10-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2003

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                                  to                                 

Commission file number 0-3658

(Exact name of registrant as specified in its charter)

Incorporated in California	95-1068610
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1 First American Way, Santa Ana, California 92707-5913

(Address of principal executive offices) (Zip Code)

(714) 800-3000

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Common	New York Stock Exchange
Rights to Purchase Series A Junior Participating Preferred	New York Stock Exchange
(Title of each class)	(Name of each exchange on which registered)

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark whether registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (17 C.F.R. § 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ¨

Indicate by check mark if the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2).    Yes  x    No  ¨

The aggregate market value of voting stock held by non-affiliates was $1,980,352,642 by reference to the closing price of the Registrant’s common stock as of the last business of the Registrant’s most recently completed second fiscal quarter.

On March 10, 2004, there were 79,502,164 shares of Common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive proxy statement with respect to the 2004 annual meeting of the shareholders are incorporated by reference in Part III of this report. The definitive proxy statement will be filed no later than 120 days after the close of Registrant’s fiscal year.

PART I

CERTAIN STATEMENTS IN THIS ANNUAL REPORT ON FORM 10-K, INCLUDING THOSE RELATING TO CORPORATE OFFICE EXPANSION, LITIGATION, DIVIDENDS, FUNDING FOR CORPORATE OFFICE EXPANSION, INSURANCE REGULATION AND OTHER REGULATIONS, CASH REQUIREMENTS AND FUNDING FOR NON-QUALIFIED SUPPLEMENTAL BENEFITS ARE FORWARD LOOKING. 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: INTEREST RATE FLUCTUATIONS; CHANGES IN THE PERFORMANCE OF THE REAL ESTATE MARKETS; LIMITATIONS ACCESS TO PUBLIC RECORDS AND OTHER DATA; GENERAL VOLATILITY IN THE CAPITAL MARKETS; CHANGES IN APPLICABLE GOVERNMENT REGULATIONS; CONSOLIDATION AMONG THE COMPANY’S SIGNIFICANT CUSTOMERS AND COMPETITORS; THE COMPANY’S CONTINUED ABILITY TO IDENTIFY BUSINESSES TO BE ACQUIRED; CHANGES IN THE COMPANY’S ABILITY TO INTEGRATE BUSINESSES WHICH IT ACQUIRES; AND OTHER FACTORS DESCRIBED IN THIS ANNUAL REPORT ON FORM 10-K. THE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE TO UPDATE FORWARD-LOOKING STATEMENTS TO REFLECT CIRCUMSTANCES OR EVENTS THAT OCCUR AFTER THE DATE THE FORWARD-LOOKING STATEMENTS ARE MADE.

Item 1.    Business.

The Company

The First American Corporation (the Company) was organized in 1894 as Orange County Title Company, succeeding to the business of two title abstract companies founded in 1889 and operating in Orange County, California. In 1924, the Company commenced issuing title insurance policies. In 1986, the Company began a diversification program by acquiring and developing business information companies closely related to the real estate transfer and closing process. In 1998, the Company expanded its diversification program to include business information companies outside of the real estate transfer and closing process. The Company is a California corporation and has its executive offices at 1 First American Way, Santa Ana, California 92707-5913. The Company’s telephone number is (714) 800-3000. Unless the context otherwise indicates, the “Company,” as used herein, refers to The First American Corporation and its subsidiaries.

General

The First American Corporation (the Company), through its subsidiaries, is engaged in the business of providing business information and related products and services. The Company has seven reporting segments that fall within two primary business groups, financial services and information technology. The financial services group includes title insurance, specialty insurance and trust and other services. The title insurance segment issues residential and commercial title insurance policies, provides escrow services, equity loan services, tax-deferred exchanges and other related products. The specialty insurance segment issues property and casualty insurance policies and provides home warranties. The trust and other services segment provides investment advisory and trust and thrift services. The information technology group includes mortgage information, property information, credit information, and screening information. The mortgage information segment provides tax monitoring, flood zone certification, default management services, document preparation and other real estate related services. The property information segment provides property database services and appraisal services. The credit information segment provides mortgage credit and specialized credit reporting services. The screening information segment provides resident screening, pre-employment screening, substance abuse management and testing, consumer direct location services and motor vehicle reporting. Financial information regarding each of the Company’s business segments is included in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Item 8. Financial Statements and Supplementary Data” of Part II of this report.

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The Company believes that it holds the number one market share position for many of its products and services, including but not limited to, flood zone determinations, based on the number of flood zone certification reports issued; tax monitoring services, based on the number of loans under service; mortgage credit reporting services, based on the number of credit reports issued; automotive credit reporting services, based on the number of credit reports issued; default management services, based on the number of foreclosure/bankruptcy cases reported; property database services, based on the number of inquiries; and resident screening, based on the number of reports issued. The Company also believes that it holds the number two market share position for title insurance, based on operating revenues; home warranty services, based on the number of home protection contracts under service; and drug testing, based on the number of reports issued.

Substantially all of the revenues for the Company’s title insurance and mortgage information segments result from resales and refinancings of residential real estate and, to a lesser extent, from commercial transactions and the construction and sale of new housing. Over one-half of the revenues in the Company’s property information and credit information segments also depend on real estate activity. The remaining portion of the property information and credit information revenues, as well as the revenues for the Company’s specialty insurance, trust and other services, and screening information segments are isolated from the volatility of real estate transactions. Real estate activity is cyclical in nature and is affected greatly by the cost and availability of long-term mortgage funds. Real estate activity and, in turn, a large portion of the Company’s revenue base, can be adversely affected during periods of high interest rates and/or limited money supply. However, this adverse effect is mitigated in part by the continuing diversification of the Company’s operations into areas outside of the traditional real estate transfer and closing process.

The Financial Services Group

Title Insurance Segment

Overview of Title Insurance Industry

Title to, and the priority of interests in, real estate are determined in accordance with applicable laws. In most real estate transactions, mortgage lenders and purchasers of real estate want to be protected from loss or damage in the event that title is not as represented. In most parts of the United States, title insurance has become accepted as the most efficient means of providing such protection.

Title Policies.    Title insurance policies insure the interests of owners and their lenders in the title to real property against loss by reason of adverse claims to ownership of, or to defects, liens, encumbrances or other matters affecting such title which exist at the time a title insurance policy is issued and which were not excluded from the coverage of a title insurance policy. Title insurance policies are issued on the basis of a title report, which is prepared after a search of the public records, maps, documents and prior title policies to ascertain the existence of easements, restrictions, rights of way, conditions, encumbrances or other matters affecting the title to, or use of, real property. In certain instances, a visual inspection of the property is also made. To facilitate the preparation of title reports, copies of public records, maps, documents and prior title policies may be compiled and indexed to specific properties in an area. This compilation is known as a “title plant.”

The beneficiaries of title insurance policies are generally real estate buyers and mortgage lenders. A title insurance policy indemnifies the named insured and certain successors in interest against title defects, liens and encumbrances existing as of the date of the policy and not specifically excepted from its provisions. The policy typically provides coverage for the real property mortgage lender in the amount of its outstanding mortgage loan balance and for the buyer in the amount of the purchase price of the property, but in some cases might insure for a greater amount where the buyer anticipates constructing improvements on the property. Coverage under a title insurance policy issued to a real property mortgage lender generally terminates upon the sale of the insured property unless the owner carries back a mortgage or makes certain warranties as to the title.

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Before issuing title policies, title insurers seek to limit their risk of loss by accurately performing title searches and examinations. The major expenses of a title company relate to such searches and examinations, the preparation of preliminary reports or commitments and the maintenance of title plants, and not from claim losses as in the case of property and casualty insurers.

The Closing Process.    Title insurance is essential to the real estate closing process in most transactions involving real property mortgage lenders. In a typical residential real estate sale transaction, title insurance is generally ordered on behalf of an insured by a real estate broker, lawyer, developer, lender or closer involved in the transaction. Once the order has been placed, a title insurance company or an agent conducts a title search to determine the current status of the title to the property. When the search is complete, the title company or agent prepares, issues and circulates a commitment or preliminary title report (“commitment”) to the parties to the transaction. The commitment summarizes the current status of the title to the property, identifies the conditions, exceptions and/or limitations that the title insurer intends to attach to the policy and identifies items appearing on the title that must be eliminated prior to closing.

The closing function, sometimes called an escrow in western states, is often performed by a lawyer, an escrow company or a title insurance company or agent (such person or entity, the “closer”). Once documentation has been prepared and signed, and mortgage lender payoff demands are in hand, the transaction is “closed.” The closer records the appropriate title documents and arranges the transfer of funds to pay off prior loans and extinguish the liens securing such loans. Title policies are then issued insuring the priority of the mortgage of the real property mortgage lender in the amount of its mortgage loan and the buyer in the amount of the purchase price. The time lag between the opening of the title order and the issuance of the title policy is usually between 30 and 90 days. The seller and the buyer bear the risk during this time lag. Any matter affecting title which is discovered during this period would have to be dealt with to the title insurers’ satisfaction or the insurer would except the matter from the coverage afforded by the title policy. Before a closing takes place, however, the closer would request that the title insurer provide an update to the commitment to discover any adverse matters affecting title and, if any are found, would work with the seller to eliminate them so that the title insurer would issue the title policy subject only to those exceptions to coverage which are acceptable to the buyer and the buyer’s lender.

Issuing the Policy: Direct vs. Agency.    A title policy can be issued directly by a title insurer or indirectly on behalf of a title insurer through agents which are not themselves licensed as insurers. Where the policy is issued by a title insurer, the search is performed by or at the direction of the title insurer, and the premium is collected and retained by the title insurer. Where the policy is issued by an agent, the agent performs the search, examines the title, collects the premium and retains a portion of the premium. The remainder of the premium is remitted to the title insurer as compensation for bearing the risk of loss in the event a claim is made under the policy. The percentage of the premium retained by an agent varies from region to region. A title insurer is obligated to pay title claims in accordance with the terms of its policies, regardless of whether it issues its policy directly or indirectly through an agent.

Premiums.    The premium for title insurance is due and earned in full when the real estate transaction is closed. Premiums are generally calculated with reference to the policy amount. The premium charged by a title insurer or an agent is subject to regulation in most areas. Such regulations vary from state to state.

The Company’s Title Insurance Operations

Overview.    The Company, through First American Title Insurance Company and its subsidiaries, transacts the business of title insurance through a network of both direct operations and agents. Through this network, the Company issues policies in all states (except Iowa) and the District of Columbia. In Iowa, the Company provides abstracts of title only, because title insurance is not permitted. The Company also offers title services in Australia, the Bahama Islands, Canada, Guam, Hong Kong, Ireland, Mexico, New Zealand, Puerto Rico, South Korea, the United Kingdom, the U.S. Virgin Islands and other countries abroad.

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Based on industry statistics showing premiums written in 2002, the Company had the largest or second largest share of the title insurance market in 30 states and in the District of Columbia, and had a national market share of 22.6%. Industry statistics for 2003 are not currently available.

The Company plans to continue increasing its share of the title insurance market through strategic acquisitions and further development of its existing branch office and agency operations. The Company also will continue to focus on expanding its share of the higher margin, title insurance business conducted on behalf of commercial clients. The Company believes its national commercial market share has grown through programs directed at major developers, lenders and law firms.

Sales and Marketing.    The Company markets its title insurance services to a broad range of customers. The Company believes that its primary source of business is from referrals from persons in the real estate community, such as independent escrow companies, real estate brokers, developers, mortgage brokers, mortgage bankers, financial institutions and attorneys. In addition to the referral market, the Company markets its title insurance services directly to large corporate customers and mortgage lenders. As title agents contribute a large portion of the Company’s revenues, the Company also markets its title insurance services to independent agents. The Company’s marketing efforts emphasize the quality and timeliness of its services, process innovation and its national presence.

While virtually all personnel in the Company’s title insurance business assist in marketing efforts, the Company maintains a sales force of more than 1,000 persons dedicated solely to marketing. This sales force, which is located throughout the Company’s branch office network, not only markets the Company’s title insurance services, but also certain of the Company’s other products. The Company provides its sales personnel with training in selling techniques, and each branch manager is responsible for hiring the sales staff and ensuring that sales personnel under his or her supervision are properly trained. In addition to this sales force, the Company has approximately 90 salespeople in its national commercial services division. One of the responsibilities of the sales personnel of this division is the coordination of marketing efforts directed at large real estate lenders and companies developing, selling, buying or brokering properties on a multistate basis. The Company also supplements the efforts of its sales force through general advertising in various trade and professional journals.

The Company’s increased commercial sales effort during the past decade has enabled the Company to expand its commercial business base. Because commercial transactions involve higher coverage amounts and yield higher premiums, commercial title insurance business generates greater profit margins than does residential title insurance business. Accordingly, the Company plans to continue to emphasize its commercial sales program.

Although sales outside of the United States account for a small percentage of the Company’s revenues, the Company believes that the acceptance of title insurance in foreign markets has increased in recent years. Accordingly, the Company plans to continue its international sales efforts, particularly in Canada, the United Kingdom and Australia.

Underwriting.    Before a title insurance policy is issued, a number of underwriting decisions are made. For example, matters of record revealed during the title search may require a determination as to whether an exception should be taken in the policy. The Company believes that it is important for the underwriting function to operate efficiently and effectively at all decision making levels so that transactions may proceed in a timely manner. To perform this function, the Company has underwriters at the branch level, the regional level and the national level.

Agency Operations.    The relationship between the Company and each agent is governed by an agency agreement which states the conditions under which the agent is authorized to issue title insurance policies on behalf of the Company. The agency agreement also prescribes the circumstances under which the agent may be liable to the Company if a policy loss is attributable to error of the agent. Such agency agreements typically have a term of one to five years and are terminable immediately for cause.

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Due to the high incidence of agency fraud in the title insurance industry during the late 1980s, the Company instituted measures to strengthen its agent selection and audit programs. In determining whether to engage an independent agent, the Company investigates the agent’s experience, background, financial condition and past performance. The Company maintains loss experience records for each agent and conducts periodic audits of its agents. The Company has also increased the number of agent representatives and agent auditors that it employs. Agent representatives periodically visit agents and examine their books and records. In addition to periodic audits, a full agent audit will be triggered if certain “warning signs” are evident. Warning signs that can trigger an audit include the failure to implement Company-required accounting controls, shortages of escrow funds and failure to remit underwriting fees on a timely basis.

Title Plants.    The Company’s network of title plants constitutes one of its principal assets. A title search is conducted by searching the public records or utilizing a title plant. While public records are indexed by reference to the names of the parties to a given recorded document, most title plants arrange their records on a geographic basis. Because of this difference, records of a title plant are generally easier to search. Most title plants also index prior policies, adding to searching efficiency. Many title plants are computerized. Certain offices of the Company utilize jointly owned plants or utilize a plant under a joint user agreement with other title companies. The Company believes its title plants, whether wholly or partially owned or utilized under a joint user agreement, are among the best in the industry.

The Company has significantly enhanced its investment in title plants through three business combinations. The first was the formation of a limited liability corporation (“LLC”) with Experian Group on January 1, 1998. Experian Group contributed to the LLC its real estate information division, which the Company believes is the nation’s leading operator of title plants. The second business combination was the acquisition of Data Tree in June 1998. Data Tree is a supplier of database management and document imaging systems. The third business combination was the formation of Data Trace Information Services. This business is 80.0% owned by the Company’s subsidiary, FARES, and 20.0% owned by LandAmerica. Data Trace Information Services is a provider of comprehensive title information delivery systems.

The Company’s title plants are carried on its balance sheet at original cost, which includes the cost of producing or acquiring interests in title plants or the appraised value of subsidiaries’ title plants at dates of acquisition for companies accounted for as purchases. Thereafter, the cost of daily maintenance of these plants is charged to expense as incurred. A properly maintained title plant has an indefinite life and does not diminish in value with the passage of time. Therefore, in accordance with generally accepted accounting principles, no provision is made for depreciation of these plants. Since each document must be reviewed and indexed into the title plant, such maintenance activities constitute a significant item of expense. The Company is able to offset title plant maintenance costs at its plants through joint ownership and access agreements with other title insurers and title agents.

Reserves for Claims and Losses.    The Company provides for title insurance losses based upon its historical experience by a charge to expense when the related premium revenue is recognized. The resulting reserve for known claims and incurred but not reported claims reflects management’s best estimate of the total costs required to settle all claims reported to the Company and claims incurred but not reported, and is considered by the Company to be adequate for such purpose.

In settling claims, the Company occasionally purchases and ultimately sells the interest of the insured in the real property or the interest of the claimant adverse to the insured. These assets, which totaled $42.7 million at December 31, 2003, are carried at the lower of cost or fair value, less costs to sell, and are included in “Other assets” in the Company’s consolidated balance sheets.

Reinsurance and Coinsurance.    The Company assumes and distributes large title insurance risks through mechanisms of reinsurance and coinsurance. In reinsurance agreements, in consideration for a portion of the premium, the reinsurer accepts that part of the risk which the primary insurer cedes to the reinsurer over and

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above the portion retained by the primary insurer. The primary insurer, however, remains liable for the total risk in the event that the reinsurer does not meet its obligation. As a general rule, the Company does not retain more than $40.0 million of primary risk on any single policy. Under coinsurance agreements, each coinsurer is jointly and severally liable for the risk insured, or for so much thereof as is agreed to by the parties. The Company’s reinsurance activities account for less than 1.0% of its total title insurance operating revenues.

Competition.    The title insurance business is highly competitive. The number of competing companies and the size of such companies varies in the different areas in which the Company conducts business. Generally, in areas of major real estate activity, such as metropolitan and suburban localities, the Company competes with many other title insurers. Approximately 75 title insurance underwriters are members of the American Land Title Association, the title insurance industry’s national trade association. The Company’s major nationwide competitors in its principal markets include Fidelity National Title Insurance Company (which also includes Chicago Title, Ticor Title Insurance Company and Security Union Title Insurance Company) Landamerica (which includes Lawyers Title Insurance Company, Commonwealth Land Title Insurance Company and Transnation Title Insurance Company, Stewart Title Guaranty Company and Old Republic Title Insurance Group. In addition to these nationwide competitors, numerous agency operations throughout the country provide aggressive competition on the local level.

The Company believes that competition for title insurance business is based primarily on the quality and timeliness of service, because parties to real estate transactions are usually concerned with time schedules and costs associated with delays in closing transactions. In those states where prices are not established by regulatory authorities, the price of title insurance policies is also an important competitive factor. The Company believes that it provides quality service in a timely manner at competitive prices.

Specialty Insurance Segment

Home Warranties.    The Company’s home warranty business commenced operations in 1984, in part with the proceeds of a $1.5 million loan from the Company which was, in 1986, converted to a majority equity interest. The Company currently owns 92.3% of its home warranty business, which is operated as a second tier subsidiary, with the balance owned by management of that subsidiary. The Company’s home warranty business issues one-year warranties that protect homeowners against defects in household systems and appliances, such as plumbing, water heaters and furnaces. The Company’s home warranty subsidiary currently charges approximately $245 to $420 for its basic home warranty contract. Optional coverage is available for air conditioners, pools, spas, washers, dryers, refrigerators and other items for charges ranging from approximately $25 to $160. For an additional charge, coverage is renewable annually at the option of the homeowner upon approval by the home warranty subsidiary. Fees for the warranties are paid at the closing of the home purchase and are recognized monthly over a 12-month period. Home warranties are marketed through real estate brokers and agents. This business has continually expanded nationally and is currently licensed in 40 states. The principal competitor of the Company’s home warranty business is American Home Shield, a subsidiary of Service Master L.P.

Property and Casualty Insurance.    The Company offers property and casualty insurance through its subsidiaries First American Property and Casualty Insurance Company and First American Specialty Insurance Company. First American Property and Casualty Insurance Company conducts its business utilizing the Company’s distribution channels, allowing for cross selling through existing closing-service activities. First American Specialty Insurance Company conducts its business utilizing a network of brokers in California.

Trust and Other Services Segment

Investment Advisory and Trust and Thrift Services.    The Company offers investment advisory services through its SEC registered investment management firm that manages equity and fixed-income securities.

Since 1960, the Company has conducted a general trust business in California, acting as trustee when so appointed pursuant to court order or private agreement. In 1985, the Company formed a banking subsidiary into

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which its subsidiary trust operation was merged. During August 1999, this subsidiary converted from a state-chartered bank to a federal savings bank. As of December 31, 2003, the trust operation was administering fiduciary and custodial assets having a market value in excess of $2.3 billion.

During 1988, the Company, through a majority-owned subsidiary, acquired an industrial bank (the Thrift), formerly known as an industrial loan corporation, that accepts thrift deposits and uses deposited funds to originate and purchase loans secured by commercial properties primarily in Southern California. As of December 31, 2003, the Thrift had approximately $76.6 million of demand deposits and $105.2 million of loans outstanding.

Loans made or acquired during the current year, by the Thrift, ranged in amount from $15,050 to $2,887,500. The average loan balance outstanding at December 31, 2003, was $430,471. Loans are made only on a secured basis, at loan-to-value percentages no greater than 75.0%. The Thrift specializes in making commercial real estate loans. In excess of 99.5% of the Thrift’s loans are made on a variable rate basis. The average yield on the Thrift’s loan portfolio as of December 31, 2003, was 7.77%. A number of factors are included in the determination of average yield, principal among which are loan fees and closing points amortized to income, prepayment penalties recorded as income, and amortization of discounts on purchased loans. The Thrift’s primary competitors in the Southern California commercial real estate lending market are local community banks, other thrift and loan companies and, to a lesser extent, commercial banks. The Thrift’s average loan is approximately 12.5 years in duration.

The performance of the Thrift’s loan portfolio is evaluated on an ongoing basis by management of the Thrift. The Thrift places a loan on non-accrual status when two payments become past due. When a loan is placed on non-accrual status, the Thrift’s general policy is to reverse from income previously accrued but unpaid interest. Income on such loans is subsequently recognized only to the extent that cash is received and future collection of principal is probable. Interest income on non-accrual loans that would have been recognized during the year ended December 31, 2003, if all of such loans had been current in accordance with their original terms, totaled $8,094.

The following table sets forth the amount of the Thrift’s non-performing assets as of the dates indicated:

	Year Ended December 31
	2003		2002		2001		2000		1999
	(in thousands)
Nonperforming Assets:
Loans accounted for on a nonaccrual basis	$	53	$	65	$	94	$	89	$	707
Total	$	53	$	65	$	94	$	89	$	707

Based on a variety of factors concerning the creditworthiness of its borrowers, the Thrift determined that it had $52,928 of potential problem loans in existence as of December 31, 2003.

The Thrift’s allowance for loan losses is established through charges to earnings in the form of provision for loan losses. Loan losses are charged to, and recoveries are credited to, the allowance for loan losses. The provision for loan losses is determined after considering various factors, such as loan loss experience, maturity of the portfolio, size of the portfolio, borrower credit history, the existing allowance for loan losses, current charges and recoveries to the allowance for loan losses, the overall quality of the loan portfolio, and current economic conditions, as determined by management of the Thrift, regulatory agencies and independent credit review specialists. While many of these factors are essentially a matter of judgment and may not be reduced to a mathematical formula, the Company believes that, in light of the collateral securing its loan portfolio, the Thrift’s current allowance for loan losses is an adequate allowance against foreseeable losses.

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The following table provides certain information with respect to the Thrift’s allowance for loan losses as well as charge-off and recovery activity.

	Year Ended December 31
	2003			2002			2001			2000			1999
	(in thousands, except percentages)
Allowance for Loan Losses:
Balance at beginning of year	$	1,170		$	1,050		$	1,020		$	905		$	1,150
Charge-offs:
Real estate—mortgage		—			—			(140	)		—			(346	)
Assigned lease payments		—			(3	)		(2	)		(2	)		—
		—			(3	)		(142	)		(2	)		(346	)
Recoveries:
Real estate—mortgage		—			—			—			9			—
Assigned lease payments		—			—			—			—			—
		—			—			—			9			—
Net charge-offs		—			(3	)		(142	)		7			(346	)
Provision for losses		120			123			172			108			101
Balance at end of year	$	1,290		$	1,170		$	1,050		$	1,020		$	905
Ratio of net charge-offs during the year to average loans outstanding during the year		.00	%		.00	%		.14	%		(.01	%)		.40	%

The adequacy of the Thrift’s allowance for loan losses is based on formula allocations and specific allocations. Formula allocations are made on a percentage basis, which is dependent on the underlying collateral, the type of loan and general economic conditions. Specific allocations are made as problem or potential problem loans are identified and are based upon an evaluation by the Thrift’s management of the status of such loans. Specific allocations may be revised from time to time as the status of problem or potential problem loans changes.

The following table shows the allocation of the Thrift’s allowance for loan losses and the percent of loans in each category to total loans at the dates indicated.

	Year Ended December 31
	2003			2002			2001			2000			1999
	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans
	(in thousands, except percentages)
Loan Categories:
Real estate-mortgage	$	1,289	100	$	1,159	100	$	1,036	100	$	1,002	100	$	904	100
Other		1	—		11	—		14	—		18	—		1	—
	$	1,290	100	$	1,170	100	$	1,050	100	$	1,020	100	$	905	100

The Information Technology Group

Mortgage Information Segment

The mortgage information segment provides tax monitoring, flood zone certification, default management services, and other real estate related services.

Tax Monitoring.    The tax monitoring service, established by the Company in 1987, advises real property mortgage lenders of the status of property tax payments due on real estate securing their loans. With the

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acquisition of Transamerica’s tax monitoring business in October 2003, the Company believes that it is the largest provider of tax monitoring services in the United States.

Under a typical contract, a tax service provider monitors, on behalf of a mortgage lender, the real estate taxes owing on properties securing such lender’s mortgage loans for the life of such loans. In general, providers of tax monitoring services, such as the Company’s tax service, indemnify mortgage lenders against losses resulting from a failure to monitor delinquent taxes. Where a mortgage lender requires that tax payments be impounded on behalf of borrowers, providers of tax monitoring services, such as the Company’s tax service, may be required to monitor and oversee the transfer of these monies to the taxing authorities and provide confirmation to lenders that such taxes have been paid.

The fee charged to service each mortgage loan varies from region to region, but generally falls within the $45 to $130 price range and is paid in full at the time the contract is executed. The Company recognizes revenues from tax service contracts over the estimated duration of the contracts. However, income taxes are paid on the entire fee in the year the fee is received. Historically, the Company has maintained minimal reserves for losses relating to its tax monitoring service because its losses have been negligible.

Flood Zone Certification.    In January 1995, the Company acquired Flood Data Services, Inc. (now a subsidiary of First American Real Estate Solutions LLC). This business furnishes to mortgage lenders flood zone determination reports, which provide information on whether or not property securing a loan is in a governmentally delineated special flood hazard area. Federal legislation passed in 1994 requires that most mortgage lenders obtain a determination of the current flood zone status at the time each loan is originated and obtain updates during the life of the loan. In October 2003, the Company acquired Transamerica’s flood zone determination business. This acquisition enhanced the Company’s number one market share position for flood zone determinations in the United States, based on the number of flood zone determination reports issued.

Default Management Services.    The default management business supports mortgage servicers and financial institutions in the handling of loss mitigation, foreclosure, REO and claims processing. With the acquisition in 2001 of LFC Nationwide, a leading provider of property preservation and field inspections, the Company believes it is now the nation’s leading provider of default management services, based on the number of foreclosure/bankruptcy cases reported.

Property Information Segment

This business was established in January 1998 when the Company and its real estate information service subsidiaries (the “Real Estate Information Subsidiaries”) consummated a business transaction with Experian Group (“Experian”), pursuant to which First American Real Estate Solutions LLC (“FARES”) was established. Under the transaction, the Real Estate Information subsidiaries contributed substantially all of their assets and liabilities to FARES in exchange for an 80.0% ownership interest and Experian transferred substantially all of the assets and liabilities of its Real Estate Solutions division (“RES”) to FARES in exchange for a 20.0% ownership interest. RES is believed to be the nation’s foremost supplier of core real estate data, providing, among other things, property valuation information, title information, tax information and imaged title documents.

Adding to this business, in June 1998, the Company acquired Data Tree Corporation. Data Tree is a supplier of database management and document imaging systems to county recorders, other governmental agencies and the title industry.

In July 2000, the Company combined its Smart Title Solutions division with the Datatrace division of LandAmerica Financial Group, Inc (“LandAmerica”). The combined entity, Data Trace Information Services, is 80.0% owned by the Company’s subsidiary, FARES, and 20.0% owned by LandAmerica. The Company believes that Data Trace Information Services is the nation’s most advanced and comprehensive title information delivery system.

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In August 2000, the Company combined its RES division with the Intellitech real estate information business of Transamerica Corporation to form a new entity, First American Real Estate Solutions, L.P. This joint venture is 80.0% owned by the Company’s subsidiary, FARES, and 20.0% by Transamerica Corporation. The Company believes that this joint venture is the nation’s largest database of property characteristic information, supplying data and decision-support products to the real estate and mortgage finance industry.

In June 2002, the Company acquired Tri County Tax Research, Inc., a provider of tax searches for title companies in the Detroit, Michigan metropolitan area. In July of 2002, the Company acquired Current Status, Inc., a provider of property tax searches for customers in the New Jersey and Western Pennsylvania markets. These acquisitions strengthened the Company’s existing tax information business.

In September 2002, the Company added to its property valuation information business by acquiring SourceOne Services, Corp., a provider of real estate valuation services in the form of Broker Price Opinions (BPO). The Company believes that SourceOne Services Corp. is the largest provider of BPO services to the default market and the second largest provider of BPO services in the United States.

In February 2003, the Company acquired Infinity Information Solutions, Inc., a provider of lien release information. This strategic acquisition enhances the Company’s offering of products and services to mortgage lenders.

In June 2003, the Company added to its title information business with the acquisition of Abstracter’s Information Services, Inc., (AIS). AIS is one of the leading title abstracting companies in New York. This acquisition strengthens the Company’s title information services presence in the Northeast region.

Credit Information Segment

The Company’s mortgage credit reporting service provides credit information reports for mortgage lenders throughout the United States. These reports are derived from two or more credit bureau sources and are summarized and prepared in a standard form acceptable to mortgage loan originators and secondary mortgage purchasers. The Company’s credit reporting service has grown primarily through acquisitions. In 1994, the Company acquired all of the minority interests in its lower tier subsidiaries Metropolitan Credit Reporting Services, Inc., and Metropolitan Property Reporting Services, Inc. In 1994, the Company also acquired California Credit Data, Inc., and Prime Credit Reports, Inc., and in 1995, the Company acquired CREDCO, Inc. (now a division of First American Real Estate Solutions LLC). With the acquisition of First American CREDCO, Inc., the Company believes that it is now the largest mortgage credit reporting service in the United States, based on the number of credit reports issued. The credit information segment also provides specialized credit reports. This service provides credit information reports to non-mortgage lenders, such as auto lenders, as well as direct to consumers. The specialized reports are derived from two or more credit bureau sources and are summarized and prepared in an acceptable form. This service also provides subprime-consumer information and includes a database of credit records on consumers with flawed credit histories. This information is used to provide data to credit grantors such as furniture and appliance retailers, pay-day loan and check-advance stores, rent-to-own retailers and others.

Screening Information

The Company’s screening information segment is comprised entirely of First Advantage Corporation, a public company whose shares of Class A common stock trade on the Nasdaq National Market System under the ticker symbol FADV. As of December 31, 2003, the Company owned all of First Advantage’s outstanding Class B common stock, which constitutes approximately 76.7% of the economic interest and 97.4% of the voting interest of First Advantage.

First Advantage’s business is organized into three business segments: Enterprise Screening, Risk Mitigation and Consumer Direct. First Advantage’s Enterprise Screening segment offers employment screening services,

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such as criminal records and credit checks; occupational health services, such as drug testing and employee assistance programs; and resident screening services, such as eviction record, credit and criminal records checks. First Advantage’s Risk Management segment provides automated access to motor vehicle records from all 50 states and the District of Columbia and investigative services designed to detect and expose worker’s compensation, disability and liability insurance fraud. First Advantage, through its Consumer Direct segment, also provides location, verification and screening services directly to consumers through the Internet.

The Company’s screening information segment serves a wide variety of clients throughout the United States, including nearly a quarter of those businesses comprising the Fortune 1000, many major real estate investment trusts and property management companies, a number of the top providers of transportation services, insurance companies, governmental agencies, non-profit organizations and health care providers. Insurance carriers and agents purchase a substantial proportion of the segment’s risk mitigation products. Larger employers and transportation companies are major consumers of the segment’s employment screening and occupational health services. Multifamily housing property management companies and landlords of all sizes are represented in the resident screening business’ customer base.

Acquisitions

Commencing in the 1960s, the Company initiated a growth program with a view to becoming a nationwide provider of title insurance. This program included expansion into new geographic markets through internal growth and selective acquisitions. In 1986 the Company began expanding into other real estate business information services. In 1998 the Company expanded its diversification program to include business information companies outside of the real estate transfer and closing process. To date, the Company has made numerous strategic acquisitions designed to expand not only its direct title operations, but also the range of services it can provide to its customers.

Regulation

The title insurance business is heavily regulated by state insurance regulatory authorities. These authorities generally possess broad powers with respect to the licensing of title insurers, the types and amounts of investments that title insurers may make, insurance rates, forms of policies and the form and content of required annual statements, as well as the power to audit and examine title insurers. Under state laws, certain levels of capital and surplus must be maintained and certain amounts of securities must be segregated or deposited with appropriate state officials. Various state statutes require title insurers to defer a portion of all premiums in a reserve for the protection of policyholders and to segregate investments in a corresponding amount. Further, most states restrict the amount of dividends and distributions a title insurer may make to its shareholders.

In 1999, the Company entered into the property casualty insurance business through the acquisitions of Great Pacific Insurance Company (included in the acquisition of National Information Group) and Five Star Holdings, Inc. The property and casualty business is subject to regulation by government agencies in the states in which they transact business. The nature and extent of such regulation may vary from jurisdiction to jurisdiction, but typically involves prior approval of the acquisition of “control” of an insurance company, regulation of certain transactions entered into by an insurance company with any of its affiliates, the payment of dividends by an insurance company, approval of premium rates and policy forms for many lines of insurance, standards of solvency and minimum amounts of capital and surplus which must be maintained. In order to issue policies on a direct basis in a state, the property and casualty insurer must generally be licensed by such state. In certain circumstances, such as dealings initiated directly by citizens or placements through licensed surplus lines brokers, it may conduct business without being admitted and without being subject to rate and/or policy forms approval. The Company is currently licensed to write property and casualty insurance in 46 states and the District of Columbia.

The Company’s home warranty business also is subject to regulation by insurance authorities in the states in which it conducts such business. The Company’s trust company and industrial loan company are both subject to

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regulation by the Federal Deposit Insurance Corporation. In addition, as a federal savings bank, the Company’s trust company is regulated by the United States Department of the Treasury’s Office of Thrift Supervision, and the Company’s industrial loan company is regulated by the California Commissioner of Corporations.

Investment Policies

The Company invests primarily in cash equivalents, federal and municipal governmental securities, mortgage loans and investment grade debt and equity securities. The largely fixed income portfolio is classified in the Company’s financial statements as “available for sale.” In addition to the Company’s investment strategy, state laws impose certain restrictions upon the types and amounts of investments that may be made by the Company’s regulated subsidiaries.

Employees

The following table provides a summary of the total number of employees as of December 31, 2003:

Business	Number of employees
Title Insurance	18,421
Specialty Insurance	849
Trust and Other Services	111
Mortgage Information	5,017
Property Information	3,064
Credit Information	931
Screening Information	1,202
Corporate	207
Total	29,802

Risk Factors

You should carefully consider each of the following risk factors and the other information contained in this Annual Report on Form 10-K. The Company faces risks other than those listed here, including those that are unknown to the Company and others of which the Company may be aware but, at present, consider immaterial. Because of the following factors, as well as other variables affecting the Company’s operating results, past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods.

Certain recurring trends generally result in a decrease in the demand for the Company’s products

Demand for the Company’s products generally decreases as the number of real estate transactions in which the Company’s products are purchased decreases. The Company has found that the number of real estate transactions in which the Company’s products are purchased decreases in the following situations:

• when mortgage interest rates are high;

• when the mortgage fund supply is limited; and

• when the United States economy is weak.

The Company believes that this trend will recur.

Changes in government regulation could prohibit or limit the Company’s operations

The Company’s title insurance, property and casualty insurance, home warranty, thrift, trust and investment businesses are regulated by various federal, state and local governmental agencies. Many of the Company’s other

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businesses operate within statutory guidelines. Changes in the applicable regulatory environment or statutory guidelines could prohibit or restrict the Company’s existing or future operations. Such restrictions may restrict the Company’s ability to implement rate increases, acquire assets or businesses or otherwise have a negative impact on the Company’s ability to generate revenue and earnings.

