sc13da107206002_04102008.htm

0000921895-08-001082.txt : 20080411 0000921895-08-001082.hdr.sgml : 20080411 20080411145427 ACCESSION NUMBER: 0000921895-08-001082 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20080411 DATE AS OF CHANGE: 20080411 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: 1st Century Bancshares, Inc. CENTRAL INDEX KEY: 0001420525 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 261169687 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-83859 FILM NUMBER: 08752132 BUSINESS ADDRESS: STREET 1: 1875 CENTURY PARK EAST STREET 2: SUITE 1400 CITY: LOS ANGELES STATE: CA ZIP: 90067 BUSINESS PHONE: 310-270-9500 MAIL ADDRESS: STREET 1: 1875 CENTURY PARK EAST STREET 2: SUITE 1400 CITY: LOS ANGELES STATE: CA ZIP: 90067 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Palisair Capital Partners LP CENTRAL INDEX KEY: 0001412698 IRS NUMBER: 000000000 STATE OF INCORPORATION: de FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 1900 Avenue of the Stars CITY: Los Angeles STATE: CA ZIP: 90067 BUSINESS PHONE: 310-203-4880 MAIL ADDRESS: STREET 1: 1900 Avenue of the Stars CITY: Los Angeles STATE: CA ZIP: 90067 SC 13D/A 1 sc13da107206002_04102008.htm sc13da107206002_04102008.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 1)1

1st Century Bancshares, Inc.

(Name of Issuer)

Common Stock, par value $0.01

(Title of Class of Securities)

31943X102

(CUSIP Number)

ADAM FINERMAN, ESQ.

OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP

Park Avenue Tower

65 East 55th Street

New York, New York 10022

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

April 11, 2008

(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 that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

_______________

1 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).

CUSIP NO. 31943X102

1	NAME OF REPORTING PERSON PALISAIR CAPITAL PARTNERS, L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) o (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 593,692
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 593,692
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 593,692
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.0%
14	TYPE OF REPORTING PERSON PN

CUSIP NO. 31943X102

1	NAME OF REPORTING PERSON PALISAIR CAPITAL LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) o (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 593,692
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 593,692
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 593,692
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.0%
14	TYPE OF REPORTING PERSON OO

CUSIP NO. 31943X102

1	NAME OF REPORTING PERSON ZACHARY JAMES COHEN
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) o (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS AF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 593,692
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 593,692
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 593,692
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.0%
14	TYPE OF REPORTING PERSON IN

CUSIP NO. 31943X102

The following constitutes Amendment No. 1 to the Schedule 13D filed by the undersigned (“Amendment No. 1”). This Amendment No. 1 hereby amends and restates the Schedule 13D in its entirety to read as follows:

Item 1.

Security and Issuer.

This statement relates to shares of the Common Stock, par value $0.01 per share (the “Shares”), of 1st Century Bancshares, Inc. (the “Issuer”). The address of the principal executive offices of the Issuer is 1875 Century Park East, Suite 1400, Los Angeles, California 90067.

Item 2.

Identity and Background.

(a) This statement is filed by Palisair Capital Partners, L.P., a Delaware limited partnership (“Palisair Partners”), Palisair Capital LLC, a Delaware limited liability company (“Palisair LLC”) and Zachary James Cohen (“Mr. Cohen”). Each of the foregoing is referred to as a “Reporting Person” and collectively as the “Reporting Persons.” Each of the Reporting Persons is party to that certain Joint Filing Agreement as further described in Item 6. Accordingly, the Reporting Persons are hereby filing a joint Schedule 13D.

Palisair LLC is the general partner of Palisair Partners. Mr. Cohen is the managing member of Palisair LLC. By virtue of these relationships, each of Palisair LLC and Mr. Cohen may be deemed to beneficially own the Shares owned by Palisair Partners.

