The First American Corporation Announces Bondholders' Support


April 27, 2010, SANTA ANA, Calif.

The First American Corporation (NYSE: FAF), America’s largest provider of business information, announced today that holders of a majority in aggregate principal amount of its 5.7 percent senior notes due 2014 and the 8.5 percent capital securities due 2012 have approved its proposed amendments to the related indentures. 

To date, $148,720,000 in principal amount of the 5.7 percent senior notes due 2014, or approximately 99.15 percent of the outstanding aggregate principal amount, and $64,167,000 in liquidation amount of 8.5 percent capital securities, or approximately 64.17 percent of the outstanding aggregate liquidation amount, have been tendered in the tender offers.  Such tenders constitute grants of consent to the proposed amendments.  In the tender offer for the
 7.55 percent senior debentures due 2028, $23,803,000 in principal amount, or approximately 23.8 percent of the outstanding aggregate principal amount, has been tendered.  The consent solicitation for such senior debentures is being conducted separately from the tender offer, as discussed below.  Excluding senior debentures held by the PREFERRED PLUS Trust Series Far-1, the principal amount tendered exceeds 43 percent of the outstanding aggregate principal amount of 7.55 percent senior debentures due 2028.  All of First American’s previously announced tender offers for the 7.55 percent senior debentures due 2028, the 5.7 percent senior notes due 2014, the 8.5 percent capital securities due 2012 and the 7.55 percent trust certificates issued by the PREFERRED PLUS Trust Series Far-1 due 2028 remain open.  The tender offers commenced on April 12, 2010 and expire at 11:59 p.m., New York City time, on May 7, 2010.

The proposed amendments approved by holders of the 5.7 percent senior notes due 2014 and the 8.5 percent capital securities due 2012 expressly affirm that the pending separation transaction, currently targeted for June 1, 2010, in which the Information Solutions Group and Financial Services Group will become separate public companies, does not conflict with the terms of such indentures.  Because sufficient consents to approve such amendments have been received, the requisite consent conditions in First American’s previously announced offers to purchase any and all of its 5.7 percent senior notes due 2014, and any and all of the 8.5 percent capital securities due 2012, have been satisfied. 


First American expects that it will promptly execute supplemental indentures effecting proposed amendments to the indentures under which those securities were issued. 
The supplemental indentures will be binding upon execution, but the amendments set forth in the supplemental indentures will not become operative unless and until First American accepts for purchase such notes or capital securities, as applicable, validly tendered (and not validly withdrawn) and certain other conditions relating to consummation of the tender offers and consent solicitations are satisfied.

Additionally, First American has announced that it will continue to offer, through the expiration of the related tender offers, the early consent fee of $10 per $1,000 liquidation amount validly tendered in its tender offer for the 8.5 percent capital securities due 2012 and $10 per $1,000 principal amount  validly tendered in its tender offer for the 5.7 percent senior notes due 2014.  Withdrawal rights in the tender offers for the 8.5 percent capital securities due 2012 and 5.7 percent senior notes due 2014 have terminated; such notes and securities may no longer be withdrawn.


Information regarding First American’s ongoing tender offers and consent solicitations is set forth in the table below.


Subject
 Securities and Certain Terms of the Tender Offers and Consent Solicitations

Security

CUSIP No.

Outstanding Amount

Tender Price
(per $1,000 principal amount, except as noted)

Consent Fee

7.55% Senior Debentures due 2028

318522AA7

$100,000,000

$1,000.00

$10.00
(as part of a separate consent solicitation, see below)

5.70% Senior Notes due 2014

31848JAA7

$150,000,000

$1,000.00

$10.00
(early consent fee offered until expiration time)

8.50% Capital Securities due 2012 of First American Capital Trust I

31847JAB6

$100,000,000

$1,000.00

$10.00
(
early consent fee offered until expiration time)

PREFERRED PLUS 7.55%
Trust Certificates

740434659

$45,000,000
(representing 45%
of the 7.55% Senior Debentures due 2028) 

$25.00
(per $25.00
stated amount of certificates)

N/A

 

 

7.55 percent senior debentures due 2028
First American is continuing to solicit consents of holders of the 7.55 percent senior debentures due 2028 separately from its tender offer to purchase such notes, and is offering a consent fee of $10 per $1,000 principal amount of consenting notes in the consent solicitation to amend the indenture with respect to the 7.55 percent senior debentures due 2028.  As previously announced, the consent solicitation with respect to the 7.55 percent senior debentures due 2028 expires at 5:00 p.m., New York City time, on April 30, 2010.