The Company may be subject to increased regulation regarding the use of personal information

Certain data and services the Company provides are subject to regulation by various federal, state and local regulatory authorities. Compliance with existing federal, state and local laws and regulations has not had a material adverse effect on the Company’s results of operations or financial condition to date. Nonetheless, federal, state and local laws and regulations in the United States designed to protect the public from the misuse of personal information in the marketplace and adverse publicity or potential litigation concerning the commercial use of such information may increasingly affect the Company’s operations and could result in substantial regulatory compliance expense, litigation expense and a loss of revenue.

The Company may not be able to pursue its acquisition strategy.

The Company intends to continue to grow through acquisitions. The Company may not be able to identify suitable acquisition candidates or complete acquisitions on satisfactory terms. A number of the Company’s competitors also have adopted the strategy of expanding and diversifying through acquisitions. The Company will continue to experience competition in its effort to execute on its acquisition strategy. As a result, the Company may be unable to continue to make acquisitions or may be forced to pay more for the companies the Company is able to acquire.

The integration of companies the Company acquires may be difficult and may result in a failure to realize some of the anticipated potential benefits of acquisitions.

When companies are acquired, the Company may not be able to integrate or manage these businesses so as to produce returns that justify the investment. Any difficulty in successfully integrating or managing the operations of the businesses could have a material adverse effect on the Company’s business, financial condition, results of operations or liquidity, and could lead to a failure to realize any anticipated synergies. The Company’s management also will be required to dedicate substantial time and effort to the integration of its acquisitions. These efforts could divert management’s focus and resources from other strategic opportunities and operational matters.

The Company’s earnings may be reduced if acquisition projections are inaccurate

The Company’s earnings have improved since 1991 in large part because of the Company’s acquisition and integration of non-title insurance businesses. These businesses generally have higher margins than the title insurance businesses. For example, pre-tax margins for the title insurance and services segment were 11.1% in 2003, while pre-tax margins for the segments in the Company’s information technology group in the same year were 27.6%. The success or failure of acquisitions in this group has depended in large measure upon the accuracy of the Company’s projections. These projections are not always accurate. Inaccurate projections have historically led to lower than expected earnings.

As a holding company, the Company depend on distributions from the Company’s subsidiaries, and if distributions from the Company’s subsidiaries are materially impaired, the Company’s ability to declare and pay dividends may be adversely affected

First American is a holding company whose primary assets are the securities of its operating subsidiaries. The Company’s ability to pay dividends is dependent on the ability of the Company’s subsidiaries to pay dividends or repay funds to us. If the Company’s operating subsidiaries are not able to pay dividends or repay

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funds, the Company may not be able to declare and pay dividends to its shareholders. Moreover, pursuant to insurance and other regulations under which the Company’s insurance subsidiaries operate, the amount of dividends, loans and advances available is limited. Under such regulations, the maximum amount of dividends, loans and advances available to us from the Company’s insurance subsidiaries in 2004 is $313.4 million

Certain provisions of the Company’s charter and rights plan may make a takeover of our company difficult even if such takeover could be beneficial to some of the Company’s shareholders

The Company’s restated articles of incorporation authorize the issuance of “blank check” preferred stock with such designations, rights and preferences as may be determined from time to time by the Company’s board of directors. Accordingly, the Company’s board is empowered, without further shareholder action, to issue shares or series of preferred stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights, including the ability to receive dividends, of the Company’s common shareholders. The issuance of such preferred stock could be utilized, under certain circumstances, as a method of discouraging, delaying or preventing a change in control. In conjunction with the rights plan discussed below, the Company has authorized the issuance of the Company’s Series A Junior Participating Preferred Shares. Although the Company has no present intention of issuing any additional shares or series of preferred stock, the Company cannot guarantee that it will not make such an issuance in the future.

The Company has adopted a rights plan which could, alone or in combination with the Company’s restated articles of incorporation, discourage transactions involving actual or potential changes of control, including transactions that otherwise could involve payment of a premium over prevailing market prices to the Company’s shareholders for their common shares.

Available Information

The Company maintains a website, www.firstam.com, which includes financial and other information for investors. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available through the “Investors” page of our website as soon as reasonably practicable after the Company electronically files such material with, or furnishes it to, the Securities and Exchange Commission. The Company’s website and the information contained therein or connected thereto are not intended to be incorporated into this annual report on Form 10-K, or any other filing with the Securities and Exchange Commission unless the Company expressly incorporates such materials.

Item 2.     Properties.

In September 1999, the Company moved its executive offices to one of the newly constructed office buildings at MacArthur Place in Santa Ana, California. The Orange County branch and certain other operations of the Company’s title insurance segment moved into the two other buildings constructed on the site later in 1999. The three new buildings are in a campus environment and total approximately 210,000 square feet. In the first quarter of 2004, the Company began the expansion of its office campus. This expansion will add two 4-story office buildings totaling 225,000 square feet, and a two-story, free standing, 50,000 square foot technology center. The construction is estimated to be completed by the third quarter of 2005.

The Company continues to own the two adjacent buildings in Santa Ana, California, which previously housed its executive offices. That location, comprising approximately 105,000 square feet of floor space, continues as the home of the company’s trust and banking division and the Company’s property and casualty insurance division. The Company also owns an 18,000 square foot building located across the street from that complex. This building is currently used primarily for storage.

The Company’s title insurance subsidiary, First American, and its subsidiaries, own or lease buildings or office space in more than 900 locations throughout the United States and abroad, principally for their respective title operations.

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The Company’s mortgage information business, houses its national operations in a leased 231,000 square foot office building in Dallas, Texas. In 1999, the Company completed the construction of two office buildings in Poway, California. These two buildings, which primarily house the Company’s credit reporting business, total approximately 152,000 square feet and are located on a 17 acre parcel of land. In addition, the Company’s mortgage information, credit information and property information businesses lease office space in more than 75 locations throughout the United States, principally for their respective operations.

The Company’s home warranty subsidiary owns 1.7 acres of land in Van Nuys, California, which contains a 20,000-square-foot office building, a 7,000-square-foot warehouse and a parking lot.

The screening information business houses its executive offices in a leased 20,800 square foot building in St. Petersburg, Florida. In addition, this business owns or leases more than 30 offices throughout the United States, principally for its screening information operations.

Each of the office facilities occupied by the Company or its subsidiaries is in good condition and adequate for its intended use.

Item 3.     Legal Proceedings.

The Company is involved in numerous routine legal proceedings related to its operations. While the ultimate disposition of each proceeding is not determinable, the Company does not believe that any of such proceedings will have a material adverse effect on its financial condition or results of operations.

Item 4.     Submission of Matters to a Vote of Security Holders.

No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report.

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PART II

Item 5.     Market for Registrant’s Common Stock and Related Stockholder Matters.

Common Stock Market Prices and Dividends

The Company’s common stock trades on the New York Stock Exchange (ticker symbol FAF). The approximate number of record holders of common stock on March 9, 2004 was 3,584.

High and low stock prices and dividends for the last two years were as follows:

	2003				2002
Quarter Ended	High-low range		Cash dividends		High-low range		Cash dividends
March 31	$	24.73—$21.72	$	.10	$	21.80—$17.71	$	.08
June 30	$	27.85—$24.67	$	.10	$	23.10—$20.42	$	.08
September 30	$	27.25—$23.36	$	.15	$	22.20—$16.54	$	.08
December 31	$	30.64—$25.38	$	.15	$	22.50—$18.98	$	.10

While the Company expects to continue its policy of paying regular quarterly cash dividends, future dividends will be dependent on future earnings, financial condition and capital requirements. The payment of dividends is subject to the restrictions described in Note 2 to the consolidated financial statements included in “Item 8. Financial Statements and Supplementary Data” of Part II of this report.

Plan Category	Number of securities to be issued upon exercise of outstanding options (a)	Weighted-average exercise price of outstanding options (b)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
	(in thousands, except weighted-average exercise price)
Equity compensation plans approved by security holders (1)(3)	8,078	$	18.71	6,349
Equity compensation not approved by security holders (2)	268	$	19.79	—
	8,346	$	18.75	6,349

(1) Consists of The First American Corporation 1996 Stock Option Plan and The First American Corporation 1997 Directors’ Stock Plan. See Note 14 to the Company’s consolidated financial statements for additional information.

(2) Includes shares related to plans assumed by the Company in the purchase of Credit Management Solutions, Inc. and the business combination with National Information Group. See Note 14 to the Company’s consolidated financial statements for additional information.

(3) Includes 2,455,000 shares available to be issued under the Company’s stock purchase plan. See Note 13 to the Company’s consolidated financial statements for additional information.

Recent Sales of Unregistered Securities

In the last three years, the Company has not issued unregistered shares of its common stock.

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Item 6.     Selected Financial Data.

The selected consolidated financial data for the Company for the five-year period ended December 31, 2003, has been derived from the audited Consolidated Financial Statements. The selected consolidated financial data should be read in conjunction with the Consolidated Financial Statements and Notes thereto, “Item 1—Business—Acquisitions,” and “Item 7—Management’s Discussion and Analysis—Results of Operations.”

The First American Corporation and Subsidiary Companies

	Year Ended December 31
	2003			2002			2001			2000			1999
	(in thousands, except percentages, per share amounts and employee data)
Revenues	$	6,213,714		$	4,704,209		$	3,750,723		$	2,934,255		$	2,988,169
Income before cumulative effect of a change in accounting for tax service contracts (Note A)	$	451,022		$	234,367		$	167,268		$	82,223		$	88,643
Cumulative effect of a change in accounting for tax service contracts (Note A)		—			—			—			—		$	(55,640	)
Net income	$	451,022		$	234,367		$	167,268		$	82,223		$	33,003
Total assets	$	4,892,111		$	3,398,045		$	2,837,263		$	2,199,737		$	2,116,414
Notes and contracts payable	$	553,888		$	425,705		$	415,341		$	219,838		$	196,815
Mandatorily redeemable preferred securities	$	100,000		$	100,000		$	100,000		$	100,000		$	100,000
Stockholders’ equity	$	1,879,520		$	1,364,589		$	1,104,452		$	870,237		$	815,991
Return on average stockholders’ equity (Note B)		27.8	%		19.0	%		16.9	%		9.8	%		10.9	%
Cash dividends on common shares	$	34,008		$	24,570		$	18,210		$	15,256		$	15,840
Per share of common stock (Note C)—
Basic:
Income before cumulative effect of a change in accounting for tax service contracts	$	5.89		$	3.27		$	2.51		$	1.29		$	1.37
Cumulative effect of a change in accounting for tax service contracts		—			—			—			—			(.86	)
Net income	$	5.89		$	3.27		$	2.51		$	1.29		$	.51
Diluted:
Income before cumulative effect of a change in accounting for tax service contracts	$	5.22		$	2.92		$	2.27		$	1.24		$	1.34
Cumulative effect of a change in accounting for tax service contracts		—			—			—			—			(.84	)
Net income	$	5.22		$	2.92		$	2.27		$	1.24		$	.50
Stockholders’ equity	$	23.84		$	18.53		$	16.08		$	13.62		$	12.54
Cash dividends	$	.50		$	.34		$	.27		$	.24		$	.24
Number of common shares outstanding
Weighted average during the year
Basic		76,632			71,594			66,568			63,680			64,669
Diluted		87,775			82,567			75,834			66,050			66,351
End of year		78,826			73,636			68,694			63,887			65,068
Title orders opened (Note D)		2,511			2,184			1,930			1,241			1,334
Title orders closed (Note D)		2,021			1,696			1,405			975			1,120
Number of employees		29,802			24,886			22,597			20,346			20,065

Note A—Resulted from the adoption of Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements”, which became effective January 1, 1999, and applied to the Company’s tax service operations.

Note B—Return on average stockholders’ equity for 1999 excludes the cumulative effect of a change in accounting for tax service contracts from both net income and stockholders’ equity.

Note C—Per share information relating to net income is based on weighted-average number of shares outstanding for the years presented. Per share information relating to stockholders’ equity is based on shares outstanding at the end of each year.

Note D—Title order volumes are those processed by the direct title operations of the Company and do not include orders processed by agents.

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Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

Critical Accounting Policies.    The Company’s management considers the accounting policies described below to be critical in preparing the Company’s consolidated financial statements. These policies require management to make estimates and judgments that affect the reported amounts of certain assets, liabilities, revenues, expenses and related disclosures of contingencies. See Note 1 to the consolidated financial statements for a more detailed description of the Company’s accounting policies.

Revenue recognition.    Title premiums on policies issued directly by the Company are recognized on the effective date of the title policy, and for policies issued by independent agents, when notice of issuance is received from the agent. Revenues from home warranty contracts are recognized ratably over the 12-month duration of the contracts. Revenues from property and casualty insurance policies are recognized ratably over the 12-month duration of the policies. The Company’s tax service division, which is included in the mortgage information segment, defers its tax service fee and recognizes that fee as revenue ratably over the expected service period. The amortization rates applied to recognize the revenues assume a 10-year contract life and are adjusted to reflect prepayments. The Company reviews its tax service contract portfolio on a quarterly basis to determine if there have been changes in contract lives and/or changes in the number and/or timing of prepayments and adjusts the rates accordingly to reflect current trends. For all other products, revenues are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Provision for title losses.    The Company provides for estimated title insurance losses by a charge to expense when the related premium revenue is recognized. The amount charged to expense (the loss rate), as well as the adequacy of the ending reserves, is determined by the Company based on historical experience and other factors, including changes and trends in the type of title insurance policies issued, the real estate market and the interest rate environment. Management monitors the adequacy of the estimated loss reserves on a quarterly basis using a variety of techniques, including actuarial models, and adjusts the loss rate as necessary.

Purchase accounting and impairment testing for goodwill and other intangible assets.    Pursuant to Statement of Financial Standards No. 142, “Goodwill and Other Intangible Assets” (SFAS 142), the Company is required to perform an annual impairment test for goodwill and other intangible assets by reporting unit. This annual test, which the Company elected to perform every September 30, utilizes a variety of valuation techniques, all of which require management to make estimates and judgments, and includes discounted cash flow analysis, market approach valuations and the use of third-party valuation advisors. Certain of these valuation techniques are also utilized by the Company in accounting for business combinations, primarily in the determination of the fair value and estimated lives of acquired assets and liabilities. The Company’s reporting units, for purposes of applying the provisions of SFAS 142, are title insurance, home warranty, property and casualty insurance, trust and other services, mortgage origination products and services, mortgage servicing products and services, property information services, conventional credit information, sub-prime credit information, pre-employment and drug screening, tenant screening and motor vehicle reporting. In accordance with the provisions of SFAS 142, the Company completed the required annual impairment testing for goodwill and other intangible assets for the years ended December 31, 2003 and 2002, and determined that there was no impairment.

Income taxes.    The Company estimates its quarterly effective income tax rate based upon a variety of factors including, but not limited to, the expected revenues and resulting pretax income for the year, the composition and geographic mix of the pretax income and the ratio of permanent differences to pretax income. Any changes to the estimated rate are made prospectively in accordance with Accounting Principles Board Opinions No. 28, “Interim Financial Reporting.” Additionally, management makes estimates as to the amount of reserves, if any, that are necessary for known and potential tax exposures.

Depreciation and amortization lives for assets.    Management is required to estimate the useful lives of several asset classes, including capitalized data, internally developed software and other intangible assets. The

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estimation of useful lives requires a significant amount of judgment related to matters such as future changes in technology, legal issues related to allowable uses of data and other matters.

Overview—The majority of the revenues in the Company’s title insurance and mortgage information segments depend, in large part, upon the level of real estate activity and the cost and availability of mortgage funds. Revenues for these segments result primarily from resales and refinancings of residential real estate and, to a lesser extent, from commercial transactions and the construction and sale of new housing. Over one-half of the revenues in the Company’s property information and credit information segments also depend on real estate activity. The remaining portion of the property information and credit information revenues, as well as the revenues for the Company’s specialty insurance, trust and other services, and screening information segments, are isolated from the volatility of real estate transactions. Traditionally, the greatest volume of real estate activity, particularly residential resale, has occurred in the spring and summer months. However, changes in interest rates, as well as other economic factors, can cause fluctuations in the traditional pattern of real estate activity.

During the second half of 2000, mortgage interest rates began to decline, fueling an increase in refinance activity. This trend continued into the fourth quarter of 2000 and resulted in a high inventory of open orders going into the first quarter of 2001. This, coupled with record levels of refinance activity as a result of the continuation of low mortgage interest rates, as well as the high demand for residential resale and new home sales, resulted in an exceptionally strong 2001. Mortgage originations totaled $2.03 trillion in 2001, up from $1.02 trillion in 2000. The favorable trends present during 2001 continued into 2002. Refinance activity remained at high levels, with existing and new-home-sale activity surpassing 2001 levels. Mortgage originations reached $2.79 trillion in 2002, with refinance activity comprising 66.4% of the total. Mortgage interest rates remained low through the first three quarters of 2003, fueling new record-setting refinance activity, but began to rise during the fourth quarter of the year. Existing and new-home-sale activity also reached new record levels. Mortgage originations totaled $3.91 trillion in 2003, with refinance activity comprising 71.3% of the total. The increase in mortgage interest rates that began in the fourth quarter of 2003 resulted in a low inventory of open orders going into 2004. This, together with the expectation of a relatively stable to marginally increasing mortgage interest rate environment in 2004, will most likely result in a return to more traditional, seasonal real estate patterns in 2004, where the greatest volume of real estate activity will occur in the spring and summer months.

Operating revenues—A summary by segment of the Company’s operating revenues is as follows:

	2003		%	2002		%	2001		%
	(in thousands, except percentages)
Financial Services:
Title Insurance:
Direct operations	$	2,264,925	37	$	1,803,775	39	$	1,463,303	40
Agency operations		2,138,059	35		1,589,817	34		1,185,691	32
		4,402,984	72		3,393,592	73		2,648,994	72
Specialty Insurance		207,287	3		143,307	3		112,054	3
Trust and Other Services		39,546	1		41,737	1		39,882	1
		4,649,817	76		3,578,636	77		2,800,930	76
Information Technology:
Mortgage Information		642,684	11		479,288	10		407,006	11
Property Information		366,271	6		259,315	6		210,975	6
Credit Information		246,987	4		215,337	5		194,981	5
Screening Information		166,430	3		100,702	2		49,094	2
		1,422,372	24		1,054,642	23		862,056	24
	$	6,072,189	100	$	4,633,278	100	$	3,662,986	100

20

Financial Services.    Operating revenues from direct title operations increased 25.6% in 2003 over 2002 and 23.3% in 2002 over 2001. These increases reflect the growth in the number of title orders closed by the Company’s direct operations, as well as increases in the average revenues per order closed. The Company’s direct title operations closed 2,021,000, 1,696,100 and 1,404,600 title orders during 2003, 2002 and 2001, respectively, increases of 19.2% in 2003 over 2002 and 20.8% in 2002 over 2001. The average revenues per order closed were $1,121, $1,063 and $1,042 for 2003, 2002 and 2001, respectively, increases of 5.5% in 2003 over 2002 and 2.0% in 2002 over 2001. The increases noted in closed orders were primarily attributable to the relative changes in real estate activity year-over-year, as mentioned above. The increases in average revenues per order closed primarily reflect increasing real estate values. Operating revenues from agency title operations increased 34.5% in 2003 over 2002 and 34.1% in 2002 over 2001. These increases were primarily attributable to the same factors affecting direct title operations compounded by the inherent delay in the reporting of transactions by agents.

Specialty insurance operating revenues increased 44.7% in 2003 over 2002 and 27.9% in 2002 over 2001. These increases were primarily attributable to geographic expansion at the Company’s home warranty division and market share growth at the property and casualty insurance division.

Information Technology.    Mortgage information operating revenues increased 34.1% in 2003 over 2002 and 17.8% in 2002 over 2001. These increases were primarily attributable to the same factors affecting title insurance mentioned above, as well as acquisition activity. Operating revenues of $48.0 million and $14.9 million were contributed by new acquisitions in 2003 and 2002, respectively. In addition, during 2003 and 2002, the Company’s tax service division accelerated its deferred revenue amortization rates to reflect the increase in refinance activity. This change resulted in increased operating revenues of $9.4 million in 2003 and $6.5 million in 2002.

Property information operating revenues increased 41.3% in 2003 over 2002 and 22.9% in 2002 over 2001. These increases were primarily due to the same favorable real estate conditions that benefited the title insurance and mortgage information segments, as well as market share growth and acquisition activity. Operating revenues of $52.4 million and $15.5 million were contributed by new acquisitions in 2003 and 2002, respectively.

Credit information operating revenues increased 14.7% in 2003 over 2002 and 10.4% in 2002 over 2001. The increase in 2003 over 2002 was primarily due to the growth in demand for credit information in the housing sector, offset in part by a $6.2 million reduction in revenues as a result of the sale of the Company’s subsidiary, FASTRAC Systems, Inc., in August 2002. The increase in 2002 over 2001 was also primarily due to the growth in demand for credit information in the housing sector, and operating revenues of $9.2 million contributed by new acquisitions.

Screening information operating revenues increased 65.3% in 2003 over 2002 and 105.1% in 2002 over 2001. These increases were primarily attributable to $56.0 million and $49.8 million of operating revenues contributed by new acquisitions for the respective periods.

Investment and other income—Investment and other income totaled $105.8 million, $89.8 million and $81.1 million in 2003, 2002 and 2001, respectively, an increase of $16.0 million, or 17.8% in 2003 over 2002, and $8.7 million, or 10.8% in 2002 over 2001. The increase in 2003 over 2002 was primarily due to a $16.5 million increase in equity in earnings of unconsolidated affiliates. The increase in 2002 over 2001 was also primarily due to an $18.3 million increase in equity in earnings of unconsolidated affiliates, offset, in part, by a $9.6 million decrease in net interest and other income, primarily as a result of lower yields on cash equivalents and the Company’s investment portfolio due to the lower interest rate environment. See Note 10 to the consolidated financial statements for additional information.

Net realized investment gains/losses—Net realized investment gains totaled $35.7 million in 2003, compared with net realized investment losses of $18.9 million in 2002 and gains of $6.6 million in 2001. The current year total

21

included the recognition of a previously deferred gain totaling $14.2 million relating to the sale of the Company’s Contour Software, Inc. subsidiary in the first quarter of 2001. This gain was initially deferred due to the uncertainty relating to the realizability of the consideration received. In the fourth quarter of 2003, management concluded that, based upon the current financial condition and expected future performance of the acquirer, the realization of the consideration was assured and, therefore, recognition of the gain appropriate. Also included in the current year total was a $13.1 million realized gain associated with the merger of the Company’s Credit Online business with DealerTrack Holdings, Inc. The prior year investment losses included a $13.6 million loss resulting from the write-down of WorldCom bonds; a $2.6 million loss associated with the sale of the Company’s subsidiary, FASTRAC Systems, Inc.; and $2.3 million of losses due to the restructuring of the 1031 tax-deferred exchange investment portfolio, which was managed by the Company’s Capital Management division.

Salaries and other personnel costs—A summary by segment of the Company’s salaries and other personnel costs is as follows:

	2003		%	2002		%	2001		%
	(in thousands, except percentages)
Financial Services:
Title insurance	$	1,246,198	69	$	1,076,727	71	$	893,615	71
Specialty Insurance		38,506	2		33,424	2		29,021	2
Trust and Other Services		14,922	1		14,260	1		12,234	1
		1,299,626	72		1,124,411	74		934,870	74
Information Technology:
Mortgage Information		210,033	12		156,999	10		129,383	10
Property Information		127,832	7		102,614	7		95,910	8
Credit Information		61,226	3		63,795	4		57,034	4
Screening Information		54,333	3		31,985	2		20,795	2
		453,424	25		355,393	23		303,122	24
Corporate		46,503	3		43,391	3		25,459	2
	$	1,799,553	100	$	1,523,195	100	$	1,263,451	100

Financial Services.    The Company’s title insurance segment comprised 95.9% of total salaries and other personnel costs for the Financial Services group. The title insurance segment (primarily direct operations) is labor intensive; accordingly, a major variable expense component is salaries and other personnel costs. This expense component is affected by two competing factors: the need to monitor personnel changes to match corresponding or anticipated new orders, and the need to provide quality service. In addition, this segment’s growth in operations that specialize in builder and lender title business has created ongoing fixed costs required to service accounts.

Title insurance personnel expenses increased 15.7% in 2003 over 2002 and 20.5% in 2002 over 2001. The increase in 2003 over 2002 was primarily attributable to $29.3 million of personnel costs associated with new acquisitions, $12.0 million of increased employee benefit costs, incremental labor costs incurred to service the increase in business volume and increased commissions associated with the increase in closed orders. The increase in 2002 over 2001 was primarily due to $36.1 million of increased employee benefit costs, $28.2 million of personnel costs associated with new acquisitions, $26.5 million in expenses related to the implementation of the Company’s FAST title production system, incremental labor costs incurred to service the increase in business volume and increased commissions associated with the increase in closed orders. The increase in employee benefit costs was primarily the result of the Company’s discretionary match related to the 401(k) plan, which is profit driven and increases as profits escalate. This match increased $5.8 million in 2003 over 2002 and $16.9 million in 2002 over 2001. Also contributing to the overall increase in employee benefit costs were increases in

22

health care costs of $6.2 million in 2003 over 2002 and $11.5 million in 2002 over 2001. The Company’s direct title operations opened 2,511,000, 2,184,200 and 1,930,300 orders in 2003, 2002 and 2001, respectively, representing an increase of 15.0% in 2003 over 2002 and 13.2% in 2002 over 2001. From an efficiency standpoint, title insurance personnel costs as a percentage of title insurance operating revenues were 28.3% in 2003, 31.7% in 2002 and 33.7% in 2001.

Information Technology.    Personnel expenses in total for the Information Technology group increased 27.6% in 2003 over 2002 and 17.2% in 2002 over 2001. These increases were primarily due to personnel expenses associated with new acquisitions, costs incurred to service the increase in business volume and increased employee benefit costs. Personnel costs associated with new acquisitions totaled $51.1 million in 2003 and $19.1 million in 2002. Employee benefit costs increased $9.8 million in 2003 over 2002 and $12.6 million in 2002 over 2001. From an efficiency standpoint, personnel costs for the Information Technology group as a percentage of operating revenues were 31.9% in 2003, 33.7% in 2002 and 35.2% in 2001.

Corporate.    Corporate personnel expenses increased $3.1 million in 2003 over 2002 and $17.9 million in 2002 over 2001. The increase in 2002 over 2001 was primarily attributable to an increase of $13.3 million in employee benefit costs, increased technology personnel costs and higher general costs associated with the support effort needed to service the Company’s expanded national and international operations.

Premiums retained by agents—A summary of agent retention and agent revenues is as follows:

	2003			2002			2001
	(in thousands, except percentages)
Agent retention	$	1,729,104		$	1,292,297		$	960,215
Agent revenues	$	2,138,059		$	1,589,817		$	1,185,691
% retained by agents		80.9	%		81.3	%		81.0	%

The premium split between underwriter and agents is in accordance with their respective agency contracts and can vary from region to region due to divergencies in real estate closing practices, as well as rating structures. As a result, the percentage of title premiums retained by agents varies due to the geographical mix of revenues from agency operations.

Other operating expenses—A summary by segment of the Company’s other operating expenses is as follows:

	2003		%	2002		%	2001		%
	(in thousands, except percentages)
Financial Services:
Title Insurance	$	715,725	54	$	584,604	56	$	474,127	55
Specialty Insurance		23,316	2		11,596	1		14,270	2
Trust and Other Services		13,219	1		12,658	1		13,873	2
		752,260	57		608,858	58		502,270	59
Information Technology:
Mortgage Information		177,234	14		159,211	15		140,199	16
Property Information		131,896	10		86,039	8		73,809	9
Credit Information		129,367	10		107,781	10		101,323	12
Screening Information		97,034	7		61,037	6		26,499	3
		535,531	41		414,068	39		341,830	40
Corporate		32,084	2		26,199	3		9,504	1
	$	1,319,875	100	$	1,049,125	100	$	853,604	100

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Financial Services.    The Company’s title insurance segment comprised 95.1% of total other operating expenses for the Financial Services group. Title insurance other operating expenses (principally direct operations) increased 22.4% in 2003 over 2002 and 23.3% in 2002 over 2001. These increases were primarily due to incremental costs (i.e., messenger costs, reproduction costs, title plant maintenance costs, etc.) associated with servicing the increases in total order volume and costs associated with new acquisitions. Other operating expenses associated with new acquisitions were $19.6 million in 2003 and $9.6 million in 2002. Title insurance other operating expenses as a percentage of title insurance operating revenues were 16.3% in 2003, 17.2% in 2002 and 17.9% in 2001.

Information Technology.    Other operating expenses for the Information Technology group increased 29.3% in 2003 over 2002 and 21.1% in 2002 over 2001. These increases were primarily due to costs associated with servicing the increase in business volume and costs associated with new acquisitions. Other operating expenses associated with new acquisitions were $66.2 million in 2003 and $57.0 million in 2002. Information Technology other operating expenses as a percentage of operating revenues were 37.7% in 2003, 39.3% in 2002 and 39.7% in 2001.

Corporate.    Corporate other operating expenses increased $5.9 million in 2003 over 2002 and $16.7 million in 2002 over 2001. The increase in 2002 over 2001 was primarily due to $15.0 million of technology expenses, primarily consulting and outsourcing costs, required to expand the Company’s e-commerce capabilities, and higher general costs associated with the support effort needed to service the Company’s expanded national and international operations.

Provision for title losses and other claims—A summary by segment of the Company’s provision for title losses and other claims is as follows:

	2003		%	2002		%	2001		%
	(in thousands, except percentages)
Title Insurance	$	179,681	55	$	135,622	60	$	113,812	63
Specialty Insurance:
Home Warranty		56,769	18		50,881	23		47,661	26
Property and Casualty Insurance		62,777	19		26,168	12		10,838	6
		119,546	37		77,049	35		58,499	32
All other segments		25,177	8		11,918	5		8,335	5
	$	324,404	100	$	224,589	100	$	180,646	100

The provision for title insurance losses, expressed as a percentage of title insurance operating revenues (excluding the one-time 2001 adjustment mentioned below), was 4.1% in 2003, 4.0% in 2002 and 4.0% in 2001. During the third quarter of 2001, the Company recorded a $7.9 million adjustment to a purchase accounting estimate for loss reserves at one of its title insurance subsidiaries, which was purchased in 1998. This adjustment strengthened loss reserves to reflect subsequent adverse development.

The provision for specialty insurance losses reflects home warranty claims and property and casualty insurance claims. The provision for home warranty claims, expressed as a percentage of home warranty operating revenues, was 48.9% in 2003, 49.8% in 2002 and 53.1% in 2001. The rate decreases were primarily due to a decrease in the average cost per claim, which was primarily due to the elimination of higher-cost contractors that were servicing claims in new geographic areas.

The provision for property and casualty insurance claims, expressed as a percentage of property and casualty insurance operating revenues, was 63.6% in 2003, 63.8% in 2002 and 52.0% in 2001. The rate for 2003 excludes $5.0 million of catastrophe losses related to the Southern California wildfires, which represents the

24

Company’s deductible on its reinsurance treaty. The increase in 2002 over 2001 was primarily due to the shift in the lines of property and casualty insurance written from lender-placed insurance, which typically carries lower loss ratios (but higher expense ratios), to preferred homeowner’s insurance, which generally carries higher loss ratios (but lower expense ratios). The Company exited the lender-placed insurance business in 2001.

Depreciation and amortization—Depreciation and amortization increased 18.2% in 2003 over 2002 and decreased 10.6% in 2002 from 2001. The increase in 2003 over 2002 was primarily due to an increase in the amortization of intangibles as a result of acquisition activity and an increase in amortization of capitalized data and software. The decrease in 2002 was primarily due to the elimination of goodwill amortization as a result of implementing SFAS No. 142. See Note 5 to the consolidated financial statements. Depreciation and amortization, as well as capital expenditures, are summarized in Note 20 to the consolidated financial statements.

Premium taxes—A summary by pertinent segment of the Company’s premium taxes is as follows:

	2003		%	2002		%	2001		%
	(in thousands, except percentages)
Title Insurance	$	46,211	90	$	31,045	90	$	22,762	92
Specialty Insurance		5,324	10		3,613	10		2,078	8
	$	51,535	100	$	34,658	100	$	24,840	100

Insurers are generally not subject to state income or franchise taxes. However, in lieu thereof, a “premium” tax is imposed on certain operating revenues, as defined by statute. Tax rates and bases vary from state to state; accordingly, the total premium tax burden is dependent upon the geographical mix of operating revenues. The Company’s underwritten title company (noninsurance) subsidiaries are subject to state income tax and do not pay premium tax. Accordingly, the Company’s total tax burden at the state level for the title insurance segment is composed of a combination of premium taxes and state income taxes. Premium taxes as a percentage of title insurance operating revenues remained relatively constant at approximately 1.0%.

Interest—Interest expense increased 7.4% in 2003 over 2002 and 11.7% in 2002 over 2001. These increases were primarily due to an increase in acquisition-related debt, and for 2002, the issuance of the Company’s $210.0 million senior convertible debentures in April of 2001.

Income before income taxes and minority interests—A summary by segment is as follows:

	2003			%	2002			%	2001			%
	(in thousands, except percentages)
Financial Services:
Title Insurance	$	494,946		52	$	271,720		48	$	173,654		44
Specialty Insurance		30,125		3		24,465		4		11,929		3
Trust and Other Services		9,683		1		13,548		2		12,269		3
		534,754		56		309,733		54		197,852		50
Information Technology:
Mortgage Information		238,508		25		146,849		26		129,751		33
Property Information		105,339		11		71,459		12		35,321		9
Credit Information		64,291		7		39,266		7		30,062		8
Screening Information		4,505		1		2,459		1		(286	)	—
		412,643		44		260,033		46		194,848		50
		947,397		100		569,766		100		392,700		100
Corporate		(108,675	)			(119,859	)			(63,160	)
	$	838,722			$	449,907			$	329,540

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The Company’s title insurance profit margins vary according to a number of factors, including the volume, composition (residential or commercial) and type (resale, refinancing or new construction) of real estate activity. Commercial transactions tend to generate higher revenues and greater profit margins than residential transactions. Profit margins from refinancing activities are lower than those from resale activities because in many states there are premium discounts on, and cancellation rates are higher for, refinancing transactions. Cancellations of title orders adversely affect profits because costs are incurred in opening and processing such orders, but revenues are not generated. Also, the Company’s direct title insurance business has significant fixed costs in addition to its variable costs. Accordingly, profit margins from the Company’s direct title insurance business improve as the volume of title orders closed increases. Title insurance profit margins are also affected by the percentage of operating revenues generated by agency operations. Profit margins from direct operations are generally higher than from agency operations due primarily to the large portion of the premium that is retained by the agent.

Most of the businesses that are included in the Information Technology group are database intensive, with a relatively high proportion of fixed costs. As such, profit margins generally improve as revenues increase. Revenues for the mortgage information segment, like title insurance, are primarily dependent on the level of real estate activity and the cost and availability of mortgage funds. Revenues from the property information segment are, in part, dependent on real estate activity, but are less cyclical than title insurance and mortgage information revenues as a result of a significant subscription-based revenue stream. Revenues for the credit information segment are, in part, impacted by real estate activity, but also by the consumer and automobile sectors.

In general, the title insurance business is a lower-margin business when compared with the Company’s other segments. The lower margins reflect the high fixed cost of producing title evidence, whereas the corresponding revenues are subject to regulatory and competitive pricing constraints.

Corporate expenses include investment gains and losses, personnel and other operating expenses associated with the Company’s corporate facilities, certain technology initiatives and unallocated interest expense.

Income taxes—The Company’s effective income tax rate, which includes a provision for state income and franchise taxes for noninsurance subsidiaries, was 34.8%, 33.3% and 35.7% for 2003, 2002 and 2001, respectively. The differences in the effective tax rate were primarily due to changes in the ratio of permanent differences to income before income taxes and minority interests and changes in state income and franchise taxes resulting from fluctuations in the Company’s noninsurance subsidiaries’ contribution to pretax profits. Information regarding items included in the reconciliation of the effective rate with the federal statutory rate is contained in Note 11 to the consolidated financial statements.

Minority interests—Minority interests in net income of consolidated subsidiaries increased $30.1 million in 2003 over 2002 and $20.9 million in 2002 over 2001. These increases were primarily due to the relative increases in the operating results of the Company’s joint venture with Experian.