Palisair Partners is a hedge fund founded in September 2007 by Mr. Cohen. Mr. Cohen founded Palisair LLC, the general partner of Palisair Partners, in February 2007. From September 2004 to December 2006, Mr. Cohen was a managing member of Coldwater Asset Management, LLC and was co-portfolio manager for Coldwater Partners, LP, a hedge fund based in Los Angeles from January 2005 to October 2006. From March 2003 to August 2004, Mr. Cohen was an analyst at Witmer Asset Management, LLC (“Witmer”). Witmer serves as investment adviser to Eagle Capital Partners, L.P., a value-oriented, hedge fund in New York City. Mr. Cohen graduated from the Harvard-Westlake School in North Hollywood, California and received a Bachelor of Science Degree in Business Administration with Honors from the Haas School of Business at the University of California, Berkeley in 2002.

(b) The principal business address of each of the Reporting Persons is 1900 Avenue of the Stars, Suite 303, Los Angeles, California 90067.

(d) No Reporting Person has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) No Reporting Person has, during the last five years, been 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, federal or state securities laws or finding any violation with respect to such laws.

(f) Mr. Cohen is a citizen of the United States of America.

CUSIP NO. 31943X102

Item 3.

Source and Amount of Funds or Other Consideration.

The aggregate purchase price of the 593,692 Shares owned by Palisair Partners is approximately $4,565,614 including brokerage commissions. The Shares owned by Palisair Partners were acquired with partnership funds.

Palisair Partners effects purchases of securities primarily through margin accounts maintained for it with prime brokers, which may extend margin credit to it as and when required to open or carry positions in the margin accounts, subject to applicable federal margin regulations, stock exchange rules and the prime brokers’ credit policies. In such instances, the positions held in the margin accounts are pledged as collateral security for the repayment of debit balances in the accounts.

Item 4.

Purpose of Transaction.

The Reporting Persons purchased the Shares based on the Reporting Persons’ belief that the Shares, when purchased, were undervalued and represented an attractive investment opportunity. Depending upon overall market conditions, other investment opportunities available to the Reporting Persons, and the availability of Shares at prices that would make the purchase of additional Shares desirable, the Reporting Persons may endeavor to increase their position in the Issuer through, among other things, the purchase of Shares on the open market or in private transactions or otherwise, on such terms and at such times as the Reporting Persons may deem advisable.

No Reporting Person has any present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) - (j) of Item 4 of Schedule 13D except as set forth herein or such as would occur upon completion of any of the actions discussed above. Palisair Partners intends to review its investment in the Issuer on a continuing basis and engage in discussions with management and the Board of Directors of the Issuer concerning the business, operations and future plans of the Issuer. Depending on various factors including, without limitation, the Issuer’s financial position and investment strategy, the price levels of the Shares, conditions in the securities markets and general economic and industry conditions, Palisair Partners may in the future take such actions with respect to its investment in the Issuer as it deems appropriate including, without limitation, seeking Board representation, making proposals to the Issuer concerning changes to the capitalization, ownership structure or operations of the Issuer, purchasing additional Shares, making an offer for the entire company, selling some or all of its Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares or changing its intention with respect to any and all matters referred to in Item 4.

On February 29, 2008, Palisair Partners announced its intention to commence a tender offer on March 14, 2008 for up to 688,000 of the Issuer’s outstanding Shares, which was later revised to purchase up to 396,000 of the Issuer’s outstanding Shares. At the present time the Reporting Persons have determined not to proceed with a tender offer.

On April 11, 2008, Palisair Partners delivered a letter to the Corporate Secretary of the Issuer nominating Mr. Cohen for election to the Issuer’s Board of Directors at the Issuer’s 2008 annual meeting of stockholders, or any other meeting of stockholders held in lieu thereof, and any adjournments, postponements, reschedulings or continuations thereof. Palisair Partners intends to file a proxy statement with the Securities and Exchange Commission and solicit proxies in support of the election of its nominee. A copy of the letter is attached as exhibit 99.2 hereto and is incorporated herein by reference.

Also on April 11, 2008, Palisair Partners delivered a letter to the Corporate Secretary of the Issuer requesting to inspect the Issuer’s stockholder list pursuant to Section 220 of the General Corporation Law of the State of Delaware.

CUSIP NO. 31943X102

Item 5.

Interest in Securities of the Issuer.

(a) The aggregate percentage of Shares reported owned by each person named herein is based upon 9,913,884 Shares outstanding, which is the total number of Shares outstanding as of February 29, 2008 as reported in the Issuer’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 17, 2008.

