As filed with the Securities and Exchange Commission on January 24, 2002
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
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REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
THE FIRST AMERICAN 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 Number)
1 First American Way
Santa Ana, California 92707-5913
(714) 800-3000
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
With a copy to:
Mark R Arnesen, Esq.
Secretary Neil W. Rust, Esq.
The First American Corporation White & Case LLP
1 First American Way 633 West Fifth Street
Santa Ana, California 92707-5913 Los Angeles, California 90071
(714) 800-3000 (213) 620-7700
(Name, Address, Including Zip Code, and
Telephone Number, Including Area Code,
of Agent For Service)
Approximate date of commencement of proposed sale to the public: From time
to time following the date this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_| __________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_| __________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
========================= ====================== ======================= ====================== ======================
Title Of Shares To Be Amount Proposed Proposed Maximum Amount of
Registered To Be Maximum Offering Aggregate Registration
Registered (2) Price Per Unit (3) Offering Price (3) Fee (4)
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Common shares,
$1.00 par value (1)... 500,000 shares $19.325 $9,662,500 $888.95
========================= ====================== ======================= ====================== ======================
(1) The common shares being registered hereunder include the associated rights
to purchase First American's Series A Junior Participating Preferred
Shares. Such rights initially are attached to and trade with the common
shares being registered hereunder.
(2) Pursuant to Rule 416 under the Securities Act, this Registration Statement
shall include any additional shares that may become issuable as a result of
any stock split, stock dividend, recapitalization or other similar
transaction effected without the receipt of consideration that results in
an increase in the number of First American's outstanding common shares.
(3) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c) under the Securities Act. The
price and fee are computed based upon the average of the high and low sale
prices of First American's common stock on January 18, 2002, as reported on
the New York Stock Exchange.
(4) Calculated in accordance with Section 6 of the Securities Act and Rule 457
under the Securities Act by multiplying 0.000092 and the proposed maximum
aggregate offering price.
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The Registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until this registration statement shall
become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
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PROSPECTUS
[Logo of The First American Corporation]
THE FIRST AMERICAN CORPORATION
DIVIDEND REINVESTMENT AND DIRECT PURCHASE PLAN
The First American Corporation is pleased to offer you the opportunity to
participate in The First American Corporation Dividend Reinvestment and Direct
Purchase Plan, a direct stock purchase plan designed to provide investors with a
convenient method to purchase shares of First American common stock and to
reinvest cash dividends in the purchase of additional shares.
Plan highlights include:
o Purchasing common shares of First American without paying fees or
brokerage commissions.
o Reinvesting dividends automatically at no cost.
o Buying additional common shares of First American by check or
automatic deduction from your bank account.
o Transferring and selling common shares of First American easily.
This prospectus relates to 500,000 of our common shares, $1.00 par value,
to be offered for purchase under the plan. Our common shares are traded on the
New York Stock Exchange under the trading symbol "FAF".
Please read this prospectus carefully and keep it and all account
statements for future reference. If you have any questions about the plan,
please call First American Trust, FSB, the plan administrator, toll-free at
1-800-894-4076. Messages may be left at this toll-free number. Customer service
representatives are available between the hours of 7:30 A.M. and 5:00 P.M.
Pacific Standard Time, Monday through Friday.
Our common shares being offered by this prospectus are not insured or
protected by any governmental agency, and involve investment risk, including the
possible loss of principal. The payment of dividends by First American is
discretionary and dividend payments may increase, decrease or be eliminated
altogether at the discretion of First American's Board of Directors.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY COMMON SHARES OF FIRST AMERICAN IN ANY STATE OR OTHER JURISDICTION
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. TO
THE EXTENT REQUIRED BY APPLICABLE LAW IN CERTAIN JURISDICTIONS, COMMON SHARES
OFFERED UNDER THE PLAN TO PERSONS WHO ARE NOT RECORD HOLDERS OF FIRST AMERICAN
COMMON SHARES ARE OFFERED ONLY THROUGH A REGISTERED BROKER/DEALER IN THOSE
JURISDICTIONS.
This prospectus is dated January 24, 2002.