Net income—Net income and per share information are summarized as follows (see Note 12 to the consolidated financial statements):

	2003		2002		2001
	(in thousands, except per share amounts)
Net income	$	451,022	$	234,367	$	167,268
Per share of common stock:
Net income:
Basic	$	5.89	$	3.27	$	2.51
Diluted	$	5.22	$	2.92	$	2.27
Weighted-average shares:
Basic		76,632		71,594		66,568
Diluted		87,775		82,567		75,834

26

Liquidity and Capital Resources

Cash provided by operating activities amounted to $830.1 million, $540.6 million and $388.2 million for 2003, 2002 and 2001, respectively, after net claim payments of $269.5 million, $193.1 million and $153.4 million, respectively. The principal nonoperating uses of cash and cash equivalents for the three-year period ended December 31, 2003, were for the $375 million acquisition of Transamerica’s flood determination and tax reporting businesses, other company acquisitions, capital expenditures, additions to the investment portfolio, dividends, distributions to minority shareholders and the repayment of debt. The most significant nonoperating sources of cash and cash equivalents were proceeds from the issuance of the Company’s $210.0 million senior convertible debentures in 2001 (see Note 8 to the consolidated financial statements), proceeds from the issuance of other debt and proceeds from the sales and maturities of certain investments. The net effect of all activities on total cash and cash equivalents was an increase of $212.7 million for 2003, $255.6 million for 2002 and $344.3 million for 2001.

Notes and contracts payable, as a percentage of total capitalization, was 23.0% as of December 31, 2003, as compared with 25.6% as of the prior year end. This decrease was primarily attributable to the increase in the capital base primarily due to net income for the year. Notes and contracts payable are more fully described in Note 8 to the consolidated financial statements. In May 2003, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.” This statement became effective for the current year and establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The implementation of this statement required the Company to reclassify its “Mandatorily redeemable preferred securities of the Company’s subsidiary trust whose sole assets are the Company’s $100.0 million 8.5% deferrable interest subordinated notes due 2012” as debt.

In the first quarter of 2004, the Company began the expansion of its corporate office campus. This expansion will add two 4-story office buildings totaling 225,000 square feet, and a single-story, free-standing, 50,000 square foot technology center. The construction is estimated to be completed by the third quarter of 2005 with an estimated total cost of $69.0 million. The Company anticipates funding the corporate office expansion with internally generated funds.

On October 1, 2003, the Company completed the previously announced acquisition of Transamerica Finance Corporation’s real estate tax service and flood hazard certification business for a net purchase price of $375.0 million. The acquisition was made through the Company’s 80.0% owned joint venture with Experian. There was no debt assumed in the transaction and the purchase price was funded with $125.0 million of existing cash at the joint venture, a $200.0 million contribution from the Company and a $50.0 million contribution from Experian.

On October 12, 2001, the Company entered into a credit agreement that provided for a $200.0 million line of credit. This agreement supercedes the Company’s prior credit agreements and expires in October 2006. Under the terms of the credit agreement, the Company is required to maintain minimum levels of capital and earnings and meet predetermined debt-to-capitalization ratios. The Company’s line of credit was unused at December 31, 2003. The Company’s publicly traded subsidiary, First Advantage Corporation also has a bank credit agreement that provides for a $15.0 million collateralized line of credit. Under the terms of that credit agreement, First Advantage Corporation is required to satisfy certain financial requirements. The line of credit remains in effect until July 2006 and had a balance due of $9.0 million at December 31, 2003.

Off-balance sheet arrangements and contractual obligations.    The Company administers escrow and trust deposits as a service to its customers. Escrow deposits totaled $4.5 billion and $5.6 billion at December 31, 2003 and 2002, respectively, of which $260.2 million and $176.6 million were held at certain of the Company’s subsidiaries. The remaining escrow deposits were held at third-party financial institutions. Trust deposits totaled $2.3 billion and $1.9 billion at December 31, 2003 and 2002, respectively, and were held at the Company’s trust subsidiary. Escrow and trust deposits are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company remains contingently liable for the disposition of these deposits.

27

In addition, The Company facilitates tax-deferred property exchanges for customers pursuant to Section 1031 of the Internal Revenue Code. As a facilitator and intermediary, the Company holds the proceeds from sales transactions until a qualified acquisition occurs. Like-kind exchange deposits totaled $1.1 billion and $978.0 million at December 31, 2003 and 2002, respectively. The Company also facilitates tax deferred reverse exchanges pursuant to Revenue Procedure 2000-37. These exchanges require the Company, using the customer’s funds, to acquire the qualifying property on behalf of the customer and take temporary title to the customer’s property until a qualifying acquisition occurs. Reverse exchange property totaled $229.4 million and $154.6 million at December 31, 2003 and 2002, respectively. Due to the structure utilized to facilitate these transactions, like-kind exchanges and reverse exchanges are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company remains contingently liable for the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate.

A summary, by due date, of the Company’s total contractual obligations at December 31, 2003, is as follows:

	Notes and contracts payable		Operating leases		Mandatorily reedemable preferred securities		Total
	(in thousands)
2004	$	55,049	$	167,962		—	$	223,011
2005		49,719		129,652		—		179,371
2006		46,931		86,323		—		133,254
2007		18,326		52,484		—		70,810
2008		223,949		29,628		—		253,577
Later Years		159,914		33,840	$	100,000		293,754
	$	553,888	$	499,889	$	100,000	$	1,153,777

Pursuant to various insurance and other regulations, the maximum amount of dividends, loans and advances available to the Company in 2004 from its insurance subsidiaries is $313.4 million. Such restrictions have not had, nor are they expected to have, an impact on the Company’s ability to meet its cash obligations. See Note 2 to the consolidated financial statements.

Due to the Company’s significant liquid-asset position and its consistent ability to generate cash flows from operations, management believes that its resources are sufficient to satisfy its anticipated operational cash requirements. The Company’s financial position will enable management to react to future opportunities for acquisitions or other investments in support of the Company’s continued growth and expansion.

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Item 7A.    Quantitative and Qualitative Disclosures about Market Risk

The Company’s primary exposure to market risk relates to interest rate risk associated with certain other financial instruments. Although the Company monitors its risk associated with fluctuations in interest rates, it does not currently use derivative financial instruments to hedge these risks. The table below provides information about certain assets and liabilities that are sensitive to changes in interest rates and presents cash flows and the related weighted average interest rates by expected maturity dates. The Company is also subject to equity price risk as related to its equity securities. At December 31, 2003, the Company had equity securities with a book value of $49.6 million and fair value of $45.8 million. Although the Company has operations in certain foreign countries, these operations, in the aggregate, are not material to the Company’s financial condition or results of operations.

	2004			2005		2006		2007		2008		Thereafter			Total			Fair Value
	(in thousands except percentages)
Assets
Deposits with Savings and Loans
Book Value	$	57,945													$	57,945		$	57,945
Ave. Interest Rate		2.12	%																100.0	%
Debt Securities
Book Value	$	24,183		22,129		40,161		32,097		30,005			189,155		$	337,730		$	350,475
Ave. Interest Rate		4.49	%	5.57	%	4.93	%	4.55	%	4.57	%		5.06	%					103.8	%
Loans Receivable
Book Value	$	385		5		996		46		1,271			102,525		$	105,228		$	105,304
Ave. Interest Rate		8.72	%	0.00	%	8.66	%	7.83	%	9.32	%		7.01	%					100.1	%
Liabilities
Variable Rate Demand Deposits
Book Value	$	19,784													$	19,784		$	19,784
Ave. Interest Rate		1.75	%																100.0	%
Fixed Rate Demand Deposits
Book Value	$	35,473		10,121		6,271		2,613		2,318					$	56,796		$	57,121
Ave. Interest Rate		2.95	%	3.10	%	3.37	%	4.95	%	3.77	%								100.6	%
Notes Payable
Book Value	$	55,049		49,719		46,931		18,326		223,949			159,914		$	553,888		$	564,505
Ave. Interest Rate		7.91	%	7.62	%	8.19	%	8.79	%	4.52	%		6.10	%					101.9	%
Mandatorily Redeemable Preferred Securities
Book Value												$	100,000		$	100,000		$	100,000
Ave. Interest Rate													8.50	%		8.50	%		100.0	%

Item 8.    Financial Statements and Supplementary Data

Separate financial statements for subsidiaries not consolidated and 50% or less owned persons accounted for by the equity method have been omitted because, if considered in the aggregate, they would not constitute a significant subsidiary.

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INDEX

			Page No.
Report of Independent Accountants			31
Financial Statements:
	Consolidated Balance Sheets		32
	Consolidated Statements of Income and Comprehensive Income		33
	Consolidated Statements of Stockholders’ Equity		34
	Consolidated Statements of Cash Flows		35
	Notes to Consolidated Financial Statements		36
Unaudited Quarterly Financial Data			60
Financial Statement Schedules:
	I.	Summary of Investments—Other than Investments in Related Parties	61
	III.	Supplementary Insurance Information	62
	IV.	Reinsurance	64
	V.	Valuation and Qualifying Accounts	65

Financial statement schedules not listed are either omitted because they are not applicable or the required information is shown in the consolidated financial statements or in the notes thereto.

30

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Stockholders of

The First American Corporation:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of The First American Corporation and its subsidiaries at December 31, 2003 and 2002, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2003 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules listed in the accompanying index present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company’s management; our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 5 to the financial statements, in 2002, the Company changed its method of accounting for goodwill and other intangible assets as required by Statement of Financial Accounting Standards No. 142 “Goodwill and Other Intangible Assets.”

As discussed in Note 9 to the financial statements, in 2003, the Company changed the classification of its mandatorily redeemable preferred securities as required by Statement of Financial Accounting Standards No. 150 “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.”

PricewaterhouseCoopers LLP

San Francisco, California

March 11, 2004

31

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except percentage and share data)

	December 31
	2003			2002
ASSETS
Cash and cash equivalents	$	1,113,530		$	900,863
Accounts and accrued income receivable, less allowances ($55,112 and $50,782)		347,035			299,040
Investments:
Deposits with savings and loan associations and banks		57,945			38,328
Debt securities		350,475			309,864
Equity securities		45,758			36,931
Other long-term investments		233,794			142,392
		687,972			527,515
Loans receivable		105,228			108,162
Property and equipment, at cost:
Land		43,327			43,185
Buildings		187,167			183,045
Furniture and equipment		286,337			270,004
Capitalized software		364,658			284,537
Less—accumulated depreciation		(403,473	)		(347,695	)
		478,016			433,076
Title plants and other indexes		426,086			375,401
Deferred income taxes		141,622			20,951
Goodwill, net (Note 5)		1,253,080			563,991
Other assets		339,542			169,046
	$	4,892,111		$	3,398,045
LIABILITIES AND STOCKHOLDERS’ EQUITY
Demand deposits	$	76,580		$	84,473
Accounts payable and accrued liabilities:
Accounts payable		72,315			51,701
Salaries and other personnel costs		227,193			165,454
Pension costs and other retirement plans		218,249			170,327
Other		301,258			151,587
		819,015			539,069
Deferred revenue		719,503			358,747
Reserve for known and incurred but not reported claims		435,852			360,305
Income taxes payable		4,017			1,518
Notes and contracts payable		553,888			425,705
Mandatorily redeemable preferred securities of the Company’s subsidiary trust whose sole assets are the Company’s $100,000,000 8.5% Deferrable interest subordinated notes Due 2012 (Note 9)		100,000			100,000
Minority interests in consolidated subsidiaries		303,736			163,639
Commitments and contingencies (Note 15)
Stockholders’ equity:
Preferred stock, $1 par value
Authorized—500,000 shares; Outstanding—None
Common stock, $1 par value
Authorized—180,000,000 shares Outstanding—78,826,000 and 73,636,000 shares		78,826			73,636
Additional paid-in capital		463,610			359,644
Retained earnings		1,399,940			987,768
Accumulated other comprehensive loss		(62,856	)		(56,459	)
Total stockholders’ equity		1,879,520			1,364,589
	$	4,892,111		$	3,398,045

32

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(in thousands, except per share amounts)

	Year Ended December 31
	2003			2002			2001
Revenues:
Operating revenues	$	6,072,189		$	4,633,278		$	3,662,986
Investment and other income		105,808			89,823			81,093
Net realized investment gains (losses)		35,717			(18,892	)		6,644
		6,213,714			4,704,209			3,750,723
Expenses:
Salaries and other personnel costs		1,799,553			1,523,195			1,263,451
Premiums retained by agents		1,729,104			1,292,297			960,215
Other operating expenses		1,319,875			1,049,125			853,604
Provision for title losses and other claims		324,404			224,589			180,646
Depreciation and amortization		114,424			96,829			108,348
Premium taxes		51,535			34,658			24,840
Interest		36,097			33,609			30,079
		5,374,992			4,254,302			3,421,183
Income before income taxes and minority interests		838,722			449,907			329,540
Income taxes		292,000			149,900			117,500
Income before minority interests		546,722			300,007			212,040
Minority interests		95,700			65,640			44,772
Net income		451,022			234,367			167,268
Other comprehensive income (loss), net of tax: (Note 17)
Unrealized gain (loss) on securities		3,831			(1,199	)		(3,852	)
Minimum pension liability adjustment		(10,228	)		(41,644	)		(14,733	)
		(6,397	)		(42,843	)		(18,585	)
Comprehensive income	$	444,625		$	191,524		$	148,683
Per share amounts: (Note 12)
Basic	$	5.89		$	3.27		$	2.51
Diluted	$	5.22		$	2.92		$	2.27
Weighted-average common shares outstanding: (Note 12)
Basic		76,632			71,594			66,568
Diluted		87,775			82,567			75,834

See Notes to Consolidated Financial Statements

33

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

	Shares		Common Stock			Additional paid-in capital			Retained earnings			Accumulated other comprehensive income (loss)			Total
Balance at December 31, 2000	63,887		$	63,887		$	172,468		$	628,913		$	4,969		$	870,237
Net income for 2001										167,268						167,268
Cash dividends on common shares										(18,210	)					(18,210	)
Shares issued in connection with company acquisitions	3,510			3,510			79,304									82,814
Shares issued in connection with option, benefit and savings plans	1,337			1,337			20,556									21,893
Purchase of Company shares	(40	)		(40	)		(925	)								(965	)
Other comprehensive loss													(18,585	)		(18,585	)
Balance at December 31, 2001	68,694			68,694			271,403			777,971			(13,616	)		1,104,452
Net income for 2002										234,367						234,367
Cash dividends on common shares										(24,570	)					(24,570	)
Shares issued in connection with company acquisitions	3,094			3,094			58,257									61,351
Shares issued in connection with option, benefit and savings plans	1,848			1,848			29,984									31,832
Other comprehensive loss													(42,843	)		(42,843	)
Balance at December 31, 2002	73,636			73,636			359,644			987,768			(56,459	)		1,364,589
Net income for 2003										451,022						451,022
Cash dividends on common shares										(38,850	)					(38,850	)
Shares issued in connection with company acquisitions	1,067			1,067			27,413									28,480
Shares issued in connection with option, benefit and savings plans	4,123			4,123			76,553									80,676
Other comprehensive loss													(6,397	)		(6,397	)
Balance at December 31, 2003	78,826		$	78,826		$	463,610		$	1,399,940		$	(62,856	)	$	1,879,520

See Notes to Consolidated Financial Statements.

34

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31
	2003			2002			2001
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	451,022		$	234,367		$	167,268
Adjustments to reconcile net income to cash provided by operating activities:
Provision for title losses and other claims		324,404			224,589			180,646
Depreciation and amortization		114,424			96,829			108,348
Minority interests in net income		95,700			65,640			44,772
Investment (gains) losses		(35,717	)		18,892			(6,644	)
Other, net		(59,789	)		(43,337	)		(12,166	)
Changes in assets and liabilities excluding effects of company acquisitions and noncash transactions:
Claims paid, including assets acquired, net of recoveries		(269,468	)		(193,105	)		(153,373	)
Net change in income tax accounts		(4,975	)		(8,376	)		39,232
Increase in accounts and accrued income receivable		(17,443	)		(17,223	)		(63,668	)
Increase in accounts payable and accrued liabilities		161,140			95,531			68,920
Increase in deferred revenue		129,507			66,047			30,383
Other, net		(58,685	)		753			(15,471	)
Cash provided by operating activities		830,120			540,607			388,247
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash effect of company acquisitions/dispositions		(499,038	)		(51,450	)		(18,935	)
Net (increase) decrease in deposits with banks		(13,768	)		(11,905	)		4,427
Purchases of debt and equity securities		(320,134	)		(284,776	)		(188,738	)
Proceeds from sales of debt and equity securities		232,941			116,701			52,147
Proceeds from maturities of debt securities		52,857			127,187			89,746
Net decrease in other long-term investments		42,110			24,859			13,025
Net decrease (increase) in loans receivable		2,934			(3,898	)		(9,812	)
Capital expenditures		(98,963	)		(94,672	)		(129,221	)
Purchases of capitalized data		(19,866	)		(17,745	)		(12,583	)
Net proceeds from sale of property and equipment		3,373			3,661			4,299
Cash used for investing activities		(617,554	)		(192,038	)		(195,645	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in demand deposits		(7,893	)		(6,812	)		9,996
Proceeds from issuance of notes		177,117			9,919			212,717
Repayment of debt		(152,722	)		(40,414	)		(34,235	)
Purchase of Company shares		—			—			(965	)
Proceeds from exercise of stock options		26,500			8,401			10,566
Proceeds from issuance of stock to employee benefit plans		5,989			4,433			160
Contributions from minority shareholders		58,000			—			—
Distributions to minority shareholders		(72,882	)		(43,903	)		(28,296	)
Cash dividends		(34,008	)		(24,570	)		(18,210	)
Cash provided by (used for) financing activities		101			(92,946	)		151,733
Net increase in cash and cash equivalents		212,667			255,623			344,335
Cash and cash equivalents—Beginning of year		900,863			645,240			300,905
Cash and cash equivalents—End of year	$	1,113,530		$	900,863		$	645,240
SUPPLEMENTAL INFORMATION:
Cash paid during the year for:
Interest	$	36,276		$	33,281		$	28,323
Premium taxes	$	46,723		$	30,655		$	20,349
Income taxes	$	296,227		$	157,528		$	93,361
Noncash investing and financing activities:
Shares issued for benefits plans	$	48,187		$	18,998		$	11,167
Company acquisitions in exchange for common stock	$	28,480		$	61,351		$	82,814
Purchase of minority interest	$	—		$	—		$	1,322
Liabilities in connection with company acquisitions	$	330,599		$	55,761		$	34,596

See Notes to Consolidated Financial Statements

35

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.    Description of the Company:

The First American Corporation (the Company), through its subsidiaries, is engaged in the business of providing business information and related products and services. The Company has seven reporting segments that fall within two primary business groups, financial services and information technology. The Financial Services group includes title insurance and services, specialty insurance, and trust and other services. The title insurance and services segment issues residential and commercial title insurance policies, provides escrow services, equity loan services, tax-deferred exchanges and other related products and services. The specialty insurance segment issues property and casualty insurance policies and provides home warranties. The trust and other services segment provides investment advisory and trust and thrift services. The Information Technology group includes mortgage information, property information, credit information and screening information. The mortgage information segment provides tax monitoring, flood zone certification, default management services and other real estate related services. The property information segment provides property database services and appraisal services. The credit information segment provides mortgage credit and specialized credit reporting services. The screening information segment provides resident screening, pre-employment screening, substance abuse management and testing, consumer direct location services and motor vehicle reporting.

Significant Accounting Policies:

Principles of consolidation

The consolidated financial statements include the accounts of The First American Corporation and all controlled subsidiaries. All significant intercompany transactions and balances have been eliminated. Certain 2001 and 2002 amounts have been reclassified to conform to the 2003 presentation. In January 2003, the Financial Accounting Standards Board (FASB) issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46). This interpretation requires the consolidation of variable interest entities (VIEs) created or acquired if certain conditions are met. During December 2003, the FASB issued FIN 46 revised (FIN 46R) to defer the implementation date for pre-existing VIEs that are not special purpose entities until the end of the first interim or annual period ending after December 15, 2003. For VIEs that are not special purpose entities, companies must apply FIN 46R no later than the end of the first reporting period ending after March 15, 2004. The adoption of FIN 46 as revised by FIN 46R did not have a material impact on the Company’s financial condition or results of operations.

Cash equivalents

The Company considers cash equivalents to be all short-term investments that have an initial maturity of 90 days or less and are not restricted for statutory deposit or premium reserve requirements. The carrying amount for cash equivalents is a reasonable estimate of fair value due to the short-term maturity of these investments.

Investments

Deposits with savings and loan associations and banks are short-term investments with initial maturities of more than 90 days. The carrying amount of these investments is a reasonable estimate of fair value due to their short-term nature.

Debt securities are carried at fair value and consist primarily of investments in obligations of the United States Treasury, various corporations, certain state and political subdivisions and mortgage-backed securities.

36

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Equity securities are carried at fair value and consist primarily of investments in marketable common stocks of corporate entities.

Other long-term investments consist primarily of investments in affiliates, which are accounted for under the equity method of accounting; and notes receivable and other investments, which are carried at the lower of cost or fair value less costs to sell.

The Company classifies its debt and equity securities portfolio as available-for-sale. This portfolio is continually monitored for differences between the cost and estimated fair value of each security. If the Company believes that a decline in the value of a debt or equity security is temporary in nature, it records the decline as an unrealized loss in stockholders’ equity. If the decline is believed to be other than temporary, the debt or equity security is written down to the carrying value and a realized loss is recorded on the Company’s statement of income. Management’s assessment of a decline in value includes, among other things, its current judgment as to the financial position and future prospects of the entity that issued the security. If that judgment changes in the future, the Company may ultimately record a realized loss after having initially concluded that the decline in value was temporary.

Property and equipment

Property and equipment includes computer software acquired or developed for internal use and for use with the Company’s products. Software development costs, which include capitalized interest costs incurred and certain payroll-related costs of employees directly associated with developing software, in addition to incremental payments to third parties, are capitalized from the time technological feasibility is established until the software is ready for use.

Depreciation on buildings and on furniture and equipment is computed using the straight-line method over estimated useful lives of 25 to 40 and 3 to 10 years, respectively. Capitalized software costs are amortized using the straight-line method over estimated useful lives of 3 to 10 years.

Title plants and other indexes

Title plants and other indexes include the Company’s title plants, flood zone databases and capitalized real estate data. Title plants and flood zone databases are carried at original cost, with the costs of daily maintenance (updating) charged to expense as incurred. Because properly maintained title plants and flood zone databases have indefinite lives and do not diminish in value with the passage of time, no provision has been made for depreciation or amortization. Capitalized real estate data, which is primarily used by the Company’s property information segment, is amortized using the straight-line method over estimated useful lives of 5 to 15 years. The Company continually analyzes its title plant and other indexes for impairment. This analysis includes, but is not limited to, the effects of obsolescence, duplication, demand and other economic factors.

Assets acquired in connection with claim settlements

In connection with settlement of title insurance and other claims, the Company sometimes purchases mortgages, deeds of trust, real property or judgment liens. These assets, sometimes referred to as “salvage

37

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

assets,” are carried at the lower of cost or fair value less costs to sell and are included in “Other assets” in the Company’s consolidated balance sheets. The balance for these assets was $42.7 million and $41.6 million at December 31, 2003 and 2002, respectively.

Goodwill

On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (SFAS 142). This statement addresses financial accounting and reporting for goodwill and other intangible assets. In accordance with the provisions of SFAS 142, goodwill is no longer amortized but is rather tested annually for impairment. The Company has selected September 30 as the annual valuation date to test goodwill for impairment.

Impairment of long-lived assets and loans receivable

On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 144, “Accounting for Impairment or Disposal of Long-Lived Assets” (SFAS 144). This standard requires that the Company test long-lived assets for impairment whenever there are recognized events or changes in circumstances that could affect the carrying value of the long-lived assets. In accordance with SFAS 144, management uses estimated expected future cash flows (undiscounted and excluding interest costs) to measure the recoverability of long-lived assets held and used. As of December 31, 2003 and 2002, no indications of impairment were identified. SFAS 144 also requires that long-lived assets classified as held for sale be carried at the lower of cost or market as of the date the criteria established by SFAS 144 have been met. As of December 31, 2003 and 2002, no long-lived assets were classified as held for sale.

Loans receivable are impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Impaired loans receivable are measured at the present value of expected future cash flows discounted at the loan’s effective interest rate. As a practical expedient, the loan may be valued based on its observable market price or the fair value of the collateral, if the loan is collateral-dependent. As of December 31, 2003 and 2002, no indications of impairment of loans receivable were identified.

Reserve for known and incurred but not reported claims

The Company provides for title insurance and property and casualty insurance losses based upon its historical experience by a charge to expense when the related premium revenue is recognized. Title insurance losses and other claims associated with ceded reinsurance are provided for as the Company remains contingently liable in the event that the reinsurer does not satisfy its obligations.

The Company provides for claims losses relating to its home warranty business based on the average cost per claim as applied to the total of new claims incurred. The average cost per home warranty claim is calculated using the average of the most recent 12 months of claims experience.

The reserve for known and incurred but not reported claims reflects management’s best estimate of the total costs required to settle all claims reported to the Company and claims incurred but not reported. The process applied to estimate claim costs is subject to many variables, including, for title insurance, changes and trends in the type of title insurance policies issued, the real estate market and the interest rate environment. Management monitors the adequacy of the estimated loss reserves on a quarterly basis using a variety of techniques, including actuarial models, and adjusts the loss rates as necessary.

38

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Operating revenues

Financial Services Group—Title premiums on policies issued directly by the Company are recognized on the effective date of the title policy and escrow fees are recorded upon close of the escrow. Revenues from title policies issued by independent agents are recorded when notice of issuance is received from the agent.

Revenues from home warranty contracts are recognized ratably over the 12-month duration of the contracts. Revenues from property and casualty insurance policies are recognized ratably over the 12-month duration of the policies.

Interest on loans with the Company’s thrift subsidiary is recognized on the outstanding principal balance on the accrual basis. Loan origination fees and related direct loan origination costs are deferred and recognized over the life of the loan. Revenues earned by the other products in the trust and other services segment are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Information Technology Group—The Company’s tax service operations defer the tax service fee and recognize that fee as revenue ratably over the expected service period. The amortization rates applied to recognize the revenues assume a 10-year contract life and are adjusted to reflect prepayments. The Company reviews its tax service contract portfolio quarterly to determine if there have been changes in contract lives and/or changes in the number and/or timing of prepayments. Accordingly, the Company may adjust the rates to reflect current trends. Revenues earned by the other products in the Information Technology group are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Premium taxes

Title insurance, property and casualty insurance and home warranty companies, like other types of insurers, are generally not subject to state income or franchise taxes. However, in lieu thereof, most states impose a tax based primarily on insurance premiums written. This premium tax is reported as a separate line item in the consolidated statements of income in order to provide a more meaningful disclosure of the taxation of the Company.

Income taxes

Taxes are based on income for financial reporting purposes and include deferred taxes applicable to temporary differences between the financial statement carrying amount and the tax basis of certain of the Company’s assets and liabilities.

Earnings per share

Basic earnings per share are computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that net income is increased by the effect of interest expense, net of tax, on the Company’s convertible debt; and the weighted-average number of common shares outstanding is increased to include the number of additional common shares that would have been outstanding if dilutive stock options had been exercised and the debt had been converted.

Risk of real estate market

Real estate activity is cyclical in nature and is affected greatly by the cost and availability of long-term mortgage funds. Real estate activity and, in turn, the majority of the Company’s revenues can be adversely affected during periods of high interest rates and/or limited money supply.

39

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Use of estimates

The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the statements. Actual results could differ from the estimates and assumptions used.

Escrow and trust deposits

The Company administers escrow and trust deposits as a service to its customers. Escrow deposits totaled $4.5 billion and $5.6 billion at December 31, 2003 and 2002, respectively, of which $260.2 million and $176.6 million were held at certain of the Company’s subsidiaries. The remaining escrow deposits were held at third party financial institutions. Trust deposits totaled $2.3 billion and $1.9 billion at December 31, 2003 and 2002, respectively, and were held at the Company’s trust subsidiary. Escrow and trust deposits are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company remains contingently liable for the disposition of these deposits.

Like-kind exchanges

The Company facilitates tax-deferred property exchanges for customers pursuant to Section 1031 of the Internal Revenue Code. As a facilitator and intermediary, the Company holds the proceeds from sales transactions until a qualified acquisition occurs. Like-kind exchange deposits totaled $1.1 billion and $978.0 million at December 31, 2003 and 2002, respectively. The Company also facilitates tax-deferred reverse exchanges pursuant to Revenue Procedure 2000-37. These exchanges require the Company, using the customer’s funds, to acquire the qualifying property on behalf of the customer and take temporary title to the customer’s property until a qualifying acquisition occurs. Reverse exchange property totaled $229.4 million and $154.6 million at December 31, 2003 and 2002, respectively. Due to the structure utilized to facilitate these transactions, like-kind exchanges and reverse exchanges are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company remains contingently liable for the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate

NOTE 2.    Statutory Restrictions on Investments and Stockholders’ Equity:

Investments carried at $31.7 million were on deposit with state treasurers in accordance with statutory requirements for the protection of policyholders at December 31, 2003.

Pursuant to insurance and other regulations of the various states in which the Company’s insurance subsidiaries operate, the amount of dividends, loans and advances available to the Company is limited, principally for the protection of policyholders. Under such statutory regulations, the maximum amount of dividends, loans and advances available to the Company from its insurance subsidiaries in 2004 is $313.4 million.

The Company’s title insurance subsidiary, First American Title Insurance Company, maintained statutory capital and surplus of $746.6 million and $651.3 million at December 31, 2003 and 2002, respectively. Statutory net income for the years ended December 31, 2003, 2002 and 2001, was $229.9 million, $132.0 million and $118.7 million, respectively.

The National Association of Insurance Commissioners established certain statutory accounting practices, which became effective January 1, 2001. Adoption of the practices did not have a material impact on the Company’s statutory financial condition or results of operations.

40

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 3.    Debt and Equity Securities:

The amortized cost and estimated fair value of investments in debt securities are as follows:

	Amortized Cost		Gross unrealized					Estimated fair value
			gains		losses
	(in thousands)
December 31, 2003
U.S. Treasury securities	$	74,669	$	2,399	$	(120	)	$	76,948
Corporate securities		136,574		7,464		(287	)		143,751
Obligations of states and political subdivisions		79,726		3,713		(200	)		83,239
Mortgage-backed securities		46,761		633		(857	)		46,537
	$	337,730	$	14,209	$	(1,464	)	$	350,475
December 31, 2002
U.S. Treasury securities	$	31,190	$	2,256		—		$	33,446
Corporate securities		155,683		9,400	$	(700	)		164,383
Obligations of states and political subdivisions		72,525		3,251		(257	)		75,519
Mortgage-backed securities		35,188		1,405		(77	)		36,516
	$	294,586	$	16,312	$	(1,034	)	$	309,864

The amortized cost and estimated fair value of debt securities at December 31, 2003, by contractual maturities, are as follows:

	Amortized cost		Estimated fair value
	(in thousands)
Due in one year or less	$	24,183	$	24,505
Due after one year through five years		117,959		123,178
Due after five years through ten years		102,913		108,576
Due after ten years		45,914		47,679
		290,969		303,938
Mortgage-backed securities		46,761		46,537
	$	337,730	$	350,475

41

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The cost and estimated fair value of investments in equity securities are as follows:

			Gross unrealized					Estimated fair value
	Cost		gains		losses
	(in thousands)
December 31, 2003
Preferred stock:
Other	$	2,925	$	312	$	(1	)	$	3,236
Common stocks:
Corporate securities		46,625		4,707		(8,914	)		42,418
Other		81		34		(11	)		104
	$	49,631	$	5,053	$	(8,926	)	$	45,758
December 31, 2002
Preferred stock:
Other	$	4,085	$	56	$	(168	)	$	3,973
Common stocks:
Corporate securities		43,079		5,164		(15,979	)		32,264
Other		882		24		(212	)		694
	$	48,046	$	5,244	$	(16,359	)	$	36,931

The fair value of debt and equity securities was estimated using quoted market prices. Sales of debt and equity securities resulted in realized gains of $7.0 million, $2.2 million and $0.6 million; and realized losses of $3.1 million, $4.8 million and $0.6 million for the years ended December 31, 2003, 2002 and 2001, respectively.

In accordance with the enhanced disclosure provisions of Emerging Issues Task Force Issue No. 03-1, “The Meaning of Other-Than Temporary Impariment and Its Application to Certain Investments,” the Company, at December 31, 2003 had gross unrealized losses of $1.5 million from debt securities that had been in an unrealized loss position for less than 12 months. The fair value of those debt securities that had been in an unrealized loss position for less than 12 months is $16.1 million. At December 31, 2003, the Company had gross unrealized losses of $8.9 million from equity securities that had been in an unrealized loss position for 12 months or greater. The fair value of those equity securities that had been in an unrealized loss position for 12 months or greater was $19.3 million.

NOTE 4.    Loans Receivable:

Loans receivable are summarized as follows:

	December 31
	2003			2002
	(in thousands)
Real estate—mortgage	$	109,340		$	113,853
Other		8			25
		109,348			113,878
Unearned income on lease contracts					(3	)
Allowance for loan losses		(1,290	)		(1,170	)
Participations sold		(2,588	)		(4,361	)
Deferred loan fees, net		(242	)		(182	)
	$	105,228		$	108,162

42

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Real estate loans are collateralized by properties located primarily in Southern California. The average yield on the Company’s loan portfolio was 8.0% and 9.0% for the years ended December 31, 2003 and 2002, respectively. Average yields are affected by amortization of discounts on loans purchased from other institutions, prepayment penalties recorded as income, loan fees amortized to income and the market interest rates charged by thrift and loan institutions.

The fair value of loans receivable was $105.3 million and $108.4 million at December 31, 2003 and 2002, respectively, and was estimated based on the discounted value of the future cash flows using the current rates being offered for loans with similar terms to borrowers of similar credit quality.

The allowance for loan losses is maintained at a level that is considered appropriate by management to provide for known risks in the portfolio.

The aggregate annual maturities for loans receivable in each of the five years after December 31, 2003, are as follows:

Year	(in thousands)
2004	$	385
2005	$	5
2006	$	996
2007	$	46
2008	$	1,271

NOTE 5.    Goodwill and Other Intangible Assets:

On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (SFAS 142). This statement addresses financial accounting and reporting for goodwill and other intangibles and superceded Accounting Principles Board Opinions No. 17, “Intangible Assets.” SFAS 142 addresses how goodwill and other intangible assets should be accounted for in the financial statements. Pursuant to SFAS 142, the Company’s goodwill and intangible assets that have indefinite lives will not be amortized but rather will be tested at least annually for impairment. SFAS 142 requires that goodwill and other intangible assets be allocated to various reporting units that are either operating segments or one reporting unit below the operating segment. The Company’s reporting units, for purposes of applying the provisions of SFAS 142, are title insurance, home warranty, property and casualty insurance, trust and other services, mortgage origination products and services, mortgage servicing products and services, property information services, conventional credit information, subprime credit information, pre-employment and drug screening, tenant screening and motor vehicle reporting.

The SFAS 142 impairment testing process includes two phases. The first phase (Test 1) compares the fair value of each reporting unit to its book value. The fair value of each reporting unit is determined by using discounted cash flow analysis, market approach valuations and third-party valuation advisors. If the fair value of the reporting unit exceeds its book value, the goodwill is not considered impaired and no additional analysis is required. However, if the book value is greater than the fair value, a second test (Test 2) must be completed to determine if the fair value of the goodwill exceeds the book value. The fair value of the goodwill is determined by discounted cash flow analysis and appraised values. If the fair value is less than the book value, an impairment is considered to exist.

43

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company has determined that its flood zone certification database, which is included in “Title plants and other indexes,” is an intangible asset with an indefinite life. Accordingly, this asset is not amortized but rather tested annually for impairment by comparing the fair value of the database with its carrying value. In addition, the Company had $113.6 million of intangible assets included in “Other assets” at December 31, 2003, with definite lives ranging from three to ten years. These assets, comprised primarily of customer lists and noncompete agreements, are being amortized in a manner consistent with periods prior to the adoption of SFAS 142.

In accordance with the provisions of SFAS 142, the Company completed the required annual impairment tests of goodwill and intangible assets with indefinite lives for the years ended December 31, 2003 and 2002, and determined that there was no impairment.