As of the close of business on April 10, 2008, Palisair Partners beneficially owned 593,692 Shares, constituting approximately 6.0% of the Shares outstanding. By virtue of their relationships with Palisair Partners discussed in further detail in Item 2, each of Palisair LLC and Mr. Cohen may be deemed to beneficially own the Shares owned by Palisair Partners.

(b) Each of Palisair Partners, Palisair LLC and Mr. Cohen may be deemed to have the sole power to vote and dispose of the Shares reported in this Schedule 13D.

(c) Schedule A annexed hereto lists all transactions in securities of the Issuer during the past sixty days by the Reporting Persons. All of such transactions were effected in the open market.

(d) No person other than the Reporting Persons is known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Shares.

(e) Not applicable.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

On March 10, 2008, the Reporting Persons entered into a Joint Filing Agreement in which the Reporting Persons agreed to the joint filing on behalf of each of them of statements on Schedule 13D, with respect to securities of the Issuer, to the extent required by applicable law. A copy of this agreement is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Except as set forth herein, there are no contracts, arrangements, understandings or relationships among the Reporting Persons, or between the Reporting Persons and any other person, with respect to the securities of the Issuer.

Item 7.

Material to be Filed as Exhibits.

99.1

Joint Filing Agreement by and among Palisair Capital Partners, L.P., Palisair Capital LLC and Zachary James Cohen, dated March 10, 2008.

99.2

Nomination Letter from Palisair Capital Partners, L.P. to 1st Century Bancshares, Inc., dated April 11, 2008.

CUSIP NO. 31943X102

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: April 11, 2008	PALISAIR CAPITAL PARTNERS, L.P.

	By:		PALISAIR CAPITAL LLC General Partner

	By:	/s/ Zachary James Cohen
		Zachary James Cohen Managing Member

	PALISAIR CAPITAL LLC

	By:	/s/ Zachary James Cohen
		Zachary James Cohen Managing Member

	/s/ Zachary James Cohen
	ZACHARY JAMES COHEN

CUSIP NO. 31943X102

SCHEDULE A

Transactions in the Securities of the Issuer During the Past 60 Days

Class of

Security

Securities

Purchased / (Sold)

Price Per

Share ($)

Date of

Purchase / Sale

PALISAIR CAPITAL PARTNERS, L.P.

Common Stock	3,000	5.8167	02/22/08
Common Stock	(5,900)	6.5729	02/25/08
Common Stock	101,000	7.4748	02/25/08
Common Stock	193,120	7.2032	02/25/08
Common Stock	(100)	7.9000	02/27/08
Common Stock	25,085	8.1182	02/27/08
Common Stock	225,957	8.0472	02/27/08
Common Stock	22,530	8.2071	02/28/08
Common Stock	29,000	8.0974	02/29/08

PALISAIR CAPITAL LLC

None

ZACHARY JAMES COHEN

None

CUSIP NO. 31943X102

EXHIBIT LIST

Exhibit

99.1	Joint Filing Agreement by and among Palisair Capital Partners, L.P., Palisair Capital LLC and Zachary James Cohen, dated March 10, 2008 (previously filed with the Schedule 13D filed on March 10, 2008).

99.2	Nomination Letter from Palisair Capital Partners, L.P. to 1st Century Bancshares, Inc., dated April 11, 2008.

EX-99.1 2 ex991sc13da107206002_041008.htm JOINT FILING AGREEMENT ex991sc13da107206002_041008.htm

Exhibit 99.1

JOINT FILING AGREEMENT

In accordance with Rule 13d-1(k)(1)(iii) under the Securities Exchange Act of 1934, as amended, the persons named below agree to the joint filing on behalf of each of them of a Statement on Schedule 13D dated March 10, 2008 (including amendments thereto) with respect to the Common Stock of 1st Century Bancshares, Inc. This Joint Filing Agreement shall be filed as an Exhibit to such Statement.

Dated: March 10, 2008	PALISAIR CAPITAL PARTNERS, L.P.

