Petition for Writ of Certiorari — Barton v. Landmark Land Co. of Carolina, 116 S. Ct. 2582 (1996) (No. 95-1855)

OPH Ve Lic GickX

In The

Supreme Court of the United States

October Term, 1995

*

GERALD G. BARTON, WILLIAM W. VAUGHAN,

III and JOE W. WALSER,

Petitioners,

LANDMARK LAND COMPANY OF CAROLINA, INC.,

a Delaware Corporation, et al.,

Responden t

¢

On Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Fourth Circuit

*

PETITION FOR WRIT OF CERTIORARI

¢

Dawes COookgE, Jr.

Rc pert P. Gritton

BarNWELL WHALEY PATTERSON & Hetms, LLC

id Meeting Street, Suite 300

C.arleston, South Carolina 29401

‘$953) 577-7700

Attorneys for Petitioners

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED

[he question presented in this case is whether the

Financial Institutior . Reform, Recovery, and Enforcement

Act of 1989 (“FIRREA”) confers such broad and preemp

tive authority upon the Office of Thrift Supervision

(“OTS”) that an OTS-targeted bank’s corporate subsidiary

that files for protection under the Bankruptcy Act

necessarily precluded ‘rom indemnifying its directors for

their legal costs incurred in defending OTS civil proceed

ings brought against them as a result of the bankrupt:

filing, upon the rationale that the bankruptcy filing wa

“a deliberzte attempt to undermine the regulatory

authority of a government agency” which “cannot consti

tute good faith conduct, even if such actions benefit the

corporation,” even though those directors abstained from

the corporate vote to file for bankrupt Y protection and

even though the bankruptcy action successfully pre

served the assets of the corporation for the benefit of it

( reditor:

PARTIES TO THE PROCEEDING

The principal parties to this Petition are: Gerald G.

Barton, William W. Vaughan, III and Joe W. Walser, as

Petitioners; Landmark Land Company of Carolina, Inc., a

Delaware Corporation, Landmark Land Company of Flor-

ida, Inc., a Delaware Corporation, Landmark Land Com-

pany of Oklahoma, Inc., an Oklahoma Corporation,

Landmark Land Company of California, Inc., a Delaware

Corporation, Landmark Land Company of Louisiana,

Inc., a Louisiana Corporation, Carmel Valley Ranch, a

California Corporation, Clock Tower Place Investments,

Ltd., a California Corporation, as Debtor-Respondents;

Resolution Trust Corporation, a receiver (formerly con-

servator) for Oak Tree Federal Savings Bank as Creditor-

Respondent.

The complete list of parties to this bankruptcy pro-

ceeding are listed on pages 215-262 on the appendix.

TABLE OF CONTENTS

Page

QUESTION PRESENTED........ 7 i

PARTIES TO THE PROCEEDING il

rABLE OF CONTENTS....-.-+-+>: iii

TABLE OF AUTHORITIES Vv

| OPINIONS BELOW . ; |

iI. JURISDICTION oes tenes 2

il. STATUTORY PROVISIONS INVOLVED . 2

1V. STATEMENT OF THE CASE... om 5

V. REASONS FOR GRANTING THE PETITION ... 6

VI. CONCLUSION ......-. aie ee ~ 12

APPENDICES

Appendix A: Opinion of the United States Court

of Appeals for the Fourth Circuit,

dated February 15, 1996.......--- App. 1

Appendix B: Order on Applications and Fees of

Attorneys for Debtor Employees of

the United States District Court for

the District of South Carolina,

dated November 9, 1994......--. App. 34

Appendix C: Order on Attorneys Fees for

Debtor Employees and Debtor

Officers and Directors of the

United States District Court for the

District of South Carolina, dated

May 27, 1994......----+eeerre ees App. 40

Appendix D: Order of the United States Court of

Appeals for the Fourth Circuit,

filed April 15, | Cae eee App. 53

TABLE OF CONTENTS Continued

Page

Appendix E: Order of the United States Court of

Appeals for the Fourth Circuit,

OG. AGT 2, 1996... 066 scisere- AD, 5

Appendix F: Order on Debtor’s Motion to

Reconsider the Court’s May 27,

1994 Order regarding Indemnifica-

tion of Officers and Directors of

the United States District Court for

the District of South Carolina,

dated October 5, 1994 App. 200

Appendix G: Order on Motions to Intervene in

Motion to Reconsider Order

regarding Indemnification of Offi-

cers and Directors of the United

States District Court for the Dis-

trict of South Carolina, dated

August 31, 1994 Kad App. 212

TABLE OF AUTHORITIES

Page

C ASES

Fallick v. Kehr, 369 F.2d 899 (2d Cir. 1966)......... 9, 10

In re All Season’s Kitchen, Inc., 145 B.R. 391 (Bankr

Di: Wc SON es 5 ee grt ke 10

In re George, 15 B.R. 247 (Bankr.N.D. Ohio 1981) .... 10

In re Kriger, 2 B.R. 19 (Bankr.D. Or 1979) ........... 10

In re Landmark Land Company of Carolina, Inc., 76

Pe ee Se Ee BONS orc bs ceva cia bs ck ae 608 jae

In re Tru Block Concrete Products, Inc., 27 B.R. 486

ae aa 10

In re Weitzen, 3 F. Supp. 698 (S.D.N.Y. 1933) . om

McAvoy v. United States, 178 F.2d 353 (2d Cir. 1949) .... 11

Merchants and Mechanics Federal Savings and Loan

Association v. Lewis, 25 B.R. 422 (Bankr. S.D.

CE ED oo ccakia anew s cor bn C40 PEP ErR One ae Ys ae

O’Melveny & Myers v. FDIC, __ U.S. ,1145.Ct

DG CRT sc ib ted hi wds vecane ohne igs ee

CONSTITUTIONS AND STATUTES

11 U.S.C. § 106 (1994) ..... Pa | BGA

11 U.S.C. § 109(a) (1993)........... er One:

12 U.S.C. § 1821(d)(2)(A)(1) (1989) ..... woot coe

28 U.S.C. § 12'54(1) (1993)...... , ee

28 U.S.C. § 1291 (1988) ..... e past iene ee ea

28 U.S.C. § 1334 (1988) ..... epee

Vi

TABLE OF AUTHORITIES Continued

Page

Court Fintincs

Order of the United States Court of Appeals for

the Fourth Circuit filed April 2, 1996. |, 6

Order of the United States Court of Appeals for

the Fourth Circuit filed April 15, 1996 1, 6

Order on Applications and Fees of Attorneys for

Debtor Employees of the United States District

Court for the District of South Carolina dated

November 9, 1994 i WAP ee Lk ay ete Spt hy l

Order on Attorneys Fees for Debtor Employees

and Debtor Officers and Directors of the United

States District Court for the District of South

Carolina dated May 27, 1994 ............. ai 1,5

Order on Debtor’s Motion to Reconsider the

Court’s May 27, 1994, Order regarding Indem-

nification of Officers and Directors of the

United States District Court for the District of

South Carolina dated October 5, 1994...... 2, 5

~

Order on Motions to Intervene in Motion to

Reconsider Order regarding Indemnification of

Officers and Directors of the United States Dis-

trict Court for the District of South Carolina

dated August 31, 1994........... Vek eianeaeen 2

PETITION FOR WRIT OF CERTIORARI

Petitioners, Gerard G. Barton, et al., respectfully

request that a writ of certiorari issue to review the deci-

sion of the United States Court of Appeals for the Fourth

Circuit, entered on February 15, 1996

I. OPINIONS BELOW

The opinion of the United States Court of Appeals for

the Fourth Circuit, in which review is sought is reported

at In re Landmark Land Company of Carolina, Inc., 76 F.3d

553 (4th Cir. 1996) and is appended to this petition for

writ of certiorari.

The Order on Applications and Fees of Attorneys for

Debtor Employees of the United States District Court for

the District of South Carolina dated November 9, 1994, is

unreported and is appended to this writ of certiorari. The

Order on Attorneys Fees for Debtor Employees and

Debtor Officers and Directors of the United States District

Court for the District of South Carolina dated May 27,

1994, is unreported and is appended to this writ of cer-

tiorari.

The Order of the United States Court of Appeals for

the Fourth Circuit filed April 15, 1996, denying the Peti-

tioners’ Motion for Reconsideration of the Court’s denial

of the Petition for Rehearing is unreported and is

appended to this writ of certiorari. The Order of the

United States Court of Appeals for the Fourth Circuit

filed April 2, 1996, denying the Petition for Rehearing is

unreported and is appended to this writ of certiorari

The Order on Debtor’s }.otion to Reconsider the

Court’s May 27, 1994, Order regarding Indemnification of

Officers and Directors of the United States District Court

for the District of South Carolina dated October 5, 1994, is

unreported and is apyended to this writ of certiorari. The

Order on Motions to Intervene in Motion to Reconsider

Order regarding Indemnification of Officers and Direc-

tors of the United States District Court for the District of

South Carolina dated August 31, 1994, is unreported and

is appended to this writ of certiorari.

II. JURISDICTION

The judgment of the Court of Appeals was entered

on February 15, 1996. The Court of Appeals denied a

Petition for Rehearing on April 2, 1996, and denied a

Motion for Reconsideration of the Petition for Rehearing

on April 15, 1996. Petitioners invoke this Court's jurisdic-

tion under 28 U.S.C. § 1254(1) (1993).

Ill. STATUTORY PROVISIONS INVOLVED

Notwithstanding any other provision of this section,

only a person that resides or has a domicile, a place of

business, or property in the United States, or a munici-

pality, may be a debtor under this title.

11 U.S.C. § 109(a) (1993).

The Corporation shall, as conservator or receiver, and

by operation of law, succeed to — all rights, titles, powers,

and privileges of the insured depository institution, and

of any stockholder, member, account holder, depositor,

officer, or director of such institution with respect to the

institution and the assets of the institution.