A reconciliation of the changes in the carrying amount of net goodwill, by operating segment, as of December 31, 2003, is as follows:

	Balance as of January 1, 2003		Acquired/(disposed of) during the year			Impairment losses	Balance as of December 31, 2003
	(in thousands)
Financial Services:
Title Insurance	$	149,013	$	111,139		—	$	260,152
Specialty Insurances		19,794		—		—		19,794
Trust and Other Services		—		—		—		—
Information Technology:
Mortgage Information		72,423		473,189		—		545,612
Property Information		124,678		25,721		—		150,399
Credit Information		86,900		(14,450	)	—		72,450
Screening Information		111,183		93,490		—		204,673
	$	563,991	$	689,089		—	$	1,253,080

Pro forma net income and earnings per share, adjusted to add back the amortization of goodwill, net of income taxes, is as follows:

	2003		2002		2001
	(in thousands except per share amounts)
Reported net income	$	451,022	$	234,367	$	167,268
Add back: Goodwill amortization		—		—		15,061
Adjusted net income	$	451,022	$	234,367	$	182,329
Basic earnings per share:
Reported net income	$	5.89	$	3.27	$	2.51
Goodwill amortization		—		—		0.23
Adjusted net income	$	5.89	$	3.27	$	2.74
Diluted earnings per share:
Reported net income	$	5.22	$	2.92	$	2.27
Goodwill amortization		—		—		0.20
Adjusted net income	$	5.22	$	2.92	$	2.47

44

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 6.    Demand Deposits:

Passbook and investment certificate accounts are summarized as follows:

	December 31
	2003		2002
	(in thousands except percentages)
Passbook accounts	$	19,784	$	20,227
Certificate accounts:
Less than one year		35,473		43,639
One to five years		21,323		20,607
		56,796		64,246
	$	76,580	$	84,473
Annualized interest rates:
Passbook accounts		2%		2%-3%
Certificate accounts		2%-7%		2%-7%

The carrying value of the passbook accounts approximates fair value due to the short-term nature of this liability. The fair value of investment certificate accounts was $57.1 million and $65.1 million at December 31, 2003 and 2002, respectively, and was estimated based on the discounted value of future cash flows using a discount rate approximating current market for similar liabilities.

NOTE 7.    Reserve for Known and Incurred But Not Reported Claims:

Activity in the reserve for known and incurred but not reported claims is summarized as follows:

	December 31
	2003			2002			2001
	(in thousands)
Balance at beginning of year	$	360,305		$	314,777		$	284,607
Provision related to:
Current year		324,406			224,058			181,346
Prior years		(2	)		531			(700	)
		324,404			224,589			180,646
Payments related to:
Current year		151,590			97,729			90,442
Prior years		117,896			79,888			61,079
		269,486			177,617			151,521
Other		20,629			(1,444	)		1,045
Balance at end of year	$	435,852		$	360,305		$	314,777

“Other” primarily represents reclassifications to the reserve for assets acquired in connection with claim settlements and purchase accounting adjustments related to company acquisitions. Included in “Other” for 2003 was a $16.0 million purchase accounting adjustment related to the acquisition of Transamerica Finance Corporation’s tax monitoring and flood zone certification businesses. Claims activity associated with reinsurance is not material and, therefore, not presented separately. Current year payments include $133.3 million, $79.8 million and $69.1 million in 2003, 2002 and 2001, respectively, that relate to the Company’s non-title insurance operations.

45

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 8.    Notes and Contracts Payable:

	December 31
	2003		2002
	(in thousands)
4.5% senior convertible debentures, due April 2008	$	210,000	$	210,000
7.55% senior debentures, due April 2028		99,558		99,540
Trust deed notes with maturities through 2023, collateralized by land and buildings with a net book value of $63,117, weighted-average interest rate of 5.5%		62,360		152
Other notes and contracts payable with maturities through 2013, weighted-average interest rate of 5.5%		181,970		116,013
	$	553,888	$	425,705

The Company has $210.0 million of senior convertible debentures due in 2008. The debentures are convertible into common shares of the Company at $28 per share. The Company may redeem some or all of the debentures at any time on or after April 15, 2004. The Company has also issued debt that is convertible into shares of its common stock to finance certain acquisitions. This debt, which is included in “Other notes and contracts payable,” is convertible at the option of each note holder at a conversion price of $30 per share. The balance of this convertible debt was $24.5 million and $28.9 million at December 31, 2003 and 2002, respectively.

In October 2003, the Company obtained a $55.0 million loan collateralized by its corporate headquarters. This loan will be repaid over a 20-year period and requires the Company to maintain certain minimum levels of capital and earnings.

The Company has one primary bank credit agreement that provides for a $200.0 million unsecured line of credit. Under the terms of the credit agreement, the Company is required to maintain certain minimum levels of capital and earnings and meet predetermined debt-to-capitalization ratios. The line of credit remains in effect until October 2006 and was unused at December 31, 2003 and 2002. The Company’s publicly traded subsidiary, First Advantage Corporation also has a bank credit agreement that provides for a $15.0 million collateralized line of credit. Under the terms of that credit agreement, First Advantage Corporation is required to satisfy certain financial requirements. The line of credit remains in effect until July 2005 and had a balance due of $9.0 million at December 31, 2003.

The aggregate annual maturities for notes and contracts payable in each of the five years after December 31, 2003, are as follows:

Year	(in thousands)
2004	$	55,049
2005	$	49,719
2006	$	46,931
2007	$	18,326
2008	$	223,949

The fair value of notes and contracts payable was $564.5 million and $442.4 million at December 31, 2003 and 2002, respectively, and was estimated based on the current rates offered to the Company for debt of the same remaining maturities. The weighted-average interest rate for the Company’s notes and contracts payable was 5.5% and 6.0% at December 31, 2003 and 2002, respectively.

46

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 9.    Mandatorily Redeemable Preferred Securities:

On April 22, 1997, the Company issued and sold $100.0 million of 8.5% trust preferred securities, due in 2012, through its wholly owned subsidiary, First American Capital Trust. In connection with the subsidiary’s issuance of the preferred securities, the Company issued to the subsidiary trust 8.5% subordinated interest notes due in 2012. The sole assets of the subsidiary are and will be the subordinated interest notes. The Company’s obligations under the subordinated interest notes and related agreements, taken together, constitute a full and unconditional guarantee by the Company of the subsidiary’s obligations under the preferred securities. Distributions payable on the securities are included as interest expense in the Company’s consolidated income statements.

In May 2003, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.” This statement was effective for interim periods beginning after June 15, 2003 and establishes standards regarding the classification and measurement of certain financial instruments with characteristics of both liabilities and equity. The implementation of this statement required the Company to reclassify its “Mandatorily redeemable preferred securities” as debt. As a result of the change in classification, the Company’s debt-to-total capitalization ratio increased. This change has not had any other impact on the Company’s financial condition or results of operations.

The fair value of the Company’s mandatorily redeemable preferred securities was $100.0 million at December 31, 2003 and 2002 and was estimated based on the current rates offered to the Company for debt of the same type and remaining maturity.

NOTE 10.    Investment and Other Income:

The components of investment and other income are as follows:

	2003		2002		2001
	(in thousands)
Interest:
Cash equivalents and deposits with savings and loan associations and banks	$	9,359	$	7,204	$	15,837
Debt securities		19,999		19,242		17,118
Other long-term investments		2,877		5,786		11,826
Dividends on marketable equity securities		1,435		1,328		1,504
Equity in earnings of unconsolidated affiliates		59,789		43,337		25,013
Other		12,349		12,926		9,795
	$	105,808	$	89,823	$	81,093

47

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 11.    Income Taxes:

Income taxes are summarized as follows:

	2003			2002			2001
	(in thousands)
Current:
Federal	$	247,779		$	118,748		$	101,665
State		43,727			23,560			9,181
Foreign		6,964			2,609			2,136
		298,470			144,917			112,982
Deferred:
Federal		(4,697	)		6,587			3,526
State		(1,773	)		(1,604	)		992
		(6,470	)		4,983			4,518
	$	292,000		$	149,900		$	117,500

Income taxes differ from the amounts computed by applying the federal income tax rate of 35.0%. A reconciliation of this difference is as follows:

	2003			2002			2001
	(in thousands)
Taxes calculated at federal rate	$	260,091		$	134,494		$	99,669
Tax exempt interest income		(1,005	)		(748	)		(1,291	)
Tax effect of minority interests		1,249			1,837			1,146
State taxes, net of federal benefit		28,670			13,767			7,430
Exclusion of certain meals and entertainment expenses		5,990			5,222			4,661
Other items, net		(2,995	)		(4,672	)		5,885
	$	292,000		$	149,900		$	117,500

48

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The primary components of temporary differences that give rise to the Company’s net deferred tax assets are as follows:

	December 31
	2003			2002
	(in thousands)
Deferred tax assets:
Deferred revenue	$	195,476		$	87,705
Employee benefits		48,516			34,993
Bad debt reserves		19,181			16,531
Loss reserves		35,764			14,044
Accumulated other comprehensive income		31,464			26,613
Net operating loss carryforward		50,171			16,742
Excess capital losses		3,554			—
Other		8,406			5,920
		392,532			202,548
Deferred tax liabilities:
Depreciable and amortizable assets		131,948			112,177
Investment gain		17,261			17,418
Claims and related salvage		55,794			39,424
Other		2,478			2,052
		207,481			171,071
Net deferred tax asset before valuation allowance		185,051			31,477
Valuation allowance		(43,429	)		(10,526	)
Net deferred tax asset	$	141,622		$	20,951

For the year 2003, domestic and foreign pretax income from continuing operations was $727.1 million and $15.9 million, respectively.

The exercise of stock options represents a tax benefit and has been reflected as a reduction of taxes payable and an increase to the additional paid-in capital account. The benefits recorded were $5.8 million, $1.5 million and $2.6 million for the years ended December 31, 2003, 2002 and 2001, respectively.

At December 31, 2003, the Company had available net operating-loss carryforwards totaling approximately $130.4 million for income tax purposes, of which $10.4 million has an indefinite expiration. The remaining $120.0 million begins to expire at various times beginning in 2008 and ending in 2023.

The valuation allowance relates primarily to deferred tax assets for federal and state net operating-loss carryforwards relating to acquisitions consummated by First Advantage. Utilization of the pre-acquisition net operating losses is subject to limitations by the Internal Revenue Code and State jurisdictions. The Company evaluates the realizability of its deferred tax assets by assessing the valuation allowance and by adjusting the amount of such allowance, if necessary. The factors used to assess the likelihood of realization are the Company’s forecast of future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. To the extent that the related tax benefits are realized in subsequent years, they will be applied to reduce goodwill arising from the acquisitions.

49

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 12.    Earnings Per Share:

The Company’s potential dilutive shares are stock options and convertible debt. Stock options are reflected in diluted earnings per share by application of the treasury-stock method and convertible debt is reflected in diluted earnings per share by application of the if-converted method. A reconciliation of net income and weighted average shares outstanding is as follows:

	2003		2002		2001
	(in thousands, except per share data)
Numerator:
Net income—numerator for basic net income per share	$	451,022	$	234,367	$	167,268
Effect of dilutive securities:
Convertible debt—interest expense (net of tax)		6,823		7,017		5,247
Numerator for diluted net income per share	$	457,845	$	241,384	$	172,515
Denominator
Weighted-average shares—denominator for basic net income per share		76,632		71,594		66,568
Effect of dilutive securities:
Employee stock options		2,754		2,436		3,073
Convertible debt		8,389		8,537		6,193
Denominator for diluted net income per share		87,775		82,567		75,834
Net income per share:
Basic	$	5.89	$	3.27	$	2.51
Diluted	$	5.22	$	2.92	$	2.27

For the three years ended December 31, 2003, 2002 and 2001, 1.0 million, 3.6 million and 2.8 million options, respectively, were excluded from the weighted-average diluted common shares outstanding due to their antidilutive effect.

NOTE 13.    Employee Benefit Plans:

In December 2003, the Financial Accounting Standards Board revised Statement of Financial Accounting Standards (SFAS) No. 132, “Employers” Disclosures About Pensions and Other Post Retirement Benefits” to require additional disclosures related to pensions and post retirement benefits. The Company has implemented the revised disclosures in these financial statements.

The Company has benefit plans covering substantially all employees, including a 401(k) savings plan (the Savings Plan), an employee stock purchase plan and a defined benefit pension plan.

The Savings Plan allows for employee-elective contributions up to the maximum deductible amount as determined by the Internal Revenue Code. The Company makes discretionary contributions to the Savings Plan based on profitability, as well as contributions of the participants. The Company’s expense related to the Savings Plan amounted to $48.4 million, $39.6 million and $16.0 million for the years ended December 31, 2003, 2002 and 2001, respectively. The Savings Plan allows the participants to purchase the Company’s stock as one of the investment options. The Savings Plan held 9,982,000 and 8,906,000 shares of the Company’s common stock, representing 12.7% and 12.0% of the total shares outstanding at December 31, 2003 and 2002, respectively.

50

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The employee stock purchase plan allows eligible employees to purchase common stock of the Company at 85% of the closing price on the last day of each month. There were 283,000 and 245,000 shares issued in connection with the plan for the years ending December 31, 2003 and 2002, respectively. At December 31, 2003, there were 2,455,000 shares reserved for future issuances.

The Company’s defined benefit pension plan is a noncontributory, qualified, defined benefit plan with benefits based on the employee’s years of service. The Company’s policy is to fund all accrued pension costs. Contributions are intended to provide not only for benefits attributable to past service, but also for those benefits expected to be earned in the future. The Company also has nonqualified, unfunded supplemental benefit plans covering certain key management personnel. Benefits under these plans are anticipated to be funded with proceeds from life insurance policies purchased by the Company on the lives of the executives.

The following table provides a reconciliation of the changes in the defined benefit plan and supplemental benefit plan obligations, fair value of assets, a statement of the funded status and a summary of the amounts recognized in the consolidated financial statements as of December 31, 2003 and 2002:

	December 31
	2003						2002
	Defined benefit pension plans			Unfunded supplemental benefit plans			Defined benefit pension plans			Unfunded supplemental benefit plans
	(in thousands)
Change in projected benefit obligation:
Benefit obligation at beginning of year	$	227,013		$	73,322		$	183,186		$	59,393
Service costs		12,033			2,904			17,321			2,304
Interest costs		14,789			5,535			13,484			4,709
Plan amendments		(2,168	)		6			—			—
Actuarial losses		15,250			13,663			22,910			9,407
Benefits paid		(14,767	)		(3,212	)		(9,888	)		(2,491	)
Projected benefit obligation at end of year		252,150			92,218			227,013			73,322
Change in plan assets:
Plan assets at fair value at beginning of year		147,932			—			138,247			—
Actual return on plan assets		17,407			—			(12,024	)		—
Company contributions		2,904			3,212			31,597			2,491
Benefits paid		(14,767	)		(3,212	)		(9,888	)		(2,491	)
Plan assets at fair value at end of year		153,476			—			147,932			—
Reconciliation of funded status:
Funded status of the plans		(98,674	)		(92,218	)		(79,081	)		(73,322	)
Unrecognized net actuarial loss		101,267			37,262			93,806			25,476
Unrecognized prior service cost		(7,791	)		464			(9,783	)		818
Unrecognized net transition (asset) obligation		(7	)		—			(28	)		—
Prepaid (accrued) pension cost		(5,205	)		(54,492	)		4,914			(47,028	)
Amounts recognized in the consolidated financial statements consist of:
Accrued benefit liability		(96,778	)		(68,483	)		(76,728	)		(55,328	)
Intangible asset		—			463			(29	)		818
Minimum pension liability adjustment		91,573			13,528			81,671			7,482
	$	(5,205	)	$	(54,492	)	$	4,914		$	(47,028	)

51

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Net periodic pension cost for the Company’s defined benefit pension and supplemental benefit plans includes the following components:

	2003			2002			2001
	(in thousands)
Expense:
Service cost	$	14,937		$	19,625		$	17,015
Interest cost		20,324			18,193			15,737
Actual return on plan assets		(14,046	)		(14,795	)		(15,926	)
Amortization of net transition obligation		(22	)		(22	)		309
Amortization of prior service cost		(3,802	)		(3,632	)		(3,632	)
Amortization of net loss		6,309			2,707			742
	$	23,700		$	22,076		$	14,245

The projected benefit obligation for the defined benefit plans and the unfunded supplemental benefit plans was determined using the following weighted-average assumptions:

	December 31
	2003		2002
Defined benefit pension plan
Discount rate	6.25	%	6.75	%
Rate of return on plan assets	9.00	%	9.00	%
Unfunded supplemental benefit plans
Discount rate	6.25	%	6.75	%

The asset allocation for the Company’s defined benefit pension plan trust is as follows:

	Target allocation		Percentage of plan assets at December 31
	2004		2003		2002
Asset category
Domestic equities	52	%	52	%	51	%
Fixed income	46	%	46	%	46	%
Cash	2	%	2	%	3	%

Included in the domestic equities amount above are common shares of the Company with a market value of $12.1 million as of December 31, 2003.

NOTE 14.    Stock Option Plans:

On April 24, 1996, the Company implemented The First American Corporation 1996 Stock Option Plan (the Stock Option Plan). Under the Stock Option Plan, options are granted to certain employees to purchase the Company’s common stock at a price no less than the market value of the shares on the date of the grant. The maximum number of shares that may be subject to options is 14,625,000. Currently, outstanding options become exercisable in one to five years, and expire ten years from the grant date. On April 24, 1997, the Company implemented The First American Corporation 1997 Directors’ Stock Plan (the Directors’ Plan). The Directors’

52

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Plan is similar to the employees’ Stock Option Plan, except that the maximum number of shares that may be subject to options is 1,800,000 and the maximum number of shares that may be purchased pursuant to options granted shall not exceed 6,750 shares during any consecutive 12-month period.

In May 2001, in connection with the purchase of Credit Management Solutions, Inc. (CMSI), the Company adjusted the outstanding CMSI stock options to substitute common shares of the Company for the shares of CMSI that were issuable upon exercise of those options. The shares and exercise price for the CMSI options were adjusted by an exchange factor, with the result being that the CMSI options became exercisable with respect to 900,000 common shares of the Company at exercise prices ranging from $3.96 to $43.58.

In May 1999, in connection with the Company’s business combination with National Information Group (NAIG), which was accounted for under the pooling-of-interests method of accounting, the Company adjusted the outstanding NAIG stock options to substitute Common shares of the Company for the shares of NAIG that were issuable upon exercise of those options. At December 31, 2003, 14,430 common shares of the Company were issuable pursuant to exercise of the remaining outstanding adjusted NAIG options with exercise prices ranging from $7.65 to $15.58.

Effective December 15, 2002, the Company adopted Statement of Financial Accounting Standards No. 148, “Accounting for Stock-Based Compensation-Transition and Disclosure, which amends Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation” (SFAS 148). In accounting for its plans, the Company, as allowable under the provisions of SFAS 148, applies Accounting Principles Board Opinions No. 25, “Accounting for Stock issued to Employees.” As a result of this election, the Company does not recognize compensation expense for its stock option plans. Had the Company determined compensation cost based on the fair value for its stock options at grant date, net income and earnings per share would have been reduced to the pro forma amounts as follows:

	2003		2002		2001
	(in thousands, except per share amounts)
Net income:
As reported	$	451,022	$	234,367	$	167,268
Pro forma	$	441,517	$	229,434	$	157,609
Earnings per share:
As reported
Basic	$	5.89	$	3.27	$	2.51
Diluted	$	5.22	$	2.92	$	2.27
Pro forma
Basic	$	5.76	$	3.20	$	2.37
Diluted	$	5.11	$	2.86	$	2.15

The fair value of each option grant is estimated at the grant date using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in 2003, 2002 and 2001, respectively; dividend yield of 1.8%, 1.9% and 1.4%; expected volatility of 45.1%, 48.9% and 53.6%; risk-free interest rate of 4.2%, 4.2% and 5.4%; and expected life of seven years, seven years and eight years.

53

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Transactions involving stock options are summarized as follows:

	Number outstanding		Weighted-average exercise price
	(in thousands, except weighted-average exercise price)
Balance at December 31, 2000	9,798		$	15.45
Granted during 2001	1,288		$	18.82
Exercised during 2001	(1,009	)	$	11.17
Forfeited during 2001	(371	)	$	18.88
Balance at December 31, 2001	9,706		$	16.22
Granted during 2002	508		$	17.41
Exercised during 2002	(802	)	$	11.08
Forfeited during 2002	(466	)	$	17.73
Balance at December 31, 2002	8,946		$	16.66
Granted during 2003	1,652		$	23.45
Exercised during 2003	(2,011	)	$	13.30
Forfeited during 2003	(241	)	$	18.66
Balance at December 31, 2003	8,346		$	16.66

Stock options outstanding and exercisable at December 31, 2003, are summarized as follows:

	Outstanding				Exercisable
Range of Exercise Prices	Options	Average remaining life in years	Average exercise price		Options	Average exercise price
	(options in thousands)
$  3.95—$13.00	2,483	5.5	$	10.09	1,269	$	9.47
$13.01—$23.57	2,386	7.9	$	19.57	626	$	17.34
$23.58—$24.00	2,511	4.3	$	23.58	2,504	$	23.58
$24.01—$43.58	966	8.2	$	26.38	242	$	28.98
$  3.95—$43.58	8,346	6.1	$	18.75	4,641	$	19.16

NOTE 15.    Commitments and Contingencies:

Lease commitments

The Company leases certain office facilities, automobiles and equipment under operating leases, which, for the most part, are renewable. The majority of these leases also provide that the Company will pay insurance and taxes. In December 2000, the Company’s subsidiary, First American Real Estate Information Services, Inc. and, in 1999, the Company entered into sale-leaseback agreements with regard to certain furniture and equipment with a net book value of $30.7 million and $65.7 million, respectively. Proceeds from the sales, which amounted to $33.8 million and $80.1 million and gains of $3.1 million and $14.4 million for the years ended December 31, 2000 and 1999, respectively, have been included in “Deferred revenue” and will be amortized over the life of the leases. Under the agreements, the Company’s subsidiary and the Company agreed to lease the equipment for three to five years with minimum annual lease payments of $3.3 million and $9.3 million, respectively. At the end of the term of the leases, the Company has the option to acquire the equipment or return it to the lessor.

54

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Future minimum rental payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of December 31, 2003, are as follows:

Year	(in thousands)
2004	$	167,962
2005		129,652
2006		86,323
2007		52,484
2008		29,628
Later years		33,840
	$	499,889

Total rental expense for all operating leases and month-to-month rentals was $205.6 million, $178.2 million and $162.5 million for the years ended December 31, 2003, 2002 and 2001, respectively.

Other commitments and guarantees

In November 2002, the Financial Accounting Standards Board issued Interpretation No. 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees Including Indirect Guarantees of Indebtedness of Others” (FIN 45). This interpretation clarifies the requirements relating to the guarantor’s accounting for, and disclosure of, the issuance of certain types of guarantees. The disclosure provisions of FIN 45 were effective for fiscal years ending after December 15, 2002. The provisions for initial recognition and measurement are effective on a prospective basis for guarantees issued or modified after December 31, 2002. The adoption of FIN 45 did not have a material impact on the Company’s financial condition or results of operations.

The Company and Experian Information Solutions, Inc. (Experian) are parties to a joint venture that resulted in the creation of the Company’s First American Real Estate Solutions, LLC (FARES) subsidiary. Pursuant to the terms of the joint venture, Experian has the right to sell to the Company its interest in FARES at a purchase price determined pursuant to a specified formula based on the after-tax earnings of FARES. Experian may only exercise this right if the purchase price is greater than $80.0 million and less than $160.0 million. As of December 31, 2003, the purchase price exceeded $160.0 million and, therefore, Experian’s right was not exercisable as of such date. In addition to the agreement with Experian, the Company is also party to several other agreements that require the Company to purchase some or all of the minority shares of certain less-than-100.0% owned subsidiaries if certain conditions are met. The total potential purchase price related to those agreements that have met the necessary conditions as of December 31, 2003, was not material.

The Company also guarantees the obligations of certain of its subsidiaries. These obligations are included in the Company’s consolidated balance sheets as of December 31, 2003.

NOTE 16.    Stockholders’ Equity:

On October 23, 1997, the Company adopted a Shareholder Rights Plan (the Rights Plan). Under the Rights Plan, after the close of business on November 15, 1997, each holder of the Company’s common shares received a dividend distribution of one Right for each common share held. Each Right entitles the holder thereof to buy a preferred share fraction equal to 1/100,000 of a share of Series A Junior Participating Preferred Shares of the Company at an exercise price of $265 per preferred share fraction. Each fraction is designed to be equivalent in voting and dividend rights to one common share.

55

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Rights will be exercisable and will trade separately from the common shares only if a person or group, with certain exceptions, acquires beneficial ownership of 15.0% or more of the Company’s common shares or commences a tender or exchange offer that would result in such person or group beneficially owning 15.0% or more of the common shares then outstanding. The Company may redeem the Rights at $0.001 per Right at any time prior to the occurrence of one of these events. All Rights expire on October 23, 2007.

Each Right will entitle its holder to purchase, at the Right’s then-current exercise price, preferred share fractions (or other securities of the Company) having a value of twice the Right’s exercise price. This amounts to the right to buy preferred share fractions of the Company at half price. Rights owned by the party triggering the exercise of Rights will be void and, therefore, will not be exercisable.

In addition, if, after any person has become a 15.0%-or-more stockholder, the Company is involved in a merger or other business combination transaction with another person in which the Company’s common shares are changed or converted, or if the Company sells 50.0% or more of its assets or earning power to another person, each Right will entitle its holder to purchase, at the Right’s then-current exercise price, common stock of such other person (or its parent) having a value of twice the Right’s exercise price.

NOTE 17.    Other Comprehensive Income:

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income.

Components of other comprehensive income are as follows:

	Unrealized gains on securities			Minimum pension liability adjustment			Accumulated other comprehensive income (loss)
	(in thousands)
Balance at December 31, 2000	$	6,541		$	(1,572	)	$	4,969
Pretax change		(5,928	)		(22,665	)		(28,593	)
Tax effect		2,076			7,932			10,008
Balance at December 31, 2001		2,689			(16,305	)		(13,616	)
Pretax change		28			(64,068	)		(64,040	)
Tax effect		(1,227	)		22,424			21,197
Balance at December 31, 2002		1,490			(57,949	)		(56,459	)
Pretax change		4,709			(15,810	)		(11,101	)
Tax effect		(878	)		5,582			4,704
Balance at December 31, 2003	$	5,321		$	(68,177	)	$	(62,856	)

The change in unrealized gains on debt and equity securities includes reclassification adjustments of $3.9 million and $(2.6) million of net realized gains (losses) for the years ended December 31, 2003 and 2002, respectively. There were no reclassification adjustments in 2001.

NOTE 18.    Litigation.

The Company and certain of its subsidiaries on October 2, 2002, settled the lawsuit filed against certain of the Company’s subsidiaries by the state of California in the California state court in Sacramento, California. On or about September 18, 2002, the Company and certain of its subsidiaries settled a related class action lawsuit filed in the state court in the county of Los Angeles, California.

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THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

These lawsuits involved allegations that certain subsidiaries of the Company and certain of their competitors failed to turn over unclaimed property to the state of California on a timely basis; charged California home buyers and other escrow customers fees for services that were never performed or that cost less than the amount charged; and devised and carried out programs, known as earnings credits, with financial institutions to receive interest on escrow funds placed in demand deposits.

Under the terms of the settlements, the Company will pay up to $5.5 million to certain customers in the form of cash refunds and discounts against future title insurance and escrow services. The settlements further required the Company to pay approximately $2.5 million to specified governmental agencies; counsel to the class action plaintiffs; and the Consumer Protection Prosecution Trust Fund, a trust fund established to assist consumers in protecting their rights.

The settlements provide that they do not constitute an admission of liability or wrongdoing by the Company or any of its subsidiaries.

The Company is involved in numerous routine legal proceedings related to its operations. While the ultimate disposition of each proceeding is not determinable, the Company does not believe that any of such proceedings will have a material adverse effect on its financial condition or results of operations.

NOTE 19.    Business Combinations:

On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 141, “Business Combinations” (SFAS 141). This statement addresses financial accounting and reporting for business combinations and supercedes Accounting Principles Board Opinions No. 16, “Business Combinations.” SFAS 141 requires that all business combinations be accounted for under the purchase method of accounting. In applying the purchase method of accounting, the Company undertakes a comprehensive review of the acquired entity to ensure that all identifiable assets and liabilities are properly recorded at their fair value. In determining fair value, the Company utilizes a variety of valuation techniques, including discounted cash flow analysis and outside appraisals, to the extent necessary, given materiality and complexity. All excess purchase price is appropriately recorded as goodwill. The useful lives for all assets recorded in purchase accounting are based on market conditions, contractual terms and other appropriate factors.

On October 1, 2003, the Company acquired the real estate tax monitoring and flood zone certification businesses of Transamerica Finance Corporation for a combined net purchase price of $375 million. These businesses will be integrated with the Company’s existing real estate tax monitoring and flood zone certification businesses which are included in the Company’s mortgage information and services segment. The purchase price was allocated to the assets acquired and liabilities assumed based on their fair values at October 1, 2003. As a result of this acquisition, the Company recognized approximately $473.0 million of goodwill and $63.6 million of intangible assets with definite lives. The operating results of Transamerica’s tax monitoring and flood zone certification businesses are included in the Company’s consolidated financial statements commencing October 1, 2003. Assuming the acquisition had occurred January 1, 2002, pro forma revenues, net income and net income per diluted share would have been $6.4 billion, $487.2 million and $5.63, respectively, for the year ended December 31, 2003; and $4.9 billion, $264.5 million and $3.29, respectively, for the year ended December 31, 2002.

On June 5, 2003, the Company formed First Advantage Corporation, which was created through the merger of First American Corporation’s screening information businesses with the operations of US SEARCH.com Inc. Under the terms of the agreement, the former stockholders of US SEARCH received 0.04 of a Class A common share of First Advantage for each share of US SEARCH owned prior to the merger. The former stockholders of

57

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

US SEARCH hold approximately 20% of the total shares of First Advantage. The First American Corporation received Class B common stock, entitling 10 votes for each share, representing approximately 80% of the total shares of First Advantage. Approximately $3.0 million of intangible assets with definite lives and $54.9 million of goodwill was recorded by First Advantage as part of this transaction. The new public company trades Class A common stock as “FADV” on the NASDAQ National Market System.

First Advantage Corporation completed 9 acquisitions during the current year. The aggregate purchase price of these acquisition was $10.9 million in cash, $11.3 million in notes payable and .9 million shares, valued at $15.2 million, of First Advantage’s Class A common stock. The purchase price of each acquisition was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis. As a result of these transactions, First Advantage recorded approximately $6.1 million of intangible assets with definite lives and $27.6 million of goodwill. In accounting for the First Advantage shares issued in these acquisitions, the Company, whose ownership interest was reduced to approximately 77 percent, recorded a pretax gain of $2.3 million.

In addition to the acquisitions discussed above, the Company completed 30 acquisitions during the year ended December 31, 2003. These acquisitions were individually not material and are included in the following business segments: 25 in the title insurance and services segment, two in the mortgage information segment and three in the property information segment. Their aggregate purchase price was $71.7 million in cash, $53.9 million in notes and 1.1 million shares of the Company’s common stock valued at $28.5 million. The purchase price for each was allocated to the assets acquired and liabilities assumed based on estimated fair values and approximately $121.2 million in goodwill and $20.3 million of intangible assets with definite lives was recorded. The operating results of these acquired companies were included in the Company’s consolidated financial statements from their respective acquisition dates.

Assuming all of the current year acquisitions had occurred January 1, 2002, pro forma revenues, net income and net income per diluted share would have been $6.6 billion, $498.8 million and $5.72, respectively, for the year ended December 31, 2003; and $5.2 billion, $265.8 million and $3.07, respectively, for the year ended December 31, 2002. All pro forma results include interest expense on acquisition debt. The pro forma results are not necessarily indicative of the operating results that would have been obtained had the acquisitions occurred at the beginning of the periods presented, nor are they necessarily indicative of future operating results.

NOTE 20.    Segment Financial Information:

The Company, through its subsidiaries, is engaged in the business of providing business information and related products and services. The Company has seven reporting segments that fall within two primary business groups, financial services and information technology. The Financial Services group includes title insurance, specialty insurance and trust and other services. The title insurance and services segment issues residential and commercial title insurance policies, provides escrow services, equity loan services, tax-deferred exchanges and other related products. The specialty insurance segment issues property and casualty insurance policies and provides home warranties. The trust and other services segment provide investment advisory and trust and thrift services. The Information Technology group includes mortgage information, property information, credit information and screening information. The mortgage information segment provides tax monitoring, flood zone certification, default management services and other real estate related services. The property information segment provides property database services and appraisal services. The credit information segment provides mortgage credit and specialized credit reporting services. The screening information segment provides resident screening, pre-employment screening, substance abuse management and testing, consumer direct location services and motor vehicle reporting.

58

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company provides its title services through both direct operations and agents throughout the United States. It also offers title services in Australia, The Bahama Islands, Canada, Guam, Hong Kong, Ireland, Mexico, New Zealand, Puerto Rico, South Korea, the United Kingdom, the U.S. Virgin Islands and other countries abroad. The international operations account for less than 1% of the Company’s income before income taxes and minority interests. Home warranty services are provided in 40 states throughout the United States. Property and casualty insurance is offered nationwide. Trust and other services products are provided in Southern California. The products offered by the four segments included in the Information Technology group are provided nationwide.

Corporate consists primarily of investment gains and losses, personnel and other operating expenses associated with the Company’s corporate facilities, certain technology initiatives and unallocated interest expense.