	By:		PALISAIR CAPITAL LLC General Partner

	By:	/s/ Zachary James Cohen
		Zachary James Cohen Managing Member

	PALISAIR CAPITAL LLC

	By:	/s/ Zachary James Cohen
		Zachary James Cohen Managing Member

	/s/ Zachary James Cohen
	ZACHARY JAMES COHEN

EX-99.2 3 ex992sc13da107206002_041008.htm NOMINATION LETTER ex992sc13da107206002_041008.htm

Exhibit 99.2

PALISAIR CAPITAL PARTNERS, L.P.

1900 Avenue of the Stars, Suite 303

Los Angeles, California 90067

April 11, 2008

VIA FACSIMILE AND FEDERAL EXPRESS

1st Century Bancshares, Inc.

1875 Century Park East, Suite 1400

Los Angeles, California 90067

Attention: Corporate Secretary

Re:

Notice of Intention to Nominate an Individual for Election as a Director at

the 2008 Annual Meeting of Stockholders of 1st Century Bancshares, Inc.

Dear Sir:

This letter shall serve to satisfy the advance notice requirements of Article II, Section 5 of the Bylaws (the “Bylaws”) of 1st Century Bancshares, Inc., a Delaware corporation (“1st Century” or the “Company”) as to the nomination by Palisair Capital Partners, L.P., a Delaware limited partnership (“Palisair Partners”), of one (1) nominee for election to the Board of Directors of 1st Century (the “Board”) at the 2008 annual meeting of stockholders of 1st Century, or any other meeting of stockholders held in lieu thereof, and any adjournments, postponements, reschedulings or continuations thereof (the “Annual Meeting”). Since 1st Century was formed in August 2007 and has never previously held an annual meeting of stockholders, we believe the correct time for submission of a nomination for director pursuant to the Bylaws is no later than the 10th day following the day on which public announcement of the date of the Annual Meeting is made. To date, there has been no public announcement of the date of the Annual Meeting, and accordingly, this notice is timely.

This letter and the Exhibits attached hereto are collectively referred to as the “Notice.” Palisair Partners is the beneficial owner of 593,692 shares of common stock, $0.01 par value per share (the “Common Stock”), of 1st Century, 1,000 shares of which are held of record by Palisair Partners. Through this Notice, Palisair Partners hereby nominates and notifies you of its intent to nominate Zachary James Cohen as a nominee (the “Nominee”) to be elected to the Board at the Annual Meeting. Palisair Partners believes that the terms of the fourteen (14) directors currently serving on the Board expire at the Annual Meeting. To the extent there are in excess of fourteen (14) vacancies on the Board to be filled by election at the Annual Meeting or 1st Century increases the size of the Board above its existing size, Palisair Partners reserves the right to nominate additional nominees to be elected to the Board at the Annual Meeting. Additional nominations made pursuant to the preceding sentence are without prejudice to the position of Palisair Partners that any attempt to increase the size of the current Board or to classify the Board constitutes an unlawful manipulation of 1st Century’s corporate machinery. If this Notice shall be deemed for any reason by a court of competent jurisdiction to be ineffective with respect to the nomination of the Nominee at the Annual Meeting, or if the Nominee shall be unable to serve for any reason, this Notice shall continue to be effective with respect to any replacement Nominee selected by Palisair Partners.

The information concerning Palisair Partners and the Nominee required by Article II, Section 5 of the Bylaws is set forth below:

(i)	Name and address, as believed to appear on 1st Century’s books, of the stockholder giving the Notice is as follows:

Name	Address

Palisair Capital Partners, L.P.	1900 Avenue of the Stars, Suite 303 Los Angeles, CA 90067

(ii)	Class and number of shares of Common Stock of 1st Century which are owned beneficially and of record by the stockholder giving the Notice:

Name	Class	Number and Type of Ownership
Palisair Capital Partners, L.P.	Common Stock, $0.01 par value per share	Palisair Capital Partners, L.P. beneficially owns 593,692 shares of Common Stock, including 1,000 shares of Common Stock held of record.1

(iii)

Representation that the nominating stockholder is a holder of record of stock of 1st Century, is entitled to vote at the Annual Meeting and intends to appear in person or by proxy at the Annual Meeting to nominate the Nominee:

Palisair Partners hereby represents that it is the beneficial owner of 593,692 shares of Common Stock of 1st Century and that it holds 1,000 shares of Common Stock in record name. Palisair Partners further represents that it is currently entitled to vote its shares of Common Stock at the Annual Meeting and also represents that it will appear in person or by proxy at the Annual Meeting to nominate the Nominee. Please see Exhibit A for information regarding purchases and sales during the past two years by Palisair Partners in securities of 1st Century.