TABLE OF CONTENTS
Page
The First American Corporation................................................................1
Where You Can Find More Information...........................................................3
Documents Incorporated by Reference...........................................................3
Special Note of Caution Regarding Forward-Looking Statements..................................4
Information About the Plan....................................................................5
Purpose..................................................................................5
1. What is the purpose of the Plan?................................................5
Administration...........................................................................5
2. Who administers the Plan?.......................................................5
3. How do I contact the Plan Administrator?........................................5
4. What kind of reports will be sent to participants in the Plan?..................5
Eligibility and Enrollment...............................................................5
5. How does a First American shareholder participate in the Plan?..................5
6. I'm not currently a shareholder. Can I participate in the Plan?................5
7. I already own First American shares, but they are held by my bank or broker
and registered in "street name." How can I participate?.........................5
8. Are there fees associated with enrollment?......................................6
Optional Cash Investments................................................................6
9. What are the minimum and maximum amounts
for optional cash investments?..................................................6
10. How do I make an optional cash investment?......................................6
11. Can I have optional cash investments automatically
deducted from my bank account?..................................................6
12. Will I be charged fees for optional cash investments?...........................6
13. How are payments with insufficient funds handled?...............................6
Purchase of Common Stock.................................................................7
14. What is the source of First American common shares purchased
through the Plan?...............................................................7
15. When will shares be purchased?..................................................7
16. What is the price of shares purchased under the Plan?...........................7
Cash Dividends...........................................................................7
17. Must my dividends be reinvested automatically?..................................7
18. When will my dividends be reinvested and at what price?.........................7
Stock Splits and Stock Dividends.........................................................7
19. How would a stock split or stock dividend affect my account?....................7
Voting...................................................................................7
20. How do I vote my Plan shares at shareholder meetings?...........................7
Sale of Shares...........................................................................8
21. How do I sell my Plan shares?...................................................8
22. Is there a minimum number of shares that I must maintain
in my account to keep it active?................................................8
Custodial Service........................................................................8
23. How does the custodial service work?............................................8
24. How do I deposit my First American stock certificates
with the Plan Administrator?....................................................8
25. Are there any charges associated with the custodial service?....................8
Issuance of Stock Certificates...........................................................8
26. Will stock certificates be issued for shares acquired through the Plan?.........8
27. How do I request a stock certificate?...........................................8
Gifts and Transfers of Shares............................................................9
28. Can I transfer shares that I hold in the Plan to someone else?..................9
29. Can I transfer shares that I hold in the Plan to a minor?.......................9
Service Fees.............................................................................9
(i)
30. What are the fees associated with participation in the Plan?....................9
Withdrawal from the Plan.................................................................9
31. How do I close my Plan account?.................................................9
Amendment, Modification, Suspension and Termination of the Plan.........................10
32. Can the Plan be amended, modified, suspended or terminated?....................10
Tax Matters.............................................................................10
33. What are the federal income tax consequences of participating in the Plan?.....10
Limitation on Liability.................................................................10
34. What are the responsibilities of First American
and the Administrator under the Plan?..........................................10
Use of Proceeds..............................................................................11
Legal Matters................................................................................11
Experts......................................................................................11
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This prospectus incorporates important business and financial information
about First American that is not included in or delivered with this document.
This means that we may satisfy our disclosure obligations to you by referring
you to one or more documents separately filed with the SEC. See "Documents
Incorporated By Reference" on page XX for a list of documents that we have
incorporated by reference into this prospectus. This information is available to
shareholders without charge upon written or oral request to:
The First American Corporation
Mark R Arnesen
1 First American Way
Santa Ana, California 92707-5913
(714) 800-3000
To obtain timely delivery, you must request the information at least five
business days before the date on which you must make a decision on whether to
invest in our company.
(ii)
THE FIRST AMERICAN CORPORATION
We are a leading provider of business information, providing products and
services in connection with the major economic events in a consumer's life. We
provide information and related services in connection with:
o Getting a job o Arranging a mortgage
o Renting an apartment o Opening or buying a business
o Buying a car o Retirement
o Buying a house, boat or airplane
Our largest segment is title insurance. We entered this business in 1889.
We have broad geographic coverage, with strong market shares in all the states
and in many foreign countries. In the early 1990s, we began a more aggressive
plan to develop and acquire operations that enable us to provide a range of
title insurance, real estate-related services, and information services to major
residential lenders and loan servicers. Given our strong relationships with
these major lenders and the fact that in most refinance transactions the lender
selects the title insurer, we believe we are well positioned from a competitive
standpoint to benefit from an increase in refinancing activity.
During the last decade we have developed a complete set of real
estate-related services. We now provide all information and services needed to
close a home sale and a mortgage, including credit information, flood zone
information and real estate tax information. We offer the broadest array of
services and have the first or second largest market share in almost all the
product categories.
During the last decade, we developed and purchased extensive databases used
in producing our real estate-related products. Included are:
o Data Trace, the nation's largest provider of title information
systems;
o Data Tree, the nation's largest database of image recorded documents;
and
o First American RES, the nation's largest provider of real estate
property characteristic and valuation information.