Selected financial information about the Company’s operations by segment for each of the past three years is as follows:

	Revenues			Depreciation and amortization		Income (loss) before income taxes and minority interests			Assets		Investment in affiliates		Capital expenditures
	(in thousands)
2003
Title Insurance	$	4,455,238		$	39,158	$	494,946		$	2,123,388	$	109,168	$	38,978
Specialty Insurance		219,837			1,929		30,125			380,663		—		1,305
Trust and Other Services		39,645			829		9,683			156,177		3,436		206
Mortgage Information		668,765			19,296		238,508			1,117,825		2,313		15,941
Property Information		390,151			22,847		105,339			539,882		9,337		19,798
Credit Information		267,074			11,838		64,291			189,389		54,528		4,949
Screening Information		166,536			10,166		4,505			284,007		—		4,740
Corporate		6,468			8,361		(108,675	)		100,780		—		13,046
	$	6,213,714		$	114,424	$	838,722		$	4,892,111	$	178,782	$	98,963
2002
Title Insurance	$	3,437,726		$	42,092	$	271,720		$	1,618,186	$	66,939	$	45,014
Specialty Insurance		153,205			1,965		24,465			282,199		—		1,829
Trust and Other Services		41,687			1,091		13,548			147,039		3,558		299
Mortgage Information		485,206			10,161		146,849			433,471		—		12,130
Property Information		279,754			18,729		71,459			450,355		23,787		14,096
Credit Information		221,761			11,355		39,266			161,964		13,457		7,732
Screening Information		100,888			4,050		2,459			157,051		—		3,964
Corporate		(16,018	)		7,386		(119,859	)		147,780		—		9,608
	$	4,704,209		$	96,829	$	449,907		$	3,398,045	$	107,741	$	94,672
2001
Title Insurance	$	2,690,677		$	49,208	$	173,654		$	1,303,832	$	49,000	$	48,197
Specialty Insurance		120,558			3,671		11,929			204,326		—		2,383
Trust and Other Services		39,661			1,173		12,269			138,899		3,756		651
Mortgage Information		420,118			11,233		129,751			379,170		—		21,187
Property Information		227,900			23,355		35,321			394,197		26,277		25,549
Credit Information		201,029			12,145		30,062			175,759		4,947		17,970
Screening Information		49,326			1,810		(286	)		58,360		—		4,122
Corporate		1,454			5,753		(63,160	)		182,720		—		9,162
	$	3,750,723		$	108,348	$	329,540		$	2,837,263	$	83,980	$	129,221

59

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

QUARTERLY FINANCIAL DATA

(Unaudited)

	Quarter Ended
	March 31		June 30		September 30		December 31
	(in thousands, except per share amounts)
Year Ended December 31, 2003
Revenues	$	1,341,975	$	1,542,931	$	1,716,742	$	1,612,066
Income before income taxes and minority interests	$	163,493	$	239,753	$	260,759	$	174,717
Net income	$	87,580	$	127,476	$	141,847	$	94,119
Net income per share:
Basic	$	1.18	$	1.67	$	1.83	$	1.20
Diluted	$	1.05	$	1.47	$	1.62	$	1.07
Year Ended December 31, 2002
Revenues	$	1,042,202	$	1,091,530	$	1,196,086	$	1,374,391
Income before income taxes and minority interests	$	88,559	$	80,054	$	129,022	$	152,272
Net income	$	44,075	$	40,121	$	67,359	$	82,812
Net income per share:
Basic	$	0.63	$	0.56	$	0.94	$	1.13
Diluted	$	0.57	$	0.51	$	0.84	$	1.01

60

SCHEDULE I

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THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUMMARY OF INVESTMENTS—OTHER THAN INVESTMENTS IN RELATED PARTIES

(in thousands)

December 31, 2003

Column A	Column B		Column C		Column D
Type of investment	Cost		Market value		Amount at which shown in the balance sheet
Deposits with savings and loan associations and banks:
Registrant—None
Consolidated	$	57,945	$	57,945	$	57,945
Debt securities:
U.S. Treasury securities
Registrant—None
Consolidated	$	74,669	$	76,948	$	76,948
Corporate securities
Registrant—None
Consolidated	$	136,574	$	143,751	$	143,751
Obligations of states and political subdivisions
Registrant—None
Consolidated	$	79,726	$	83,239	$	83,239
Mortgage-backed securities
Registrant—None
Consolidated	$	46,761	$	46,537	$	46,537
Total debt securities:
Registrant—None
Consolidated	$	337,730	$	350,475	$	350,475
Equity securities:
Registrant—None
Consolidated	$	49,631	$	45,758	$	45,758
Other long-term investments:
Registrant	$	3,756	$	3,756	$	3,756
Consolidated	$	233,794	$	233,794	$	233,794
Total investments:
Registrant	$	3,756	$	3,756	$	3,756
Consolidated	$	679,100	$	687,972	$	687,972

61

SCHEDULE III

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THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUPPLEMENTARY INSURANCE INFORMATION

(in thousands)

BALANCE SHEET CAPTIONS

Column A	Column B		Column C		Column D
Segment	Deferred policy acquisition costs		Claims reserves		Deferred revenues
2003
Title Insurance		—	$	367,992	$	6,558
Specialty Insurance	$	19,888		32,285		98,718
Trust and Other Services		—		3		—
Mortgage Information		—		31,620		596,274
Property Information		—		3,952		12,727
Credit Information		—		—		3,725
Screening Information						1,501
Corporate		—		—		—
Total	$	19,888	$	435,852	$	719,503
2002
Title Insurance		—	$	319,826	$	7,356
Specialty Insurance	$	22,648		19,021		90,356
Trust and Other Services		—		3		—
Mortgage Information		—		18,373		251,298
Property Information		—		3,082		7,576
Credit Information		—		—		1,938
Screening Information						223
Corporate		—		—		—
Total	$	22,648	$	360,305	$	358,747

62

SCHEDULE III

2 OF 2

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUPPLEMENTARY INSURANCE INFORMATION

(in thousands)

INCOME STATEMENT CAPTIONS

Column A	Column F		Column G			Column H			Column I		Column J		Column K
Segment	Operating revenues		Net investment income			Loss provision			Amortization of deferred policy acquisition costs		Other operating expenses		Net premiums written
2003
Title Insurance	$	4,402,984	$	52,254		$	179,814				$	715,725
Specialty Insurance		207,287		12,550			119,546		$	2,885		20,431	$	139,012
Trust and Other Services		39,546		99			29					13,219
Mortgage Information		642,684		26,081			24,229					177,234
Property Information		366,271		23,880			786					131,896
Credit Information		246,987		20,087			—					129,367
Screening Information		166,430		106			—					97,034
Corporate		—		6,468			—			—		32,084		—
Total	$	6,072,189	$	141,525		$	324,404		$	2,885	$	1,316,990	$	139,012
2002
Title Insurance	$	3,393,592	$	44,134		$	135,622				$	584,604
Specialty Insurance		143,307		9,898			77,049		$	11,313		283	$	69,412
Trust and Other Services		41,737		(51	)		130					12,658
Mortgage Information		479,288		5,919			11,975					159,211
Property Information		259,315		20,440			150					86,039
Credit Information		215,337		6,424			(348	)				107,781
Screening Information		100,702		186			11					61,037
Corporate		—		(16,019	)		—			—		26,199		—
Total	$	4,633,278	$	70,931		$	224,589		$	11,313	$	1,037,812	$	69,412
2001
Title Insurance	$	2,648,994	$	41,684		$	113,811				$	474,127
Specialty Insurance		112,054		8,504			58,499		$	9,365		4,905	$	16,982
Trust and Other Services		39,882		(221	)		112					13,873
Mortgage Information		407,006		13,110			8,748					140,199
Property Information		210,975		16,925			(1,099	)				73,809
Credit Information		194,981		6,048			575					101,323
Screening Information		49,094		233			—					26,499
Corporate		—		1,454			—			—		9,504		—
Total	$	3,662,986	$	87,737		$	180,646		$	9,365	$	844,239	$	16,982

63

SCHEDULE IV

1 OF 1

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

REINSURANCE

(in thousands, except percentages)

Segment	Insurance operating revenues before reinsurance		Ceded to other companies		Assumed from other companies		Insurance operating revenues		Percentage of amount assumed to operating revenues
Title Insurance
2003	$	4,406,746	$	9,223	$	5,461	$	4,402,984	0.1	%
2002	$	3,395,743	$	5,357	$	3,206	$	3,393,592	0.1	%
2001	$	2,651,380	$	6,622	$	4,236	$	2,648,994	0.2	%
Specialty Insurance
2003	$	141,456	$	50,572		—	$	90,884	0.0	%
2002	$	49,497	$	8,648	$	171	$	41,020	0.4	%
2001	$	23,086	$	2,264	$	4	$	20,826	0.0	%

64

SCHEDULE V

1 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2003

Column A	Column B		Column C					Column D			Column E
			Additions
Description	Balance at beginning of period		Charged to costs and expenses		Charged to other accounts			Deductions from reserve			Balance at end of period
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	50,782	$	25,723				$	21,393	(A)	$	55,112
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	360,305	$	324,404	$	20,629	(B)	$	269,486	(B)	$	435,852
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,170	$	120							$	1,290
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	1,066	$	155				$	19	(D)	$	1,202
Reserve deducted from other assets:
Registrant—None
Consolidated	$	2,489	$	1,081							$	3,570
Reserve deducted from deferred income taxes:
Registrant—None
Consolidated	$	10,526			$	32,903	(E)				$	43,429

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents net $20,629 in purchase accounting adjustments

Note C—Amount represents claim payments, net of recoveries

Note D—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

Note E—Amount represents allowance against recognition of future tax benefits related to net operating loss carryforwards.

65

SCHEDULE V

2 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2002

Column A	Column B		Column C					Column D			Column E
			Additions
Description	Balance at beginning of period		Charged to costs and expenses		Charged to other accounts			Deductions from reserve			Balance at end of period
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	39,107	$	22,061				$	10,386	(A)	$	50,782
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	314,777	$	224,589	$	1,865	(B)	$	180,926	(C)	$	360,305
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,050	$	123				$	3	(A)	$	1,170
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	1,101			$	137		$	172	(D)	$	1,066
Reserve deducted from other assets:
Registrant—None
Consolidated	$	3,418	$	200				$	1,129	(D)	$	2,489
Reserve deducted from deferred income taxes:
Registrant—None Consolidated					$	10,526	(E)				$	10,526

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents net $1,865 in purchase accounting adjustments

Note C—Amount represents claim payments, net of recoveries.

Note D—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

Note E—Amount represents allowance against recognition of future tax benefits related to net operating loss carryforwards.

66

SCHEDULE V

3 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2001

Column A	Column B		Column C					Column D			Column E
			Additions
Description	Balance at beginning of period		Charged to costs and expenses		Charged to other accounts			Deductions from reserve			Balance at end of period
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	15,477	$	20,353	$	3,277					$	39,107
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	284,607	$	180,646	$	2,383	(B)	$	152,859	(C)	$	314,777
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,020	$	172				$	142	(A)	$	1,050
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	2,192			$	319		$	1,410	(D)	$	1,101
Reserve deducted from other assets:
Registrant—None
Consolidated	$	2,600	$	818							$	3,418

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents net $2,383 in purchase accounting adjustments

Note C—Amount represents claim payments, net of recoveries.

Note D—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

67

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None

Item 9A.    Controls and Procedures

The Company’s President and Chief Financial Officer, after evaluating the effectiveness of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, have concluded that, as of the end of the fiscal year covered by this report on Form 10-K, the Company’s disclosure controls and procedures were effective to provide reasonable assurances that information required to be disclosed in the reports filed or submitted under such Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

There was no change in the Company’s internal control over financial reporting during the quarter ended December 31, 2003 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART III

The information required by Items 10 through 14 of this report is set forth in the sections entitled “Election of Directors,” “Executive Officers,” “Section 16(a) Beneficial Ownership Reporting Compliance,” “Executive Compensation,” “Stock Option Grants and Exercises,” “Pension Plan,” “Supplemental Benefit Plan,” “Deferred Compensation Plan,” “Change of Control Arrangements,” “Directors’ Compensation,” “Codes of Ethics,” “Compensation Committee Interlocks and Insider Participation,” “Report of the Compensation Committee on Executive Compensation,” “Comparative Cumulative Total Return to Shareholders,” “Report of the Audit Committee,” “Who are the largest principal shareholders outside of management?,” “Security Ownership of Management,” “Principal Accountant Fees and Services” and “Transactions with Management and Others” in the Company’s definitive proxy statement, which sections are incorporated in this report and made a part hereof by reference. The definitive proxy statement will be filed no later than 120 days after the close of Registrant’s fiscal year.

68

PART IV

Item 14.    Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

(a) 1. & 2.	Financial Statements and Financial Statement Schedules
	The Financial Statements and Financial Statement Schedules filed as part of this report are listed in the accompanying index at page     in Item 8 of Part II of this report.
3.	Exhibits (Each management contract or compensatory plan or arrangement in which any director or named executive officer of The First American Corporation, as defined by Item 402(a)(3) of Regulation S-K (17 C.F.R. §229.402(a)(3)), participates that is included among the exhibits listed below is identified by an asterisk (*).)
	(2)	Agreement and Plan of Merger, dated as of November 17, 1998, among The First American Financial Corporation, National Insurance Group, and Pea Soup Acquisition Corp., incorporated by reference herein from Exhibit 2.1 of Form 8-K filed by National Information Group on November 25, 1998.
	(3)(a)	Restated Articles of Incorporation of The First American Financial Corporation dated July 14, 1998, incorporated by reference herein from Exhibit 3.1 of Amendment No. 1, dated July 28, 1998, to the Company’s Registration Statement No. 333-53681 on Form S-4.
	(3)(b)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation dated April 23, 1999, incorporated by reference herein from Exhibit (3) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.
	(3)(c)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation dated May 11, 2000, incorporated by reference herein from Exhibit 3.1 of Report on Form 8-K dated June 12, 2000.
	(3)(d)	Bylaws of The First American Corporation, as amended.
	(4)(a)	Rights Agreement, dated as of October 23, 1997, incorporated by reference herein from Exhibit 4 of Registration Statement on Form 8-A dated November 7, 1997.
	(4)(b)	Junior Subordinated Indenture, dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.2) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
	(4)(c)	Form of New 8.50% Junior Subordinated Deferrable Interest Debenture, incorporated by reference herein from Exhibit 4.2 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
	(4)(d)	Certificate of Trust of First American Capital Trust I, incorporated by reference herein from Exhibit 4.3 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
	(4)(e)	Amended and Restated Declaration of Trust of First American Capital Trust I dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.3) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
	(4)(f)	Form of New 8.50% Capital Security (Liquidation Amount $1,000 per Capital Security), incorporated by reference herein from Exhibit 4.6 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.

69

(4)(g)	Form of New Guarantee Agreement, incorporated by reference herein from Exhibit 4.7 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
(4)(h)	Senior Indenture, dated as of April 7, 1998, between The First American Financial Corporation and Wilmington Trust Company as Trustee, incorporated by reference herein from Exhibit (4) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1998.
(4)(i)	Registration Rights Agreement dated as of April 24, 2001, incorporated by reference herein from Exhibit 4.2 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
(4)(j)	Indenture dated as of April 24, 2001, incorporated by reference herein from Exhibit 4.3 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
(4)(k)	Form of Senior Convertible Debenture, incorporated by reference herein from Exhibit 4.4 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
*(10)(a)	Description of Stock Bonus Plan, as amended, incorporated by reference herein from Exhibit (10)(a) of Annual Report on Form 10-K for the fiscal year ended December 31, 1992.
*(10)(b)	Executive Supplemental Benefit Plan dated April 10, 1986, and Amendment No. 1 thereto dated October 1, 1986, incorporated by reference herein from Exhibit (10)(b) of Annual Report on Form 10-K for the fiscal year ended December 31, 1988.
*(10)(c)	Amendment No. 2, dated March 22, 1990, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1989.
*(10)(d)	Amendment No. 3, dated July 7, 1998, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(d) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(e)	Amendment No. 4, dated March 22, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(f)	Amendment No. 5, dated July 19, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(e) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(g)	Management Supplemental Benefit Plan dated July 20, 1988, incorporated by reference herein from Exhibit (10) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1992.
*(10)(h)	Amendment No. 1, dated July 7, 1998, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(i)	Amendment No. 2, dated March 22, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(h) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(j)	Amendment No. 3, dated July 19, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(k)	Pension Restoration Plan (effective as of January 1, 1994), incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1996.

70

*(10)(l)	Amendment No. 1, dated July 19, 2000, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(m)	Amendment No. 2, dated August 1, 2001, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.
*(10)(n)	1996 Stock Option Plan, incorporated by reference herein from Exhibit 4 of Registration Statement No. 333-19065 on Form S-8 dated December 30, 1996.
*(10)(o)	Amendment No. 1, dated February 26, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(i) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(p)	Amendment No. 2, dated June 22, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(j) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(q)	Amendment No. 3, dated July 7, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(k) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(r)	Amendment No. 4, dated April 22, 1999, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1999.
*(10)(s)	Amendment No. 5, dated February 29, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(o) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(t)	Amendment No. 6, dated July 19, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(u)	Amendment No. 7, dated June 4, 2002, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2002.
*(10)(v)	Change in Control Agreement (Executive Form) dated November 12, 1999, incorporated by reference herein from Exhibit (10)(p) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(w)	Change in Control Agreement (Management Form) dated November 12, 1999, incorporated by reference herein from Exhibit (10)(q) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(x)	1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit 4.1 of Registration Statement No. 333-41993 on Form S-8 dated December 11, 1997.
*(10)(y)	Amendment No. 1 to 1997 Directors’ Stock Plan, dated February 26, 1998, incorporated by reference herein from Exhibit (10)(m) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(z)	Amendment No. 2 to 1997 Directors’ Stock Plan, dated July 7, 1998, incorporated by reference herein from Exhibit (10)(n) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(aa)	Amendment No. 3, dated July 19, 2000, to 1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit (10)(c) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.

71

*(10)(bb)	The First American Financial Corporation Deferred Compensation Plan dated March 10, 2000, incorporated by reference herein from Exhibit (10)(v) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(cc)	Amendment No. 1, dated July 19, 2000, to Deferred Compensation Plan, incorporated by reference herein from Exhibit (10)(d) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(dd)	Amendment No. 2, dated February 1, 2003, to Deferred Compensation Plan, incorporated by reference herein from Exhibit (10) of Quarterly Report on Form 10-Q for the quarter ended March 31, 2003.
*(10)(ee)	The First American Financial Corporation Deferred Compensation Plan Trust Agreement dated March 10, 2000, incorporated by reference herein from Exhibit (10)(w) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
(10)(ff)	Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(gg)	Amendment No. 1, dated June 30, 2003, to Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al, dated November 30, 1997, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2003.
(10)(hh)	Amendment No. 2, dated September 23, 2003, to Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2003.
(10)(ii)	Operating Agreement for First American Real Estate Solutions LLC, a California Limited Liability Company, By and Among First American Real Estate Information Services, Inc., and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(jj)	Data License Agreement dated November 30, 1997, incorporated by reference herein from Exhibit (10)(d) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(kk)	Reseller Services Agreement dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(g) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(ll)	Amendment to Reseller Services Agreement For Resales to Consumers, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(h) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(mm)	Trademark License Agreement, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(i) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(nn)	Credit Agreement dated as of October 12, 2001, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.
(10)(oo)	Amendment No. 1, dated as of July 7, 2003, to Credit Agreement.
(10)(pp)	Amendment No. 2, dated as of October 22, 2003, to Credit Agreement.

72

(10)(qq)	Amendment No. 3, dated as of November 26, 2003, to Credit Agreement.
(10)(rr)	Master Lease Agreement dated as of December 27, 1999, between FATICO 1999 TRUST, as Lessor, and First American Title Insurance Company, as Lessee, incorporated by reference herein from Exhibit (10)(g) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
(10)(ss)	Agreement of Amendment No. 1 to Master Lease Agreement and Equipment Schedule No. 1, dated as of May 5, 2000, incorporated by reference herein from Exhibit (10)(h) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
(10)(tt)	Omnibus Agreement, dated as of December 30, 2003, by and among First American Title Insurance Company, as Lessee and certain lenders, agents and trustees.
(21)	Subsidiaries of the registrant.
(23)	Consent of Independent Accountants.
(31)(a)	Certification by Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Act of 1934.
(31)(b)	Certification by Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
(32)(a)	Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.
(32)(b)	Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.

(b)    Reports on Form 8-K

During the last quarter of the period covered by this report, no reports on Form 8-K were filed.

73

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE FIRST AMERICAN CORPORATION
(Registrant)
By	/s/    PARKER S. KENNEDY
	Parker S. Kennedy President (Principal Executive Officer)
	Date: March 15, 2004
By	/s/    THOMAS A. KLEMENS
	Thomas A. Klemens Senior Executive Vice President, Chief Financial Officer (Principal Financial Officer)
	Date: March 15, 2004

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/    D. P. KENNEDY         D. P. Kennedy	Chairman Emeritus and Director	March 15, 2004
/s/    PARKER S. KENNEDY         Parker S. Kennedy	Chairman, President, CEO and Director	March 15, 2004
/s/    THOMAS A. KLEMENS         Thomas A. Klemens	Senior Executive Vice President, Chief Financial Officer	March 15, 2004
/s/    MAX O. VALDES         Max O. Valdes	Vice President (Principal Accounting Officer)	March 15, 2004
/s/    GARY J. BEBAN         Gary J. Beban	Director	March 15, 2004
/s/    J. DAVID CHATHAM         J. David Chatham	Director	March 15, 2004
/s/    WILLIAM G. DAVIS         William G. Davis	Director	March 15, 2004
/s/    JAMES L. DOTI         James L. Doti	Director	March 15, 2004
/s/    LEWIS W. DOUGLAS, JR.         Lewis W. Douglas, Jr.	Director	March 15, 2004

74

Signature	Title	Date
/s/    PAUL B. FAY, JR.         Paul B. Fay, Jr.	Director	March 15, 2004
/s/    FRANK O’BRYAN         Frank O’Bryan	Director	March 15, 2004
/s/    ROSLYN B. PAYNE         Roslyn B. Payne	Director	March 15, 2004
/s/    D. VAN SKILLING         D. Van Skilling	Director	March 15, 2004
/s/    HERBERT B. TASKER         Herbert B. Tasker	Director	March 15, 2004
/s/    VIRGINIA UEBERROTH         Virginia Ueberroth	Director	March 15, 2004

75

Exhibit No.	Description	Sequentially Numbered Page
(2)	Agreement and Plan of Merger, dated as of November 17, 1998, among The First American Financial Corporation, National Insurance Group, and Pea Soup Acquisition Corp., incorporated by reference herein from Exhibit 2.1 of Form 8-K filed by National Information Group on November 25, 1998.
(3)(a)	Restated Articles of Incorporation of The First American Financial Corporation dated July 14, 1998, incorporated by reference herein from Exhibit 3.1 of Amendment No. 1, dated July 28, 1998, to the Company’s Registration Statement No. 333-53681 on Form S-4.
(3)(b)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation dated April 23, 1999, incorporated by reference herein from Exhibit (3) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.
(3)(c)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation dated May 11, 2000, incorporated by reference herein from Exhibit 3.1 of Report on Form 8-K dated June 12, 2000.
(3)(d)	Bylaws of The First American Corporation, as amended.
(4)(a)	Rights Agreement, dated as of October 23, 1997, incorporated by reference herein from Exhibit 4 of Registration Statement on Form 8-A dated November 7, 1997.
(4)(b)	Junior Subordinated Indenture, dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.2) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
(4)(c)	Form of New 8.50% Junior Subordinated Deferrable Interest Debenture, incorporated by reference herein from Exhibit 4.2 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
(4)(d)	Certificate of Trust of First American Capital Trust I, incorporated by reference herein from Exhibit 4.3 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
(4)(e)	Amended and Restated Declaration of Trust of First American Capital Trust I dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.3) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
(4)(f)	Form of New 8.50% Capital Security (Liquidation Amount $1,000 per Capital Security), incorporated by reference herein from Exhibit 4.6 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
(4)(g)	Form of New Guarantee Agreement, incorporated by reference herein from Exhibit 4.7 of Registration Statement No. 333-35945 on Form S-4 dated September 18, 1997.
(4)(h)	Senior Indenture, dated as of April 7, 1998, between The First American Financial Corporation and Wilmington Trust Company as Trustee, incorporated by reference herein from Exhibit (4) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1998.

76

Exhibit No.	Description	Sequentially Numbered Page
(4)(i)	Registration Rights Agreement dated as of April 24, 2001, incorporated by reference herein from Exhibit 4.2 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
(4)(j)	Indenture dated as of April 24, 2001, incorporated by reference herein from Exhibit 4.3 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
(4)(k)	Form of Senior Convertible Debenture, incorporated by reference herein from Exhibit 4.4 of Registration Statement No. 333-65216 on Form S-3 dated July 16, 2001.
*(10)(a)	Description of Stock Bonus Plan, as amended, incorporated by reference herein from Exhibit (10)(a) of Annual Report on Form 10-K for the fiscal year ended December 31, 1992.
*(10)(b)	Executive Supplemental Benefit Plan dated April 10, 1986, and Amendment No. 1 thereto dated October 1, 1986, incorporated by reference herein from Exhibit (10)(b) of Annual Report on Form 10-K for the fiscal year ended December 31, 1988.
*(10)(c)	Amendment No. 2, dated March 22, 1990, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1989.
*(10)(d)	Amendment No. 3, dated July 7, 1998, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(d) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(e)	Amendment No. 4, dated March 22, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(f)	Amendment No. 5, dated July 19, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(e) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(g)	Management Supplemental Benefit Plan dated July 20, 1988, incorporated by reference herein from Exhibit (10) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1992.
*(10)(h)	Amendment No. 1, dated July 7, 1998, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(i)	Amendment No. 2, dated March 22, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(h) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(j)	Amendment No. 3, dated July 19, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(k)	Pension Restoration Plan (effective as of January 1, 1994), incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1996.

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Exhibit No.	Description	Sequentially Numbered Page
*(10)(l)	Amendment No. 1, dated July 19, 2000, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(m)	Amendment No. 2, dated August 1, 2001, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.
*(10)(n)	1996 Stock Option Plan, incorporated by reference herein from Exhibit 4 of Registration Statement No. 333-19065 on Form S-8 dated December 30, 1996.
*(10)(o)	Amendment No. 1, dated February 26, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(i) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(p)	Amendment No. 2, dated June 22, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(j) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(q)	Amendment No. 3, dated July 7, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(k) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(r)	Amendment No. 4, dated April 22, 1999, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1999.
*(10)(s)	Amendment No. 5, dated February 29, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(o) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(t)	Amendment No. 6, dated July 19, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(u)	Amendment No. 7, dated June 4, 2002, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for quarter ended June 30, 2002.
*(10)(v)	Change in Control Agreement (Executive Form) dated November 12, 1999, incorporated by reference herein from Exhibit (10)(p) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(w)	Change in Control Agreement (Management Form) dated November 12, 1999, incorporated by reference herein from Exhibit (10)(q) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(x)	1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit 4.1 of Registration Statement No. 333-41993 on Form S-8 dated December 11, 1997.
*(10)(y)	Amendment No. 1 to 1997 Directors’ Stock Plan, dated February 26, 1998, incorporated by reference herein from Exhibit (10)(m) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.

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Exhibit No.	Description	Sequentially Numbered Page
*(10)(z)	Amendment No. 2 to 1997 Directors’ Stock Plan, dated July 7, 1998, incorporated by reference herein from Exhibit (10)(n) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(aa)	Amendment No. 3, dated July 19, 2000, to 1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit (10)(c) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(bb)	The First American Financial Corporation Deferred Compensation Plan dated March 10, 2000, incorporated by reference herein from Exhibit (10)(v) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(cc)	Amendment No. 1, dated July 19, 2000, to Deferred Compensation Plan, incorporated by reference herein from Exhibit (10)(d) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(dd)	Amendment No. 2, dated February 1, 2003, to Deferred Compensation Plan, incorporated by reference herein from Exhibit (10) of Quarterly Report on Form 10-Q for the quarter ended March 31, 2003.
*(10)(ee)	The First American Financial Corporation Deferred Compensation Plan Trust Agreement dated March 10, 2000, incorporated by reference herein from Exhibit (10)(w) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(ff)	Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(gg)	Amendment No. 1, dated June 30, 2003, to Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al, dated November 30, 1997, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2003.
(10)(hh)	Amendment No. 2, dated September 23, 2003, to Contribution and Joint Venture Agreement By and Among The First American Financial Corporation and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2003.
(10)(ii)	Operating Agreement for First American Real Estate Solutions LLC, a California Limited Liability Company, By and Among First American Real Estate Information Services, Inc., and Experian Information Solutions, Inc., et al., dated November 30, 1997, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(jj)	Data License Agreement dated November 30, 1997, incorporated by reference herein from Exhibit (10)(d) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(kk)	Reseller Services Agreement dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(g) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(ll)	Amendment to Reseller Services Agreement For Resales to Consumers, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(h) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.

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Exhibit No.	Description	Sequentially Numbered Page
(10)(mm)	Trademark License Agreement, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(i) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(nn)	Credit Agreement dated as of October 12, 2001, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.
(10)(oo)	Amendment No. 1, dated as of July 7, 2003, to Credit Agreement.
(10)(pp)	Amendment No. 2, dated as of October 22, 2003, to Credit Agreement.
(10)(qq)	Amendment No. 3, dated as of November 26, 2003, to Credit Agreement.
(10)(rr)	Master Lease Agreement dated as of December 27, 1999, between FATICO 1999 TRUST, as Lessor, and First American Title Insurance Company, as Lessee, incorporated by reference herein from Exhibit (10)(g) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
(10)(ss)	Agreement of Amendment No. 1 to Master Lease Agreement and Equipment Schedule No. 1, dated as of May 5, 2000, incorporated by reference herein from Exhibit (10)(h) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
(10)(tt)	Omnibus Agreement, dated as of December 30, 2003, by and among First American Title Insurance Company, as Lessee and certain lenders, agents and trustees.
(21)	Subsidiaries of the registrant.
(23)	Consent of Independent Accountants.
(31)(a)	Certification by Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Act of 1934.
(31)(b)	Certification by Chief Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
(32)(a)	Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.
(32)(b)	Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.

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EX-3.(D)

EXHIBIT 3(d)

BYLAWS

OF

THE FIRST AMERICAN CORPORATION

ARTICLE I

OFFICES

Section l. PRINCIPAL OFFICES. The location of the principal executive office of the corporation is 1 First American Way, Santa Ana, California. The board of directors may change the location of the principal executive office to any place within or outside the State of California. If the principal executive office is located outside this state, and the corporation has one or more business offices in this state, the board of directors shall fix and designate a principal business office in the State of California.

Section 2. OTHER OFFICES. The board of directors may at any time establish branch or subordinate offices at any place or places where the corporation is qualified to do business.

ARTICLE II

MEETINGS OF SHAREHOLDERS

Section l. PLACE OF MEETINGS. Meetings of shareholders shall be held at any place within or outside the State of California designated by the board of directors. In the absence of any such designation, shareholders’ meetings shall be held at the principal executive office of the corporation.

Section 2. ANNUAL MEETING. The annual meeting of shareholders shall be held each year on a date and at a time designated by the board of directors. At each annual meeting, directors shall be elected, and any other proper business may be transacted.

Section 3. SPECIAL MEETING. A special meeting of the shareholders may be called at any time by the board of directors, or by the chairman of the board, or by the president, or by one or more shareholders holding shares in the aggregate entitled to cast not less than 10% of the votes at that meeting.

If a special meeting is called by any person or persons other than the board of directors, the request shall be in writing, specifying the time of such meeting and the general nature of the business proposed to be transacted, and shall be delivered personally or sent by registered mail or by telegraphic or other facsimile transmission to the chairman of the board, the president, any vice president, or the secretary of the corporation. The officer receiving the request shall cause notice to be promptly given to the shareholders

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entitled to vote, in accordance with the provisions of Sections 4 and 5 of this Article II, that a meeting will be held at the time requested by the person or persons calling the meeting, not less than thirty-five (35) nor more than sixty (60) days after the receipt of the request. If the notice is not given within twenty (20) days after receipt of the request, the person or persons requesting the meeting may give notice. Nothing contained in this paragraph of this Section 3 shall be construed as limiting, fixing or affecting the time when a meeting of shareholders called by action of the board of directors may be held.

Section 4. NOTICE OF SHAREHOLDERS’ MEETING. All notices of meetings of shareholders shall be sent or otherwise given in accordance with Section 5 of this Article II not less than ten (10) (or if sent by third-class mail, thirty (30)) nor more than sixty (60) days before the date of the meeting. The notice shall specify the place, date and hour of the meeting and (i) in the case of a special meeting, the general nature of the business to be transacted, or (ii) in the case of the annual meeting, those matters which the board of directors, at the time of giving the notice, intends to present for action by the shareholders. The notice of any meeting at which directors are to be elected shall include the name of any nominee or nominees whom, at the time of the notice, management intends to present for election.

If action is proposed to be taken at any meeting for approval of (i) a contract or transaction in which a director has a direct or indirect financial interest, pursuant to Section 310 of the Corporations Code of California, (ii) an amendment of the articles of incorporation, pursuant to Section 902 of that Code, (iii) a reorganization of the corporation, pursuant to Section 1201 of that Code, (iv) a voluntary dissolution of the corporation, pursuant to Section 1900 of that code, or (v) a distribution in dissolution other than in accordance with the rights of outstanding preferred shares, pursuant to Section 2007 of that Code, the notice shall also state the general nature of that proposal.

Section 5. MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE. Notice of any meeting of shareholders shall be given either personally or by first or third-class mail or telegraphic or other written communication, charges prepaid, addressed to the shareholder at the address of that shareholder appearing on the books of the corporation or given by the shareholder to the corporation for the purpose of notice. If no such address appears on the corporation’s books or is given, notice shall be deemed to have been given if sent to that shareholder by first or third-class mail or telegraphic or other written communication to the corporation’s principal executive office, or if published at least once in a newspaper of general circulation in the county where that office is located. Notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by telegram or other means of written communication.

If any notice addressed to a shareholder at the address of that shareholder appearing on the books of the corporation is returned to the corporation by the United States Postal Service marked to indicate that the United States Postal Service is unable to deliver the notice to the shareholder at that address, all future notices or reports shall be deemed to have been given without further mailing if these shall be available to the shareholder on written demand of the shareholder at the principal executive office of the corporation for a period of one year from the date of the giving of the notice.

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An affidavit of the mailing or other means of giving any notice of any shareholders’ meeting shall be executed by the secretary, assistant secretary, or any transfer agent of the corporation giving the notice, and shall be filed and maintained in the minute book of the corporation.

Section 6. QUORUM. The presence in person or by proxy of the holders of a majority of the shares entitled to vote at any meeting of shareholders shall constitute a quorum for the transaction of business. The shareholders present at a duly called or held meeting at which a quorum is present may continue to do business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the shares required to constitute a quorum.

Section 7. ADJOURNED MEETING NOTICE. Any shareholders’ meeting, annual or special, whether or not a quorum is present, may be adjourned from time to time by the vote of the majority of the shares represented at that meeting, either in person or by proxy, but in the absence of a quorum, no other business may be transacted at that meeting, except as provided in Section 6 of this Article II.

When any meeting of shareholders, either annual or special, is adjourned to another time or place; notice need not be given of the adjourned meeting if the time and place are announced at a meeting at which the adjournment is taken, unless a new record date for the adjourned meeting is fixed, or unless the adjournment is for more than forty-five (45) days from the date set forth for the original meeting, in which case the board of directors shall set a new record date. Notice of any such adjourned meeting shall be given to each shareholder of record entitled to vote at the adjourned meeting in accordance with the provisions of Sections 4 and 5 of this Article II. At any adjourned meeting the corporation may transact any business which might have been transacted at the original meeting.

Section 8. VOTING. The shareholders entitled to vote at any meeting of shareholders shall be determined in accordance with the provisions of Section ll of this Article II, subject to the provisions of Sections 702 to 704 inclusive, of the Corporations Code of California (relating to voting shares held by a fiduciary in the name of a corporation, or in joint ownership). The shareholders’ vote may be by voice vote or by ballot; provided however, that any election for directors must be by ballot if demanded by any shareholder before the voting has begun. On any matter other than elections of directors, any shareholder may vote part of the shares in favor of the proposal and refrain from voting the remaining shares or vote them against the proposal, but, if the shareholder fails to specify the number of shares which the shareholder is voting affirmatively, it will be conclusively presumed that the shareholder’s approving vote is with respect to all shares that the shareholder is entitled to vote. If a quorum is present, the affirmative vote of the majority of the shares represented at the meeting and entitled to vote on any matter (other than the election of directors) shall be the act of the shareholders, unless the vote of a greater number or voting by classes is required by California General Corporation Law or by the articles of incorporation.

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At a shareholders’ meeting at which directors are to be elected, no shareholder shall be entitled to cumulate votes (i.e., cast for any one or more candidates a number of votes greater than the number of the shareholder’s shares) unless the candidates’ names have been placed in nomination prior to commencement of the voting and a shareholder has given notice prior to commencement of the voting of the shareholder’s intention to cumulate votes. If any shareholder has given such a notice, then every shareholder entitled to vote may cumulate votes for candidates in nomination and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which that shareholder’s shares are entitled, or distribute the shareholder’s votes on the same principle among any or all of the candidates, as the shareholder thinks fit. The candidates receiving the highest number of votes, up to the number of directors to be elected, shall be elected.

Section 9. WAIVER OF NOTICE OR CONSENT BY ABSENT SHAREHOLDERS. The transactions of any meeting of shareholders, either annual or special, however called and noticed, and wherever held, shall be as valid as though had at a meeting duly held after regular call and notice, if a quorum be present either in person or by proxy, and if, either before or after the meeting, each person entitled to vote, who was not present in person or by proxy, signs a written waiver of notice or a consent to a holding of the meeting, or an approval of the minutes. The waiver of notice or consent need not specify either the business to be transacted or the purpose of any annual or special meeting of shareholders, except that if action is taken or proposed to be taken for approval of any of those matters specified in the second paragraph of Section 4 of this Article II, the waiver of notice or consent shall state the general nature of the proposal. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

Attendance by a person at a meeting shall also constitute a waiver of notice of that meeting, except when the person objects, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened, and except that attendance at a meeting is not a waiver of any right to object to the consideration of matters not included in the notice of the meeting if that objection is expressly made at the meeting.

Section 10. SHAREHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING. Any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, is signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take that action at a meeting at which all shares entitled to vote on that action were present and voted. In the case of election of directors, such a consent shall be effective only if signed by the holders of all outstanding shares entitled to vote for the election of directors; provided, however, that a director may be elected at any time to fill a vacancy on the board of directors that has not been filled by the directors, by the written consent of the holders of a majority of the outstanding shares entitled to vote for the election of directors. All such

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consents shall be filed with the secretary of the corporation and shall be maintained in the corporate records. Any shareholder giving a written consent, or the shareholder’s proxy holders, or a transferee of the shares or a personal representative of the shareholder or their respective proxy holders, may revoke the consent by a writing received by the secretary of the corporation before written consents of the number of shares required to authorize the proposed action have been filed with the secretary.

If the consents of all shareholders entitled to vote have not been solicited in writing, and if the unanimous written consent of all such shareholders shall not have been received, the secretary shall give prompt notice of the corporate action approved by the shareholders without a meeting. This notice shall be given in the manner specified in Section 5 of this Article II. In the case of approval of (i) contracts or transactions in which a director has a direct or indirect financial interest, pursuant to Section 310 of the Corporations Code of California, (ii) indemnification of agents of the corporation, pursuant to Section 317 of that Code, (iii) a reorganization of the corporation, pursuant to Section 1201 of that Code, and (iv) a distribution in dissolution other than in accordance with the rights of outstanding preferred shares, pursuant to Section 2007 of that Code, the notice shall be given at least ten (10) days before the consummation of any action authorized by that approval.

Section ll. RECORD DATE FOR SHAREHOLDER NOTICE, VOTING, AND GIVING CONSENTS. For purposes of determining the shareholders entitled to notice of any meeting or to vote or entitled to give consent to corporate action without a meeting, the board of directors may fix, in advance, a record date, which shall not be more than sixty (60) days nor less than ten (10) days before the date of any such meeting nor more than sixty (60) days before any such action without a meeting, and in this event only shareholders of record on the date so fixed are entitled to notice and to vote or to give consents, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date, except as otherwise provided in the California General Corporation Law.