12 U.S.C. § 1821(d)(2)(A)(1) (1989).

IV. STATEMENT OF THE CASE

The issue before the Court arises from a successful,

confirmed Chapter 11 bankruptcy case wherein all

unsecured creditors have been paid in full. Petitioners

were directors of first and second tier subsidiaries

(Debtors) of Oak Tree Savings Bank (Bank), which was

wholly owned by the Landmark Land Company, Inc.

(Landmark).

In June 1990 the Office of Thrift Supervision (OTS)

determined that the Bank was undercapitalized and had

demonstrated a pattern of consistent losses. On January

15, 1991, the Bank agreed that its subsidiaries would not

enter into any material transaction without prior

approval from the OTS. On October 11, 1991, the Debtors

filed bankruptcy petitions in South Carolina. Petitioners,

officers and directors both of the Bank and of the

Debtors, abstained from voting in the Debtors’ resolu-

tions to file for bankruptcy.

Two days after the bankruptcy filing, the OTS took

control of the Bank and appointed the Resolution Trust

Corporation (RTC) as receiver. The Debtors obtained a

temporary restraining order and then a preliminary

injunction from the bankruptcy court preventing the RTC

from replacing their management. The OTS gained con-

trol approximately 11 months later when the Court of

Appeals lifted the injunction.

Meanwhile, the OTS filed civil administrative

charges against Petitioners, charging them with breach of

their fiduciary duties to the Bank and fining them an

initial one million dollars and five hundred thousand

dollars for each day that they failed to take all necessary

steps to seek dismissal of the bankruptcy proceedings.

The OTS alleged that the Petitioners breached their

fiduciary duties to the Bank because they knew that the

bankruptcy filings of the Debtors would have a substan-

tially adverse effect on the Bank’s ability to collect on the

secured and unsecured lines of credit to the Debtors. The

OTS also claimed that the Petitioners had violated the

terms of the Bank’s January 15, 1991 agreement by enter-

ing into a material transaction — the filing for bankruptcy

on behalf of Bank subsidiaries. The Petitioners hired

attorneys to defend them in those administrative actions,

which are still pending.

During the 11 month period between the filing of

bankruptcy and the RTC finally obtaining control of the

Debtors, the Debtors resolved to indemnify the Peti-

tioners for the legal fees and costs that they incurred

defending the OTS charges arising out of the bankruptcy

filings. Petitioners abstained from voting on those resolu-

tions. On March 26, 1992, the Debtors filed a Reimburse-

ment Motion requesting permission to indemnify the

Petitioners pursuant to the corporate resolutions. The

district court heard the motion and still had it under

advisement when the RTC gained control of the Debtors.

Once the RTC gained control it did not seek to dis-

miss the bankruptcy petitions, but proceeded with the

bankruptcy action and actually placed another Bank sub-

sidiary into bankruptcy. The RTC did, however, move to

withdraw the Reimbursement Motion, but the district

court refused because the motion had already been heard.

The district court initially granted the reimbursement

motion, finding in a May 27, 1994 order “that the evi-

dence demonstrates that the off.cers and directors of the

Debtor companies sought the protection of the bank-

ruptcy court in good faith.” Appendix C. Subsequently,

on October 5, 1994 the court clarified its earlier order,

holding that Petitioners should be indemnified “if and

when [they] prove by a preponderance of the evidence

that they have incurred reasonable expenses in defending

themselves for actions taken in good faith with the rea-

sonable belief that such actions were not opposed to the

best interests of the Debtor companies.” Appendix F. This

appeal ensued before the district court ever ordered

actual reimbursement to the Petitioners.

The Fourth Circuit reversed the district court’s reim-

bursement orders. The Court of Appeals agreed that

under the applicable state corporate codes a corporate

agent is entitled to indemnification for costs incurred in

defending himself against legal charges if he “could have

acted in good faith and in the best interests of the corpo-

ration if the charges against the agent turn out to be

true.” 76 F.3d at 563. Appendix A. The court held, how-

ever, “We cannot conclude that the [Petitioners’] action

was taken in good faith. If the OTS charges are accurate,

the [Petitioners’] action to place the Debtors in bank-

ruptcy was a deliberate attempt to prevent the OTS from

exercising control over the Bank’s assets, thus hindering

the OTS’s ability to deal effectively with a failing savings

and loan.” Id. at 565. “We recognize that the [Petitioners]

did not break any law by filing the bankruptcy petitions,

6

and that the OTS has not filed criminal charges against

the [Petitioners]. Nonetheless, we find that a deliberate

attempt to undermine the regulatory authority of a gov-

ernment agency cannot constitute good faith conduct,

even if such actions beefit the corporation.” Id.

The Court of Appeals denied as untimely Petitioners’

Petition for Rehearing and Suggestion for Rehearing en

Banc, and also denied their motion for reconsideration of

the Petition. Appendix D and Appendix E.

The United States District Court for the District of

South Carolina had jurisdiction of the underlying bank-

ruptcy matter pursuant to 28 U.S.C. § 1334. The Court of

Appeals for the Fourth Circuit had appellate jurisdiction

pursuant to 28 U.S.C. § 1291.

V. REASONS FOR GRANTING THE PETITION

This case presents an important opportunity for the

Court to correct the Court of Appeals’ application of

FIRREA that broadly preempts not only state-created

rights but federal-law rights under the Bankruptcy Act

By finding Petitioners guilty of bad faith under the facts

of this case the Court of Appeals has laid out a bright line

rule which prohibits any resistance, no matter how mea-

sured or how well justified, to a takeover action by the

OTS.

The facts of this case make it an ideal vehicle by

which to clarify the limits of FIRREA because of the

extreme nature of the Court of Appeals’ interpretation of

FIRREA. The Debtor corporations were subsidiaries of

the Bank that was the subject of OTS investigation and

that was signatory to the Consent Agreement not to

engage in material transactions without OTS consent

Neither the district court nor the Court of Appeals

engaged in any analysis of the Bank-OTS agreement to

determine whether the agreement was even intended to

let alone able to — preclude Bank subsidiaries from filing

for bankruptcy. Though supportive of filing for bank

ruptcy, Petitioners personally abstained from the corpo

rate votes both to declare bankruptcy and to indemnify

them for their legal defense costs. The district court

found, and the Court of Appeals did not disagree, that

the federal regulators were hampering the Petitioners

legitimate efforts to reorganize the companies and that

Petitioners sought the protection of the bankruptcy court

to protect themselves from an “overrun bureaucracy”. 76

F.3d at 564. The filing for bankruptcy was not only legal

and in fact specifically provided for by federal bank

ruptcy law, but was ratified by the RTC once it seized

control of the Debtors, and the bankruptcy was spe:

tacularly successful, resulting in all unsecured creditors

being paid in full.

Despite these facts the Court of Appeals did not so

much as remand the reimbursement claim for an eviden

tiary hearing or even hold the reimbursement claim in

abeyance pending resolution of the OTS civil administra

tive proceedings. Instead, the Court of Appeals sum

marily declared the filing for bankruptcy to be the legal

equivalent of a deliberate criminal act, preclusive per se of

a finding of good faith.

This case thus starkiy presents the question whether

FIRREA confers such broad and preemptive authority

upon the OTS that resistance by any means, even by

means specifically sanctioned by the Bankruptcy Act, is

illegal. The Court of Appeals succinctly summarized its

guiding principle as follows: “[w]le recognize that the

[Petitioners] did not break any law by filing the bank-

ruptcy petitions, and that the OTS has not filed criminal

charges against the [Petitioners]. Nonetheless, we find

that a deliberate attempt to undermine the regulatory

authority of a government agency cannot constitute good

faith conduct, even if such actions benefit the corpora-

tion.” 76 F.3d at 565. Neither the case law nor the record

in this case supports such facile overwriting of the Bank-

ruptcy Code. In O'Melveny & Myers v. FDIC, __ U.S. __,

114 S. Ct. 2048 (1994), the Court granted certiorari in

order to decide that FIRREA did not require that federal

common law supplant state tort law in an action brought

by the FDIC against a bank attorney. We believe that the

issue presented in this case is equally if not more worthy

of review by the Court.

The Court of Appeals appears to have concluded,

without engaging in the formality of taking evidence on

the issue, that Petitioners breached the agreement

between the Bank and the OTS that prohibited the Bank

and its subsidiaries from engaging in “material transac-

tions” without OTS consent. The court evinced no interest

in the fact that, though Petitioners signed the agreement,

they clearly did so as directors of the Bank, not as direc-

tors of the Debtors, or of the fact that Petitioners abs-

tained from the Debtors’ votes to file for bankruptcy.

Perhaps of even more significance, the Court of Appeals

did not examine the question whether the agreement was

even intended to — let alone legally could - prevent

Debtors from filing for bankruptcy. That comprehensive,

twelve-page agreement makes no mention at all of bank-

ruptcy. Rather, it prohibits the Bank and its subsidiaries

from engaging in “material transactions” without OTS

consent. Both in common usage and in the context in

which it appears in the agreement, “transaction” con-

notes a transitive action between two or more persoiis,

not a unilateral action whereby one person submits him-

self to the protection of the bankruptcy court. That the

Court of Appeals found unnecessary any factual inquiry

into whether Petitioners had actually breached the stand-

still agreement with the OTS is testament to the breadth

and depth of obeisance that the OTS commands under the

court’s holding in this case.

The Court of Appeals’ holding with regard to the

effect of a “breach” of the Bank-OTS standstill agreement

sets up a patent conflict between FIRREA and the Bank-

ruptcy Act, and in resolving this conflict in favor of

eviscerating rights created under the Bankruptcy Act the

court has departed from heretofore virtually universally

accepted interpretation of the Act. The ability to seek the

protection of the bankruptcy court is a statutory right

which is generally held to be superior to any rights or

obligations created by prior contractual agreements. It

has long been held that an agreement to waive the bene-

fits of bankruptcy is unenforceable. In re Weitzen, 3 F.