Critical Dates and Times

All of the tender offers expire at 11:59 p.m., New York City time, on May 7, 2010. 

The separate consent solicitation for the 7.55 percent senior debentures due 2028 expires at 5:00 p.m., New York City time, on April 30, 2010.

The Early Tender Time in our tender offers for the 5.7 percent senior notes due 2014, and 8.5 percent capital securities was 5:00 p.m., New York City time, on April 23, 2010.  The Early Tender Time has not been extended in either tender offer; however, the early consent fee continues to be offered, as noted above.

Withdrawal rights in the tender offers and consent solicitations for the 5.7 percent senior notes due 2014 and the 8.5 percent capital securities due 2012 terminated at the Early Tender Time.  Notes or capital securities may no longer be withdrawn from those tender offers and consent solicitations. Each of the above expiration times may be extended by First American in its sole discretion.  We will provide notice of any such extension by press release.
 

J.P. Morgan Securities Inc. is the dealer manager and solicitation agent for the tender offers and consent solicitations.


None of First American; Global Bondholder Services, the information agent for the tender offers and consent solicitations; Wilmington Trust Company, the depositary and tabulation agent for the tender offers and consent solicitations; or J.P. Morgan Securities Inc., makes any recommendation as to whether holders of any of the securities should tender or refrain from tendering or as to whether holders of such securities should provide consents to the proposed amendments.  This press release does not constitute an offer to purchase any of the securities.

First American expressly reserves the right, in its sole discretion, subject to applicable law to:  (i) terminate prior to the relevant expiration date any tender offer and consent solicitation and not accept for payment any securities not previously accepted for payment; (ii) waive on or prior to the acceptance of any security any and all of the conditions of the applicable tender offer and the related consent solicitation; (iii) extend the relevant expiration date; and (iv) amend the terms of any tender offer or consent solicitation.  The foregoing rights are in addition to its right to delay acceptance for payment of securities tendered under the relevant tender offer or the payment for securities accepted for payment in order to comply in whole or in part with any applicable law, subject to Rule 14e-1(c) under the Securities Exchange Act of 1934, as amended, to the extent applicable, which requires that an offeror pay the consideration offered or return the securities deposited by or on behalf of the holders thereof promptly after the termination or withdrawal of a tender offer.

This press release is for informational purposes only and is not an offer to buy, or the solicitation of an offer to sell, any of the securities.  The full details of the tender offers for the securities, including complete instructions on how to tender securities are included in the offer to purchase and consent solicitation statements, the letter of transmittal, letter of consent, where applicable, and related materials.  Holders of the securities are strongly encouraged to read carefully the offer to purchase and consent solicitation statements, the letter of transmittal, letter of consent and any other related materials because they  contain important information.  Holders of the securities may obtain a copy of the offers to purchase and consent solicitation statements, free of charge, from Global Bondholder Services Corporation, the information agent in connection with the tender offers and consent solicitations, by calling toll-free (866) 470-4500 or (212) 430-3774.  Bankers and brokers may call collect at (212) 430-3774. 
 


About First American
The First American Corporation (NYSE: FAF) is a FORTUNE 500® company that traces its history to 1889. With total revenues of approximately $6.0 billion in 2009, it is America’s largest provider of business information. First American combines advanced analytics with its vast data resources to supply businesses and consumers with valuable information products to support the major economic events of people’s lives, such as getting a job, renting an apartment, buying a car or house, securing a mortgage and opening or buying a business. The First American Family of companies, many of which command leading market share positions in their respective industries, operate within five primary business segments, including: Title Insurance and Services, Specialty Insurance, Information and Outsourcing Solutions, Data and Analytic Solutions, and Risk Mitigation and Business Solutions. More information about the company and an archive of its press releases can be found at www.firstam.com.

Forward-Looking Statements

Certain statements made in this press release, including those related to the consummation of the spin-off separation and the structure and timing thereof, are “forward-looking statements.”  These forward-looking statements may contain the words “intend,” “anticipate,” “expect,” “plan,” “predict,” “estimate,” “project,” “will be,” “will continue,” “will likely result” or other similar words and phrases. Risks and uncertainties exist that may cause results to differ materially from those set forth in these forward-looking statements. Factors that could cause the anticipated results to differ from those described in the forward-looking statements include those described in the Part I, Item 1A of First American’s annual report on Form 10-K for the year ended Dec. 31, 2009. The forward-looking statements speak only as of the date they are made. Except as required by law, First American does 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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