If the board of directors does not so fix a record date:

(a) The record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding the day on which notice is given or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held.

(b) The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, (i) when no prior action by the board has been taken, shall be the day on which the first written consent is given, or (ii) when prior action of the board has been taken, shall be at the close of business on the day on which the board adopts the resolution relating to that action, or the sixtieth (60th) day before the date of such other action, whichever is later.

Section 12. PROXIES. Every person entitled to vote for directors or on any other matter shall have the right to do so either in person or by one or more agents authorized by

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a written proxy signed or an electronic transmission authorized by the person and properly submitted to the corporation or its designated agent for such purpose. A proxy shall be deemed signed if the shareholder’s name or other authorization is placed on the proxy (whether by manual signature, typewriting, telegraphic or electronic transmission, or otherwise) by the shareholder or the shareholder’s attorney in fact. A validly executed proxy which does not state that it is irrevocable shall continue in full force and effect unless (i) revoked by the person executing it, before the vote pursuant to that proxy, by a writing delivered to the corporation stating that the proxy is revoked, or by a subsequent proxy executed by, or attendance at the meeting and voting in person by, the person executing the proxy; or (ii) written notice of the death or incapacity of the maker of that proxy is received by the corporation before the vote pursuant to that proxy is counted; provided, however, that no proxy shall be valid after the expiration of eleven (ll) months from the date of the proxy, unless otherwise provided in the proxy. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Sections 705(e) and 705(f) of the Corporations Code of California.

Section 13. INSPECTORS OF ELECTION. Before any meeting of shareholders, the board of directors may appoint any persons other than nominees for office to act as inspectors of election at the meeting or its adjournment. If no inspectors of election are so appointed, the chairman of the meeting may, and on the request of any shareholder or a shareholder’s proxy shall, appoint inspectors of election at the meeting. The number of inspectors shall be either one (l) or three (3). If inspectors are appointed at a meeting on the request of one or more shareholders or proxies, the holders of a majority of shares or their proxies present at the meeting shall determine whether one (l) or three (3) inspectors are to be appointed. If any person appointed as inspector fails to appear or fails or refuses to act, the chairman of the meeting may, and upon the request of any shareholder or a shareholder’s proxy shall, appoint a person to fill that vacancy.

These inspectors shall:

(a) Determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum, and the authenticity, validity, and effect of proxies;

(b) Receive votes, ballots, or consents;

(c) Hear and determine all challenges and questions in any way arising in connection with the right to vote;

(d) Count and tabulate all votes or consents;

(e) Determine when the polls shall close;

(f) Determine the result; and

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(g) Do any other acts that may be proper to conduct the election or vote with fairness to all shareholders.

ARTICLE III

DIRECTORS

Section l. POWERS. Subject to the provisions of the California General Corporation Law and any limitations in the articles of incorporation and these bylaws relating to action required to be approved by the shareholders or by the outstanding shares, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the board of directors.

Without prejudice to these general powers, and subject to the same limitations, the directors shall have the power to:

(a) Select and remove all officers, agents, and employees of the corporation; prescribe any powers and duties for them that are consistent with law, with the articles of incorporation, and with these bylaws; fix their compensation; and require from them security for faithful service.

(b) Change the principal executive office or the principal business office in the State of California from one location to another; cause the corporation to be qualified to do business in any other state, territory, dependency, or country and to conduct business within or without the State of California; and designate any place within or without the State of California for the holding of any shareholders’ meeting, or meetings, including annual meetings.

(c) Adopt, make, and use a corporate seal; prescribe the forms of certificates of stock; and alter the form of the seal and certificates.

(d) Authorize the issuance of shares of stock of the corporation on any lawful terms, in consideration of money paid, labor done, services actually rendered, debts or securities cancelled, or tangible or intangible property actually received.

(e) Borrow money and incur indebtedness on behalf of the corporation, and cause to be executed and delivered for the corporation’s purposes, in the corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages, pledges, hypothecations, and other evidences of debt and securities.

Section 2. NUMBER AND QUALIFICATION OF DIRECTORS. The number of directors of the corporation shall be no less than 9 nor more than 17. The exact number of directors shall be 13 until changed, within the limits specified above, by a bylaw amending this Section 2, duly adopted by the board of directors or by the shareholders. The indefinite number of directors may be changed, or a definite number fixed without provision for an indefinite number, by a duly adopted amendment to the articles of incorporation; provided,

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however, that an amendment reducing the number or the minimum number of directors to a number less than five cannot be adopted if the votes cast against its adoption at a meeting of the shareholders, or the shares not consenting in the case of action by written consent, are equal to more than 16 ²/3% of the outstanding shares entitled to vote. No amendment may change the stated maximum number of authorized directors to a number greater than two times the stated minimum number of directors minus one.

Section 3. ELECTION AND TERM OF OFFICE OF DIRECTORS. Directors shall be elected at each annual meeting of the shareholders to hold office until the next annual meeting. Each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified.

Section 4. VACANCIES. Vacancies in the board of directors may be filled by a majority of the remaining directors, though less than a quorum, or by a sole remaining director, except that a vacancy created by the removal of a director by the vote or written consent of the shareholders or by court order may be filled only by the vote of a majority of the shares entitled to vote represented at a duly held meeting at which a quorum is present, or by the written consent of holders of a majority of the outstanding shares entitled to vote. Each director so elected shall hold office until the next annual meeting of the shareholders and until a successor has been elected and qualified.

A vacancy or vacancies in the board of directors shall be deemed to exist in the event of the death, resignation, or removal of any director, or if the board of directors by resolution declares vacant the office of a director who has been declared of unsound mind by an order of court or convicted of a felony, or if the authorized number of directors is increased, or if the shareholders fail, at any meeting of shareholders at which any director or directors are elected, to elect the number of directors to be voted for at that meeting.

The shareholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent shall require the consent of a majority of the outstanding shares entitled to vote.

Any director may resign effective on giving written notice to the chairman of the board, the president, the secretary, or the board of directors, unless the notice specifies a later time for that resignation to become effective. If the resignation of a director is effective at a future time, the board of directors may elect a successor to take office when the resignation becomes effective.

No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.

Section 5. PLACE OF MEETINGS AND MEETINGS BY TELEPHONE. Regular meetings of the board of directors may be held at any place within or outside the State of California that has been designated from time to time by resolution of the board. In the absence of such a designation, regular meetings shall be held at the principal executive

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office of the corporation. Special meetings of the board shall be held at any place within or outside the State of California that has been designated in the notice of the meeting or, if not stated in the notice or there is no notice, at the principal executive office of the corporation. Any meeting, regular or special, may be held by conference telephone or similar communication equipment, so long as all directors participating in the meeting can hear one another, and all such directors shall be deemed to be present in person at the meeting.

Section 6. ANNUAL MEETING. Immediately following each annual meeting of shareholders, the board of directors shall hold a regular meeting for the purpose of organization, any desired election of officers, and the transaction of other business. Notice of this meeting shall not be required.

Section 7. OTHER REGULAR MEETINGS. Other regular meetings of the board of directors shall be held without call at such time as shall from time to time be fixed by the board of directors. Such regular meetings may be held without notice.

Section 8. SPECIAL MEETINGS. Special meetings of the board of directors for any purpose or purposes may be called at any time by the chairman of the board or the president or the secretary or any two directors.

Notice of the time and place of special meetings shall be delivered personally or by telephone to each director or sent by first-class mail or telegram, charges prepaid, addressed to each director at that director’s address as it is shown on the records of the corporation. In case the notice is mailed, it shall be deposited in the United States mail at least four (4) days before the time of the holding of the meeting. In case the notice is delivered personally, or by telephone or telegram, it shall be delivered personally or by telephone or to the telegraph company at least forty-eight (48) hours before the time of the holding of the meeting. Any oral notice given personally or by telephone may be communicated either to the director or to a person at the office of the director who the person giving the notice has reason to believe will promptly communicate it to the director. The notice need not specify the purpose of the meeting nor the place if the meeting is to be held at the principal executive office of the corporation.

Section 9. QUORUM. A majority of the authorized number of directors shall constitute a quorum for the transaction of business, except to adjourn as provided in Section ll of this Article III. Every act done or decision made by a majority of the directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the board of directors, subject to the provisions of Section 310 of the Corporations Code of California (as to approval of contracts or transactions in which a director has a direct or indirect material financial interest), Section 311 of that Code (as to appointment of committees), and Section 317(e) of that Code (as to indemnification of directors). A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for that meeting.

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Section 10. WAIVER OF NOTICE. The transactions of any meeting of the board of directors, however called and noticed or wherever held, shall be as valid as though had at a meeting duly held after regular call and notice if a quorum is present and if, either before or after the meeting, each of the directors not present signs a written waiver of notice, a consent to holding the meeting or an approval of the minutes. The waiver of notice or consent need not specify the purpose of the meeting. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meeting. Notice of a meeting shall also be deemed given to any director who attends the meeting without protesting before or at its commencement, the lack of notice to that director.

Section 11. ADJOURNMENT. A majority of the directors present, whether or not constituting a quorum, may adjourn any meeting to another time and place.

Section 12. NOTICE OF ADJOURNMENT. Notice of the time and place of holding an adjourned meeting need not be given, unless the meeting is adjourned for more than twenty-four hours, in which case notice of the time and place shall be given before the time of the adjourned meeting, in the manner specified in Section 8 of this Article III, to the directors who were not present at the time of the adjournment.

Section 13. ACTION WITHOUT MEETING. Any action required or permitted to be taken by the board of directors may be taken without a meeting, if all members of the board shall individually or collectively consent in writing to that action. Such action by written consent shall have the same force and effect as a unanimous vote of the board of directors. Such written consent or consents shall be filed with the minutes of the proceedings of the board.

Section 14. FEES AND COMPENSATION OF DIRECTORS. Directors and members of committees may receive such compensation, if any, for their services, and such reimbursement of expenses, as may be fixed or determined by resolution of the board of directors. This Section 14 shall not be construed to preclude any director from serving the corporation in any other capacity as an officer, agent, employee, or otherwise, and receiving compensation for those services.

ARTICLE IV

COMMITTEES

Section l. COMMITTEES OF DIRECTORS. The board of directors may, by resolution adopted by a majority of the authorized number of directors, designate one or more committees, each consisting of two or more directors, to serve at the pleasure of the board. The board may designate one or more directors as alternate members of any committee who may replace any absent member at any meeting of the committee. Any committee, to the extent provided in the resolution of the board, shall have all the authority of the board, except with respect to:

(a) the approval of any action which, under the General Corporation Law of California, also requires shareholders’ approval or approval of the outstanding shares;

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(b) the filling of vacancies on the board of directors or in any committee;

(c) the fixing of compensation of the directors for serving on the board or on any committee;

(d) the amendment or repeal of bylaws or the adoption of new bylaws;

(e) the amendment or repeal of any resolution of the board of directors which by its express terms is not so amendable or repealable;

(f) a distribution to the shareholders of the corporation, except at a rate or in a periodic amount or within a price range determined by the board of directors; or

(g) the appointment of any other committees of the board of directors or the members of these committees.

Section 2. MEETINGS AND ACTION OF COMMITTEES. Meetings and action of committees shall be governed by, and held and taken in accordance with, the provisions of Article III of these bylaws, Sections 5 (place of meetings), 7 (regular meetings), 8 (special meetings and notice), 9 (quorum), 10 (waiver of notice), 11 (adjournment), 12 (notice of adjournment), and 13 (action without meeting), with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the board of directors and its members, except that the time of regular meetings of committees may be determined either by resolution of the board of directors or by resolution of the committee; special meetings of committees may also be called by resolution of the board of directors; and notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The board of directors may adopt rules for the government of any committee not inconsistent with the provisions of these bylaws.

ARTICLE V

OFFICERS

Section l. OFFICERS. The officers of the corporation shall be a president, a secretary, and a chief financial officer. The corporation may also have, at the discretion of the board of directors, a chairman of the board, one or more vice presidents, one or more assistant secretaries, one or more assistant treasurers, and such other officers as may be appointed in accordance with the provisions of Section 3 of this Article V. Any number of offices may be held by the same person.

Section 2. ELECTION OF OFFICERS. The officers of the corporation, except such officers as may be appointed in accordance with the provisions of Section 3 or Section

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5 of this Article V, shall be chosen by the board of directors, and each shall serve at the pleasure of the board, subject to the rights, if any, of any officer under any contract of employment.

Section 3. SUBORDINATE OFFICERS. The board of directors may appoint, and may empower the president to appoint, such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority and perform such duties as are provided in the bylaws or as the board of directors may from time to time determine.

Section 4. REMOVAL AND RESIGNATION OF OFFICERS. Subject to the rights, if any, of any officer under any contract of employment, any officer may be removed, either with or without cause, by the board of directors, at any regular or special meeting of the board, or, except in the case of an officer chosen by the board of directors, by an officer upon whom such power of removal may be conferred by the board of directors.

Any officer may resign at any time by giving written notice to the corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice; and unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.

Section 5. VACANCIES IN OFFICES. A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in these bylaws for regular appointments to that office.

Section 6. CHAIRMAN OF THE BOARD. The chairman of the board, if such an officer be elected, shall, if present, preside at meetings of the board of directors and exercise and perform such powers and duties as may be from time to time assigned to him by the board of directors or prescribed by the bylaws. If there is no president, the chairman of the board shall, in addition be the chief executive officer of the corporation and shall have the powers and duties prescribed in Section 7 of this Article V.

Section 7. PRESIDENT. Subject to such supervisory powers, if any, as may be given by the board of directors to the chairman of the board, if there be such an officer, the president shall be the chief executive officer of the corporation and shall, subject to the control of the board of directors, have general supervision, direction, and control of the business and the officers of the corporation. He shall preside at all meetings of the shareholders and, in the absence of the chairman of the board, or if there be none, at all meetings of the board of directors. He shall have the general powers and duties of management usually vested in the office of president of a corporation, and shall have such other powers and duties as may be prescribed by the board of directors or by the bylaws.

Section 8. VICE PRESIDENT. In the absence or disability of the president, the vice presidents, if any, in order of their rank as fixed by the board of directors or, if not ranked,

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a vice president designated by the board of directors, shall perform all the duties of the president, and when so acting shall have all the powers of, and be subject to all the restrictions upon, the president. The vice presidents shall have such other powers and perform other duties as from time to time may be prescribed for them respectively by the board of directors or the bylaws, and the president, or the chairman of the board.

Section 9. SECRETARY. The secretary shall keep or cause to be kept, at the principal executive office or such other place as the board of directors may direct, a book of minutes of all meetings and actions of directors, committees of directors, and shareholders, with the time and place of holding, whether regular or special, and, if special, how authorized, the notice given, the names of those present at directors’ meetings or committee meetings, the number of shares present or represented at shareholders’ meetings, and the proceedings.

The secretary shall keep, or cause to be kept, at the principal executive office or at the office of the corporation’s transfer agent or registrar, as determined by resolution of the board of directors, a share register, or a duplicate share register, showing the names of all shareholders and their addresses, the number of classes of shares held by each, the number and date of certificates issued for the same, and the number and date of cancellation of every certificate surrendered for cancellation.

The secretary shall give, or cause to be given, notice of all meetings of the shareholders and of the board of directors required by the bylaws or by law to be given, and he shall keep the seal of the corporation if one be adopted, in safe custody, and shall have such other powers and perform such other duties as may be prescribed by the board of directors or by the bylaws.

Section 10. CHIEF FINANCIAL OFFICER. The chief financial officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings and shares. The books of the account shall at all reasonable times be open to inspection by any director.

The chief financial officer shall deposit moneys and other valuables in the name and to the credit of the corporation with such depositaries as may be designated by the board of directors. He shall disburse the funds of the corporation as may be ordered by the board of directors, shall render to the president and directors, whenever they request it, an account of all his transactions as chief financial officer and of the financial condition of the corporation, and shall have other powers and perform such other duties as may be prescribed by the board of directors or the bylaws.

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ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES

AND OTHER AGENTS; INSURANCE OF DIRECTORS AND OFFICERS

Section 1. INDEMNIFICATION. (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.

Indemnification of Agents of the corporation who are not its Officers and Directors shall be in accordance with the provisions of Section 317 of the Corporations Code of California.

The corporation may enter into indemnification agreements with its Directors, Officers and other Agents upon such terms and conditions as are deemed to be in the best interests of the corporation by its board of directors.

The other provisions of this Section 1 to the contrary notwithstanding, the corporation shall not be obligated:

(a) to indemnify or advance expenses to an Officer, Director or Agent with respect to proceedings or claims initiated or brought voluntarily by such Officer, Director or Agent and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under an indemnification agreement or any statute or law or otherwise as required under Section 317 of the Corporations Code of California, but such indemnification or advancement of expenses may be provided by the corporation in specific cases if the board of directors has approved the bringing of such suit;

(b) to indemnify an Officer, Director or Agent for any expenses incurred with respect to any proceeding instituted by such Officer, Director or Agent to enforce or interpret provisions of an indemnity agreement or this Section 1, if a court of competent jurisdiction determines that each of the material assertions made by the Officer, Director or Agent in such proceeding was not made in good faith or was frivolous;

(c) to indemnify an Officer, Director or Agent for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) which have been paid or satisfied by an insurance carrier under a policy of officers’ and directors’ liability insurance maintained by the corporation; provided that the corporation shall be obligated to remit to the Officer, Director or Agent any insurance proceeds received in respect of expenses or liabilities previously paid or satisfied by such Officer, Director or Agent;

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(d) to indemnify an Officer, Director or Agent for expenses, judgments, fines or penalties sustained, or for an accounting of profits made from, the purchase and sale by such Officer, Director or Agent of securities of the corporation in violation of the provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, any amendments thereto or any similar provisions of any federal, state or local statutory law; or

(e) in the event a court of competent jurisdiction finally determines that such indemnification is unlawful.

The term “Officer” as used in this Section 1 shall mean each person who is, or was, appointed to the office of Chairman of the Board, President, Vice President, Secretary, Assistant Secretary, Chief Financial Officer, Treasurer, Assistant Treasurer, and such other office of the corporation as the board shall designate from time to time. The term “Director” as used in this Section 1 shall mean any person who is, or was, appointed to serve on the board of directors either by the shareholders or the remaining board members. The term “Agent” as used in this Section 1 shall have the same meaning as that set forth in Section 317(a) of the Corporations Code of California, except that it shall not include Officers and Directors.

Section 2. INSURANCE. The corporation may purchase and maintain insurance on behalf of its Directors, Officers and Agents, against any liability asserted against, or incurred by, any of them by reason of the fact that such person is, or was, a Director, Officer or Agent of the corporation, whether or not the corporation would have the power to indemnify such persons against such liability under the General Corporation Law of California.

ARTICLE VII

RECORDS AND REPORTS

Section l. MAINTENANCE AND INSPECTION OF SHARE REGISTER. The corporation shall keep at its principal executive office, or at the office of its transfer agent or registrar, if either be appointed and as determined by resolution of the board of directors, a record of its shareholders, giving the names and addresses of all shareholders and the number and class of shares held by each shareholder.

A shareholder or shareholders of the corporation holding at least five percent (5%) in the aggregate of the outstanding voting shares of the corporation may (i) inspect and copy the records of shareholders’ names and addresses and shareholdings during usual business hours on five days prior written demand on the corporation, and (ii) obtain from the transfer agent of the corporation, on written demand and on the tender of such transfer agent’s usual charges for such list, a list of the shareholders’ names and addresses, who are entitled to vote for the election of directors, and their shareholdings, as of the most recent record date for which that list has been compiled or as of a date specified by the shareholder after the date of demand. This list shall be made available to any such shareholder by the transfer

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agent on or before the latter of five (5) days after the demand is received or the date specified in the demand as the date as of which the list is to be compiled. The record of shareholders shall be open to inspection on the written demand of any shareholder or holder of a voting trust certificate, at any time during the usual business hours, for a purpose reasonably related to the holder’s interests as a shareholder or as the holder of a voting trust certificate. Any inspection and copying under this Section l may be made in person or by an agent or attorney of the shareholder or holder of a voting trust certificate making the demand.

Section 2. MAINTENANCE AND INSPECTION OF BYLAWS. The corporation shall keep at its principal executive office or, if its principal executive office is not in the State of California, at its principal business office in this state, the original or a copy of the bylaws as amended to date, which shall be open to inspection by the shareholders at all reasonable times during office hours. If the principal executive office of the corporation is outside the State of California and the corporation has no principal business office in this state, the Secretary shall, upon the written request of any shareholder, furnish to that shareholder a copy of the bylaws as amended to date.

Section 3. MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS. The accounting books and records and minutes of proceedings of the shareholders and the board of directors and any committee or committees of the board of directors shall be kept at such place or places designated by the board of directors or, in the absence of such designation, at the principal executive office of the corporation. The minutes shall be kept in written form and the accounting books and records shall be kept either in written form or in any other form capable of being converted into written form. The minutes and accounting books and records shall be open to inspection upon the written demand of any shareholder or holder of a voting trust certificate, at any reasonable time during the usual business hours, for a purpose reasonably related to the holder’s interests as a shareholder or as the holder of a voting trust certificate. The inspection may be made in person or by an agent or attorney, and shall include the right to copy and make extracts. These rights of inspection shall extend to the records of each subsidiary corporation of the corporation.

Section 4. INSPECTION BY DIRECTORS. Every director shall have the absolute right at any reasonable time to inspect all books, records, and documents of every kind and the physical properties of the corporation and each of its subsidiary corporations. This inspection by a director may be made in person, or by an agent or attorney and the right of inspection includes the right to copy and make extracts of documents.

Section 5. ANNUAL REPORT TO SHAREHOLDERS. The board of directors shall cause an annual report to be sent to the shareholders not later than one hundred twenty days (120) after the close of the fiscal year adopted by the corporation. This report shall be sent at least fifteen (15) days before the annual meeting of shareholders to be held during the next fiscal year and in the manner specified in Section 5 of Article II of these bylaws for giving notice to shareholders of the corporation. The annual report shall contain a balance sheet as of the end of the fiscal year and an income statement and statement of changes in

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financial position for the fiscal year, accompanied by any report of independent accountants or, if there is no such report, the certificate of an authorized officer of the corporation that the statements were prepared without audit from the books and records of the corporation.

Section 6. FINANCIAL STATEMENTS. A copy of any annual financial statement and any income statement of the corporation for each fiscal year, and any accompanying balance sheet of the corporation as of the end of each such period that has been prepared by the corporation, shall be kept on file in the principal executive office of the corporation for twelve (12) months and each such statement shall be exhibited at any reasonable time to any shareholder demanding an examination of any such statement or a copy shall be mailed to any such shareholder.

If a shareholder or shareholders holding at least five percent (5%) of the outstanding shares of any class of stock of the corporation makes a written request to the corporation for an income statement of the corporation for the three-month, six-month or nine-month period of the then current fiscal year ended more than thirty (30) days before the date of the request, and a balance sheet of the corporation as of the end of that period, the chief financial officer shall cause that statement to be prepared, if not already prepared, and shall deliver personally or mail that statement or statements to the person making the request within thirty (30) days after the receipt of the request. If the corporation has not sent to the shareholders its annual report for the last fiscal year, this report shall likewise be delivered or mailed to the shareholder or shareholders within thirty (30) days after the request.

The corporation shall also, on the written request of any shareholder, mail to the shareholder a copy of the last annual, semi-annual or quarterly income statement which it has prepared, and a balance sheet as of the end of that period.

The quarterly income statements and balance sheets referred to in this section shall be accompanied by the report, if any, of any independent accountants engaged by the corporation or the certificate of an authorized officer of the corporation that the financial statements were prepared without audit from the books and records of the corporation.

Section 7. ANNUAL STATEMENT OF GENERAL INFORMATION. The corporation shall, during the period commencing on April l and ending on September 30 in each year, file with the Secretary of State of the State of California, on the prescribed form, a statement setting forth the authorized number of directors, the names and complete business or residence addresses of the chief executive officer, secretary and chief financial officer, the street address of its principal executive office or principal business office in this state and the general type of business activity of the corporation, together with a designation of the agent of the corporation for the purpose of service of process, all in compliance with Section 1502 of the Corporations Code of California.

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ARTICLE VIII

GENERAL CORPORATE MATTERS

Section l. RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING. For purposes of determining the shareholders entitled to receive payment of any dividend or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action (other than action by shareholders by written consent without a meeting), the board of directors may fix, in advance, a record date, which shall not be more than sixty (60) days before any such action, and in that case only shareholders of record on the date so fixed are entitled to receive the dividend, distribution, or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date so fixed, except as otherwise provided in the California General Corporation Law.

If the board of directors does not so fix a record date, the record date for determining shareholders for any such purpose shall be at the close of business on the day on which the board adopts the applicable resolution or the sixtieth (60th) day before the date of that action, whichever is later.

Section 2. CHECKS, DRAFTS, EVIDENCES OF INDEBTEDNESS. All checks, drafts, or other orders for payment of money, notes, or other evidences of indebtedness, issued in the name of or payable to the corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the board of directors.

Section 3. CORPORATE CONTRACTS AND INSTRUMENTS; HOW EXECUTED. The board of directors, except as otherwise provided in these bylaws, may authorize any officer or officers, agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the corporation, and this authority may be general or confined to specific instances; and, unless so authorized or ratified by the board of directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

Section 4. CERTIFICATES FOR SHARES. A certificate or certificates for shares of the capital stock of the corporation shall be issued to each shareholder when any of these shares are fully paid, and the board of directors may authorize the issuance of certificates or shares as partly paid provided that these certificates shall state the amount of the consideration to be paid for them and the amount paid. All certificates shall be signed in the name of the corporation by the chairman of the board or vice chairman of the board or president or vice president and by the chief financial officer or an assistant treasurer or the secretary or an assistant secretary, certifying the number of shares and the class or series of shares owned by the shareholder. Any or all of the signatures on the certificates may be facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed on a certificate shall have ceased to be that officer, transfer agent, or registrar before that certificate is issued, it may be issued by the corporation with the same effect as if that person were an officer, transfer agent, or registrar at the date of issue.

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Section 5. LOST CERTIFICATES. Except as provided in this Section 5, no new certificates for shares shall be issued to replace an old certificate unless the latter is surrendered to the corporation and cancelled at the same time. The board of directors may, in case any share certificate or certificate for any other security is lost, stolen, or destroyed, authorize the issuance of a replacement certificate on such terms and conditions as the board may require, including provision for indemnification of the corporation secured by a bond or other adequate security sufficient to protect the corporation against any claim that may be made against it, including any expense or liability, on account of the alleged loss, theft, or destruction of the certificate or the issuance of the replacement certificate.

Section 6. REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The chairman of the board, the president, or any vice president, or any other person authorized by resolution of the board of directors or by any of the foregoing designated officers, is authorized to vote on behalf of the corporation any and all shares of any other corporation or corporations, foreign or domestic, standing in the name of the corporation. The authority granted to these officers to vote or represent on behalf of the corporation any and all shares held by the corporation in any other corporation or corporations may be exercised by any of these officers in person or by any person authorized to do so by a proxy duly executed by these officers.

Section 7. CONSTRUCTION AND DEFINITIONS. Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the California General Corporation Law shall govern the construction of these bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular, and the term “person” includes both a corporation and a natural person.

ARTICLE IX

AMENDMENTS

Section l. AMENDMENT BY SHAREHOLDERS. New bylaws may be adopted or these bylaws may be amended or repealed by the vote or written consent of holders of a majority of the outstanding shares entitled to vote; provided, however, that if the articles of incorporation of the corporation set forth the number of authorized directors of the corporation, the authorized number of directors may be changed only by an amendment of the articles of incorporation.

Section 2. AMENDMENT BY DIRECTORS. Subject to the rights of the shareholders as provided in Section l of this Article IX to adopt, amend or repeal bylaws, bylaws may be adopted, amended or repealed by the board of directors; provided, however, that the board of directors may adopt a bylaw or amendment of a bylaw changing the authorized number of directors only for the purpose of fixing the exact number of directors within the limits specified in the articles of incorporation or in Section 2 of Article III of these bylaws.

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EX-10.(OO)

EXHIBIT 10(oo)

EXECUTION COPY

AMENDMENT NO. 1

AMENDMENT NO. 1 dated as of July 7, 2003 to the Credit Agreement referred to below, between: THE FIRST AMERICAN CORPORATION, a California corporation (the “Borrower”); each of the lenders that is a signatory hereto (individually, a “Lender” and, collectively, the “Lenders”) and JPMORGAN CHASE BANK (formerly known as The Chase Manhattan Bank), as agent for the Lenders (in such capacity, together with its successors in such capacity, the “Administrative Agent”).

The Borrower, the Lenders and the Administrative Agent are parties to a Credit Agreement dated as of October 12, 2001 (as amended, the “Credit Agreement”), pursuant to which a revolving credit facility is made available to the Borrower. The Borrower, the Lenders and the Administrative Agent wish to amend the Credit Agreement in certain respects, and accordingly, the parties hereto hereby agree as follows:

Section 1. Definitions. Capitalized terms used in this Amendment No. 1 and not otherwise defined are used herein as defined in the Credit Agreement.

Section 2. Amendments. Subject to the satisfaction of the conditions precedent specified in Section 4 below, but effective as of the date hereof, the Credit Agreement shall be amended as follows:

2.01. References in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein” and “hereof”) shall be deemed to be references to the Credit Agreement as amended hereby.

2.02. Section 6.01 of the Credit Agreement is hereby amended by (a) deleting the word “and” at the end of clause (l) thereof, (b) changing clause “(m)” to clause “(n)” and (c) inserting a new clause (m), immediately following clause (l), to read as follows:

“(m) in addition to the Indebtedness permitted under clause (i) of this Section, additional Indebtedness of FATICO secured by a Lien upon its real Property located in Santa Ana, California (which Indebtedness may be guaranteed by the Borrower) that exceeds 80% of the market value of such Property, provided that the aggregate principal amount of Indebtedness permitted under this clause (m) shall not exceed $55,000,000 at any one time outstanding; and”

2.03. Section 6.02(e) of the Credit Agreement is hereby amended by inserting at the end thereof the words: “and 6.01(m)”.

Section 3. Representations and Warranties. The Borrower represents and warrants to the Lenders that (a) the representations and warranties set forth in Section 3 of the Credit Agreement are true and complete on the date hereof as if made on and as of the date hereof and as if each reference in said Section 3 to “this Agreement” included reference to this

Amendment No. 1 and (b) immediately before and after giving effect to the amendment under Section 2 hereof, no Default has occurred and is continuing.

Section 4. Conditions Precedent to Effectiveness. The amendments to the Credit Agreement set forth in Section 2 hereof shall become effective, as of the date hereof, upon receipt by the Administrative Agent of one or more counterparts of this Amendment No. 1 executed by the Borrower and the Required Lenders.

Section 5. Miscellaneous. Except as herein provided, the Credit Agreement shall remain unchanged and in full force and effect. This Amendment No. 1 may be executed in any number of counterparts, all of which taken together shall constitute one and the same agreement and any of the parties hereto may execute this Amendment No. 1 by signing any such counterpart. This Amendment No. 1 shall be governed by, and construed in accordance with, the law of the State of New York.

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be duly executed and delivered as of the day and year first above written.

THE FIRST AMERICAN CORPORATION
By	/s/    Thomas A. Klemens
	Name:	Thomas A. Klemens
	Title:	Senior Executive Vice President Chief Financial Officer

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JPMORGAN CHASE BANK
individually and as Administrative Agent
By	/s/    Elisabeth H. Schwabe
	Name: Elisabeth H. Schwabe
	Title: Managing Director
COMERICA BANK
By	/s/    Fernando Loza
	Name: Fernando Loza
	Title: Assistant Vice President
COMERICA BANK CALIFORNIA
By	/s/    Fernando Loza
	Name: Fernando Loza
	Title: Assistant Vice President
UNION BANK OF CALIFORNIA, N.A.
By	/s/    Joseph Argabrite
	Name: Joseph Argabrite
	Title: Vice President
BANK OF THE WEST ( F/K/A UNITED CALIFORNIA BANK)
By	/s/    Dale Paterson
	Name: Dale Paterson
	Title: Vice President

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BANK ONE ARIZONA, NA
By
	Name:
	Title:
BANK ONE, NA
By
	Name:
	Title:
WELLS FARGO BANK, N.A.
By
	Name:
	Title:
U.S. BANK NATIONAL ASSOCIATION
By	/s/    Ryan Stipe
	Name: Ryan Stipe
	Title: Assistant Vice President
U.S. BANK NATIONAL ASSOCIATION (OREGON)
By
	Name:
	Title:
BANK OF AMERICA, N.A.
By	/s/    Leslie E. Nannen
	Name: Leslie E. Nannen
	Title: Vice President

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FLEET NATIONAL BANK
By	/s/    AMY B. PEDEN
	Name: Amy B. Peden
	Title:   Vice President
SUMITOMO MITSUI BANKING CORPORATION
By
	Name:
	Title:
FIRST SECURITY BANK, N.A.
By
	Name:
	Title:
SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By
	Name:
	Title:

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EX-10.(PP)

EXHIBIT 10(pp)

EXECUTION COPY

AMENDMENT NO. 2

AMENDMENT NO. 2 dated as of October 22, 2003 to the Credit Agreement referred to below, between: THE FIRST AMERICAN CORPORATION, a California corporation (the “Borrower”); each of the lenders that is a signatory hereto (individually, a “Lender” and, collectively, the “Lenders”) and JPMORGAN CHASE BANK, as agent for the Lenders (in such capacity, together with its successors in such capacity, the “Administrative Agent”).

The Borrower, the Lenders and the Administrative Agent are parties to a Credit Agreement dated as of October 12, 2001 (as amended, the “Credit Agreement”), pursuant to which a revolving credit facility is made available to the Borrower. The Borrower, the Lenders and the Administrative Agent wish to amend the Credit Agreement in certain respects, and accordingly, the parties hereto hereby agree as follows:

Section 1. Definitions. Capitalized terms used in this Amendment No. 2 and not otherwise defined are used herein as defined in the Credit Agreement.

Section 2. Amendments. Subject to the satisfaction of the conditions precedent specified in Section 4 below, but effective as of the date hereof, the Credit Agreement shall be amended as follows:

2.01. References in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein” and “hereof”) shall be deemed to be references to the Credit Agreement as amended hereby.

2.02. Section 6.01(m) of the Credit Agreement is hereby amended in its entirety to read as follows:

“(m) in addition to the Indebtedness permitted under clause (i) of this Section, additional Indebtedness of FATICO secured by a Lien upon its real property located in Santa Ana, California, and/or related fixtures and personal property including insurance and condemnation proceeds, if any, and assignment of leases and rents, with respect thereto (which Indebtedness may be guaranteed by the Borrower) that exceeds 80% of the market value of such property, provided that the aggregate principal amount of Indebtedness permitted under this clause (m) shall not exceed $55,000,000 at any one time outstanding; and”

Section 3. Representations and Warranties. The Borrower represents and warrants to the Lenders that (a) the representations and warranties set forth in Section 3 of the Credit Agreement are true and complete on the date hereof as if made on and as of the date hereof and as if each reference in said Section 3 to “this Agreement” included reference to this Amendment No. 2 and (b) immediately before and after giving effect to the amendment under Section 2 hereof, no Default has occurred and is continuing.

Section 4. Conditions Precedent to Effectiveness. The amendments to the Credit Agreement set forth in Section 2 hereof shall become effective, as of the date hereof, upon receipt by the Administrative Agent of one or more counterparts of this Amendment No. 2 executed by the Borrower and the Required Lenders.

Section 5. Miscellaneous. Except as herein provided, the Credit Agreement shall remain unchanged and in full force and effect. This Amendment No. 2 may be executed in any number of counterparts, all of which taken together shall constitute one and the same agreement and any of the parties hereto may execute this Amendment No. 2 by signing any such counterpart. This Amendment No. 2 shall be governed by, and construed in accordance with, the law of the State of New York.

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be duly executed and delivered as of the day and year first above written.