Our expertise developed in producing real estate-related products led to
our entry into businesses less sensitive to real estate cycles, such as tenant
screening and pre-employment screening. Most significantly, we have developed a
set of products used by auto lending and leasing companies to originate and
service auto loans and leases. We are the nation's largest provider of
specialized automotive credit reports. The revenues of our consumer information
services segment have grown significantly during the past five years.
We have developed sophisticated systems to streamline the processes
relating to title and real estate information. We have also built sophisticated
electronic delivery systems.
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The following is a list of our businesses:
Title Insurance and Services
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o Equity loan services o Subdivision title insurance
o Lenders Services o 1031 tax-deferred exchange services
o National/Commercial title insurance o Title and escrow systems
o Residential title insurance o Aircraft and vessel title insurance
Real Estate Information and Services
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o Default management services o Mortgage origination/servicing software
systems
o Credit reporting and information o Appraisal and property valuation
management
o Residential and commercial real estate tax o Property characteristic and valuation
reporting and valuation services information
o Flood determination and compliance o Title plant and document imaging
services
o Mortgage document services o Field inspections
Consumer Information and Services
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o Pre-employment screening o Banking services
o Resident screening o Consumer credit reports
o Specialized credit reporting o Home warranty
o Sub-prime consumer information o Investment services
o Vehicle information and insurance tracking o Property and casualty insurance
o Trust services
Our principal executive office is located at 1 First American Way, Santa
Ana, California 92707-5913, and our telephone number is (714) 800-3000.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information and documents with the SEC. You may read and copy any document we
file with the SEC at the SEC's Public Reference Room located at 450 Fifth
Street, N.W., Washington, D.C. 20549. The SEC may charge a fee for making
copies. You may call the SEC at (800) 732-0330 for more information on the
operation of the Public Reference Room, and on the availability of other Public
Reference Rooms. Our filings with the SEC are also available to the public on
the Internet through the SEC's EDGAR database. You may access the EDGAR database
at the SEC's web site at www.sec.gov.
We have filed a registration statement on Form S-3 with the SEC to register
the common stock offered by this prospectus. This prospectus is part of the
registration statement. As allowed by SEC rules, this prospectus does not
contain all of the information that is in the registration statement and the
exhibits to the registration statement. For further information about First
American, investors should refer to the registration statement and its exhibits.
A copy of the registration statement and its exhibits may be inspected, without
charge, at a Public Reference Room or on the SEC's web site.
You should analyze the information in this prospectus, each prospectus
supplement and the additional information described under the heading "Documents
Incorporated By Reference" below before you make a decision about investing in
our common shares.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" certain information in
documents we file with them, which means that we can disclose important
information to you in this prospectus by referring you to another document filed
separately with the SEC. The information incorporated by reference is deemed to
be part of this prospectus, except for any information superseded by information
in this prospectus, information filed subsequently that is incorporated by
reference and information in any prospectus supplement. These documents contain
important business and financial information about our company, including
information concerning its financial performance, and we urge you to read them.
We incorporate by reference into this prospectus all of the following documents:
o our annual report on Form 10-K for the fiscal year ended December 31,
2000;
o our quarterly reports on Form 10-Q for the quarters ended March 31,
2001, June 30, 2001 and September 30, 2001, as amended;
o our current reports on Form 8-K filed January 31, 2001, February 21,
2001, April 11, 2001, April 16, 2001, May 7, 2001, May 8, 2001, May
10, 2001, May 17, 2001, August 1, 2001 and October 25, 2001;
o the description of our common shares, $1.00 par value, contained in
our registration statement on Form 8-A, dated November 19, 1993, which
registers the shares under Section 12(b) of the Exchange Act; and
o 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.
We also incorporate into this prospectus all of our filings with the SEC
made pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act that we
file between the date of this prospectus and the earlier of the following dates:
o the date on which all of the shares offered by this prospectus are
resold by the persons or entities who acquire them from us; and
o the date that is one year after the last date on which shares offered
by this prospectus are issued by us.
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SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference contain
"forward-looking statements" within the meaning of the federal securities laws.
These forward-looking statements are based on our management's estimates and
assumptions and take into account only the information available at the time the
forward-looking statements are made. Although we believe these estimates and
assumptions are and will be reasonable, forward-looking statements involve
risks, uncertainties and other factors that could cause our actual results to
differ materially from those suggested in the forward-looking statements.
