interests as a record shareholder of Foothill, for an inspection
of Board or shareholder minutes on the financial information
referenced in your letter.
19. The March 23 Response asserted that Basswood's purposes are
neither genuine nor made in good faith. The March 23 Response also took issue
with Basswood's statements regarding the financial underperformance of the
Company and with other particulars of Basswood's demand.
20. The Company's failure to make available the requested accounting
books and records and minutes for inspection and copying pursuant to Section
1601 of the CGCL is especially disturbing because the Company has recently taken
a number of corporate actions that Basswood believes were designed to interfere
with Basswood's voting rights under California law. For example, on October 19,
1998, the Company announced it had expanded its board of directors and appointed
three new members to Foothill's classified board. There has been no public
disclosure as to which of the new directors will be up for reelection at the
annual meeting in 1999 or as to which class of directors such three new
directors were elected. Additionally, on January 29, 1999, the Company announced
its board of directors amended the Company's bylaws to delete the section
addressing the nomination by shareholders of candidates to Foothill's board of
directors. Furthermore, the Company has recently made statements -- both to
Basswood in
6
<PAGE>
correspondence and to the public in the form of press releases -- regarding its
financial performance. Basswood believes those statements inaccurately portray
Foothill's financial performance. Basswood is entitled to access the Company's
accounting records and minutes to determine the basis for the Foothill Board's
conduct and Foothill's statements regarding its financial performance.
Basswood's purpose in seeking records under Section 1601 of the CGCL is proper
under California law.
Foothill Continues to Refuse Basswood's Requests.
- -------------------------------------------------
21. Basswood Partners LP., Basswood's former general partner,
previously requested these corporate records on behalf of Basswood on December
21, 1998 and again on January 27, 1999. (Basswood Partners' prior requests are
attached hereto as Exhibits C and D, respectively). Foothill objected to
Basswood Partners, LP's previous requests on the basis that Basswood Partners,
LP (and its successor as general partner, Basswood Partners, LLC) was not itself
a record owner of shares, and Basswood at that time held its shares through
street names rather than as record holder. The dispute between the parties
prompted Basswood Partners, LLC to file a petition for writ of mandate to compel
production of the records. The court denied without prejudice Basswood Partners,
LLC's petition for a writ of mandate finding that the foundational criteria to
request the records had not been met. In response to the Court's ruling,
Basswood converted its shares to shares of record on March 16, 1999, and made
the March 17 demand as a record holder. Foothill nevertheless continues to
refuse to provide the shareholder and other corporate records sought by
Basswood.
FIRST CAUSE OF ACTION
(For Shareholder Records under ss. 1600(a) of the CGCL)
-------------------------------------------------------
22. Petitioner incorporates by reference the allegations of paragraphs
1 through 21 above.
23. Petitioner's March 17 Request constitutes a lawful demand for
corporate records identified in Section 1600(a) of the Act.
24. Basswood is the record owner of in excess of 5% of Foothill's
outstanding shares.
7
<PAGE>
25. The March 17 Request described in detail and with particularity
the proper and lawful purpose for which Petitioner seeks the shareholder records
identified therein -- even though Section 1600(a) does not require that a
shareholder such as Basswood provide a proper purpose for seeking access to the
Company's shareholder records.
26. Petitioner's purpose in seeking the shareholder list and other
records identified in Section 1600(a) and Annex A to the March 17 Request is to
communicate with other shareholders regarding, inter alia, the maximizing of
value to Foothill's shareholders, the financial performance of Foothill, and
Foothill's future financial performance.
27. The records identified in Annex A to the March 17 Request are
directly related to Basswood's purpose. In fact, without access to Foothill's
shareholder list, including the list of non-objecting beneficial holders (the
NOBO list), Basswood will be unable to communicate with other shareholders
regarding their mutual interest concerning Foothill and the maximization of
shareholder value.
28. Foothill's response to the March 17 Request has made it clear that
Foothill disagrees with Basswood's belief regarding the financial performance of
the Company. Such a disagreement, however, does not constitute a proper,
reasonable or lawful basis to deny Petitioner access to the records described in
Section 1600(a) of the Act and detailed in Annex A to the March 17 letter. If
Foothill and the Foothill Board believe that Basswood is mistaken in its views
about the past and future performance of the Company and the proper means to
maximize shareholder value, then the appropriate remedy is to put their case to
Foothill's shareholders; it is not lawful, justifiable or proper under the Act
to quash the debate by denying Petitioner the right to communicate with other
Foothill shareholders.