Supp. 698 (S.D.N.Y. 1933). To sustain a contractual obliga-

tion of this character would frustrate the object of the

Bankruptcy Act. Id. The purpose of the Bankruptcy Act is

a strong legislative desire that deserving debtors be

allowed to get a fresh start. Fallick v. Kehr, 369 F.2d 899,

904 (2d Cir. 1966). “It is well settled principle that an

advanced agreement to waive benefits conferred by the

ccccsanithsamnsmasiiiiiiamn siassstiennineaeasit TELL

10

bankruptcy laws is wholly void against public policy.” In

re Tru Block Concrete Products, Inc., 27 B.R. 486, 492 (S.D.

Cal. 1983). See In re Kriger, 2 B.R. 19, 23 (Bankr.D. Or.

1979); In re George, 15 B.R. 247, 248-249 (Bankr.N.D. Ohio

1981) (pre-bankruptcy waivers unenforceable because in

conflict with the purposes of bankruptcy laws); Fallick v

Kehr, 369 F.2d 899, 904 (2d Cir. 1966). The Court of

Appeals’ departure from this principle is all the more

dramatic because the court equated the supposed breach

of the standstill agreement to a deliberate criminal act.

The corporate indemnification statutes clearly require

that the corporate agent who is seeking indemnification

must have acted in good faith vis-a-vis the corporation.

The Court of Appeals transposed this requirement into

one of good faith vis-a-vis the OTS, citing authorities that

hold only that a corporate agent who has committed a

deliberate criminal act cannot be indemnified. 76 F.3d at

565.

Nothing in corporate law or the Bankruptcy Act sup-

ports the view that government administrative enforce-

ment actions are as sacrosanct as the Court of Appeals

has held them to be. There is no evidence that in enacting

FIRREA Congress intended to divest the bankruptcy

courts of jurisdiction to adjudicate matters merely

because they fall within the reach of government regula-

tors. In re All Season's Kitchen, Inc., 145 B.R. 391, 397

(Bankr. D. Vt. 1992). To the contrary, the Bankruptcy

Reform Act of 1994! made explicit Congress’ intent that

there be a broad waiver of the government’s immunity

1 The section of the Act amending § 106 applies retroactively

Pub. L. No. 103-394.

1]

both to monetary recoveries and to declaratory and

injunctive relief. 2 Collier on Bankruptcy para. 106.01

Compare McAvoy v. United States, 178 F.2d 353 (2d Cir

1949) (holding prior to the amendment of 11 U.S.C. § 106

(1994) that the bankruptcy court could not enjoin the

Smal! Business Administration from intervening in a non

bankruptcy proceeding wherein the valuation of the gov

ernment’s claim might be determined). Thus, Congress

has empowered the bankruptcy courts to adjudicate dis

putes between corporations and government agencies. It

necessarily follows that it should not be regarded as bad

faith per se for a corporation to seek the protection of the

bankruptcy courts merely because doing so frustrates the

regulatory authority of a government agency. Filing for

bankruptcy almost always frustrates someone's legiti

mate business objectives, but even a contrived bank

ruptcy filing is not necessarily bad faith. See Merchant

and Mechanics Federal Savings and Loan Association v. Lew

25 B.R. 422 (Bankr. S.D. Oh. 1982). Nothing in FIRREA

purports to exempt the OTS from the Bankruptcy Act

The implications of the Court of Appeals’ holding in

this case are staggering. Under this holding there can be

no resistance to an OTS attack except through supplica

tion to the OTS itself, no matter how well justified or how

carefully measured such resistance may be. Any director

or other agent who, on behalf of his company, resists the

OTS in any way is likely to be deemed to have “under

mine([d] the regulatory authority of a government

agency” and thereby be barred from obtaining indemni

fication from the company that he sought to defend. A

corporate director whose company 1s threatened by the

OTS (or, perhaps, by any government agency) can i]

12

afford to make a difficult decision in defense of his com-

pany when the price of making the wrong decision is

personal financial ruin. He is forced to choose between

what is best for his company and what is safest for him

personally. The good faith provision in the corporate

indemnification statutes was intended to save corporate

agents from just this Hobson’s choice and, by extension,

to save corporations from suffering the inevitably unfor-

tunate consequences of such choices. Neither FIRREA nor

any other regulatory scheme should be construed to para-

lyze all resistance by a corporation to governmental

intrusion. Likewise, they should not be interpreted to

override the congressional mandate that a debtor be

allowed to seek reorganization under the Bankruptcy Act.

VI. CONCLUSION

For the foregoing reasons, Gerald G. Barton, William

W. Vaughan, III and Joe W. Walser respectfully request

that this petition for a writ of certiorari to the United

States Court of Appeals for the Fourth Circuit be granted

and the case be set for plenary review

Respectfully submitted,

M. Dawes Cooxe, Jr.

Rosert P. GRITTON

BARNWELL WHALEY PATTERSON &

Heims, LLC

134 Meeting Street, Suite 300

Charleston, South Carolina 29401

(803) 577-7700

Attorneys for Petitioners

Dated: May 14, 1996

App. 1

United States Court of Appeals

for the Fourth Circuit

In re LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellants,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-

Appellant,

v.

D. Scott CONE; John Wilson Reed,

Respondents-Appellees,

Bernard G. Ille, et al, Claimants-

Appellees,

Jones, Day, Reavis & Pogue; McGlinchey,

Stafford & Lang; McNair & Sanford,

P.A., Parties in Interest-Appellees,

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

US Trustee, Trustee.

In re LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellees,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-Appellee,

App. 2

v.

Gerald G. BARTON, et al, Claimants-

Appellants,

Jones, Day, Reavis & Pogue; McGlinchey,

Stafford & Lang; McNair &

Sanford, P.A., Parties in Interest,

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

US Trustee, Trustee.

In re LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellees,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-Appellee,

v.

McNAIR & SANFORD, P.A., Party in

Interest-Appellant,

Jones, Day, Reavis & Pogue; McGlinchey,

Stafford & Lang, Parties in Interest,

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

US Trustee, Trustee.

In re LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

aed

App. 3

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellees,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-Appellee,

v.

McGLINCHEY, STAFFORD & LANG,

Party in Interest-Appellant,

Jones, Day, Reavis & Pogue; McNair &

Sanford, P.A., Parties in Interest,

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

US Trustee, Trustee.

In re LANDMARK LAND COMPANY OIF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellees,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-Appellee,

v.

JONES, DAY, REAVIS & POGUE, Party

in Interest-Appellant,

McNair & Sanford, P.A.; McGlinchey,

Stafford & Lang, Parties in Interest,

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

App. 4

US Trustee, Trustee.

In re LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, a

Delaware Corporation,

et al, Debtors.

LANDMARK LAND COMPANY OF

CAROLINA, INCORPORATED, etc., et al,

Debtors-Appellants,

Resolution Trust Corporation, a receiver

(formerly conservator) for Oak Tree

Federal Savings Bank, Creditor-

Appellant,

v.

D. Scott CONE; John Wilson Reed,

Respondents-Appellees,

Bernard G. Ille, et al, Claimants-

Appellees,

Jones, Day, Reavis & Pogue; McGlinchey,

Stafford & Lang; McNair &

Sanford, P.A., Parties in Interest-

Appellees, ~

Alpha Nursery, Incorporated, et al,

Creditors,

88314 Ontario Limited, et al, Claimants,

Bureau of Indian Affairs, et al,

Respondents,

US Trustee, Trustee.

Nos. 94-2475, 94-2490 through 94-2493

and 94-2550.

United States Court of Appeals,

Fourth Circuit.

Argued June 8, 1995.

Decided Feb. 15, 1996.

Appeals from the United States District Court for the

District of South Carolina, at Charleston. Falcon B.

App. 5

Hawkins, Chief District Judge. (CA-91-5287-

CA-91-3287-2-1, BK-91-5814, CA-91-5386-

CA-91-3286-2-1, BK-91-5815, CA-91-5291-

CA-91-3291-

CA-91-3290-

CA-91-3289-

CA-91-2288-

BK-92-77109)

*A-91-5290-

'A-91-5289-

‘A-91-5288-

"A-92-3548-2-1,

1, BK-91-5816,

-1, BK-91-5817,

-1, BK-91-5819,

-1, BK-91-5818,

Nm NNN WN

.

Nm NON NY WN py

‘ ‘ ' ‘ ' ’

Fe on et a

ARGUED: Henry Robbins Lord, Piper & Marbury,

Baltimore, Maryland, for Appellants. John Wilson Reed,

New Orleans, Louisiana; Patrick Michael Duffy, McNair

& Sanford, P.A., Charleston, South Carolina, for Appel-

lees. ON BRIEF: Stephen H. Kaufman, Piper & Marbury,

Baltimore, Maryland; Nathan B. Feinstein, Daniel J. Car-

rigan, Timothy P. Branigan, Kimberly E. Wolod, Piper &

Marbury, Washington, D.C.; Kevyn D. Orr, Resolution

[rust Corporation, Washington, D.C., for Appellants.

Richard L. Tapp, Jr., McNair & Sanford, P.A., Charleston,

South Carolina; M. Dawes Cooke, Jr., Robert Gritton,

Barnwell, Whaley & Stevenson, Charleston, South Caro-

lina; Craig Caesar, Timothy Scott, McGlinchey, Stafford &

Lang, New Orleans, Louisiana; Paul O’Hearn, R. Matthew

Martin, Jones, Day, Reavis & Pogue, Atlanta, Georgia;

Evan Park Howell, III, Metairie, Louisiana, for Appell! es.

Before RUSSELL, NIEMEYER, and MICHAEL, Cir-

cuit Judges.

Affirmed in part and reversed in part by published

opinion. Judge DONALD RUSSELL wrote the opinion, in

which Judge NIEMEYER and Judge MICHAEL joined.