Forward-looking statements include the information concerning future financial
performance, business strategy, projected plans and objectives of First American
set forth in this prospectus, including:
o statements about any future increase in refinancing activity;
o continued strong relationships with lenders and our ability to
leverage such relationships; and
o the scope of our services;
The words "anticipates," "estimates," "projects," "forecasts," "goals,"
"believes," "expects," "intends," and similar expressions are intended to
identify such forward-looking statements. Forward-looking statements are subject
to numerous risks and uncertainties. The following are some important factors
that could cause actual results to differ materially from those in
forward-looking statements:
o changes in the real estate market, interest rates or the general
economy;
o changes in government regulations that are applicable to our regulated
businesses;
o the impact of the legal proceedings commenced by the California
attorney general and related litigation and the status of our
settlement with the California Department of Insurance;
o our continued ability to identify businesses to be acquired;
o changes in our ability to integrate businesses which we acquire;
o an increase in our expenses;
o consolidation among our significant competitors or customers; and
o other factors described in our annual report on Form 10-K for the
fiscal year ended December 31, 2000.
Our actual results, performance or achievement could differ materially from
those expressed in, or implied by, forward-looking statements and, accordingly,
no assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of them do so,
what impact they will have on the results of operations and financial condition
of First American. The forward-looking statements speak only as of the date they
are made. We do not undertake to update forward-looking statements to reflect
circumstances or events that occur after the date the forward-looking statements
are made.
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INFORMATION ABOUT THE PLAN
PURPOSE
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1. What is the purpose of the Plan?
The purpose of the Plan is to promote long-term stock ownership among
existing and new investors in the Company by providing a convenient method
to purchase shares of First American common stock and reinvest cash
dividends paid on such shares.
ADMINISTRATION
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2. Who administers the Plan?
The Plan is administered by First American Trust, FSB ("FAT"), which serves
as the Company's stock transfer agent, registrar and dividend disbursing
agent. As Administrator, FAT acts as agent for Plan participants and keeps
records, sends statements and performs other duties relating to the Plan.
Purchases and sales of First American common stock under the Plan are made
by an independent broker-dealer acting as purchasing and selling agent for
Plan participants.
3. How do I contact the Plan Administrator?
Written Inquiries: First American Trust, FSB
Corporate Transfer Department
421 N Main St
Santa Ana, CA 92701
Telephone Inquiries: 1-800-894-4076
When communicating with the Administrator, you should have available your
account number and taxpayer identification number.
4. What kind of reports will be sent to participants in the Plan?
As a participant, you will receive a quarterly statement of account
activity. The Administrator will also send transaction confirmation
promptly after each sale of shares under the Plan. You should retain these
statements and confirmations in order to establish the cost basis of shares
purchased under the Plan for income tax and other purposes. In addition,
each participant will receive all communications sent to all other
shareholders, such as annual reports and proxy statements.
ELIGIBILITY AND ENROLLMENT
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5. How does a First American shareholder participate in the Plan?
If you are already a First American shareholder with certificated shares
registered in your name, you may enroll in the Plan simply by completing
and returning the enrollment form for existing First American shareholders.
6. I'm not currently a shareholder. Can I participate in the Plan?
Yes. If you currently hold no shares of First American common stock, you
may enroll in the Plan by completing and returning an enrollment form for
new investors and either making an initial investment of at least $250.00
or authorizing automatic monthly deductions of at least $50.00 from a
qualified bank account.
7. I already own First American common shares, but they are held by my bank or
broker and registered in "street name." How can I participate?
If you currently own First American common stock but they are held at a
bank or broker in its name ("street name") you may participate in the Plan
without making an initial investment into the Plan by instructing your
agent to convert your First American common shares to certificate form,
registered in your name. Once the shares are in
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your name, you may request that the Administrator send you an enrollment
package for existing First American shareholders.
As a Plan participant you may, if you wish, send your share certificates to
the Administrator for safekeeping, but doing this is not mandatory. In
order to sell certificated shares through the Plan, however, it is
necessary for you to deposit the shares with the Administrator (see
Questions 21 and 24 below).
8. Are there fees associated with enrollment?
There is no enrollment fee for existing holders of First American common
shares. In all other cases there is a one-time $10.00 enrollment fee. If
you are not making an initial cash investment because you have signed up
for automatic monthly deductions of $50.00, you will need to include a
$10.00 check or money order made payable to "First American Trust" with
your enrollment form. If your enrollment form is accompanied by an initial
cash investment, the enrollment fee will be deducted from your initial
investment (see Question 30 below).
OPTIONAL CASH INVESTMENTS
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9. What are the minimum and maximum amounts for optional cash investments?
Additional investments may be made in amounts of at least $50.00 subject to
a maximum of $5,000.00 during any Quarter, including your initial
investment, if any.
10. How do I make an optional cash investment?
You may send a check or money order payable in U.S. dollars to "First
American Trust". Cash and third party checks are not allowed. Checks or
money orders must be accompanied by the appropriate section of your account
statement and mailed to: First American Trust, Corporate Transfer Dept.,
421 N Main St, Santa Ana, CA 92701 (see Question 3).
11. Can I have optional cash investments automatically deducted from my bank
account?