1 Palisair Capital LLC, a Delaware limited liability company (“Palisair Capital”), is the general partner of Palisair Partners. Mr. Cohen is the managing member of Palisair Capital. By virtue of these relationships, each of Palisair Capital and Mr. Cohen may be deemed to beneficially own the shares of Common Stock owned by Palisair Partners.

(iv)	All arrangements and understandings between the stockholder and the Nominee and any other person or persons pursuant to which the nominations are to be made by the stockholder:

Palisair Partners, Palisair Capital and Mr. Cohen (collectively, the “Group”) are parties to a joint filing agreement, dated March 10, 2008, and have jointly filed a Schedule 13D with respect to the Common Stock. Reference is made to the Schedule 13D initially filed on March 10, 2008 as it has been and may be amended from time to time, as filed and to be filed with the Securities and Exchange Commission, for information regarding the entities that are or may be deemed to be members in a group described therein, as well as beneficial ownership of shares of Common Stock by members of the Group.

Other than as stated herein, there are no arrangements or understandings between Palisair Partners and the Nominee or any other person or persons pursuant to which the nominations described herein are to be made.

(v)	Name and business address of the Nominee:

Name	Business Address

Zachary James Cohen	c/o Palisair Capital Partners, L.P. 1900 Avenue of the Stars, Suite 303 Los Angeles, CA 90067

(vi)	Principal occupation or employment of the Nominee:

Zachary James Cohen (Age 28) has served as the Founder and Managing Member of Palisair Capital, the general partner of Palisair Partners, since February 2007. Palisair Partners commenced operations in September 2007. From September 2004 to December 2006, Mr. Cohen was a Managing Member of Coldwater Asset Management, LLC and was co-portfolio manager for Coldwater Partners, LP, a hedge fund based in Los Angeles from January 2005 to October 2006. From March 2003 to August 2004, Mr. Cohen was an analyst at Witmer Asset Management, LLC (“Witmer”). Witmer serves as investment adviser to Eagle Capital Partners, L.P., a value-oriented, hedge fund in New York City. Mr. Cohen graduated from the Harvard-Westlake School in North Hollywood, California and received a Bachelor of Science Degree in Business Administration with Honors from the Haas School of Business at the University of California, Berkeley in 2002.

(vii)

Class and number of shares of stock of 1st Century which are beneficially owned by the Nominee:

By virtue of his position with Palisair Capital, Mr. Cohen has the power to vote and dispose of the shares of Common Stock owned by Palisair Partners. Accordingly, Mr. Cohen may be deemed to be the beneficial owner of the shares of Common Stock owned by Palisair Partners. For information regarding purchases and sales during the past two years by Palisair Partners of securities of 1st Century that may be deemed to be beneficially owned by Mr. Cohen, see Exhibit A.

(viii)

All other information relating to the Nominee that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended:

The Nominee (i) has consented to be named as a nominee in any proxy statement filed by Palisair Partners in connection with the solicitation of proxies for the election of the Nominee to the Board and to serve as a director of 1st Century, if so elected, (ii) acknowledges that as a director of 1st Century, he will owe a fiduciary duty under the General Corporation Law of the State of Delaware exclusively to 1st Century and its stockholders and (iii) certifies that he is eligible as of the date hereof, and will be eligible as of the time of the election, to serve as a director in accordance with Article II, Section 5 of the Bylaws. Such consent, acknowledgement and certification is attached hereto as Exhibit B.

Palisair Partners certifies that the Nominee is eligible as of the date hereof, and will be eligible as of the time of the election, to serve as a director in accordance with Article II, Section 5 of the Bylaws. Such certification is attached hereto as Exhibit C.