THE FIRST AMERICAN CORPORATION
By	/s/    THOMAS A. KLEMENS
	Name: Thomas A. Klemens Title:    Senior Executive Vice President         Chief Financial Officer

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JPMORGAN CHASE BANK     individually and as Administrative Agent
By	/s/    LAWRENCE PALUMBO, JR.
	Name: Lawrence Palumbo, Jr. Title:   Vice President

COMERICA BANK
By	/s/     FERNANDO LOZA
	Name: Fernando Loza Title:   Assistant Vice President

COMERICA BANK CALIFORNIA
By	/s/     FERNANDO LOZA
	Name: Fernando Loza Title:   Assistant Vice President

:

UNION BANK OF CALIFORNIA, N.A.
By	/s/    JOSEPH M. ARGABRITE
	Name: Joseph M. Argabrite Title:   Vice President

BANK OF THE WEST ( F/K/A UNITED CALIFORNIA BANK)
By	/s/    DALE PATERSON
	Name: Dale Paterson Title:   Vice President

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BANK ONE ARIZONA, NA
By
	Name: Title:

BANK ONE, NA
By
	Name: Title:

WELLS FARGO BANK, N.A.
By	/s/    MATTHEW A. FREY
	Name: Matthew A. Frey Title:   Vice President

U.S. BANK NATIONAL ASSOCIATION
By	/s/    RYAN STIPE
	Name: Ryan Stipe Title:   Assistant Vice President

U.S. BANK NATIONAL ASSOCIATION (OREGON)
By
	Name: Title:

BANK OF AMERICA, N.A.
By	/s/    BOB L. CASTON
	Name: Bob L. Caston Title:   Managing Director

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FLEET NATIONAL BANK
By
	Name: Title:

SUMITOMO MITSUI BANKING CORPORATION
By
	Name: Title:

FIRST SECURITY BANK, N.A.
By
	Name: Title:

SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By
	Name: Title:

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EX-10.(QQ)

EXHIBIT 10(qq)

EXECUTION COPY

AMENDMENT NO. 3

AMENDMENT NO. 3 dated as of November 26, 2003 to the Credit Agreement referred to below, between: THE FIRST AMERICAN CORPORATION, a California corporation (the “Borrower”); each of the lenders that is a signatory hereto (individually, a “Lender” and, collectively, the “Lenders”); and JPMORGAN CHASE BANK, as agent for the Lenders (in such capacity, together with its successors in such capacity, the “Administrative Agent”).

The Borrower, the Lenders and the Administrative Agent are parties to a Credit Agreement dated as of October 12, 2001 (as amended, the “Credit Agreement”), pursuant to which a revolving credit facility is made available to the Borrower. The Borrower, the Lenders and the Administrative Agent wish to amend the Credit Agreement in certain respects, and accordingly, the parties hereto hereby agree as follows:

Section 1. Definitions. Capitalized terms used in this Amendment No. 3 and not otherwise defined are used herein as defined in the Credit Agreement.

Section 2. Amendments. Subject to the satisfaction of the conditions precedent specified in Section 4 below, but effective as of the date hereof, the Credit Agreement shall be amended as follows:

2.01. References in the Credit Agreement (including references to the Credit Agreement as amended hereby) to “this Agreement” (and indirect references such as “hereunder”, “hereby”, “herein” and “hereof”) shall be deemed to be references to the Credit Agreement as amended hereby.

2.02. Section 6.01 of the Credit Agreement is hereby amended by (i) deleting the word “and” at the end of clause (l) thereof, (ii) changing clause “(m)” thereof to clause “(n)” and (iii) inserting a new clause (m), immediately following such clause (l), to read as follows:

“(m) Indebtedness of First Advantage Corp. (“FAC”) and its Subsidiaries in an aggregate principal amount not to exceed $125,000,000 at any one time outstanding (and any Guarantee of such Indebtedness by the Borrower), provided that (i) after giving effect to the incurrence of such Indebtedness, all Funded Debt of FAC and its Subsidiaries (“FAC Total Debt”) at such time will not exceed 45% of the sum of (i) FAC Total Debt and (ii) the aggregate stockholders’ equity (including minority interests in subsidiaries) for FAC and its Subsidiaries at such time and (ii) not more than $55,000,000 in aggregate principal amount of such Indebtedness (and interest corresponding to such guaranteed amount) may be guaranteed by the Borrower; and”.

2.03. Section 6.02 of the Credit Agreement is hereby amended by (i) deleting the word “and” at the end of clause (k) thereof, (ii) changing clause “(l)” thereof to clause “(m)” and (iii) inserting a new clause (l), immediately following such clause (k), to read as follows:

“(m) Liens upon any property or assets of First Advantage Corp. and its Subsidiaries securing Indebtedness permitted under Section 6.01(m); and”.

Section 3. Representations and Warranties. The Borrower represents and warrants to the Lenders that (a) the representations and warranties set forth in Section 3 of the Credit Agreement are true and complete on the date hereof as if made on and as of the date hereof and as if each reference in said Section 3 to “this Agreement” included reference to this Amendment No. 3 and (b) immediately before and after giving effect to the amendment under Section 2 hereof, no Default has occurred and is continuing.

Section 4. Conditions Precedent to Effectiveness. The amendments to the Credit Agreement set forth in Section 2 hereof shall become effective, as of the date hereof, upon receipt by the Administrative Agent of one or more counterparts of this Amendment No. 3 executed by the Borrower and the Required Lenders.

Section 5. Miscellaneous. Except as herein provided, the Credit Agreement shall remain unchanged and in full force and effect. This Amendment No. 3 may be executed in any number of counterparts, all of which taken together shall constitute one and the same agreement and any of the parties hereto may execute this Amendment No. 3 by signing any such counterpart. This Amendment No. 3 shall be governed by, and construed in accordance with, the law of the State of New York.

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 3 to be duly executed and delivered as of the day and year first above written.

THE FIRST AMERICAN CORPORATION
By	/s/    THOMAS A. KLEMENS
	Name:	Thomas A. Klemens
	Title:	Senior Executive Vice President Chief Financial Officer

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JPMORGAN CHASE BANK individually and as Administrative Agent
By	/s/    Lawrence Palumbo, Jr.
	Name: Lawrence Palumbo, Jr.
	Title: Vice President

COMERICA BANK
By	/s/    Fernando Loza
	Name: Fernando Loza
	Title: Assistant Vice President

COMERICA BANK CALIFORNIA
By	/s/    Fernando Loza
	Name: Fernando Loza
	Title: Assistant Vice President

UNION BANK OF CALIFORNIA, N.A.
By	/s/    Joseph M. Argabrite
	Name: Joseph M. Argabrite
	Title: Vice President

BANK OF THE WEST ( F/K/A UNITED CALIFORNIA BANK)
By
	Name:
	Title:

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BANK ONE ARIZONA, NA
By
	Name:
	Title:

BANK ONE, NA
By
	Name:
	Title:

WELLS FARGO BANK, N.A.
By
	Name:
	Title:

U.S. BANK NATIONAL ASSOCIATION
By	/s/    DENETTE CORRALES
	Name: Denette Corrales
	Title: Vice President

BANK OF AMERICA, N.A.
By	/s/    JOAN L. D’AMICO
	Name: Joan L. D’Amico
	Title: Managing Director

FLEET NATIONAL BANK
By	/s/    AMY PEDEN
	Name: Amy Peden
	Title: Vice President

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SUMITOMO MITSUI BANKING CORPORATION
By
	Name:
	Title:

FIRST SECURITY BANK, N.A.
By
	Name:
	Title:

SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By
	Name:
	Title:

-6-

EX-10.(TT)

EXHIBIT 10(tt)

OMNIBUS AGREEMENT

THIS OMNIBUS AGREEMENT (this “Agreement”) is made as of the 30^th day of December, 2003 by and among GENERAL ELECTRIC CAPITAL CORPORATION, as borrower collateral agent (“Borrower Collateral Agent”), as operating agent (“Operating Agent”) and as collateral agent (“Collateral Agent”), EDISON ASSET SECURITIZATION, L.L.C., as lender (“Edison”), MIZUHO CORPORATE BANK, LTD., as lender (“Mizuho”), KBC BANK N.V., as lender (“KBC”) (Edison, Mizuho and KBC each a “Lender” and collective, the “Lenders”), WILMINGTON TRUST COMPANY, in its individual capacity only as explicitly set forth herein (“Wilmington”), WILMINGTON TRUST COMPANY, not in its individual capacity but solely as Owner Trustee under the Trust Agreement (defined below) (in such capacity, “Owner Trustee”), FATICO 1999 TRUST (“Trust”), GENERAL ELECTRIC CAPITAL CORPORATION, as Residual Support Provider (“Residual Support Provider”), MHCB (USA) LEASING & FINANCE CORPORATION (“MLFC”) and FIRST AMERICAN TITLE INSURANCE COMPANY (“Lessee”).

A. Owner Trustee and The Fifth Third Leasing Company (“Fifth Third”) entered into that certain Trust Agreement dated as of December 22, 1999 (the “Trust Agreement”). Prior to the execution of this Agreement, Fifth Third and MLFC entered into that certain Assignment and Assumption Agreement pursuant to which Fifth Third assigned and conveyed to MLFC all of Fifth Third’s right, title and interest in, and MLFC assumed all of Fifth Third’s obligations under, the Trust Agreement.

B. Trust, as borrower, Edison, as lender, and General Electric Capital Corporation, as Operating Agent, Borrower Collateral Agent and Collateral Agent, have heretofore entered into that certain Receivables Funding Agreement dated as of December 27, 1999 (as may be amended from time to time, the “Original Funding Agreement”) and pursuant thereto the Related Documents (as defined in the Original Funding Agreement). Pursuant to that certain Amendment and Assignment dated as of May 5, 2000 among Edison, General Electric Capital Corporation, the Trust, Wilmington, The Fuji Bank (n/k/a Mizuho Corporate Bank, Ltd.) and KBC, Edison assigned to Mizuho and KBC a portion of its rights, title and interest in the Original Funding Agreement and the Related Documents, including a portion of the Advance Outstanding (as defined in the Original Funding Agreement). In connection with the transactions contemplated by this Agreement, MLFC, Lenders, Operating Agent, Borrower Collateral Agent and Collateral Agent are entering into that certain Amended and Restated Receivables Funding Agreement dated as of the date hereof (the “Amended and Restated Funding Agreement”) amending and restating the Original Funding Agreement (the Amended and Restated Funding Agreement and the other Related Documents are hereinafter collectively referred to herein as the “Loan Documents”).

C. Trust, as lessor, and Lessee, as lessee, have heretofore entered into that certain Master Lease Agreement dated as of December 27, 1999 (as amended, including by this Agreement, the “Master Lease Agreement”) and pursuant thereto Equipment Schedule No. 1 dated as of December 29, 1999 (the “Equipment Schedule”). The Equipment Schedule, incorporating by reference the terms and conditions of the Master Lease Agreement, constitutes a

separate instrument of lease and, together with the Master Lease Agreement and the other documents executed pursuant thereto are hereinafter collectively referred to as, the “Lease”. The interest of the Trust as lessor under the Lease has previously been collaterally assigned to General Electric Capital Corporation, as Borrower Collateral Agent.

D. Pursuant to that certain Corporate Guaranty dated December 27, 1999 (the “Guaranty”) by The First American Financial Corporation (n/k/a The First American Corporation), as guarantor (the “Guarantor”), in favor of the Trust and the Edison Program Parties, Guarantor guaranteed the due, regular and punctual payment of any sum or sums of money owing by Lessee to the Beneficiaries (as defined in the Guaranty).

E. Lessee, as sublessor, and First American Title Company, First American Title Guaranty Co., Midland Title Security, Inc., First American Title Insurance Company of Oregon, Mortgage Guarantee & Title Co. and SMS Settlement Services, each a sublessee, have heretofore entered into those certain Equipment Sublease Agreements dated as of December 27, 1999 (as amended, including by this Agreement, the “Sublease Agreements”)

F. Residual Support Provider, the Trust and Borrower Collateral Agent have heretofore entered into that certain Residual Support Agreement dated as of December 27, 1999 (the “Original Residual Support Agreement”). In connection with the transactions contemplated by this Agreement, Residual Support Provider, MLFC and Borrower Collateral Agent are entering into that certain Amended and Restated Residual Support Agreement dated as of the date hereof (the “Amended and Restated Residual Support Agreement”) amending and restating the Original Residual Support Agreement.

G. In connection with the termination hereunder of the Trust created by the Trust Agreement, the parties hereto desire that MLFC instruct the Trust to assign to MLFC, and MLFC desires to accept such assignment and assume all right, title, interest and obligations of the Trust in, under and with respect to the Trust Estate (as defined in the Trust Agreement), including the Related Documents, except as otherwise provided herein with respect to certain rights and obligations concerning the Lease. Borrower Collateral Agent, Collateral Agent, Lenders and Residual Support Provider are willing to consent to such assignment and assumption on the terms and conditions hereof.

H. Lessee is willing to acknowledge the referenced assignment and assumption and make the other agreements provided for herein.

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NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

ARTICLE I

DEFINITIONS

1.1 Interpretation, Definitions and Rules of Usage. Capitalized terms used herein but not otherwise defined herein shall have the meanings provided therefor in the Lease, or to the extent not defined therein, as defined in the Original Funding Agreement, and the rules of usage set forth therein shall apply hereto.

ARTICLE II

ASSIGNMENT AND ASSUMPTION OF AGREEMENTS

2.1 Assignment and Assumption of Agreements. MLFC hereby instructs the Trust to assign to MLFC all right, title, interest and obligations of the Trust in, to and under the Original Funding Agreement, the Related Documents, the Lease, the Subleases and the Residual Support Agreement. The parties hereto hereby acknowledge and consent to the above instruction, and the Trust hereby effects such assignment to MLFC. MLFC hereby accepts such assignment, assumes all such obligations arising on or after the date hereof and agrees hereafter to keep and perform all of the covenants, obligations arising on or after the date hereof and agreements of the Trust under said documents on and subject to the terms and conditions thereof, including but not limited to as borrower under the Original Funding Agreement, as lessor under the Lease (as modified by Article IV hereof) and as account party under the Residual Support Agreement.

2.2 Assumption of Obligations under Existing Agreements. MLFC hereby acknowledges that it is assuming all accrued obligations under the Original Funding Agreement, as well as the accrued and unaccrued obligations under the Related Documents, including the agreements not being amended and restated. MLFC agrees that it shall perform all of such assumed obligations, as and when due, but subject to the limitation of liability set forth in Section 14.16 of the Amended and Restated Funding Agreement and as set forth in the following sentence. Each of the parties hereto acknowledges and agrees that MLFC is not assuming and shall have no liability with respect to any obligations under any Related Document that accrued prior to the date hereof or that arise from any event, circumstance or activity that occurred prior to the date hereof.

2.3 Simultaneous Actions. All of the actions described herein shall be deemed to occur simultaneously. No action described herein shall be deemed to have occurred unless all of the actions described herein occur.

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ARTICLE III

REVOCATION OF THE TRUST; TERMINATION OF THE TRUST AGREEMENT

3.1 Revocation of Trust. MLFC, pursuant to Section 7.2 of the Trust Agreement, hereby elects, immediately after giving effect to the assignment and assumption provided in Article II above, to terminate and revoke the Trust created under the Trust Agreement and hereby authorizes, empowers and directs the Owner Trustee to distribute the Trust Estate (as defined in the Trust Agreement) to MLFC and, thereafter, to execute and file with the Secretary of State of the State of Delaware a certificate of cancellation in substantially the form attached hereto as Exhibit A. The parties hereto hereby acknowledge and consent to the above instruction.

3.2 Certification of MLFC. MLFC hereby certifies and confirms (1) that it is the sole Agent Certificate Holder (as defined in the Trust Agreement) of the Trust, and (2) that the foregoing direction, termination of the Trust and the distribution of the Trust Estate (as defined in the Trust Agreement) to MLFC (i) is permitted by and authorized under the Trust Agreement and does not violate or constitute a breach of the Trust Agreement or any other Operative Document (as defined in the Trust Agreement) (except for such breaches of the Operative Documents (as defined in the Trust Agreement) that have been expressly waived), (ii) has been consented to by all of the parties to the Operative Documents (as defined in the Trust Agreement), and (iii) is covered by the indemnification provided under Article VI of the Trust Agreement.

3.3 Distribution of the Trust Estate. The Trust hereby distributes the Trust Estate to MLFC.

3.4 Acknowledgment of Lender’s Lien. MLFC hereby acknowledges that it is acquiring the property, rights and interests constituting the Trust Estate (as defined in the Trust Agreement) subject to the Lender’s Lien under the Original Funding Agreement and Related Documents and the continuation of such Lien under the Amended and Restated Funding Agreement and the Related Documents assumed pursuant hereto.

3.5 Termination of the Trust Agreement. MLFC and Wilmington hereby terminate the Trust Agreement, except for the obligations in the Trust Agreement that are expressly stated to survive the cancellation and termination of the Trust Agreement, and such termination shall be effective immediately after giving effect to the assignment and assumption set forth in Article II. The parties hereto hereby acknowledge and consent to such termination.

ARTICLE IV

AMENDMENTS

4.1 Amendments to the Lease. The Lease is amended as follows:

(a) Throughout the Lease, each reference to “FATICO 1999 Trust” shall be deemed to refer to “MHCB (USA) Leasing & Finance Corporation”.

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(b) All references to “c/o Wilmington Trust Company, as Owner Trustee, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001” shall be replaced with “1251 Avenue of the Americas, 32^nd Floor, New York, New York 10020.”

(c) All references to “Delaware business trust” are replaced with “New York corporation”.

(d) All references to “Trust” and to “Owner Trustee” are replaced with “Lessor”.

(e) The defined terms “Owner Trustee”, “Trust” and “Trust Agreement” are deleted and each reference to such defined terms are deleted.

(f) All references to “any beneficiary of the Trust”, to “The Fifth Third Leasing Company” and to “Wilmington Trust Company” are deleted.

(g) Section 9(c)(ii) is amended by restating the entire subsection as follows: “interest on the Lease Balance outstanding from time to time during the Extension Term at a rate per annum equal to: (A) for the portion of the Lease Balance representing the Equity Investment (as defined in the Funding Agreement), the sum of four hundred fifty (450) basis points over LIBOR calculated, as to each day in any Rent Payment Period, at LIBOR applicable to such day, in twelve (12) equal monthly installments; and (B) for the remaining portion of the Lease Balance, the sum of three hundred seven (307) basis points over LIBOR calculated, as to each day in any Rent Payment Period, at LIBOR applicable to such day, in twelve (12) equal monthly installments.”

(h) Section 11(b) is amended by:

(i) inserting the following words at the end of the first sentence: “; provided, however, that Lessor shall not assign all or any part of its rights granted hereunder without the prior written consent of Lessee, such consent not to be unreasonably withheld or delayed.”

a. inserting the words “and Section 5.1(a) of the Omnibus Agreement” after the words “permitted under the Funding Agreement”.

(i) Section 14(i) of the Agreement is amended by adding the words “, jurisdiction of organization” after the first reference to “chief executive office”, by adding after the words “at the address set forth above” the words “or the jurisdiction set forth above”, and by adding at the end of the sentence the words “or any change of its jurisdiction of organization.”

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(j) Section 18(n) is amended by adding the following language at the end of the section:

“If the Lessor maintains its Equity Investment (as defined in the Amended and Restated Funding Agreement) on a LIBOR Basis and any payment of Rent or Lease Balance is made on a date other than the scheduled last day of the LIBOR interest period or Rent Payment Period applicable thereto (including, without limitation, as a result of acceleration of the obligations hereunder), then Lessee shall pay to Lessor within five (5) Business Days following written demand therefor by the Lessor, the amount of Breakage Costs actually incurred by the Lessor in connection therewith. A certificate from the Lessor as to the calculation of Breakage Costs shall, absent demonstrable error, be final and conclusive.”

(k) Section 18(o) is amended as follows:

(i) by deleting “3001 Summer Street, 2^nd Floor” in clause (2) and replacing it with “1600 Summer Street, 4^th Floor”; and

(ii) by adding new clauses (3) and (4) after the words “Conduit Administration” as follows: “and (3) Mizuho Corporate Bank, Ltd., 1251 Avenue of the Americas, New York, New York 10022, Attention: David Lim, Americas Corporate Banking Division II - Account Management Group I; and (4) KBC Bank N.V., 125 West 55^th Street, New York, New York 10019, Attention: Jean Pierre Diels, First Vice President”.

(l) In Section 19, the definition of “Affected Party” is amended by adding the word “Lessor” after the words “Residual Support Provider”.

(m) Section 19 is amended by adding the following definitions:

“Excepted Payments” shall have the meaning given such term in the Funding Agreement.

“Omnibus Agreement” shall have the meaning given such term in the Funding Agreement.

(n) Section 19 is further amended by amending and restating the definitions of “Funding Agreement” and “Lender” as follows:

“Funding Agreement” means the Amended and Restated Receivables Funding Agreement, dated as of December 30, 2003, among the Lessor, as borrower, Lenders, as lenders, the Operating Agent, the Collateral Agent and the Borrower Collateral Agent.

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“Lender” means, collectively, Edison Asset Securitization, L.L.C., Mizuho Corporate Bank, Ltd. and KBC Bank N.V. in their capacities as Lenders under the Funding Agreement.

(o) Section 21 is deleted in its entirety and replaced with:

21. THIRD PARTY BENEFICIARIES. Notwithstanding anything to the contrary contained herein, Lessor and Lessee hereby acknowledge and agree that, consistent with the purposes of the Omnibus Agreement, and for the consideration referred to therein, Borrower Collateral Agent and Lenders shall be third party beneficiaries of this Agreement.

(p) A new Section 22 is added as follows:

22. ASSIGNMENT OF RIGHTS. Lessor hereby assigns all of its rights hereunder to Lenders and Borrower Collateral Agent. Pursuant to such assignment, all of the rights and remedies of Lessor contained herein shall be enforced only by Lenders and Borrower Collateral Agent. Lessor shall have no right to enforce or modify this Agreement; provided, however, that Lessor may enforce this Agreement solely to the extent necessary to collect any Excepted Payments but may not exercise any remedies with respect to any Lease Collateral, Parts, Equipment, New Equipment, Replacement Equipment, Used Equipment, Substituted Item or Additional Collateral. All notices and information required to be supplied by Lessee shall be transmitted directly to Lenders and Borrower Collateral Agent at the addresses set forth in Section 18(o) of this Agreement. All payments by Lessee shall be made in accordance with Section 2(b).

(q) Exhibit No. 1 to Annex E to the Equipment Schedule is amended by adding the following provision immediately after the pricing grid under Daily Margin for Non-Assigned Advance Outstanding: “In addition, Lessee shall pay to Lessor per annum the amount of 1% of $2,431,109.99. The amount shall be paid monthly in arrears by multiplying $2,431,109.99 by 100 basis points (1%) and dividing the product ($24,311.10) by 360, and then multiplying the result by the number of days in the billing period.”

4.2 Amendments to the other Related Documents. Except for the Original Funding Agreement, the Amended and Restated Funding Agreement, the Note, the Lease and the Amended and Restated Residual Support Agreement, the Related Documents are amended as follows:

(a) Each reference to “FATICO 1999 Trust” shall be deemed to refer to “MHCB (USA) Leasing & Finance Corporation” and any reference to the address for the Trust shall be replaced with “1251 Avenue of the Americas, 32^nd Floor, New York, NY 10020.”

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(b) All references to “The Fifth Third Leasing Company” and to “Wilmington Trust Company” shall be deleted.

(c) All references to the “Borrower” under the “Funding Agreement” shall be deemed to refer to MLFC.

(d) All references to the “Lessor” under the “Lease” shall be deemed to refer to MLFC.

(e) All references to the “Funding Agreement” shall be deemed to refer to the Funding Agreement, as amended and restated by the Amended and Restated Funding Agreement.

ARTICLE V

ASSIGNMENTS AND PARTICIPATIONS BY MLFC

5.1 Assignments.

(a) MLFC. Except as set forth in Section 5.2, MLFC may not assign, transfer, hypothecate or otherwise convey any of its rights, obligations or interests hereunder, herein, or in or under the Amended and Restated Funding Agreement, the Lease, the Amended and Restated Residual Support Agreement or any other Related Document without the express prior written consent of the Lenders and the Borrower Collateral Agent and unless the Rating Agency Condition shall have been satisfied with respect to any such assignment. Any such purported assignment, transfer, hypothecation or other conveyance by MLFC without the prior express written consent of Lenders and Borrower Collateral Agent shall be void. Unless an Event of Default by Lessee under the Lease has occurred and is continuing, and MLFC or its assignee is diligently exercising its remedies under the Lease, MLFC may not assign, transfer, hypothecate or otherwise convey any of its rights, obligations or interests hereunder, herein, or in or under the Amended and Restated Funding Agreement, the Lease, the Amended and Restated Residual Support Agreement or any other Related Document (1) to a Person that is not Solvent and (2) without the prior written consent of Lessee, such consent not to be unreasonably withheld or delayed.

(b) Lenders and Borrower Collateral Agent. Any of Lenders and Borrower Collateral Agent may, at any time, assign any or all of its rights and obligations hereunder or interests herein to any Person and any such assignee may further assign at any time its rights and obligations hereunder or interests herein, in each case without the consent of MLFC. MLFC acknowledges and agrees that, upon any such assignment by Lenders and/or Borrower Collateral Agent, the assignee thereof may enforce directly, without joinder of Lenders and Borrower Collateral Agent, all of the obligations of MLFC hereunder.

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5.2 Participations. MLFC may sell, transfer or assign a participation in all or a portion of the interests represented by its Equity Investment and/or its right to payment under the Lease (each such sale, transfer or assignment of a participation in such interests or rights, a “Participation”), to any Person (a “Participation Holder”) upon prior notice to Lessee, Lenders and Borrower Collateral Agent. In no event may MLFC sell a Participation to a Person that is not Solvent. In the event of any such sale by MLFC of a Participation to a Participation Holder, the obligations of MLFC under the Amended and Restated Funding Agreement and under the other Related Documents shall remain unchanged, MLFC shall remain solely responsible for the performance thereof, MLFC shall remain the holder of the Equity Investment, and the party in interest for all purposes under the Amended and Restated Funding Agreement and under the other Related Documents, and Lessee, Lenders and Borrower Collateral Agent shall continue to deal solely and directly with MLFC in connection with such Participation Holder’s rights and obligations under the Amended and Restated Funding Agreement and the other Related Documents. Any agreement pursuant to which MLFC may grant such a Participation shall provide that, as between MLFC and such Participation Holder, MLFC shall retain the sole right and responsibility to enforce, at the direction of Lenders and Borrower Collateral Agent, the obligations of Lessee under the Related Documents, including, without limitation, the right to approve any amendment, modification or waiver of any provision of the Related Documents.

5.3 Documentation of Assignments. Any assignment to an Affiliate shall be documented pursuant to documents reasonably acceptable to all parties, and MLFC shall pay or otherwise be responsible for all reasonable costs incurred by the parties with respect thereto.

ARTICLE VI

THIRD PARTY BENEFICIARIES

6.1 Third Party Beneficiaries. The parties hereto hereby acknowledge and agree that, consistent with the purposes of this Agreement, and for the consideration referred to above, Borrower Collateral Agent and Lenders shall be third party beneficiaries of all Related Documents to which any of them is not a party, if and to the extent any provisions thereof contain representations, warranties, covenants, acknowledgments, indemnities or agreements made or purporting to be made for their respective benefit.

ARTICLE VII

WAIVERS

7.1 Waiver and Consent with Respect to Certain Covenants. By consenting to this Agreement, Lenders, the Operating Agent, the Borrower Collateral Agent and the Collateral Agent, for the limited purpose of effecting this Agreement, hereby (a) waive the requirements of Section 5.1(b) of the Original Funding Agreement and Section 10.3 of the Trust Agreement, (b) consent to the assignments and assumptions effected herein and referenced in Recital A hereof for the purposes of Sections 5.3(a), 5.3(c) and 14.2 of the Original Funding Agreement, and (c) waive any breach of or default under the Original Funding Agreement arising solely as a result of the execution and delivery of this Agreement and the agreements contemplated hereby.

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7.2 Acknowledgment of Lenders. The parties hereto acknowledge that each Lender is currently a “Lender” under the Related Documents.

ARTICLE VIII

CONDITIONS PRECEDENT

8.1 Conditions Precedent. This Agreement shall not become effective until the following conditions have been satisfied:

(a) Each of the parties executes and delivers this Agreement.

(b) Fifth Third and MLFC shall have executed and delivered that certain Assignment and Acceptance Agreement dated as of the date hereof regarding the assignment by Fifth Third of its rights, title and interest in and the assumption of the obligations by MLFC under the Trust Agreement referred to in Recital Paragraph A.

(c) MLFC shall have received a Replacement Certificate dated the date hereof substantially in the form of Exhibit B hereto.

(d) Lenders, MLFC and Borrower Collateral Agent shall have duly authorized, executed and delivered the Amended and Restated Funding Agreement.

(e) Each Lender shall have received a replacement Loan Note executed and delivered by MLFC pursuant to the Amended and Restated Funding Agreement.

(f) MLFC shall have received an Equity Fee Letter dated the date hereof substantially in the form of Exhibit C hereto, duly authorized, executed and delivered by the parties thereto.

(g) Residual Support Provider, MLFC and Lenders shall have duly authorized, executed and delivered the Amended and Restated Residual Support Agreement

(h) MLFC shall have caused the Residual Support Provider to issue and deliver an amended and restated Residual Letter of Credit in favor of Lenders.

(i) MLFC shall have provided to Borrower Collateral Agent evidence of the authority of MLFC to accept the assignment and assumption contemplated herein, together with a certificate of the secretary or any assistant secretary of MLFC certifying the incumbency of the officers of MLFC authorized to execute and deliver all documents in connection therewith and attaching the charter and bylaws of MLFC, as reasonably may be required by Borrower Collateral Agent.

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(j) Borrower Collateral Agent shall have received a certificate of good standing regarding MLFC from the Secretary of State of the State of New York.

(k) Any Uniform Commercial Code (“UCC”) financing statements, terminations and/or amendments reasonably requested by the Lenders and the Borrower Collateral Agent shall be delivered to such parties.

(l) An opinion letter dated the date hereof of MLFC’s counsel covering such matters reasonably requested by and in form and substance reasonably satisfactory to Borrower Collateral Agent, Collateral Agent, Residual Support Provider, Lenders, the Trust and Wilmington shall be delivered to the parties hereto.

(m) An opinion letter dated the date hereof of counsel to the Lessee and the Guarantor covering such matters reasonably requested by and in form and substance reasonably satisfactory to Borrower Collateral Agent, Collateral Agent, Residual Support Provider, Lenders, the Trust, Wilmington and MLFC shall be delivered to the parties hereto.

(n) An opinion letter dated the date hereof of counsel to the Trust and Wilmington covering such matters reasonably requested by and in form and substance reasonably satisfactory to Borrower Collateral Agent, Collateral Agent, Residual Support Provider, Lenders and MLFC shall be delivered to the parties hereto.

(o) Lessee shall have provided to MLFC an insurance certificate reflecting the inclusion of MLFC as an additional insured.

8.2 Authorization to Effect UCC Filings. MLFC authorizes Borrower Collateral Agent to record, at Lessee’s expense, such UCC financing statements, amendments and terminations as Borrower Collateral Agent may reasonably require.

ARTICLE IX

REPRESENTATIONS AND WARRANTIES

9.1 Representations and Warranties of MLFC. MLFC hereby represents and warrants as follows:

(a) MLFC is a New York corporation duly organized and validly existing in good standing under the laws of the State of New York and has full power and authority to execute, deliver and perform its obligations under this Agreement and each other Related Document to which it is or will be a party.

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(b) This Agreement and each Related Document to which MLFC is or will be a party are or upon execution and delivery, will be legal, valid and binding obligations of MLFC, enforceable against it in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting creditors’ rights generally and by general equitable principles. The execution, delivery and performance of this Agreement and each Related Document to which MLFC is a party have been duly authorized by all necessary corporate action on the part of MLFC and do not require the approval of any stockholder or holder of any obligations of MLFC except such as have been duly obtained.

(c) The execution and delivery by MLFC of this Agreement and of each Related Document to which it is or will be a party, are not and will not be, and the performance by MLFC of its obligations under each are not and will not be, inconsistent with the articles of incorporation and by-laws of MLFC, do not and will not contravene any law, governmental rule, regulation or order now binding on MLFC and do not and will not contravene any provision of, or constitute a default under, any indenture, mortgage, chattel mortgage, deed of trust, lease, conditional sales contract, loan or credit arrangement or other agreement or instrument to which MLFC is a party or by which it or its properties may be bound or affected.

(d) There is no action, proceeding or investigation pending or to MLFC’s knowledge threatened against MLFC which questions the validity of this Agreement or any of the Related Documents, and there is no action, proceeding or investigation pending or threatened which is likely to result, either in any case or in the aggregate, in any material adverse change in the ability of MLFC to perform its obligations hereunder or under the Related Documents to which it is a party, or in MLFC not being Solvent.

(e) After giving effect to the transactions contemplated hereby, MLFC is Solvent as of the date hereof.

9.2 Representations and Warranties of the Trust. The Trust hereby represents and warrants as follows:

(a) Immediately prior to the execution of this Agreement, the Trust (i) was a Delaware statutory trust duly formed, validly existing and in good standing under the laws of the State of Delaware; (ii) was duly qualified to conduct business and is in good standing in each other jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification; (iii) was in compliance with the Trust Agreement; and (iv) had the power and authority to enter into and perform its obligations under this Agreement.

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(b) The execution, delivery and performance by the Trust of this Agreement: (i) are within its power as a Delaware statutory trust; (ii) have been duly authorized by all necessary or proper action; (iii) do not contravene any provision of the Trust Agreement or its other organizational documents; (iv) do not violate any law or regulation, or any order or decree of any court or Governmental Authority of the State of Delaware or the federal government of the United States governing the banking and trust power of Wilmington; (v) do not conflict with or result in the breach or termination of, constitute a default under or accelerate or permit the acceleration of any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which it is a party or by which it or any of its property is bound; (vi) do not result in the creation or imposition of any Adverse Claim upon any of the property of any Person, and (vii) do not require the consent or approval of any Governmental Authority or any other Person.

(c) The Agreement has been duly executed and delivered by the Trust and, constitutes the legal, valid and binding obligation of the Trust, enforceable against he Trust in accordance with its terms.

(d) Upon execution and delivery of this Agreement, the Trust shall have transferred to MLFC all of its obligations and liabilities as Borrower under the Original Funding Agreement, and MLFC shall be fully obligated and bound as borrower under the Original Funding Agreement, as amended by the Amended and Restated Funding Agreement.

9.3 Representations and Warranties of Lessee. Lessee hereby represents and warrants as follows:

(a) Lessee is a corporation, duly organized, validly existing and in good standing under the laws of the State of California.

(b) The execution, delivery and performance of this Agreement and the performance of the Lease: (1) have been duly authorized by all necessary corporate action on the part of Lessee; (2) do not require the approval of any stockholder, trustee or holder of any obligations of Lessee except such as have been duly obtained; and (3) do not and will not contravene any law, governmental rule, regulation or order now binding on Lessee, or the organizational documents of Lessee, or contravene the provision of, or constitute a default under, or result in the creation of any lien or encumbrance upon the property of Lessee under, any indenture, mortgage, contract or other agreement to which Lessee is a party or by which it or its property is bound.

(c) This Agreement and the Lease constitute legal, valid and binding obligations of Lessee, enforceable against Lessee in accordance with the

13

terms hereof and thereof, except as such enforceability may be limited by applicable bankruptcy, insolvency, or other similar laws affecting creditors’ rights generally and by general equitable principles.

(d) There are no pending actions or proceedings to which Lessee is a party, and there are no other pending or threatened actions or proceedings of which Lessee has knowledge, before any court, arbitrator or administrative agency, which either individually or in the aggregate would have a Material Adverse Effect. As used herein, “Material Adverse Effect” shall mean (1) a materially adverse effect on the business, condition (financial or otherwise), operations or properties of Lessee, or (2) a material impairment of the ability of Lessee to perform its obligations under or to remain in compliance with the Lease. Further, Lessee is not in default under any obligation for borrowed money, for the deferred purchase price of property, or any lease agreement which, either individually or in the aggregate, would have the same such effect.

(e) That the representations and warranties of Lessee contained in Sections 14(f), (g), (h), (i) and (m) of the Lease are true and correct as if made on and as of the date hereof.

(f) After giving effect to this Agreement and the other agreements contemplated hereby, the security interest granted by Lessee under the Lease Agreement shall continue to be perfected by the filing of those UCC Financing Statements previously filed with respect to said lease (the “UCC Financing Statements”), shall remain in full force and effect and the priority of such security interest shall relate back to the date on which the UCC Financing Statements were filed.

ARTICLE X

MISCELLANEOUS

10.1 Entire Agreement. This Agreement, the Lease, the Amended and Restated Funding Agreement and the other Related Documents constitute the entire agreement among the parties with respect to the subject matter hereof and shall not be rescinded, amended or modified in any manner except by a document in writing executed by the parties hereto.

10.2 Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. Each party hereto (in any capacity) consents to the transactions contemplated hereby (including the amendment and restatement of the Original Funding Agreement and the termination of the Trust).

10.3 Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provisions shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Agreement.