Yes. You can authorize monthly automatic deductions from an account at a
financial institution that is a member of the National Automated Clearing
House Association. The minimum amount for monthly deductions is $50.00.
o To initiate this service, you must send a completed "Automatic
Deduction Service" form to the Administrator.
o To change any aspect of the instruction, you must send a revised
"Automatic Deduction Service" form to the Administrator.
o To terminate the deductions, you must notify the Administrator in
writing.
Initial set-up, changes and terminations to the automatic deduction
instructions of a participant will be made as soon as practicable following
receipt of directions from such participant. Once automatic deductions
begin, funds will be deducted from your designated account on the 15th of
each month, or the next business day if the 15th is not a business day, and
invested within five business days.
12. Will I be charged fees for optional cash investments?
No.
13. How are payments with "insufficient funds" handled?
If the Administrator does not receive credit for a cash payment because of
insufficient funds or incorrect draft information, the requested purchase
will be deemed void, and the Administrator will immediately remove from
your account any shares purchased upon the prior credit of such funds. The
Administrator may also place a hold on the Plan account until an
"insufficient funds" fee of $20.00 is received from the participant, or may
sell such shares to satisfy any uncollected amounts.
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PURCHASE OF COMMON STOCK
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14. What is the source of First American common shares purchased through the
Plan?
At First American's discretion, share purchases will be made by the Plan's
purchasing agent either in the open market or directly from First American.
Share purchases in the open market may be made on any stock exchange where
First American common stock is traded or by negotiated transactions on such
terms as the purchasing agent may reasonably determine. Neither First
American nor any participant will have any authority or power to direct the
date, time or price at which shares may be purchased by the purchasing
agent.
15. When will shares be purchased?
Initial and optional investment purchases will be made within five business
days following collection of the funds by the Administrator. No interest
will be paid on amounts held by the Administrator pending investment. The
Administrator may commingle each participant's funds with those of other
participants for the purpose of executing purchases.
16. What is the price of shares purchased under the Plan?
The price per share paid by each participant for shares purchased in the
open market will be the weighted average price incurred to purchase all
shares acquired on that date. Shares purchased from First American will be
purchased and credited to a participant's account at the average of the
high and low sales prices of First American common stock as reported on the
New York Stock Exchange Composite Tape on the date of purchase. No
brokerage commissions will be incurred for shares purchased under the Plan.
Your account will be credited with the number of Plan shares purchased for
you, in full and fractional shares, computed to three decimal places.
CASH DIVIDENDS
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17. Must my dividends be reinvested automatically?
No. You may choose to reinvest dividends or you may choose to receive cash
dividends. No commission will be charged in connection with the
reinvestment of dividends.
As an option, you can choose to receive cash dividends on your certificated
shares or on the shares held for you in the Plan. Should you elect to
receive any cash dividends, the Administrator can deposit those dividends
directly into a qualified bank account for you. To authorize direct deposit
of dividends, contact the Administrator (see Question 3).
18. When will my dividends be reinvested and at what price?
The reinvestment of your dividends will be processed within five business
days following the dividend payment date. The price of shares purchased
will be as described in Question 16, above.
STOCK SPLITS AND STOCK DIVIDENDS
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19. How would a stock split or stock dividend affect my account?
Any shares resulting from a stock split or stock dividend paid on shares
held in your Plan account or held by you in certificate form will be
credited to your Plan account balance. Of course, you may request a
certificate at any time for any or all of your shares (see Question 27
above).
VOTING
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20. How do I vote my Plan shares at shareholder meetings?
As a Plan participant, you will be sent a proxy statement in connection
with each meeting of the Corporation's shareholders, together with a proxy
card representing the shares held by the Administrator in your Plan
account. This proxy card, when duly signed and returned, will be voted as
you indicate. Fractional shares will be aggregated
-7-
and voted in accordance with the participants' directions. If the proxy
card is not returned or if it is returned unsigned, the shares will not be
voted.
SALE OF SHARES
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21. How do I sell my Plan shares?
You may sell any number of whole shares held in your account by completing
the appropriate section of your account statement and returning it to the
Administrator. If the market value of the Plan shares is equal to or less
than $25,000 and you have authorized telephone transactions for your
account, you may sell shares by telephoning the Corporate Transfer Dept.
toll free at 1-800-894-4076. Requests for sales or terminations will
generally be executed daily provided there is sufficient volume and the
request is received on a business day when the relevant securities market
is open.
If there is not sufficient volume, sales will be processed within five
business days. Proceeds from the sale, less a per transaction fee of $10.00
plus a brokerage commission of $0.07 per share will be deducted from the
proceeds of any shares, including fractional shares, sold through the Plan.