App. 6

OPINION

DONALD RUSSELL, Circuit Judge:

This case comes before this Court at the twilight of

the Debtors’ bankruptcy proceedings. The Resolution

Trust Corporation (“RTC”) has already taken control of

the Debtors and has liquidated their assets. The bank-

ruptcy proceedings have proven to be successful, with

the debtors-in-possession paying each claim in full. On

this appeal, the second to this Court, we consider only

whether the debtors’ estates must indemnify several of

the Debtors’ former directors, officers, and employees for

their costs in defending themselves against civil proceed-

ings brought by the Office of Thrift Supervision (“OTS”)

in connection with the bankruptcy filings. The district

court found that the Debtors’ estates must indemnify

these directors, officers, and employees for their defense

costs. We affirm in part and reverse in part.

A. The OTS Charges

On October 11, 1991, the Debtors (with one excep-

tion) filed for bankruptcy.' The Debtors were first- and

1! The Debtors are Landmark Land Company of Carolina,

Inc. (“Landmark Carolina”), Landmark Land Company of

Oklahoma, Inc. (“Landmark Oklahoma”), Landmark Land

Company of Florida, Inc. (“Landmark Florida”), Landmark

Land Company of Louisiana, Inc. (“Landmark Louisiana”),

Landmark Land Company of California, Inc. (“Landmark

California”), and Clock Tower Place Investments Ltd. (“Clock

Tower”). Carmel Valley Ranch did not file for bankruptcy at this

time and is not involved in this indemnification dispute.

App. 7

second-tier subsidiaries of Oak Tree Savings Bank, 5.5.B

(“Bank”). At the top of the corporate structure was Land-

mark Land Company, Inc. (“Landmark Land”), a publicly

traded company. It was a holding company and whole

owner of the Bank, which was the whole owner of Clock

lower, which in turn was the holding company and

whole owner of Landmark Carolina, Landmark Okla-

homa, Landmark Florida, Landmark Louisiana, and

Landmark California.

Gerald G. Barton and William W. Vaughan, III, were

prominent figures in the Landmark corporations. Barton

was the chairman of the board of directors of Landmark

Land, the Bank, and all of the subsidiaries. He was also

the chief executive officer of Landmark Land and the

Bank, and a 29% shareholder of Landmark Land

Vaughan, RBarton’s son-in-law, was a director and officer

of the Bank and most of the subsidiaries. An attorney, he

was the general counsel to the subsidiaries. Joe W. Walser

played a less prominent role in the Landmark hierarchy,

but he served as a director of the Bank and some of the

subsidiaries. Bernard G. Ille served as a director of only

the Bank, but he did not participate actively in the man-

agement of the Bank or the subsidiaries. He was

employed by First Life Assurance Company, a subsidiary

of Landmark Oklahoma.

Prior to the bankruptcy filings, the subsidiary com-

panies invested profitably in real estate using the Bank’s

funds to finance their operations. They developed,

owned, and managed residential resort communities,

complete with golf courses, tennis courts, and polo facili-

ties. During this time, the Bank loaned the subsidiaries

more than $986 million

App. 8

The financial position of the Landmark organization

eventually deteriorated. An OTS investigation on June 4,

1990 revealed that the Bank was undercapitalized and

had demonstrated a pattern of consistent losses. Despite

several attempts, the Bank was unable to submit to the

OTS an acceptable plan for meeting the minimum capital

requirements. On January 15, 1991, the directors of the

Bank signed a Consent Agreement with the OTS in which

they agreed that the Bank’s subsidiaries would not enter

into any material transaction without prior approval from

the OTS. The Consent Agreement indicated that the Bank

was near failure and that an OTS takeover was imminent

Despite the terms of the Consent Agreement, the

subsidiaries filed for bankruptcy. Anticipating that the

OTS would act quickly to take control of the Bank, the

Debtors immediately sought and obtained from the bank

ruptcy court a temporary restraining order preventing

the Bank from exercising its shareholder rights to remove

and replace the management of the Debtors.

The bankruptcy filings did not receive a pleasant

reception from the OTS. On October 13, 1991, as expected,

the OTS took control of the Bank and appointed the

Resolution Trust Corporation (“RTC”) to act as receiver

for the Bank.? See Financial Institutions Reform, Recov-

ery, and Enforcement Act of 1989 (“FIRREA”), Pub.L. No.

2 The RTC then organized, and the OTS chartered, Oak Tree

Federal] Savings Bank, F.S.B. (“New Oak Tree”). Pursuant to a

purchase and assumption agreement, New Oak Tree purchased

all of the RTC’s right, title and interest in Oak Tree’s assets,

ncluding its wholly owned subsidiaries. The OTS then

appointed the RTC as conservator for New Oak Tree.

App Y

101-73, 103 Stat: 183 (1989) (codified in scattered section

of 12 U.S.C.). More importantly, the OTS filed civil

administrative charges against Barton, Vaughan, Walser

and Ille (collectively, the “Directors”). The OTS alleged

that the Directors breached their fiduciary duties to the

Bank because they knew that the bankruptcy filings

would have a substantially adverse effect on the Bank

ability to collect on the secured and unsecured lines of

credit to the Debtors. The OTS also charged the Directors

with violating the terms of the Consent Agreement by

having the Debtors enter into a material transaction — the

filing for bankruptcy — without receiving OTS approval

The OTS assessed a fine of one million dollars against the

Directors, and it fined Landmark Land $500,000 for each

day it failed to seek dismissal ot the bankruptcy proceed

Ings On November 18, 1991, the OTS amended it

charges to add allegations that the Directors had mi

handled certain large loans. The Directors hired attorne

s ‘ in

to defend themselves against the OTS charge

As the OTS continued its investigation into the

Bank’s affairs, several members of the Bank’s accounting

department became subjects of investigation. D. Scott

Cone,* although he was an officer and director of

Landmark Louisiana, headed the Bank’s accounting

department. Mohamed Motahari was a vice-president

and the comptroller of the Bank. Gina Trapani was a vice

president, assistant comptroller, and tax manager of the

Bank. Gary Braun was an accountant for the Bank

Cone died during the yuurse of this litigatior

represented by his estate

App. 10

Motahari, Trapani, and Braun became employees of Land-

mark Louisiana soon after the Debtors’ filed for bank

rupt Vy

By March or April 1992, Cone, Motahari, Trapani,

and Braun (collectively, the “Employees”), believing that

the OTS might take action against them, retained counsel

On April 21, 1992, the OTS filed civil administrative

charges against Cone and Motahari. The OTS alleged

that, in monthly reports to federal regulators, they had

misrepresented that the Debtors’ debt to the Bank was

secured, even though it was actually unsecured. The OTS

never brought charges against Trapani or Braun

B The Reimbursement Motion

Although the RTC took control of the Bank, the origi

nal boards of directors remained in control of the Debtors

until September 1992. Once the RTC was appointed con-

servator of the Bank, it immediately moved the district

court to lift the temporary restraining order so that it

could call a shareholders meeting and exercise its owner-

ship rights over the Debtors. However, the district court,

acting as the bankruptcy court, denied the RTC’s motion

and converted the temporary restraining order into a

preliminary injunction. See Landmark Land Co. of Caro-

lina v. Resolution Trust Corp. (In re Landmark Land Co.

of Okla.), 134 B.R. 557 (D.S.C.1991), rev’d 973 F.2d 283

(4th Cir.1992). The RTC was not able to take «ontrol of the

subsidiaries until this Court lifted the injunction on

August 18, 1992. See In re Landmark Land Co. of Okla.,

973 F.2d 283 (4th Cir.1992). On September 12, 1992, the

RI

boards

(’ took control

of directors, and fired the Debtors’

oft

APP

1]

the Debtors, terminated the original

attorney .

During the eleven-month interim when the original

board controlled the Debtors, the Directors arranged for

the Debtors to pay for the fees and costs of defending

themselves against the OTS charges. On March 26, 1992,

the

making the motion, several of the Debtors’

Debtors

file

da

Reimbursement

Motion

permission to fund the Directors’ indemnification

directors met to approve the indemnification

Oklahoma met to discuss and vote on indemnification

()n April 3, 1992, the ho rd of dire¢ tors for [

Walser and Ille

three members

[hompson

but the two constituted a quorum

Landmark Oklahoma’s board consisted

Barton, Lowery

Only Roselle and

4ea Roselle. and Bill

requesting

After

boards of

andmartk

ror

of

.)

Thompson were present

They found that Wal

ser and Ille “had acted in good faith and in a manner the:

reasonably believed to be in, or not opposed to, the best

interests of [Landmark Oklahoma}

board

lower met

voted in favor of

On April 21, 1992. the board

to dis« uSS and vote

Barton and Vaughan

(

indemnification

lock

Ot

on

directors

Accordingly,

ror ¢

indemnification

the

Loe k

ror

Tower’s board consisted of

five members: Barton, Vaughan, Roselle, Thompson, and

a

director had resigned and had not yet been replaced

other four members of the board were present,

fifth

director

At

the

time

of

the

meeting,

the

;

fifth

The

onstitut

ing a quorum. The board found that Barton and Vaughan

“had acted in good faith and in a manner they reasonably

believed to be in, or not opposed to,

th

s

1e

[Clock Tower].” Roselle and Thompson voted in favor of

best interests of

App. 12

indemnification, and Barton and Vaughan abstained from

the vote.

Although the Employees were not included in the

Reimbursement Motion, the board of directors for Land-

mark Louisiana met on April 21, 1992 to discuss and vote

on indemnification for the Employees. Landmark Louisi-

ana’s board consisted of five members: Barton, Vaughan,

Cone, Roselle, and Thompson. Cone was not present, but

the other four directors constituted a quorum. The board

found that the Employees had acted in good faith and in

the best interests of Landmark Louisiana, and they voted

unanimously to indemnify the Employees for their

expenses. Barton and Vaughan participated in the vote.

On June 3, 1992, the district court held a hearing on

the Reimbursement Motion. The court did not rule on the

motion at the time, and the motion remained dormant for

almost two years.