Except as set forth in this Notice (including the Exhibits attached hereto), (i) during the past 10 years, the Nominee has not been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors); (ii) the Nominee does not directly or indirectly beneficially own any securities of 1st Century; (iii) the Nominee does not own any securities of 1st Century which are owned of record but not beneficially; (iv) the Nominee has not purchased or sold any securities of 1st Century during the past two years; (v) no part of the purchase price or market value of the securities of 1st Century owned by the Nominee is represented by funds borrowed or otherwise obtained for the purpose of acquiring or holding such securities; (vi) the Nominee is not, or within the past year was not, a party to any contract, arrangements or understandings with any person with respect to any securities of 1st Century, including, but not limited to, joint ventures, loan or option arrangements, puts or calls, guarantees against loss or guarantees of profit, division of losses or profits, or the giving or withholding of proxies; (vii) no associate of the Nominee owns beneficially, directly or indirectly, any securities of 1st Century; (viii) the Nominee does not own beneficially, directly or indirectly, any securities of any parent or subsidiary of 1st Century; (ix) the Nominee or any of his associates, was not a party to any transaction, or series of similar transactions, since the beginning of 1st Century’s last fiscal year, or is a party to any currently proposed transaction, or series of similar transactions, to which 1st Century or any of its subsidiaries was or is to be a party, in which the amount involved exceeds $120,000; (x) the Nominee or any of his associates has no arrangements or understandings with any person with respect to any future employment by 1st Century or its affiliates, or with respect to any future transactions to which 1st Century or any of its affiliates will or may be a party; and (xi) no person, including the Nominee, who is a party to an arrangement or understanding pursuant to which the Nominee is proposed to be elected, has a substantial interest, direct or indirect, by security holdings or otherwise in any matter to be acted on at the Annual Meeting. There are no material proceedings to which the Nominee or any of his associates is a party adverse to 1st Century or any of its subsidiaries or has a material interest adverse to 1st Century or any of its subsidiaries. With respect to the Nominee, none of the events enumerated in Item 401(f)(1)-(6) of Regulation S-K of the Securities Exchange Act of 1934 occurred during the past five years.

(ix)	Solicitation Notice:

Palisair Partners intends to deliver to 1st Century stockholders a proxy statement and form of proxy to a sufficient number of holders of the Company’s voting shares to elect the Nominee at the Annual Meeting. A copy of Palisair Partners’ affirmative statement of such intent is attached hereto as Exhibit D.

Palisair Capital maintains deposits at 1st Century Bank, National Association, a wholly-owned subsidiary of 1st Century. Palisair Partners does not have a substantial interest in any matters to be acted upon at the Annual Meeting except as otherwise set forth herein.

Please address any correspondence to Palisair Capital Partners L.P., Attention: Zachary Cohen, telephone (310) 203-4880, facsimile (310) 203-4885 (with a copy to our counsel, Olshan Grundman Frome Rosenzweig & Wolosky LLP, Park Avenue Tower, 65 East 55th Street, New York, New York 10022, Attention: Adam Finerman, telephone (212) 451-2289, facsimile (212) 451-2222). If you have any concerns regarding the validity of this notice, please contract the undersigned immediately. The giving of this Notice is not an admission that any procedures for notice concerning the nomination of directors to the Board are legal, valid or binding, and Palisair Partners reserves the right to challenge their validity.

	Very truly yours,

	PALISAIR CAPITAL PARTNERS, L.P.

	By:	PALISAIR CAPITAL LLC, General Partner

By:	/s/ Zachary James Cohen
Name:		Zachary James Cohen
Title:		Managing Member

EXHIBIT A

TRANSACTIONS IN SECURITIES OF 1ST CENTURY

DURING THE PAST TWO YEARS

PALISAIR CAPITAL PARTNERS, L.P.

Common Stock	3,000	5.8167	02/22/08
Common Stock	(5,900)	6.5729	02/25/08
Common Stock	101,000	7.4748	02/25/08
Common Stock	193,120	7.2032	02/25/08
Common Stock	(100)	7.9000	02/27/08
Common Stock	25,085	8.1182	02/27/08
Common Stock	225,957	8.0472	02/27/08
Common Stock	22,530	8.2071	02/28/08
Common Stock	29,000	8.0974	02/29/08