Please note that shares that you hold in certificate form must first be
deposited into your Plan account before they can be sold (see Questions 23
and 24 below).
22. Is there a minimum number of shares that I must maintain in my account to
keep it active?
No.
CUSTODIAL SERVICE
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23. How does the custodial service work?
All shares of First American common stock that are purchased through the
Plan will be held by the Administrator in an account registered in your
name. A Plan participant who holds First American common stock certificates
may also, at any time, deposit those certificates for safekeeping with the
Administrator, and the shares represented by the deposited certificates
will be included in the participant's Plan account balance.
24. How do I deposit my First American stock certificates with the
Administrator?
To deposit shares into the Plan, you should send your certificates, by
registered and insured mail, to the Administrator (see Question 3), with
written instructions to deposit the shares represented by the certificates
in your Plan account. The certificates should not be endorsed and the
assignment section should not be completed.
25. Are there any charges associated with this custodial service?
No. There is no cost to you for having the Administrator hold the shares
you purchased through the Plan, or for depositing stock certificates into
your Plan account balance.
ISSUANCE OF STOCK CERTIFICATES
--------------------------------------------------------------------------------
26. Will stock certificates be issued for shares acquired through the Plan?
No. Stock certificates will not be issued for shares acquired through the
Plan unless a specific request is made to the Administrator. The absence of
stock certificates eliminates the risk of certificate loss, theft or
destruction.
27. How do I request a stock certificate?
Certificates for full shares held in the Plan may be obtained, without
charge, by writing to the Administrator and requesting the issuance of
shares in certificate form.
-8-
GIFTS AND TRANSFERS OF SHARES
--------------------------------------------------------------------------------
28. Can I transfer shares that I hold in the Plan to someone else?
You may transfer shares held in the Plan to new or existing shareholders.
If your transferee is not a current Plan participant your transferee must
request an enrollment form from the Administrator (see Question 3). Your
transferee must include the completed enrollment form and any applicable
fee with the gift/transfer instructions.
29. Can I transfer shares that I hold in the Plan to a minor?
Yes. You can transfer shares to a minor. You will need to provide the name
of the adult custodian who will be listed on the account. Once the minor
has reached the age of majority the custodian's name can be removed.
Additionally, gifts to minors are irrevocable. Shares may not be
transferred from a custodial account to other custodial accounts or
individuals until the minor has reached the age of majority and provides
the Administrator with proper transfer instructions and proof of age.
SERVICE FEES
--------------------------------------------------------------------------------
30. What are the fees associated with participation in the Plan?
Participation in the Plan is subject to the payment of certain fees as
outlined below:
One-Time Enrollment Fee(1)................................ $10.00
Sales Transaction Fee(2).................................. $10.00
Fee for returned check or rejected
automatic deductions ............................ $20.00
----------------------
(1) Only applies to new shareholders.
(2) Plus a $0.07 per share trading fee.
WITHDRAWAL FROM THE PLAN
--------------------------------------------------------------------------------
31. How do I close my Plan account?
You may terminate your participation in the Plan either by giving written
notice to the Administrator or by completing the appropriate section of
your account statement and returning it to the Administrator. Upon
termination, you must elect either to receive a certificate for the number
of whole shares held in your Plan account and a check for the value of any
fractional share, or to sell all the shares in your Plan account (as
described above in Question 21).
Any certificates issued upon termination will be issued in the name or
names in which the account is registered, unless otherwise instructed. If
the certificate is to be issued in a name other than the name or names on
your Plan account, your signature (and that of any co-owner) on the
instructions or stock power must be "Medallion Guaranteed" by a financial
institution participating in the Medallion Guarantee program. No
certificate will be issued for fractional shares.
The Administrator will process notices of termination and send proceeds to
you as soon as practicable, without interest. If a notice of termination is
received within three business days of a record date, but before the
related dividend payment date, the termination will be processed as soon as
practicable following the payment date. Thereafter, cash dividends will be
paid out to the shareholder and not reinvested in First American common
stock.
If you are an active participant in the Automatic Deduction Service and
request that all shares be sold, be aware that you may have a purchase
pending that will result in more shares being placed in your account after
the original sale request has been completed. If this is the case, the
Administrator will automatically sell these additional shares within five
business days of the credit to your account and send you a second check for
these proceeds. The $10.00 sale fee will be waived in this circumstance,
although the brokerage commission of $0.07 per share will be charged.
-9-
AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION OF THE PLAN
--------------------------------------------------------------------------------
32. Can the Plan be amended, modified, suspended or terminated?
First American reserves the right to amend, modify, suspend or terminate
the Plan at any time. All participants will receive notice of any such
suspension, modification or termination. Upon termination of the Plan by
First American, certificates for whole shares held in a participant's
account under the Plan will be issued and a cash payment will be made for
any fractional shares.