On August 27, 1992, the Debtors amended their

Reimbursement Motion to include the Employees’ legal

expenses. Even before this formal application, however,

the Debtors had already begun indemnifying the

Employees. In March 1992, Clock Tower paid $21,825

toward Motahari’s legal expenses, and Landmark Louisi-

ana paid $1,000 toward Braun’s expenses. In June 1992,

Clock Tower paid $35,398.48 toward Cone’s, Motahari’s,

and Trapani’s legal expenses. Thus, Clock Tower paid

more than $57,000 toward the Employees’ legal expenses,

even though its board never voted to indemnify them. In

total, the Debtors have paid $122,493.20 of the

Employees’ legal expenses.

App. | 5

( The RTC-controlled Debtors

The RTC took control of the Debtors on September

12, 1992, and replaced the boards of directors. On

November 5, 1992, the RTC-controlled Debtors sought, by

means of a consent order, to withdraw the Reimburse

ment Motion. The district court denied the withdrawal

because it had already heard argument on the motion and

had taken the motion under advisement. The district

court also recognized that the beneficiaries of the Reim

bursement Motion namely, the Directors and the

Employees — were not represented in the proposed con

sent order

The RTC. once it took control of the Debtors, decided

that it was advantageous to operate the Debtors in bank

ruptcy and chose not to withdraw the Debtors from the

bankruptcy proceedings The RTC even decided to place

another Bank subsidiary, Carmel Valley Ranch, in bank

ruptcy. The RTC filed a reorganization plan for the

Debtors that was approved by the district court

Meanwhile, the OTS settled its civil administrative

actions against some of the Directors and Employees. On

October 30, 1992, the OTS dropped its charges against

Cone and Motahari in exchange for their consent to

orders (1) prohibiting them from participating in the

affairs of any insured depository institution and (2)

debarring them from practicing before the OTS. Although

Cone and Motahari accepted prohibition and debarment,

neither admitted, and both specifically disputed, the OTS

charges.

On April 1, 1993, the OTS dropped the charges

against Ille with only the mildest rebuke: [lle had to sign

App. 14

a cease and desist order, prohibiting him from engaging

in unsafe and unsound banking practices and from

breaching fiduciary duties to a federally insured deposi-

tory institution. In other words, Ille agreed to follow

diligently in the future the standard of conduct already

required of him. Ille received this lenient treatment

because he did not participate in the bankruptcy filings.

He learned of the decision to place the Debtors in bank-

ruptcy during a telephone call from Barton on the eve-

ning of October 10, 1991, the day before the bankruptcy

filings; that same evening, he resigned from his position

as a director of the Bank. At most, Ille failed only to

follow the affairs of the Bank more diligently.

As of the date of this opinion, the OTS proceedings

against Barton, Vaughan, and Walser remain unresolved.

D. The District Court’s Orders

On May 27, 1994, more than two years after the filing

of the motion, the district court granted the Reimburse-

ment Motion. The district court found that “the evidence

demonstrates that the officers and directors of the Debtor

companies sought the protection of the bankruptcy court

in good faith.” In re Landmark Land Co. of Okla., Civ.

Action No. 2:91-5286-1, order at 12 (D.S.C. May 27, 1994)

(J.A. 1278). It also concluded that the RTC-controlled

Debtors “ratified the decision to reorganize under the

protection of the bankruptcy court, demonstrating that

the placement of the Debtors into bankruptcy is reason-

ably viewed as being in the best interests of the Debtors.”

Id. Thus, the district court ordered the Debtors’ estates to

indemnify the Directors and Employees for their defense

i

é

App. 15

costs, and it granted the applications for payment from

the Employees’ attorneys.

The RTC-controlled Debtors filed a motion for recon

sideration on June 6, 1994. When the Debtors filed this

motion, the following parties moved to intervene:

1. the Directors;

2. McNair & Sanford, P.A. (“McNair”), the

attorneys for the Debtors before the RTC took

control;

3. Jones, Day, Reavis & Pogue (“Jones Day”)

and McGlinchey, Stafford & Lang

(“McGlinchey”), the Directors’ former OTS

defense attorneys;

4. John W. Reed (of Glass & Reed), attorney for

Cone; David Popper (of Popper & Popper),

attorney for Motahari; Herbert V. Larson, Jr.,

attorney for Motahari; Robert H. Habans, attor-

ney for Trapani; and William R. Campbell, Jr.,

attorney for Braun.

The district court granted their motions to intervene

on August 31, 1994. The Employees themselves did not

move to intervene.

On October 5, 1994, the district court denied the

Debtors’ motion for reconsideration with respect to the

indemnification of the Directors. The district court did,

however, grant the motion for reconsideration with

respect to the applications of the Employees’ attorneys. In

a separate order on November 9, 1994, the district court

approved the applications for payment from the

Employees’ attorneys.

App 16

The RTC and the RTC-controlled Debtors appeal

from the district court’s orders

I]

The RTC and the RTC-controlled Debtors raise a host

of arguments challenging the district court’s granting of

the Reimbursement Motion. Rather than addressing all of

their arguments, we address the issue most troubling to

us about the district court’s decision: the district court's

finding that the Directors acted in good faith and in the

best interests of the Debtors. We conclude that the district

court clearly erred in finding that the Directors, with the

exception of Ille, acted in good faith.4

A

California, Oklahoma, and Louisiana have similar

statutes regarding the indemnification of officers and

* At least one court has held that the good faith

determination is a question of fact reviewed under a clearly

erroneous standard. Plate v. Sun-Diamond Growers of Calif.,

225 Cal.App.3d 1115, 275 Cal Rptr. 667, 672 (1990) (holding that

the “question of whether a corporate agent acted in good

faith and for the best interests of the corporation| ] appears to be

an essentially factual question for the trial court”). The good

faith determination strikes us as a question of law, or at least a

mixed question of law and fact; although the facts supporting

the good faith determination should be reviewed for clear error,

an appellate court should review de novo whether or not those

facts lead to the conclusion that the agent acted in good faith

Nonetheless, we need not at this time decide the appropriate

standard of review for the good faith determination because our

reasoning applies under either standard.

>

App. 17

directors for the costs and expenses of legal proceedings.°

Under the California statute (as well as the other stat-

utes), indemnification is mandatory if a corporate agent

successfully defends himself in any proceeding. In such a

case, the corporation has a duty to indemnify the agent

for his costs and expenses, and the agent can sue the

corporation if it fails to do so

Even where the litigation does not result in a com-

plete vindication for the agent, “[{a] corporation shall

have the power to indemnify any person who was or is a

party or is threatened to be made a party to any pro

ceeding if that person acted in good faith and in a

manner the person reasonably believed to be in the best

interests of the corporation “ Cal.Corp.Code § 317(b)

hus, the statute allows for indemnification even where

the agent was negligent or committed some error, as long

as the agent acted in good faith and in the best interests

of the corporation. Plate v. Sun-Diamond Growers of

Calif., 225 Cal App.3d 1115, 275 Cal Kptr. 667, 672 (1990)

In such circumstances, indemnification is only permis-

sive: the corporation does not have a duty to indemnify

the agent but simply has the option to indemnify as long

as the good faith requirement is satisfied

> California law applies to Barton and Vaughan, Oklahoma

law to Walser and Ille, and Louisiana law to the Employees

Because the indemnification statutes are substantially similar,

compare Cal.Corp Code § 317 with Okla. Stat. tit. 18, § 1031 and

La.Rev.Stat.Ann. § 12:83, we focus on the California statute for

purposes of this discussion.

cat CL CC LLL LLL LLL LLL

i a

App. 18

Indemnification is never allowed where the agent

acted in bad faith and against the best interests of the

corporation. As one California court has stated:

Indemnification, if permitted too broadly, may

violate . . . basic tenets of public policy. It is

inappropriate to permit management to use cor-

porate funds to avoid the consequences of

wrongful conduct or conduct involving bad

faith. A director, officer, or employee who acted

wrongfully or in bad faith should not expect to

receive assistance from the corporation for legal

or other expenses and should be required to

satisfy not only any judgment entered against

him but also expenses incurred in connection

with the proceeding from his personal assets

Any other rule would tend to encourage socially

undesirable conduct

Plate, 275 Cal.Rptr. at 672 (citing 2 American Bar

Assoc., Model Business Corp. Act Ann., introductory cmt

to chapter 8, at 1082 (3d ed. 1987 supp.)).°

Thus, there are two requirements for permissive

indemnification under § 317(b): (1) the corporation must

authorize the indemnification, and (2) the agent must

have acted in good faith and in the best interests of the

corporation. It is not clear, however, whether the good

faith determination should be made by a court or by the

corporation itself. Section 317(e) provides that, before a

¢ The most recent supplement to the Model Business

Corporation Act Annotated contains similar but slightly

different language. See 2 American Bar Assoc., Model Business

Corp. Act Ann., introductory cmt. to subchapter E of chapter 8,

at 8-289 to 8-290 (3d ed. 1995 supp.).

App 19

corporation can authorize indemnification, the corpora

tion must determine that the agent has acted in good faith

and in the best interests of the corporation. The corpora

tion can make this determination in anv of the following

ways:

(1) A majority vote of a quorum consisting of

directors who are not parties to such proceed

ing

(2) If such a quorum of directors is not obtain

able, by independent legal counsel in a written

opinion

(3) Approval of the shareholders , with the

shares owned by the person to be indemnified

not being entitled to vote thereon

Cal.¢ orp.Code § 317(e). At first glance, § 317(e) sug

gests that the corporation’s finding of good faith settle:

the matter, and that the court’s role is limited to ensuring

that the corporation made its finding of good faith by

proper procedures

’ The California Code also provides a fourth way in whic!

a corporation can determine that an agent has acted in good

faith and in the best interests of the « orporation: (4) The court in

which the proceeding is or was pending upon application made

by the corporation or the agent or the attorney or other person

rendering services in connection with the defense, whether or

not the application by the agent, attorney or other person

opposed by the corporation. Cal.Corp.Code § 317(e)(4). Thi

fourth option, which is not found in the Oklahoma or Louisiana

statutes, is actually an exception. It provides that an agent can

receive indemnification over the corporation’s opposition if the

court in the proceedings for which the agent seek

indemnification found that the agent acted in good faith and in

the best interests of the « orporation

App. 20

We do not agree that the court’s role is so narrow.