29. Petitioner has no plain, speedy or adequate remedy at law.
30. Foothill's refusal to provide Petitioner access to the shareholder
list and other records identified in Section 1600(a) of the CGCL has no
reasonable factual or legal basis; rather, such conduct amounts to a bad faith
effort to prevent Petitioner from communicating with other Foothill
shareholders.
8
<PAGE>
31. Pursuant to Section 1604 of the Act, in addition to being
compelled to produce the shareholder records requested in the March 17 Request,
Foothill should also be ordered to pay costs incurred by Petitioner in bringing
these proceedings, including reasonable attorney's fees.
SECOND CAUSE OF ACTION
(For Corporate Records Pursuant to ss. 1601 of the CGCL)
--------------------------------------------------------
32. Petitioner incorporates by reference the allegations of paragraphs
1 through 31 above.
33. Petitioner's March 17 Request sought access to certain of
Foothill's accounting books and records and minutes within the meaning of
Section 1601 of the CGCL.
34. Basswood's purpose in seeking access to the records described in
detail in Annex A to the March 17 Request is lawful and proper and is reasonably
related to Basswood's interests as a shareholder. The Company's accounting books
and records and minutes will, inter alia, disclose the basis for, and reasons
behind, the board's recent appointment of three new members to the Foothill's
classified board and the recent amendments to the Company's bylaws. In addition,
the records will disclose the basis for the Company's statements regarding its
financial performance.
35. Petitioner has no plain, speedy or adequate remedy at law.
36. Foothill's refusal to provide access to corporate records under
Section 1601 has no reasonable factual or legal basis; rather, such conduct
amounts to a bad faith effort to prevent Petitioner from communicating with
other Foothill shareholders and investigating conduct that Basswood believes is
designed to interfere with its voting rights.
37. Pursuant to Section 1604 of the Act, in addition to being
compelled to produce the corporate records requested (and identified in ss. 1601
of the Act), Foothill should also be ordered to pay costs incurred by Petitioner
in bringing these proceedings, including reasonable attorney's fees.
WHEREFORE, Petitioner requests judgment as follows:
(a) That Respondent be cited to appear to answer this Petition;
9
<PAGE>
(b) That a Writ of Mandamus issue forthwith commanding Foothill to
permit Petitioner, and its agents and attorneys, to inspect and copy, within 5
business days, records requested in Petitioner's March 17 Request and Annex A
thereto, including shareholder records under Section 1600(a) including:
(1) Magnetic computer tape lists of the shareholders of the
Company as of the most recent available date showing the
name and address of, and number of shares held by, each
shareholder of record, together with such computer
processing data as is necessary for Basswood Financial
Partners to make use of such magnetic computer tape, and
printouts of such magnetic computer tape for verification
purposes;
(2) All daily transfer sheets showing changes in the names
and addresses of, and number of shares held by, shareholders
of record of the Company which are in (or come into) the
possession or control of the Company or its transfer agent,
or which can reasonably be obtained from brokers, dealers,
banks, clearing agencies or voting trustees or their
nominees, from the date of the shareholder lists referred to
in paragraph (a) above through the date of the inspection;
(3) All information in, or which comes into, the possession
or control of the Company or its transfer agent, or which
can reasonably be obtained by brokers, dealers, banks,
clearing agencies or voting trustees or their nominees,
concerning the names and addresses, and number of shares
held by, the participating brokers and banks holding shares
in the individual nominee names of Cede & Co., and other
similar nominees, including omnibus proxies and all "Weekly
Security Position Listing Daily Closing Balances" reports
issued by The Depository Trust Company, and a list or lists
containing the name and address of, and the number of shares
attributable to, any participant in any Company employee
stock ownership, dividend reinvestment, stock purchase or
comparable plan in which the
10
<PAGE>
decision how to vote or whether to dispose of shares held by
such plan is made, directly or indirectly, individually or
collectively, by the participants in the plan;
(4) All information in, or which comes into, the possession
or control of the Company or its transfer agent, or which
can reasonably be obtained from brokers, dealers, banks,
clearing agencies or voting trustees or their nominees,
disclosing the names of the Non-Objecting Beneficial Owners
of shares ("NOBO's") in the format of a printout and
magnetic tape in descending order balance (such information
is readily available to the Company under Rule 14b-1(c) of
the Securities Exchange Act of 1934, as amended, from ADP
Proxy Services);
(5) A stop list or stop lists relating to any shares and any
changes, corrections, additions or deletions from the date
of the shareholder lists referred to in paragraph (a) above
through the date of the inspection; and
(6) Lists of all holders of record of shares owning 1,000 or
more shares arranged in descending order as of the most
recent available date.