TAX MATTERS
--------------------------------------------------------------------------------
33. What are the federal income tax consequences of participating in the Plan?
Cash dividends reinvested under the Plan will be taxable for U.S. Federal
income tax purposes as having been received by a participant even though
the participant has not actually received them in cash. Each participant
will receive an annual statement from the Administrator indicating the
amount of reinvested dividends reported to the U.S. Internal Revenue
Service as dividend income.
A participant will not realize gain or loss for U.S. Federal income tax
purposes upon a transfer of shares to the Plan or the withdrawal of whole
shares from the Plan. Participants will, however, generally realize gain or
loss upon the receipt of cash for fractional shares held in the Plan. Gain
or loss will also be realized by the participant when whole shares are
sold, either by the purchasing agent pursuant to the participant's request
or by the participant after termination from the Plan. The amount of gain
or loss will be the difference between the amount that the participant
receives for the shares or fraction of a share sold and the participant's
tax basis therefor. In order to determine the tax basis for shares or any
fraction of a share credited to a participant's account, each participant
should retain all account statements and transaction confirmations.
Plan participants who are non-resident aliens or non-U.S. corporations,
partnerships or other entities generally are subject to a withholding tax
on dividends paid on shares held in the Plan. The Administrator is required
to withhold from dividends paid the appropriate amount determined in
accordance with Internal Revenue Service regulations. Where applicable,
this withholding tax is determined by treaty between the United States and
the country in which the participant resides. In addition, dividends paid
on shares in Plan accounts are subject to the "backup withholding"
provisions of the Internal Revenue Code. Accordingly, the amount of any
dividends, net of the applicable withholding tax, will be credited to
participant Plan accounts for investment in additional shares of First
American common stock.
The foregoing does not purport to be a comprehensive summary of all of the
tax considerations that may be relevant to a participant in the Plan and
does not constitute tax advice. The summary does not reflect every possible
outcome that could result from participation in the Plan, and does not
consider any possible tax consequences under various state, local, foreign
or other tax laws. Each participant is urged to consult his or her own tax
advisor regarding the tax consequences applicable to his or her particular
situation before participating in the Plan or disposing of shares purchased
under the Plan.
LIMITATION OF LIABILITY
--------------------------------------------------------------------------------
34. What are the responsibilities of First American and the Administrator under
the Plan.
IF YOU CHOOSE TO PARTICIPATE IN THE PLAN, YOU SHOULD RECOGNIZE THAT NEITHER
FIRST AMERICAN NOR THE ADMINISTRATOR CAN ASSURE YOU OF A PROFIT OR PROTECT
YOU AGAINST A LOSS ON THE SHARES THAT YOU PURCHASE UNDER THE PLAN.
Neither First American nor the Administrator, in administering the Plan,
will be liable for any act done in good faith or for any good faith
omission to act, including without limitation any claim of liability
arising out of failure to terminate a participant's account upon such
participant's death, the price at which shares are purchased or sold for
the participant's account, the times when purchases or sales are made or
fluctuations in the market value of First American common stock. This
limitation of liability will not constitute a waiver by any participant of
his or her rights under the federal securities laws.
-10-
Although the Plan provides for the reinvestment of dividends, the
declaration and payment of dividends will continue to be determined by the
Board of Directors of First American in its discretion, depending upon
future earnings, the financial condition of First American and other
factors. The amount and timing of dividends may be changed, or the payment
of dividends terminated, at any time without notice.
USE OF PROCEEDS
First American will receive proceeds from the purchase of First American
common shares through the plan only to the extent that such purchases are made
directly from First American, and not from open market purchases by the
Administrator. Any proceeds received by us (which cannot be estimated), will be
used for general corporate purposes.
LEGAL MATTERS
The validity of the common stock offered hereunder will be passed upon by
White & Case LLP, 633 West Fifth Street, Los Angeles, California 90071.
EXPERTS
The financial statements and related financial statement schedules
incorporated in this prospectus by reference to the annual report on Form 10-K
for the year ended December 31, 2000 have been so incorporated in reliance on
the report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
-11-
THE FIRST AMERICAN CORPORATION
DIVIDEND REINVESTMENT AND DIRECT PURCHASE PLAN
500,000 SHARES OF COMMON STOCK
[Logo of The First American Corporation]
-----------------
PROSPECTUS
-----------------
We have not authorized anyone to give you any information that differs from
the information in this prospectus. If you receive any different information,
you should not rely on it.
The delivery of this prospectus shall not, under any circumstances, create
an implication that THE FIRST AMERICAN CORPORATION is operating under the same
conditions that it was operating under on the date of this prospectus. Do not
assume that the information contained in this prospectus is correct at any time
past the date indicated.