Although a corporation has to find that the agent acted in

good faith before authorizing indemnification, nothing in

§ 317(e) restricts a court’s authority under § 317(b) to

make an independent assessment of the agent’s good

faith. Section 317(b) allows permissive indemnification

where the agent has acted in good faith, not where the

corporation finds that the agent has acted in good faith

Reading § 317(b) together with § 317(e), we conclude that

the issue of an agent’s good faith is a question for the

courts to decide.

In making the good faith determination, however, a

court cannot ignore the factual findings made during the

underlying proceeding for which the agent seeks indem-

nification. If the court or administrative panel in the

underlying litigation made factual findings relevant to

the determination of the agent’s good faith, the indemni-

fication court cannot reevaluate the evidence and reach

the opposite conclusion. Even the findings of an adminis-

trative agency have collateral estoppel effect on the

indemnification court. As the Supreme Court has stated:

When an administrative agency is acting in a

judicial capacity and resolves disputed issues of

fact properly before it which the parties have

had an adequate opportunity to litigate, the

courts have not hesitated to apply res judicata to

enforce repose.

United States v. Utah Construction & Mining Co., 384

U.S. 394, 422, 86 S.Ct. 1545, 1560, 16 L.Ed.2d 642 (1966).

Furthermore, where a court decides the question of

indemnification before the completion of the underlying

proceeding, the court must tread even more carefully. In

App. 21

determining whether or not the agent acted in good faith

and in the best interests of the corporation, the indemni-

fication court should not make any factual or legal deter-

minations that are properly before the court or

administrative panel in the underlying proceeding. The

indemnification court should not base its good faith

determination on its own conclusions about the merits of

the charges in the underlying proceeding.

The indemnification court, however, does not need to

postpone its determination until after the completion of

the underlying proceeding. The indemnification court

should consider whether the agent could have acted in

good faith and in the best interests of the corporation if

the charges against the agent turn out to be true.® If the

indemnification court finds that the agent could have

acted in good faith even if the charges were true, it

should grant indemnification because the indemnification

determination is not contingent on the result of the

underlying proceeding. On the other hand, if the indem-

nification court finds that the agent’s alleged misconduct,

if true, demonstrates that the agent acted in bad faith, the

indemnification court should deny permissive indemni-

fication; it should hold its indemnification decision in

abeyance until the completion of the underlying proceed-

ings and then grant indemnification only if the agent

5° The indemnification court does not need to consider the

agent's good faith if the charges turn out to be false. If the agent

succeeds on the merits in the underlying proceeding, he is

entitled to mandatory indemnification. See Cal.Corp.Code

§ 317(d). In such a situation, the issue of permissive

indemnification would be moot, thus rendering the good faith

determination unnecessary

App. 22

succeeds on the merits. For instance, an agent defending

himself against charges of negligent conduct should

receive indemnification if the indemnification court finds

that the agent, even if he were negligent, acted in good

faith. However, an agent defending himself against

charges of intentionally wrongful conduct should receive

indemnification only if he succeeds on the merits.

In the instant case, it is not clear whether the district

court — the indemnification court in this case — recognized

the proper scope of its “good faith” determination. In

finding that the Directors acted in good faith and in the

best interest of the Debtors when they filed the petitions

for bankruptcy, the district court offered little explanation

on how it reached its finding. In its May 27, 1994 order, it

simply stated:

[T]his court finds that the evidence demon-

strates that the officers and directors of the

Debtor companies sought the protection of the

bankruptcy court in good faith. Further this

court finds that the Debtors’ new management

ratified the decision to reorganize under the

protection of the bankruptcy court, demonstrat-

ing that the placement of the Debtors into bank-

ruptcy is reasonably viewed as being in the best

interest of the Debtors.

In re Landmark Land Co. of Okla., Civ. Action No.

2:91-5286-1, order at 12 (D.S.C. May 27, 1994) (J.A. 1278).

Neither in this order nor in any of its subsequent orders

did the district court articulate how the evidence demon-

strated the Directors’ good faith. More importantly, the

district court did not explain how the Directors could

App. 23

have acted in good faith if the OTS charges filed against

them were true.

Apparently, the district court’s finding of the Dire

tors’ good faith stems from its belief that the OTS charges

had no merit. From the very beginning of the bankruptcy

proceedings, the district court found that the Directors

“possesse[d] the requisite expertise to continue managing

the debtors’ estates in a manner most profitable for the

preservation of corporate assets.” Landmark Land Co. of

Carolina v. Resolution Trust Corp. (In re Landmark Land

Co. of Okla., 134 B.R. 557, 560 (D.S.C.1991), rev’d 973 F.2d

283 (4th Cir.1992)). It found that “the RTC ha[d] acted

with complete disregard of the efforts of management to

keep the debtor companies afloat.” Id. It seems that the

district court believed that federal regulators were ham

pering the Directors’ legitimate efforts to reorganize the

companies, and that the Directors sought the protection

of the bankruptcy code to protect themselves from an

overrun bureaucracy. The district court thought little of

the OTS charges, referring to them as an attempt by the

OTS to “seek[ | atonement from the named Debtor offi

cers for placing the Debtor companies in bankruptcy.” In

re Landmark Lanz Co. of Okla., Civ. Action No

2:91-5286-1, order at 8 (D.S.C. Oct. 5, 1994) (J.A. 2452

Furthermore, it found that the Directors had the best

interests of the Debtors in mind when they filed for

bankruptcy because the RTC ratified the Directors’ action

by keeping the Debtors in bankruptcy once it obtained

control over them.

Even if the district court was correct that the OTS

was inept and overbearing, the Directors’ action to file

for bankruptcy was a deliberate attempt to circumvent

App. 24

the regulatory authority that Congress had clearly given

to the OTS. Congress created the OTS in 1989 in response

to the crisis in the savings and loan industry, which

occurred when the insolvency of a large number of sav-

ings and loans bankrupted the Federal Savings and Loan

Insurance Corporation. Although the majority of savings

and loans were healthy financial institutions, Congress

found that the thrift crisis was concentrated in the

roughly twenty-five percent of the industry having capi-

tal, measured under generally accepted accounting prin-

ciples, of less than three percent. H.R.Rep. No. 101-54(1),

101st Cong., Ist Sess. 303 (1989), reprinted in 1989

U.S.C.C.A.N. 86, 99. Congress found that, “[t]o a consid-

erable extent, the size of the thrift crisis resulted from the

utilization of capital gimmicks that masked the inade-

quate capitalization of thrifts. . [I]f a crisis of this

nature is to be prevented from happening again, thrifts

must be adequately capitalized against losses.” H.R.Rep.

No. 101-54(1), 101st Cong., Ist Sess. 310 (1989), reprinted

in 1989 U.S.C.C.A.N. 86, 106. Congress invested the OTS

with broad regulatory powers to oversee financial institu-

tions and ensure that they were adequately capitalized.

By placing the Debtors in bankruptcy, the Directors

intended to prevent the OTS from enforcing the minimum

capitalization requirement against the Bank. According to

the OTS charges, the OTS investigated the Bank on June

4, 1990 and found that the Bank was inadequately cap-

italized and had demonstrated a pattern of repeated

losses. The OTS directed the Bank to infuse sufficient

capital to meet the minimum capitalization requirement,

but the Bank did not submit an acceptable plan. Because

of the Bank’s inability to meet the requirement, the OTS

App. 25

forced the Bank directors to sign a Consent Agreement on

January 15, 1991, signalling to the Directors that an OTS

takeover was imminent. Instead of working with the OTS

to correct the Bank’s capitalization problem, the Directors

filed the bankruptcy petitions to prevent the OTS from

exercising control of the Bank’s subsidiaries

We cannot conclude that the Directors’ action was

taken in good faith. If the OTS charges are accurate, the

Director's action to place the Debtors in bankruptcy was

a deliberate attempt to prevent the OTS from exercising

control over the Bank’s assets, thus hindering the OTS’s

ability to deal effectively with a failing savings and loan

Despite the district court’s findings that the federal regu-

lators had interfered with the Directors’ efforts to keep

the Debtors afloat, the fact remains that the Bank could

not comply with the minimum capitalization require-

ment, and the OTS therefore had a statutory duty to force

the Bank’s management to comply with the capitalization

requirement. The Directors acknowledged the OTS’s reg-

ulatory authority when they signed the Consent Agree

ment and agreed that the Bank’s subsidiaries would not

enter into any material transaction without prior

approval from the OTS. When the OTS threatened to take

control of the Bank, however, the Directors’ used the

bankruptcy code to stymie the OTS, even though their

action breached the Consent Agreement with the OTS

and violated their fiduciary duties to the Bank. We cannot

condone the Directors’ blatant attempt to circumvent the

OTS’s regulatory authority by holding that they acted in

good faith

Even if the bankruptcy filings benefitted the Debtors,

we still could not conclude that the Directors acted in

App. 26

good faith. An agent who has intentionally participated

in illegal activity or wrongful conduct against third per-

sons cannot be said to have acted in good faith, even if

the conduct benefits the corporation. Plate, 275 Cal. Rptr

at 672. “For example, corporate executives who partici-

pate in a deliberate price-fixing conspiracy with compet-

ing firms could not be found to have acted in good faith,

even though they may have reasonably believed that a

deliberate flouting of the antitrust laws would increase

the profits of the corporation.” 1 Harold Marsh, Jr. and R

Roy Finkle, Marsh’s California Corporation Law (3d ed.)

§ 10.43, at 751; see Plate, 275 Cal.Rptr. at 672 (citing same

language from second edition). We recognize that the

Directors did not break any law by filing the bankruptcy

petitions, and that the OTS has not filed criminal charges

against the Directors. Nonetheless, we find that a deliber-

ate attempt to undermine the regulatory authority of a

government agency cannot constitute good faith conduct,

even if such actions benefit the corporation.