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10.4 Governing Law; Venue; Waiver of Jury Trial. THIS AGREEMENT, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER, SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.

EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THEM PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER RELATED DOCUMENT; PROVIDED, THAT EACH PARTY HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE BOROUGH OF MANHATTAN IN NEW YORK CITY. EACH PARTY HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELEIF AS IS DEEMED APPROPRIATE BY SUCH COURT. EACH PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPALINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AT THE ADDRESS SET FORTH IN SECTION 14.1 OF THE AMENDED AND RESTATED FUNDING AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH PARTY’S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT IN THE UNITED STATES MAIL, PROPER POSTAGE PREPAID. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER RELATED DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

15

10.5 Counterparts. This Agreement may be executed in any number of counterparts, and by different parties hereto on separate counterpart signature pages, and all such counterparts taken together shall be deemed to constitute one and the same instrument.

10.6 Section Titles. The section titles contained in this Agreement are and shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties hereto have caused this Omnibus Agreement to be duly executed as of the day and year first above set forth.

GENERAL ELECTRIC CAPITAL CORPORATION, as Borrower Collateral Agent	GENERAL ELECTRIC CAPITAL CORPORATION, as Operating Agent
By:    /s/    PETER DI BIASI	By:    /s/    KRISTI COLBURN
Name: Peter Di Biasi	Name: Kristi Colburn
Title: Risk Manager	Title: Vice President
GENERAL ELECTRIC CAPITAL CORPORATION, as Collateral Agent	EDISON ASSET SECURITIZATION, L.L.C.
By:    /s/    KRISTI COLBURN	By:    /s/    MICHAEL JOHNSTON
Name: Kristi Colburn	Name: Michael Johnston
Title: Vice President	Title: Assistant Secretary
MIZUHO CORPORATE BANK, LTD.	KBC BANK N.V.
By:    /s/    ROBERT GALLAGHER	By:  /s/  ROBERT SNAUFFER     /s/  JEAN-PIERRE DIELs
Name: Robert Gallagher	Name: Robert Snauffer                  Jean-Pierre Diels
Title: Vice President & Team Leader	Title: First Vice President          First Vice President
WILMINGTON TRUST COMPANY, in its individual capacity only as set forth herein	WILMINGTON TRUST COMPANY, not in its individual capacity by solely as Owner Trustee
By:    /s/    TIRA L. JOHNSON	By:    /s/    TIRA L. JOHNSON
Name: Tira L. Johnson	Name: Tira L. Johnson
Title: Financial Services Officer	Title: Financial Services Officer

FATICO 1999 TRUST By Wilmington Trust Company, not in its individual capacity but solely as Owner Trustee	GENERAL ELECTRIC CAPITAL CORPORATION, as Residual Support Provider
By:    /s/    TIRA L. JOHNSON	By:    /s/    PETER DI BIASI
Name: Tira L. Johnson	Name: Peter Di Biasi
Title: Financial Services Officer	Title: Risk Manager
MHCB (USA) LEASING & FINANCE CORPORATION	FIRST AMERICAN TITLE INSURANCE COMPANY
By:    /s/    VICTOR MORA	By:    /s/    MAX O. VALDES
Name: Victor Mora	Name: Max O. Valdes
Title: Vice President	Title: Vice President

Notwithstanding the foregoing Omnibus Agreement, the undersigned confirms that the Corporate Guaranty dated December 27, 1999 by the undersigned remains in full force and effect.

THE FIRST AMERICAN CORPORATION

(f/k/a The First American Financial Corporation),

as Guarantor

By:    /s/    THOMAS A. KLEMENS

Name: Thomas A. Klemens

Title: Senior Executive Vice President

EXHIBIT A TO OMNIBUS AGREEMENT

CERTIFICATE OF CANCELLATION

OF

CERTIFICATE OF TRUST

OF

FATICO 1999 TRUST

This Certificate of Cancellation of Certificate of Trust is being executed and filed by the undersigned to cancel the certificate of trust of a statutory trust formed under the Delaware Statutory Trust Act, 12 Del. C. §3801 et seq. (as amended, the “Act”).

Section 1. Name. The name of the statutory trust (the “Trust”) is FATICO 1999 Trust.

Section 2. The Certificate of Trust of the Trust was filed with the Secretary of State of the State of Delaware on December 22, 1999.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of Cancellation of Certificate of Trust in accordance with the Act.

WILMINGTON TRUST COMPANY, not in its individual capacity, but solely as trustee of the Trust

By:

Name:

Title:

EXHIBIT B TO OMNIBUS AGREEMENT

REPLACEMENT CERTIFICATE

$                     December     , 2003

THIS REPLACEMENT CERTIFICATE evidences the right of MHCB (USA) Leasing & Finance Corporation (the “Certificate Holder”) to receive on the Maturity Date the principal sum of                                                               Dollars ($                     ) or, if less, the aggregate unpaid principal amount of all amounts advanced by the Certificate Holder pursuant to that certain Master Lease Agreement, dated as of December 27, 1999 (together with all amendments, supplements, amendments and restatements and other modifications, if any, from time to time thereafter made thereto, the “Lease”), between the Lessee and the Lessor.

This Replacement Certificate further evidences the right of the Certificate Holder to receive Yield on the unpaid principal amount hereof from time to time outstanding from the date hereof until maturity (whether by acceleration or otherwise) and, after maturity, until paid, at the rates per annum and on the dates specified in the Equity Fee Letter.

Payments of both principal and Yield are to be made without setoff or counterclaim in lawful money of the United States of America in same day or immediately available funds to the account of the Certificate Holder specified in Schedule II hereto (or to such other account as the Certificate Holder may from time to time designate in a written notice to the Owner Trustee).

The Certificate Holder is authorized to endorse the schedule attached hereto (and any continuation thereof) in accordance with the provisions of the Trust Agreement.

Capitalized terns used but not otherwise defined herein have the respective meanings specified in the Lease (as the Lease may be amended, supplemented, amended and restated or otherwise modified from time to time).

All parties hereto, whether as makers, endorsers, or otherwise, severally waive presentment for payment, demand, protest and notice of dishonor.

Notwithstanding any provisions contained in the Trust Agreement or this Replacement Certificate to the contrary, the Lessor Trust shall not, and shall not be obligated to, pay any amount pursuant to the Trust Agreement or this Certificate, unless the Lessor Trust has received funds which may be used to make such payment pursuant to Section 6.2 of the Funding Agreement. Any amount which the Lessor Trust does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in §101 of the Bankruptcy Code) against or corporate obligation of the Lessor Trust for any such insufficiency unless and until the Lessor Trust satisfies the provisions of such preceding sentence.

This Replacement Certificate is issued in replacement and substitution for the Certificate dated December 29, 1999, issued by the Owner Trustee to The Fifth Third

Leasing Company and evidences the same obligation evidenced by such prior Certificate as assigned to MHCB Leasing & Financing Corporation.

THIS REPLACEMENT CERTIFICATE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE.

FATICO 1999 TRUST

By Wilmington Trust Company, not in its individual capacity but solely as Owner

Trustee

By:

Name:

Title:

SCHEDULE TO CERTIFICATE

DATE	AMOUNT OF ADVANCE MADE		INTEREST PERIOD IF APPLICABLE	AMOUNT OF PRINCIPAL REPAID		UNPAID PRINCIPAL BALANCE		TOTAL	NOTATION MADE BY
	Base Rate	Eurodollar Rate		Base Rate	Eurodollar Rate	Base Rate	Eurodollar Rate

SCHEDULE II

CERTIFICATE HOLDER ACCOUNT

EXHIBIT C TO OMNIBUS AGREEMENT

See Tab # 11 of Closing Binder

EX-21

Exhibit 21

Subsidiaries of the Registrant

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
Consolidated subsidiaries of:
Registrant:
Abtractors' Information Service, Inc.	New York	100.00
Ace Information Services, Inc.	Florida	100.00
Augusta Financial, LLC	California	50.00
Cajon Hills Escrow	California	51.00
Computer Aided Real Estate Data, Inc.	Georgia	100.00
CYD Acquisition Corporation	Delaware	100.00
Escrow Transfer Inc.	California	51.00
First Advantage Corporation	Delaware	77.00
First American Capital Management, Inc. (DE)	Delaware	100.00
First American Credit Management Solutions, Inc.	Delaware	100.00
First American Loan Servicing A.K.A Fastrealty.com	Texas	100.00
First American Management Company	Washington	100.00
Proprety Data Services fka First American Property Data Services, Inc.	California	100.00
First American Real Estate Information Services, Inc.	California	100.00
First American Residential Real Estate Group, Inc.	Delaware	100.00
First American Title Insurance Company	California	100.00
First American Trust, F.S.B.	California	100.00
GPIC Holdings, Inc.	California	52.39
Guaranty Abstract Company of Eastern Massachusetts	Massachusetts	100.00
HomeSafe Escrow Company	Delaware	5.00
ileads.com, LLC	California	5.00
Irvine Technology Corporation	California	33.33
iSymmetrics, Inc	Colorado	100.00
LFC Nationwide, Inc.	New York	100.00
Market Data Center, LLC	Georgia	100.00
National Information Group, Inc.	California	100.00
Newport Exchange Properties, LLC	Delaware	100.00
Quantrix, LLC	Delaware	50.00
Quixsource, Inc.	Georgia	100.00
Optima Information Solutions, LLC	Delaware	100.00
SMS Settlement Services, Inc.	California	100.00
Source One	Utah	100.00
Strategic Mortgage Services, Inc. (OH)	Ohio	100.00
Tele-Track, Inc.	Georgia	100.00
The Heritage Escrow Company, Inc.	California	50.00
Vehicle Title, LLC	Delaware	50.00
Vendor Management Services, Inc.	Delaware	100.00
Western National Title Insurance Company	Utah	100.00
Second Tier
First American Title Insurance Company:
Advance Title, Inc.	Florida	100.00
Alachua County Abstract	Florida	100.00
Albany County Title, Inc.	Wyoming	100.00
Allied Trustee Services, Inc.	California	70.00
American Title Corporation	Wisconsin	100.00
Androscoggin Title Company, Inc.	Maine	100.00
ATI Title Agency of Arizona, Inc.	Arizona	100.00
ATI Title Company of Ohio, Inc.	Ohio	10.00
ATI Title of Arizona, Inc.	Arizona	100.00
Atlantic Title Company, Inc.	Maine	100.00
Attorneys Abstract, Inc.	New York	100.00
Attorneys Title Corporation	Washington, DC	100.00
Barton County Abstract & Title Company	Kansas	100.00
Bienville Properties, Inc.	Louisiana	100.00
Big Horn Land Title Company	Wyoming	80.41
Blyar Financial, Inc.	Florida	100.00
Buckley & Associates, Inc.	California	100.00
Building Industry Advisors, Inc.	California	1.00
Burton Abstract & Title Company (Inactive)	Michigan	100.00
Cahaba Title Company, Inc.	Alabama	29.00
California Title Company	California	25.00
Campbell County Abstract Company	Wyoming	57.89
Capitol Title Insurance Agency, Inc.	Maryland	27.50
Charter Title Company, Inc.	Florida	100.00
Classic Settlement, Inc.	Maryland	15.00
Connecticut Title Services, Inc.	Connecticut	100.00
Consolidated Title & Abstract Company	Minnesota	100.00
Converse Land Title Company	Wyoming	82.80
Crystal River Title Co.	Florida	100.00
CTP, Inc.	Florida	10.00
Dallas Seven Index, Inc.	Texas	14.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
Del Norte County Title Company	California	100.00
DP Data Services, Inc.	Washington	100.00
Eastern Abstract, Inc.	Pennsylvania	21.00
Eaton County Abstract & Title Company (Inactive)	Michigan	100.00
Escrow Partners,Inc.	Washington	100.00
Equity Title, LLC	Nevada	10.00
Equity Title, Inc	California	25.00
Eureka Title Company (Inactive)	California	100.00
Executive Title Company	California	100.00
Fidelity Title and Guaranty Company	Florida	100.00
Fidelity Title Abstract Company	New Jersey	20.00
First American Abstract & Title Services, Inc.	South Carolina	85.00
First American Abstract Company (Louisiana)	Louisiana	100.00
First American Abstract Company (Mississippi)	Mississippi	100.00
First American Abstract Company of South Carolina, Inc.	South Carolina	100.00
First American Affiliates, Inc.	Florida	100.00
First American Auto Title Transfer, L.L.C.	Louisiana	99.00
First American Closing Services, Inc.	California	100.00
First American Equity Loan Services, Inc. (OH)	Ohio	100.00
First American Exchange (UT) fka Utah First Exchange, Inc.	Utah	100.00
First American Exchange Corp of Texas	Texas	100.00
First American Exchange Corp.	Louisiana	100.00
First American Exchange Corporation (CA)	California	100.00
First American Exchange Corporation (FL)	Florida	100.00
First American Exchange Corporation of California	California	100.00
First American Exchange Corporation of Indiana	Indiana	100.00
First American Exchange Corporation of Michigan	Michigan	100.00
First American Exchange Corporation of New England, Inc.	Massachusetts	100.00
First American Exchange Corporation of the North Atlantic, Inc.	Pennsylvania	100.00
First American Exchange Corporation of the Southeast	Louisiana	100.00
First American Exchange Corporation of Wisconsin	Wisconsin	100.00
First American Holdings CBA, Inc. (Inactive)	Minnesota	100.00
First American Home Buyers Protection Corporation (California)	California	92.12
First American International Title Services, Inc.	Canada	100.00
First American Leasing Company	California	100.00
First American Management Services UK Limited	United Kingdom	100.00
First American Title & Abstract Co.	Oklahoma	100.00
First American Title & Trust Company	Oklahoma	100.00
First American Title Agency, Inc.	Virginia	100.00
First American Title Company	California	100.00
First American Title Company (Idaho)	Idaho	40.00
First American Title Company of Alaska	Alaska	100.00
First American Title Company of Bellingham	Washington	99.98
First American Title Company of Carbon County	Wyoming	82.53
First American Title Company of Clark County	Washington	100.00
First American Title Company of Colorado (Inactive)	Colorado	100.00
First American Title Company of Crook County	Wyoming	80.92
First American Title Company of Dallas (Inactive)	Texas	100.00
First American Title Company of Florida, Inc.	Florida	100.00
First American Title Company of Hot Springs County	Wyoming	79.92
First American Title Company of Idaho, Inc.	Idaho	100.00
First American Title Company of Illinois dba. First American Title Company	Illinois	100.00
First American Title Company of Korea	Korea	95.00
First American Title Company of Laramie County	Wyoming	92.61
First American Title Company of Los Angeles	California	100.00
First American Title Company of Nevada (Reno)	Nevada	100.00
First American Title Company of St. Lucie County, Inc.	Florida	100.00
First American Title Company of Stockton	California	2.00
First American Title Company of Sublette County	Wyoming	79.18
First American Title Company of Thurston County	Washington	100.00
First American Title Company of Waco dba First Title Company of Waco	Texas	100.00
First American Title Company, Inc.	Hawaii	80.00
First American Title Guaranty Holding Company	California	100.00
First American Title Insurance Agency of Mohave, Inc.	Arizona	88.47
First American Title Insurance Agency, Inc. (Navajo)	Arizona	85.30
First American Title Insurance Agency, Inc. UT	Utah	100.00
First American Title Insurance Company of Australia Pty Limited	Australia	100.00
First American Title Insurance Company of Kansas, Inc.	Kansas	100.00
First American Title Insurance Company of New York	New York	100.00
First American Title Insurance Company of North Carolina	North Carolina	100.00
First American Title Insurance Company of Texas	Texas	100.00
First American Title of Kansas Agency, Inc. fka. Guarantii Land Title of Leavenworth, Inc.	Kansas	100.00
First American Title of Korea	Korea	95.00
First American Title Missouri Agency, In.c fka First American Title of St. Louis, Inc.	Missouri	100.00
First American Transportation Title Insurance Company (Louisiana First Title Insurance Company)	Louisiana	100.00
First Australian Title Company Pty Limited	Australia	85.00
First Canadian Title Company Limited	Canada	100.00
First Exchange Corporation	Arizona	100.00
First Florida Title Inc. Agency, LLC	Florida	52.00
First Hong Kong Title Limited	Camine Island	50.00
First Reliable, LLC	Delaware	51.00
First States, Inc.	Pennsylvania	100.00
First Title plc	United Kingdom	100.00
First UK Financial Corporation plc	United Kingdom	100.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
Ford County Title Company, Inc.	Kansas	100.00
Fremont County Title Company	Wyoming	100.00
Gadsden Abstract and Appraisal Company	Florida	100.00
Goshen County Abstract & Title Company	Wyoming	76.43
Greater Louisiana Title Insurance Company	Louisiana	100.00
Guarantee Title of Johnson County, Inc.	Kansas	100.00
Guarantee Title of Wyandotte County, Inc.	Kansas	100.00
Guaranty Title Corporation	Maine	100.00
Guardian Title Company of Maryland	Maryland	100.00
Guardian Title Services Corporation	Florida	100.00
Harder Abstract, LLC	Maryland	51.00
Hi-Tech Title Solutions, Inc.	Virginia	30.00
Houston County Abstract Company	Alabama	80.00
Iowa State Escrow & Closing, L.C.	Iowa	100.00
Iowa State Escrow & Closing, Inc.	Iowa	100.00
Intertitle, Inc.	California	100.00
Investors Title Company	California	22.20
Island Title Corp	Hawaii	20.00
Itasca County Abstract Company	Minnesota	100.00
Johnson County Title Company, Inc.	Wyoming	51.00
Land Title Company of St. Louis, Inc.	Missouri	100.00
Land Title Company, Chelan-Douglas County, Inc.	Washington	100.00
Latin Title, Inc.	Florida	100.00
Lenders Title & Escrow, L.L.C.	Oklahoma	15.00
LoanStar Mortgagee Services, L.L.C	Texas	100.00
Mariposa County Title Company	California	100.00
Massachusetts Abstract Company, Inc.	Massachusetts	100.00
Metropolitian Title Company	Michigan	100.00
Memphis Title Company (Inactive)	Tennessee	100.00
Midland Title Security, Inc.	Ohio	100.00
Mid-Valley Title and Escrow Company	California	58.50
Mid Illinois Title Services, Inc.	Illinois	100.00
Midstate Title Company, Inc.	Michigan	100.00
Miller Abstract Company, Inc.	Missouri	100.00
Monroe Title Company	Florida	100.00
Montgomery County Abstract Company	Kansas	100.00
Montgomery Abstract & Title Company, Inc.	Alabama	100.00
Mortgage Guarantee & Title Company	Rhode Island	100.00
National Lender's Title Guaranty Co., Inc.	Illinois	100.00
New Century Holidays Limited	United Kingdom	100.00
New York Abstract Company, Inc.	New York	100.00
North American Title, Inc.	Michigan	100.00
Northern Michigan Title Company of Emmet	Michigan	100.00
Ohio Bar Title Insurance Company	Ohio	100.00
Ohio Title Corporation (Inactive)	Ohio	100.00
Omni Title of Pasco, Inc.	Florida	100.00
Orange County Title Company (Inactive)	California	100.00
Palm Coast Abstract & Title, Inc.	Florida	100.00
Park Resort Development Company	Florida	100.00
Peoples Abstract Company	Iowa	100.00
Pilgrim Title Insurance Company	Rhode Island	35.00
Pioneer Agency Acquisition Company	Pennsylvania	100.00
Pioneer of Philadelphia, Ltd., Inc. (Inactive)	Pennsylvania	100.00
Polk County Abstract Company	Wisconsin	100.00
Port Lawrence Title and Trust Company	Ohio	100.00
Potter Title Company	Michigan	100.00
Progressive Land Title of Bowling Green, Inc.	Kentucky	100.00
RELS Title Services, LLC	Delaware	50.00
Republic Title of Texas, Inc.	Texas	100.00
R.E. Consumer's Choice, LLC	Arizona	100.00
RMS Information Services, LLC	Utah	100.00
Saia Title Company, Inc.	Kansas	100.00
San Benito Land Title Corporation	California	25.00
San Mateo County Title Company (Inactive)	California	100.00
Security Land Title & Escrow Company (Omaha)	Nebraska	45.00
Security Land Title Company	Kansas	100.00
Service Standard Title and Trust, Ltd.	Virgin Islands	100.00
Settlers Abstract Company, L.P.	Pennsylvania	100.00
Settlers Title Agency, Inc.	New Jersey	100.00
SFA Title Company	Korea	100.00
Shea Closing Services	California	19.00
Shoshone Title Insurance and Abstract Company	Wyoming	51.69
Signature	New Hampshire	100.00
Skagit County Company	Washington	22.00
Territorial Abstract & Title Company, Inc.	New Mexico	100.00
Teton Land Title Company	Wyoming	81.68
The Inland Empire Service Corporation	California	100.00
The Security Abstract & Title Company, Inc.	Kansas	100.00
The Security First Title Affiliates, Inc.	Florida	100.00
The Title Security Group, Inc. fka Shiels Title Company	Puerto Rico	20.00
Thomas Abstract Company, Inc.	Alabama	100.00
Ticore, Inc.	Oregon	100.00
Title Bond & Mortgage Company	Michigan	100.00
Title Partners of American, Inc.	Florida	100.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
Title Records, Inc.	California	20.00
Title Search Services, LLC	Virginia	51.00
Title Security of Brevard, Inc.	Florida	100.00
Title Xperts Agency, Inc.	Ohio	20.00
TitleStar, L.L.C	Texas	20.00
Tuscola Title & Escrow, Inc.	Michigan	100.00
Universal Title Company	Minnesota	100.00
Virginia Title Examiners, LLC	Virginia	51.00
Warren County Abstract	Iowa	100.00
Washakie Abstract Company	Wyoming	100.00
Weatherford Title Company	Texas	100.00
Wyoming Land Title Company	Wyoming	56.42
Yakima County Title Company dba Yakima Title & Escrow Company	Washington	100.00
First Advantage, Corp.
American Driving Records	California	100.00
Agency Records, Inc.	Connecticut	100.00
Credential Check & Personnel Services, Inc	Michigan	100.00
DTS Technologies	Texas	100.00
Employee Health Programs, Inc.	Florida	100.00
First Advantage Enterprise Screening Corp.	Delaware	100.00
First American Registry, Inc.	Nevada	100.00
First American Indian Holdings LLC	Delaware	100.00
Greystone Health Sciences Corporation	California	100.00
Hirecheck, Inc.	Florida	100.00
Liberatore Servicnes, Inc.	New York	100.00
Medtech Diagnostics, Inc.	Texas	100.00
Omega	Florida	100.00
SafeRent, Inc.	Delaware	100.00
Substance Abuse Management, Inc.	Florida	100.00
Total Information Source, In.c	North Carolina	100.00
US Search.com, Inc.	California	100.00
First American Capital Management, Inc. (DE):
Pacific American Securities, LLC	California	42.00
First American Credit Management Solutions, Inc.
CMSI Credit Services, Inc	Maryland	100.00
CMSI System, Inc.	Delaware	100.00
DealerTrack, Inc.	Delaware	20
First American Real Estate Information Services, Inc.:
Consumer Benefit Services, Inc.	Illinois	10.00
Current Status, Inc	New Jersey	100.00
DataTree Corporation	California	100.00
Excelis, Inc.	Florida	100.00
FACBS LLC	California	50.00
First American Real Estate Solutions LLC	California	80.00
First American Tax Valuation, Inc.	Florida	49.00
First American Tracking & Insurance Services, Inc.	California	100.00
Realty Tax & Service Company (Inactive)	California	100.00
Infinity Information Network, Inc.	South Carolina	100.00
Tri-County Tax Research, Inc.	Michigan	100.00
Vintek, Inc.	Pennsylvania	19.86
First American Registry:
Multifamily Community Insurance Agency, Inc.	Maryland	100.00
First American Residential Real Estate Group, Inc.
First American—Real Trends National Housing Survey LLC	Delaware	51.00
GPIC Holdings, Inc.:
First American Propery & Causality Ins. Co fka Five Star Holdings, Inc.	California	100.00
Great Pacific Insurance Company	California	100.00
Hirecheck, Inc.
Factual Business Information, Inc.	Florida	100.00
PartnerCheck, Inc.	Florida	100.00
Pretiem Corporation	New Jersey	100.00
National Information Group, Inc.:
GPIC Holdings, Inc.	California	32.61
New Arts Acquisition, Inc.	Delaware	100.00
Pinnacle Data Corporation	California	100.00
Quantrix, LLC:
Quantrix Credit Services, LLC	Delaware	100.00
Third Tier
American Driving Records, Inc.
ZapApp India Private Limited	DA	0.1
Consumer Benefit Services, Inc.

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
FACBS, LLC	California	50.00
EHG, Incorporated
Midwest Title Insurance Company	Illinois	100.00
First American Equity Loan Services, Inc. (OH):
Docu-Search, Inc.	Kentucky	100.00
First American Equity Loan Services, Inc. (DE)	Delaware	100.00
First American Exchange Corp (CA)
First American Exchange Holding Company	Utah	100.00
First American Home Buyers Protection Corporation (CA):
Alliance Home Warranty, Inc.	Utah	100.00
First American Home Buyers Protection Corporation (Delaware)	Delaware	50.00
First American Indian Holdings LLC
ZapApp India Private	DA	99.9
First American International Title Services, Inc.
First American (US) Corp fka First American China Corp.	Delaware	50.00
First American Management Services (UK)
First American Title Company (Ireland) Limited	United Kingdom	50.00
First American Title Company, Inc.:
First American Long & Melone Exchange, Ltd.	Hawaii	100.00
First American Real Estate Solutions LLC:
Daisy Software	Texas	100.00
Datatree, LLC	California	100.00
Eappraiseit	Delaware	80.00
First American Credco of Puerto Rico, Inc.	Delaware	100.00
First American Default Management Solutions LLC	Florida	100.00
First American Flood Hazard Certification, LLC	Delaware	100.00
First American Real Estate Flood & Tax Solutions LLC	Delaware	100.00
First American Real Estate Solutions, L.P.	Delaware	80.00
First American Real Estate Solutions of Texas, L.P.	Texas	1.00
First American Real Estate Tax Service, LLC	Delaware	100.00
First American Servicing Solutions, LLC	Delaware	100.00
JV Mortgage Solutions, LLC	Delaware	50.00
NDTS Software	Texas	100.00
RELS, LLC	Delaware	50.00
RES, LLC	Delaware	100.00
Smart Title Solutions LLC	Delaware	100.00
First American Tax Valuation, Inc.:
Huntington Brokerage Corporation	Texas	80.00
First American Title Company (Idaho):
First American Title Company of Asotin County, Inc.	Washington	100.00
First American Title Company of Montana, Inc.	Montana	100.00
First Exchange of Idaho	Idaho	100.00
First American Administrative Services, Inc.	Idaho	42.00
First American Title Company of Great Falls, Inc.	Montana	33.00
First American Title Company of Nevada (Reno):
First American Partners, Inc.	Nevada	100.00
First American Title Company of Nevada (Zephyr Cove)	Nevada	100.00
First American Title Insurance Agency, Inc.:
First American Title Insurance Agency, LLC	Delaware	80.00
First American Title Insurance Company of Australia Pty Limited:
First Title New Zealand Limited	New Zealand	100.00
First American Title Insurance Company of New York:
First American Exchange Corporation (NY)	New York	100.00
Judicial Title Insurance Agency, Inc	New York	20.00
L&H Abstract Corporation	New York	100.00
Public Abstract Corporation	New York	40.00
First American Title Insurance Company of Texas:
Fort Bend Title Company	Texas	100.00
The Donegan Abstract Company	Texas	100.00
First American Title Company of Alaska:
Trans Alaska Summit dba: First American Title of Alaska	Alaska	4.00
First American Title Company of Laramie County:
Wyoming First County	Wyoming	100.00
First American Title Guaranty Holding Company:
First American Title Guaranty Company	California	100.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
First Escrow Accounting Services Company	California	100.00
First Guaranty Bancorp	California	100.00
First Guaranty Exchange Company	California	100.00
Stanley Building Associates (a Partnership)	California	100.00
Superior Trustee's Services Co., Inc.	California	100.00
First American Title & Trust Company:
Southwest Title Land Company	Oklahoma	100.00
First Canadian Title Company Limited:
FCT Insurance Services, Inc.	Canada	45.00
First Canadian Title—Debt Recovery Network, Inc.	Canada	10.00
First American Specialty Ins. Co. fka Five Star Holdings, Inc.:
First American Specialty Ins. Co. fka Five Star Insurance Company	California	100.00
Gateway Pacific Insurance Agency	California	100.00
Premier Claims Service, Inc.	California	100.00
First Title plc:
First Title (Southeast) Limited	United Kingdom	100.00
First Title Services Limited	United Kingdom	100.00
First Title Insurance plc	United Kingdom	100.00
First Title Valuation Service Limited	United Kingdom	100.00
Iowa State Escrow & Closing, L.C
Dallas County Abstract & Title Company, LC	Iowa	60.00
Iowa Stat Escrow And Closing, Inc.
Central Iowa Escrow, LC	Iowa	51.00
ATI Closing, LC	Iowa	5.00
Land Title Insrance Company of St. Louis
Property Data, Inc.	Missouri	100.00
The Trust Company of St. Louis County	Missouri	99.80
Massachusetts Abstract Company, Inc.:
Massachusetts Title Insurance Company	Massachusetts	91.90
Midland Title Security, Inc.:
Commerce Title Agency, Inc. (Inactive)	Ohio	100.00
Colonial Title Agency, Inc.	Ohio	100.00
Lawyers Mortgage and Title Company, Inc. (Inactive)	Ohio	100.00
MCM Title Services, Inc.	Ohio	100.00
First American Midwest Exchange Services, Inc. fka Midland Exchange Services, Inc.	Ohio	100.00
National Survey Service, Inc.	Delaware	100.00
Property Records, Inc.	Ohio	33.00
R.E. Services, Inc.	Ohio	100.00
The Title Company (a Limited Partnership)	Kentucky	20.00
Tower City Title Agency, LLC	Ohio	17.50
Mid-Valley Title and Escrow Company:
Mt. Shasta Title & Escrow Company	California	65.00
Mortgage Guarantee & Title Company:
GR Title Services, Inc. (Inactive)	Rhode Island	100.00
New Arts Acquisition, Inc.
Pinnacle Real Estate Tax Services, Inc.	Delaware	100.00
Park Resort Development Company
Associated Land Title Group, Inc.	Florida	100.00
Bay County Land & Abstract Company	Florida	100.00
Florida Abstract & Title Insurance Company of Stuart	Florida	100.00
Pasco Abstract Company	Florida	28.00
Peoples Abstract Company
People Abstract, LLC	Iowa	80.00
Pioneer Agency Acquisition Company:
Pioneer Agency II, Corp.	Pennsylvania	100.00
Port Lawrence Title and Trust Company
Area Title Agency, Inc.	Ohio	16.66
Port Lawrence National Agency, Inc.	Ohio	100.00
The Port Lawrence Agency, Inc. (Inactive)	Ohio	100.00
RELS Title Services, LLC
ATI Title of California, Inc.	California	100.00
ATI of Nevada, Inc.	Nevada	100.00
ATI Title, LLC	Delaware	100.00
Republic Title of Texas, Inc.:
American Escrow Company	Texas	100.00
Texas Escrow Company	Texas	100.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
Title Software Corporation	Texas	100.00
Territorial Abstract & Title Company, Inc.:
Territorial Escrow Services, Inc.	New Mexico	80.00
Titles de Santa Fe	New Mexico	80.00
Ticore, Inc.:
First American Exchange Corporation of Oregon	Oregon	100.00
Title Insurance Company of Oregon dba FAT Insurance Company of Oregon	Oregon	100.00
Commercial Title Company	Oregon	100.00
Universal Title Company:
Universal Partnerships, Inc.	Minnesota	100.00
US Search.com, Inc.
Professional Resource Screening, Inc.	Delaware	100.00
Fourth Tier
Bay County Land & Abstract Company:
BCE of Panama City, Inc.	Florida	100.00
Associated Financial Title Agency, L.C	Florida	50.00
Data Tree, LLC:
Data Tree India Private Limited	India	100.00
Dallas County Abstract & Title Company, LC
Russell Title, Inc.	Iowa	100.00
First American Administrative Service, Inc.:
Exchange Services, Inc.	Idaho	100.00
FATC of Bonners Ferry	Idaho	50.00
First American (US) corporation, FKA First American China Corporation
First American (China) Real Estate Consulting Ltd.	China	100.00
First American Title Insurance Agency, LLC:
Associated Title Insurance Agency, LLC	Delaware	100.00
First American Real Estate Flood & Tax Solutions LLC:
First American Real Estate Solutions of Texas, L.P.	Texas	99.00
Total Mortgage Solutions, L.P.	Delaware	49.50
First America Real Estate Solution, L.P.:
First American Intellitech, Inc.	Delaware	100.00
Metroscan, Inc.	Delaware	100.00
Transamerica Intellitech, Inc.	Delaware	20.00
First American Title Company of Montana, Inc.:
First American Title Company of Mineral County, Inc.	Montana	50.00
First American Title Company of Ravalli County, Inc.	Montana	50.00
First American Title Guaranty Company:
Claremont Insurance Company, Ltd. (Inactive)	BM	7.00
First Guaranty Bancorp:
F.S.T Financial Services	California	100.00
First Security Thrift Company	California	100.00
First Guaranty Exchange Company:
FRE Corporation	California	100.00
FRE Corporation II	California	100.00
FRE Corporation III	California	100.00
FRE Corporation IV	California	100.00
FRE Corporation V	California	100.00
FRE Corporation VI	California	100.00
FRE Corporation VII	California	100.00
First Reverse Exchange Corp. I	California	100.00
First Title Services Limited:
Marsons Solicitors	United Kingdom	100.00
First American Specialty Ins. Co. fka Five Star Insurance Company:
FS Premium Finance Company	California	100.00
Fort Bend Title Company
Citizens Title Company	Texas	100.00
Pearson Fort Bend Abstract Company	Texas	100.00
RELS, LLC:
RELS Reporting Services, LLC dba VIE.LLC, aka Value IT	IA	100.00
Valuation Information Technology, L.L.C.	IA	100.00

Name of Subsidiary	State or Country Under Laws of Which Organized	Percent of Stock Owned Beneficially by Company or Subsidiary
RES, LLC
First American Real Estate Solutions, L.P.	Delaware	20.00
Southwest Title Land Company:
Frolich Meadows Development Company (a Joint Venture)	Oklahoma	50.00
Frolich Meadows Estates (a Joint Venture)	Oklahoma	50.00
Olympic Development Company (a Joint Venture)	Oklahoma	50.00
Penn-Brooke (a Joint Venture)	Oklahoma	50.00
Triangle Development Company (a Joint Venture)	Oklahoma	33.30
Smart Title Solutions
Data Trace Information Services, LLC	California	80.00
Title Insurance Company of Oregon dba First American Title Insurance Company of Oregon
Josephine Crater Title Companies, Inc.	Oregon	100.00
Fifith Tier
Data Trace Information Services, LLC.:
Datatrace Information Services Company	Delaware	20.00

EX-23

Exhibit 23

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-113269), S-3 (No 333-107644) and S-4 (No. 333-107494) of The First American Corporation of our report dated March 11, 2004 relating to the financial statements and financial statement schedules, which appears in this Form 10-K.

PricewaterhouseCoopers LLP

San Francisco, California

March 15, 2004

EX-31.(A)

EXHIBIT 31(a)

CERTIFICATIONS

I, Parker S. Kennedy, certify that:

1. I have reviewed this annual report on Form 10-K of The First American Corporation (“registrant”);

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 15, 2004

/s/    PARKER S. KENNEDY        

Parker S. Kennedy

President, Chief Executive Officer and Chairman

(Principal Executive Officer)

EX-31.(B)

EXHIBIT 31(b)

CERTIFICATIONS

I, Thomas A. Klemens, certify that:

1. I have reviewed this annual report on Form 10-K of The First American Corporation (“registrant”);

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 15, 2004

/s/    THOMAS A. KLEMENS        

Thomas A. Klemens

Senior Executive Vice President,

Chief Financial Officer

(Principal Financial Officer)

EX-32.(A)

EXHIBIT 32(a)

Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Form 10-K of The First American Corporation (the “Company”) for the period ended December 31, 2003, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Parker S. Kennedy, chief executive officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

/s/    PARKER S. KENNEDY        

Parker S. Kennedy

President, Chief Executive Officer and Chairman

March 15, 2004

The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. ss. 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

EX-32.(B)

EXHIBIT 32(b)

Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Form 10-K of The First American Corporation (the “Company”) for the period ended December 31, 2003, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas A. Klemens, chief financial officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

/s/    THOMAS A. KLEMENS        

Thomas A. Klemens

Senior Executive Vice President

Chief Financial Officer

March 15, 2004

The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. ss. 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.