This prospectus does not constitute an offer to sell, or the solicitation
of an offer to buy, any securities other than the securities to which it
relates.
This prospectus does not constitute an offer to sell, or the solicitation
of an offer to buy, the securities to which it relates in any circumstances in
which such offer or solicitation is unlawful.
DATED JANUARY 24, 2002
PART II
Information Not Required in Prospectus
Item 14. Other expenses of Issuance and Distribution.
Set forth below is a table of the registration fee for the Securities and
Exchange Commission and estimates of all other expenses to be incurred in
connection with the issuance and distribution of the securities described in
this Registration Statement, other than underwriting discounts and commissions:
SEC registration fee........................................ $ 888.95
Printing and distribution of prospectus..................... $25,000.00
Legal fees and expenses..................................... $25,000.00
Accounting fees and expenses................................ $ 5,000.00
Miscellaneous............................................... $ 5,000.00
Total.............................................. $60,888.95
Item 15. 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, as provided 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 Restated 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
II-1
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 only,
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
only, 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 only, 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.
The Registrant has a policy of liability insurance which insures its
directors and officers against the cost of defense, settlement or payment of a
judgment under certain circumstances.
Item 16. Exhibits.
Exhibit
Number Description
----- -----------
4.1 Description of Registrant's capital stock in Article Sixth of
Registrant's Restated Articles of Incorporation (contained in Exhibits
3.1, 3.2 and 3.3).
4.2 Rights Agreement (incorporated by reference from Exhibit 4 of
Registrant's Registration Statement on Form 8-A dated November 7, 1997).
5 Opinion of White & Case LLP regarding validity of the common shares.
23.1 Consent of PricewaterhouseCoopers LLP, independent accountants to
Registrant.
23.2 Consent of White & Case LLP (contained in Exhibit 5).
24 Power of Attorney.
II-2
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during the period in which offers or sales are being made,
a post-effective amendment to this Registration Statement to:
(i) include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) 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; and
(iii) 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) of this section do not
apply if the registration statement is on Form S-3, Form S-8 or Form F-3, and
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission 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.
(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.
(4) 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.
(5) 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 described in Item
15 above, 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.
II-3
Signatures
Pursuant to the requirements of the Securities Act of 1933, the Registrant
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 January 24, 2002.
THE FIRST AMERICAN 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: December 17, 2001 By:/s/ Parker S. Kennedy
--------------------------
Parker S. Kennedy,
President and Director
Date: December 17, 2001 By:/s/ Thomas A. Klemens
-------------------------
Thomas A. Klemens, Executive Vice
President, Chief Financial Officer
(Principal Financial and Accounting Officer)
Date: December 17, 2001 By:/s/ Max Valdes
-------------------------
Max Valdes, Vice President
Chief Accounting Officer
(Principal Accounting Officer)
II-4
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:
----------------------------
D. P. Kennedy, Chairman and Director
Date: By:
----------------------------
Parker S. Kennedy, President
and Director
Date: December 17, 2001 By: *
----------------------------
Gary J. Beban, Director
Date: December 17, 2001 By: *
----------------------------
J. David Chatham, Director
Date: December 17, 2001 By: *
----------------------------
Hon. William G. Davis, Director
Date: December 17, 2001 By: *
----------------------------
James L. Doti, Director
Date: December 17, 2001 By: *
----------------------------
Lewis W. Douglas, Jr., Director
Date: December 17, 2001 By: *
----------------------------
Paul B. Fay, Jr., Director
Date: December 17, 2001 By: *
----------------------------
Frank E. O'Bryan, Director
Date: December 17, 2001 By: *
----------------------------
Roslyn B. Payne, Director
II-5
Date: December 17, 2001 By: *
----------------------------
D. Van Skilling, Director
Date: December 17, 2001 By: *
----------------------------
Virginia Ueberroth, Director
* By: /s/ Parker S. Kennedy
---------------------------------------------
Parker S. Kennedy
Attorney-in-Fact
II-6
Exhibit
Number Description
------- ------------
4.1 Description of Registrant's capital stock in Article Sixth of
Registrant's Restated Articles of Incorporation (contained in Exhibits
3.1, 3.2 and 3.3).
4.2 Rights Agreement (incorporated by reference from Exhibit 4 of
Registrant's Registration Statement on Form 8-A dated November 7, 1997).
5 Opinion of White & Case LLP regarding validity of the common shares.
23.1 Consent of PricewaterhouseCoopers LLP, independent accountants to
Registrant.
23.2 Consent of White & Case LLP (contained in Exhibit 5).
24 Power of Attorney.
II-7