The Directors intentionally breached their fiduciary

duties to the Bank and their Consent Agreement with the

OTS in order to prevent the OTS from exercising the

powers granted to it under FIRREA. The Directors knew

the impropriety of their actions, and one of the Directors -

Ille — resigned his position when he learned of the scheme.

We therefore conclude that the Directors did not act in

good faith when they placed the Debtors in bankruptcy

B.

We do not reach the same conclusion with respect to

Ille. Because the OTS and Ille entered into a settlement

App 27

and the OTS has dropped its charges against Ille, we have

the benefit of the factual admissions contained in the

settlement agreement. That agreement confirms that Ille

had no part in the filing of the bankruptcy petitions. He

learned of the decision to place the Debtors in bank

ruptcy on the evening of October 10, 1991, the day before

the bankruptcy filings. Ille resigned his directorship later

that same evening. In the settlement agreement, III

admitted knowing of numerous serious underwriting

deficiencies on loans approved by the Bank, and that he

i

if

relied on representations by the Bank’s management tha

these deficiencies were being addressed instead of hi

independently investigating the deficiencies known to

him. At most, Ille failed only in his duties to follow the

affairs of the Bank more diligently. The OTS, recognizing

lile’s minimal participation, dropy ed the charges against

him with only a mild punishment: it required Ille to sig:

a cease and desist order prohibiting him, in effect, fron

his breaching fiduciary duties in the future

The terms of Ille’s settlement agreement inforn

decision regarding whether Ille acted in good faith and 1

the best interests of the corporation The settlemer

agreement confirms that Ille committed no intentior

wrongful act. Most importantly, upon realizing that the

other Directors had schemed to circumvent the OTS

authority by placing the Debtors into bankruptcy, hs

immediately resigned from his position as a Bank dir

tor. We find that Ille acted in good faith and in the best

interests of the Debtors

We conclude, however, that Ille innot receive

indemnification from Landmark Oklahoma because he

was not an agent of that corporation. Ile was not

App. 28

member of the boards of directors of Landmark Okla-

homa or any of the Bank’s other subsidiaries. He was a

director only of the Bank, and as the settlement agree-

ment shows, he was not an active participant in the

management of either the Bank or the subsidiaries. Ille’s

only connection to Landmark Oklahoma is that he was

employed by First Life Assurance Company (“First Life”),

a subsidiary of Landmark Oklahoma. His employment

status, however, does not make him an agent of Land-

mark Oklahoma, especially because First Life has no

involvement whatsoever in the bankruptcy filings or this

litigation. Because Ille was not an agent of Landmark

Oklahoma, he would have to seek indemnification from

the Bank. Hence, Ille is not entitled to indemnification

from Landmark Oklahoma.

Although Ille has not sought indemnification from

the Bank, we note that, under Louisiana law, Ille would

likely be entitled to mandatory indemnification from the

Bank.? The Louisiana indemnification statute provides for

mandatory indemnification of an agent to the extent that

he “has been successful on the merits or otherwise in

defense” of the OTS charges. La.Rev.Stat.Ann. § 12:83(B).

Ille never received an adjudication on the merits, but

courts in other jurisdictions have interpreted similar lan-

guage to require indemnification when a settlement

agreement demonstrates that the agent succeeded on the

merits. See Wisener v. Air Express Int’l Corp., 583 F.2d

579, 583 (2d Cir.1978) (holding, under Illinois law, that the

phrase “on the merits or otherwise” is “surely . . . broad

? The Louisiana indemnification statute would apply to the

Bank because it was chartered under Louisiana law.

a

App. 29

enough to cover a termination of claims by agreement

without any payment or assumption of liability.”); Wal-

tuch v. Conticommodity Servs. Inc., 833 FSupp. 302,

310-11 (S.D.N.Y.1993) (following Wisener in interpreting

Delaware law, although ultimately concluding that plain-

tiff was not successful on merits); B & B Investment Club

v. Kleinert’s, Inc., 472 F.Supp. 787, 790-91 (E.D.Pa.1979)

(interpreting Pennsylvania law). But see American Nat’

Bank & Trust Co. of Eau Claire, Wis. v. Schigur, 83

Cal.App.3d 790, 148 Cal.Rptr. 116, 117-18 (1978) (holding,

under California law, that mandatory indemnification

requires a judicial determination of the merits of the

agent’s defense).'° The settlement agreement strongly

suggests that Ille successfully defended himself against

the OTS charges. Nevertheless, we cannot reach the issue

of mandatory indemnification because the Bank is not a

10 The reasoning of the California court in American Nat’l

Bank & Trust does not apply to Louisiana law. The mandatory

indemnification provision in most states follows the language of

the Model Business Corporations Act, which provides for

mandatory indemnification of an agent who “has been

successful on the merits or otherwise in defense” of any action

1 Model Business Corporations Act Ann 2d § 5; see, e.g.,

La.Rev.Stat.Ann. § 12:83(B). The California statute, however,

does not include the words “or otherwise,” suggesting “a

legislative intent that mandatory indemnification should

depend upon a judicial determination of the actual merits of the

agent’s defense .. ” American Nat’l Bank & Trust, 148

Cal.Rptr. at 118. Therefore, the American Nat’l Bank & Trust

court’s interpretation of California law has no bearing on

Louisiana law

App. 30

defendant and has not had an opportunity to argue

against mandatory indemnification."

IT]

We next consider the district court’s finding that the

Employees acted in good faith and in the best interests of

the Debtors. The district court found that:

There is no evidence before this court that the

employees had any reason to believe that their

efforts in taking the company into bankruptcy

were opposed to the best interests of the corpo-

ration. While Cone and Motahari were investi-

gated for criminal conduct and the OTS brought

administrative charges for breach of fiduciary

duty against them, they were never found guilty

of any charge. Braun and Trapani were never

even named in any administrative or criminal

proceeding. They were only questioned con-

cerning actions taken in the discharge of their

duties of employment.

In re Landmark Land Co. of Okla., Civ. Action No

2:91-5286-1, order at 5 (D.S.C. Nov. 9, 1994) (J.A. 2518)

(footnote omitted). We find the district court’s reasoning

to be somewhat illogical. The Employees had no involve-

ment in the Directors’ decision to take the subsidiaries

into bankruptcy. The OTS investigated the Employees to

1! We note that Ille has not paid any portion of his defense

costs. In his deposition of April 9, 1992, he testified that the

Directors’ attorneys represented him in defense of the OTS

charges. Because his position was different from the other three

Directors, he hired a personal attorney. He never received the

bills from this attorney, who was paid by Barton. See J.A. 259-60

App. 31

determine whether, in conducting the business of the

Bank, they participated in unsafe and unsound business

practices or violated banking laws and regulations. The

charges brought against Cone and Motahari focused on

their representations to federal regulators that the

Debtors owed to the Bank over $950 million in secured

debt, when in fact the debt was unsecured. The govern

ment has never alleged that any of the Employees partici

pated in the decision to place the Debtors into

bankrupt¢ y

We therefore conclude that the district court’s hold

ing that the Employees acted in good faith and in the best

interests of the Debtors was clearly erroneous, at least

with respect to Cone and Motahari. The OTS alleged that

Cone and Motahari engaged in unsafe and unsound busi

ness practices by arranging for the Bank to loan over $950

million to its subsidiaries without securing the debt for

the Bank. The OTS further alleged that they misrepre

sented to federal regulators that the loans were secured

Although Cone’s and Motahari’s settlement agreement

stated that they continue to dispute the OTS charges

against them, they accepted prohibition from practicing

in the affairs of any insured depository institution and

debarment from practicing before the OTS. In other

words, the OTS kicked them out of the profession. Unlik«

the district court, which stated that the settlement agree

ment should not connote Cone’s and Motahari’s guilt, In

re Landmark Land Co. of Okla., Civ. Action No

2:91-5286-1, order at 5 n. 4(D.S.C. Nov. 9, 1994) (J.A. 2518

App 32

n. 4), we conclude that their punishment is strong evi

dence that they acted in bad faith.'

With respect to Trapani and Braun, we see little evi

dence in the record on which to base a “good faith”

determination, and therefore conclude that the district

court’s finding of good faith was clearly erroneous

Nonetheless, Trapani and Braun have a right to manda-

tory indemnification because they succeeded on the

merits. Like Cone and Motahari, the OTS investigated

[Irapani and Braun for possible violations of banking

statutes and regulations and for any participation in

unsafe or unsound business practices. After this investi-

gation, the OTS subpoenaed Trapani and Braun and made

them give depositions under circumstances that were

clearly adversarial. The OTS never filed any charges

against Trapani and Braun. Under these circumstances,

we conclude that they succeeded on the merits in their

defense and are thus entitled to mandatory indemnifica

tion under La.Rev.Stat.Ann. § 12:83(B)

We therefore reverse the district court’s granting of

the Reimbursement Motion with respect to Cone and

Motahari, and we affirm on different grounds the district

court's granting of the motion with respect to Trapani

ind Braun

We note that some of the subsidiaries have already

indemnitied Cone and Motahari for a substantial portion of

their defense costs. The government represented at oral

argument that it sought only prospective relief and that it was

not demanding that Cone and Motahari repay the amounts

rea 7y recely ed

We conclude that the district court erred in finding

that Barton, Vaughan, Walser, Cone, and Motahari acted

in good faith and in the best interests of the Debtors

Furthermore, we find that Ille, although he acted in good

faith and in the best interests of the Bank, was not an

agent of Landmark Oklahoma and could not receive

indemnification from that entity. Therefore, we reverse

the district court’s granting of the Reimbursement Motion

with respect to those parties We conclude also that Trap

ani and Braur succeeded on the merits in their defense

and were entitled to mandatory indemnification from

their employer, Landmark Louisiana. We therefore affirm,

on different grounds, the district court’s granting of the

Reimbursement Motion with respect to Trapani and

Braun

Because of the grounds upon which we base our

onclusions, we need not reach the numerous other issue

raised by the parties

AFFIRMED IN PART AND REVERSED IN PART

We note that the appellees nave filed a motion to dism!

this appeal Because our decision in this case renders this

motion moot, we take no action on the motior

App. 34

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF SOUTH CAROLINA

CHARLESTON DIVISION

IN RE: LANDMARK LAND

COMPANY OF OKLAHOMA,

INC. an Oklahoma Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF CAROLINA, INC

a Delaware Corporation,

Debtor.