(c) That a Writ of Mandamus issue forthwith commanding Foothill to
permit Petitioner, and its agents and attorneys, to inspect and copy, within
five (5) business days, records requested in Petitioner's March 17 Request and
Annex A thereto, including Foothill's accounting books and minutes of
proceedings under Section 1601 including:
(1) Minutes
a) All minutes of meetings of Foothill's board of
directors and any committees thereof from October 1, 1996
through the present; and
b) All agendas, minutes and other documents (including
any recordings or videotapes) that memorialize or record any
matters discussed at any meetings of Foothill's shareholders
(whether formal or informal), beginning October 1, 1996
through the present.
11
<PAGE>
(2) Accounting Records
------------------
a) All accounting and other financial records that
were consulted or used by the Company to calculate its
efficiency ratio as of December 31, 1998 and the fourth
quarter of 1998. To the extent a portion of any record was
consulted or used, the entire record should be provided.
(d) An order compelling Foothill to pay costs, including reasonable
attorney's fees, incurred by Petitioner in prosecuting this action pursuant to
ss. 1604 of the CGCL; and
1. Any other relief that the Court deems just and proper.
Dated: March 31, 1999 Respectfully submitted,
LATHAM & WATKINS
Marc W. Rappel
Amos E. Hartston
By:_________________________________
Amos E. Hartston
Attorneys for Petitioner
Basswood Financial Partners, LP
Of Counsel:
WILLKIE FARR & GALLAGHER
787 Seventh Avenue
New York, New York 10019
12
<PAGE>
VERIFICATION
------------
I am a managing member of Basswood Partners, LLC, general partner of
Basswood Financial Partners, LP, and am authorized to make this verification for
and on behalf of Basswood Financial Partners, LP, and I make this verification
for that reason. I have read the foregoing document. I am informed and believe
and on that ground allege that the matters stated in it are true.
____________________________
Matthew Lindenbaum
Subscribed and sworn to before me
this ____ day of March 1999
13
<PAGE>
LATHAM & WATKINS
Marc W. Rappel (Bar No. 097032)
Amos E. Hartston (Bar No. 186471)
633 West Fifth Street, Suite 4000
Los Angeles, California 90071-2007
Phone: (213) 485-1234 / Facsimile: (213) 891-8763
Of Counsel:
WILLKIE FARR & GALLAGHER
787 Seventh Avenue
New York, New York 10019
Phone: (212) 728-8000
Attorneys for Petitioner
Basswood Financial Partners, LP
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
BASSWOOD FINANCIAL PARTNERS, LP, CASE NO. ______________
Date: April 15, 1999
Petitioner, Time: 9:30 a.m.
Dept:
Judge:
v.
NOTICE OF MOTION AND MOTION
FOR ISSUANCE OF PEREMPTORY
WRIT OF MANDATE
FOOTHILL INDEPENDENT BANCORP.,
[Corp.Code ss.ss. 1600, et.seq; Code Civ.
Proc. ss.ss. 1085, et. seq]
Respondent.
Petition Filed: March 31, 1999
Trial Date: None Set
- -----------------------------------
TO ALL PARTIES AND TO THEIR ATTORNEYS OF RECORD:
PLEASE TAKE NOTICE that on April 15, 1999, at 9:30 a.m., or as soon
thereafter as counsel may be heard, in Dept. ___ of the above-entitled Court,
located at 111 North Hill Street, Los Angeles, California 90012, Petitioner
Basswood Financial Partners, LP
<PAGE>
("Basswood") will and hereby does move this Court, pursuant to Sections 1600 et.
seq. of the California Corporations Code and Sections 1085 et. seq. of the
California Code of Civil Procedure, and for the following:
1. That a Peremptory Writ of Mandate issue forthwith ordering that
Respondent Foothill Independent Bancorp. ("Foothill") permit Basswood to inspect
and copy Foothill's record of shareholders' names and addresses and
shareholdings (including such records maintained by Foothill's transfer agent,
ChaseMellon shareholder services (the "Transfer Agent")), including the
following:
(a) Magnetic computer tape lists of the shareholders of the
Company as of the most recent available date showing the name and
address of, and number of shares held by, each shareholder of record,
together with such computer processing data as is necessary for
Basswood Financial Partners to make use of such magnetic computer
tape, and printouts of such magnetic computer tape for verification
purposes;
(b) All daily transfer sheets showing changes in the names
and addresses of, and number of shares held by, shareholders of record
of the Company which are in (or come into) the possession or control
of the Company or its transfer agent, or which can reasonably be
obtained from brokers, dealers, banks, clearing agencies or voting
trustees or their nominees, from the date of the shareholder lists
referred to in paragraph (a) above through the date of the inspection;
(c) All information in, or which comes into, the possession
or control of the Company or its transfer agent, or which can
reasonably be obtained by brokers, dealers, banks, clearing agencies
or voting trustees or their nominees, concerning the names and
addresses, and number of shares held by, the participating brokers and
banks holding shares in the individual nominee names of Cede & Co.,
and other similar nominees, including omnibus proxies and all "Weekly
Security Position Listing Daily Closing Balances" reports issued by
The Depository Trust Company, and a list or lists containing the name
and address of, and the number of
2
<PAGE>
shares attributable to, any participant in any Company employee stock
ownership, dividend reinvestment, stock purchase or comparable plan in
which the decision how to vote or whether to dispose of shares held by
such plan is made, directly or indirectly, individually or
collectively, by the participants in the plan;
(d) All information in, or which comes into, the possession
or control of the Company or its transfer agent, or which can
reasonably be obtained from brokers, dealers, banks, clearing agencies
or voting trustees or their nominees, disclosing the names of the
Non-Objecting Beneficial Owners of shares ("NOBO's") in the format of
a printout and magnetic tape in descending order balance (such
information is readily available to the Company under Rule 14b-1(c) of
the Securities Exchange Act of 1934, as amended, from ADP Proxy
Services);
(e) A stop list or stop lists relating to any shares and any
changes, corrections, additions or deletions from the date of the
shareholder lists referred to in paragraph (a) above through the date
of the inspection; and
(f) Lists of all holders of record of shares owning 1,000 or
more shares arranged in descending order as of the most recent
available date.
2. That a Peremptory Writ of Mandate issue forthwith ordering Foothill to
permit Basswood and its agents and attorneys to inspect and copy those corporate
books and records requested in Basswood's March 17, 1999 request, specifically
including inspection of the following:
(a) Minutes
-------
(1) All minutes of meetings of Foothill's board
of directors and any committees thereof from
October 1, 1996 through the present; and
(2) All agendas, minutes and other documents
(including any recordings or videotapes)
that memorialize or record any matters
discussed at any meetings of Foothill's
shareholders (whether formal or informal),
beginning October 1, 1996 through the
present.
(b) Accounting Records
-------------------
3
<PAGE>
(1) All accounting and other financial records
that were consulted or used by the Company
to calculate its efficiency ratio as of
December 31, 1998 and the fourth quarter of
1998. To the extent a portion of any
record was consulted or used, the entire
record should be provided.
An order compelling Foothill to pay costs, including reasonable
attorneys' fees, incurred by Basswood in prosecuting this action, in accordance
with Section 1604 of the California Corporations Code; and any other relief that
the Court deems just and proper.
This Motion is and will be based on this Notice, the concurrently
filed memorandum of points and authorities and declaration of Matthew Lindenbaum
filed in support hereof, all other pleadings and records on file in this action,
and such other evidence and argument the Court may consider.
Dated: March 31, 1999 Respectfully submitted,
LATHAM & WATKINS
Marc W. Rappel
Amos E. Hartston
By __________________________________
Amos E. Hartston
Attorneys for Petitioner
Basswood Financial Partners, LP
Of Counsel:
WILLKIE FARR & GALLAGHER
787 Seventh Avenue
New York, New York 10019
4
<PAGE>
EXHIBIT C
TRANSACTIONS IN SHARES DURING THE PERIOD COMMENCING FROM THE 60-DAY PERIOD
PRECEDING MARCH 31, 1999 THROUGH THE DATE HEREOF
NONE