IN RE: CLOCK TOWER INVEST-

MENTS, LTD., a California

Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF CALIFORNIA,

INC., a Delaware Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF LOUISIANA,

INC., a Louisiana Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF FLORIDA, INC.,

a Delaware Corporation,

Debtor.

IN RE: CARMEL VALLEY

RANCH, a California

Corporation,

Debtor.

)

)

)

)

)

)

_)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

CIV. ACTION

NO.2:91-5286-1

BANKRUPTCY CASE

NO. 91-05815

CIV. ACTION

NO.2:91-5287-1

BANKRUPTCY CASE

NO. 91-05814

CIV. *CTION

NO.2:91-5288-1

BANKRUPTCY CASE

NO. 91-05818

CIV. ACTION

NO.2:91-5289-1

BANKRUPTCY CASE

NO. 91-05819

CIV. ACTION

NO.2:91-5290-1

BANKRUPTCY CASE

NO. 91-05817

CIV. ACTION

NO.2:91-3291-1

BANKRUPTCY CASE

NO. 91-05816

CIV ACT. NO

2:92-3548-1

BANKRUPTCY NO.

92-77109

Consolidated for

Purposes of Joint

Administration Only

Under Chapter 11

App. 35

(Filed Nov. 9, 1994)

ORDER ON APPLICATIONS AND FEES OF ATTOR-

NEYS FOR DEBTOR EMPLOYEES

This matter is before the court on the Debtors’

Motion To Reconsider the Court’s May 27, 1994 Order

which granted the applications of certain attorneys for

payment of fees incurred in the representation of

employees of the Debtors. This court severed recon-

sideration of these applications from the reconsideration

of the portion of the May 27, 1994 Order which related to

the indemnification of officers, directors and employees.

By Order dated October 5, 1994, this court denied ‘the

Debtors request to reconsider the indemnification of the

employees, officers and directors. At this time the court

reconsiders the applications for nunc pro tunc employ-

ment and for payment of fees filed by William R. Camp-

bell, Jr., Robert H. Habans, Jr., Herbert V. Larson, Ir.

David Popper, and John Wilson Reed and the law firms of

Popper & Popper and Glass & Reed.

The original Motion for Indemnification of officers

and directors was filed in March of 1992 when Gerald

Barton was the chief executive officer of the Debtors. In

September of 1992, after the indemnification motion had

been heard by the court, the Resolution Trust Corporation

took over management of the Debtor companies and

replaced The Board of Directors. The new Board

attempted to withdraw the indemnification motion. How-

ever, as the court had already heard the motion, with-

drawal was not permitted. Throughout the formation of

the Plan of Reorganization the court considered the

indemnification motion to be under advisement pending

App. 36

resolution by order of the court. On May 27, 1994 the

court ruled by granting the motion for indemnification as

well as certain related applications. It is these applica-

tions that the court now reconsiders.

Landmark Land Company of Louisiana, Inc. resolved

that the corporation would indemnify certain employees

against all expenses, including attorneys fees, actually

and reasonably incurred, in connection with a suit of

action brought by a third party relating to actions taken

in the discharge of their duties of employment.' Speci-

fically, these employees were Gina Trapani, D. Scott Cone,

Mohamad Motahari, and Gary Braun. Ms. Trapani? was

an assistant to officers of the Debtor. Mr. Cone?® was an

officer of Debtors. Mr. Motahari and Mr. Braun were

employed by the Debtor Landmark Land Company of

Louisiana, Inc. These employees clearly incurred expense

in defending themselves against charges brought in con-

nection with their “doing their jobs.”

In addition to the resolution of the Board of Directors

to pay the legal expenses of the four individual

employees, under applicable law, Debtors’ officers,

agents and employees are entitled to indemnification.

This indemnification includes the reimbursement of legal

fees, if it is determined that the party acted in good faith

and in a manner reasonably believed to be in the best

' See the Minutes of the April 21, 1992 Board of Directors

Meeting.

2 Ms. Trapini remained an employee of at least one of the

Debtor corporations even after the management was replaced in

the September of 1992.

3 Mr. Cone is now deceased.

App. 37

interest of the corporation. See Cal. Corp. Code, § 317(b)

and Cal. Civ. Code § 2802; See also Del. Code Ann. tit. 8,

§ 145(a); Fla St. § 607.0850; La. Corp. Code, tit. 12, § 83;

Tit. 18, Okla. Stat. § 1031; S.C. Code Ann. § 33-8-560.

Mr. Barton, the chief executive officer who managed

the Debtors until the RTC took over, testified that the

members of the Board of Directors who voted on the

resolution to pay the legal expenses of the Debtors’

agents did so in an effort to preserve the management

that remained in place during the difficult period imme-

diately following the filing of the bankruptcy petitions

Post-petition corporate stability is vitally important in a

case such as this and certainly includes providing

employees with the reassurance that the corporate deci-

sion to enter the reorganization process will not subject

mid-level employees to the cost of protecting themselves

in criminal or quasi-criminal investigations into the

Debtors’ activities.

Further the Debtors obtained the opinions of the law

firm of Berman, Blanchard, Mausner & Kindem of Los

Angeles California and of the law firm of Mock, Schwabe,

Waldo, Elder, Reeves, & Bryant of Oklahoma City, Okla-

homa. Both gave the Debtors their opinions that a corpo-

ration has an obligation to indemnify its agents and

officers. There is a requirement that those agents acted in

a manner “reasonably believed to be in or not opposed to

the best interests of” the corporation and had no reason-

able belief that their conduct was unlawful.

There is no evidence before this court that the

employees had any reason to believe that their efforts in

taking the company into bankruptcy were opposed to the

App. 38

best interests of the corporation. While Cone and

Motahari were investigated for criminal conduct and the

OTS brought administrative charges for breach of fiduci-

ary duty against them, they were never found guilty of

any charges.* Braun and Trapini were never even named

in any administrative or criminal proceeding. They were

only questioned concerning actions taken in the discharge

of their duties of employment.

Robert N. Habans, Jr. and his law firm, Habans,

Bologna & Carrier have applied to this court for reimbur-

sement for reasonable attorneys fees, cost and expenses

incurred in representing Ms. Gina Trapani for the period

from March 13, 1992 through September 12, 1992. Mr.

John Wilson Reed and the law firm of Glass & Reed have

applied to this court for reimbursement for reasonable

attorneys fees, costs and expenses incurred in represent-

ing Mr. D. Scott Cone for the period from March 9, 1992

to September 12, 1992. Mr. David Popper has applied to

this court for reimbursement for reasonable attorneys

fees, costs and expenses incurred in representing Mr.

Mamal(aka Mohamad) Motahari for the period from Jan-

uary 22, 1992 through June 10, 1992. Mr. Herbert V. Lar-

son, Jr. has also applied to this court for reimbursement

of reasonable attorney fees, costs and expenses incurred

in representing Mr. Mohamad Motahari for the period

from March 12, 1992 through September 12, 1992. Finally,

Mr. William R. Campbell, Jr. has applied to this court for

reimbursement for reasonable attorneys fees costs and

expenses incurred for representing Mr. Gary Braun for

4 Both consented to certain prohibitions sought by the OTS,

however such settlement should not connote guilt.

App. 39

the period from March 14, 1992 through September 12,

1992. Mr. Braun filed a Motion on June 29, 1993, seeking

court approval nunc pro tunc of his employment of Mr.

Campbell as counsel.

Upon reconsideration of the applications of Camp-

bell, Larson, Habans, Reed and Popper, and consideration

of the objections to those applications, the court finds as

it did in its May 27, 1994 Order that all are entitled to be

paid for the reasonable Fees and Expense incurred in the

representation of the named Debtors’ employees. Addi-

tionally the court finds that such applications indicated

reasonable fees and expenses.

Therefore, the court finds that the sums outstanding

as described on pages 11 and 12 of the May 27, 1994

Order should be paid by Debtors’ estates on behalf of the

named individual employees.

Therefore, it is

ORDERED that the applications of Messrs. Habans,

Campbell, Larson, Popper and Reed, and the law firms of

Popper & Popper, and Glass & Reed for the payment of

attorneys fees and costs be and hereby are approved.

ORDERED FURTHER, the motion of Gary Braun to

employee counsel nunc pro tunc be and hereby is granted

AND IT IS SO ORDERED.

/s/ Falcon B. Hawkins

Falcon B. Hawkins,

United States

District Judge

Charleston, South Carolina

November 1994

App. 40

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF SOUTH CAROLINA

CHARLESTON DIVISION

IN RE: LANDMARK LAND)

COMPANY OF OKLAHOMA, )

INC. an Oklahoma Corporation, )

Debtor.

IN RE: LANDMARK LAND

COMPANY OF CAROLINA, INC.

a Delaware Corporation,

De -btor.

IN RE: CLOCK - TOWE R INVEST-

MENTS, LTD., a California

Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF CALIFORNIA,

INC., a Delaware Corporation,

Debtor.

IN RE: LANDMARK LAND

COMPANY OF LOUISIANA

INC., a Louisiana Corporation,

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

Debtor.

IN RE: LANDMARK LAND)

COMPANY OF FLORIDA, INC., )

a Delaware Corporation, )

Debtor.

RANCH, a California

Corporation,

)

)

IN RE: CARMEL VALLEY )

)

)

Debtor. )

)

CIV. ACTION

NO.2:91-5286-1

BANKRUPTCY CASE

NO. 91-05815

CIV. ACTION

NO.2:91-5287-1

BANKRUPTCY CASE

NO. 91-05814

CIV. ACTION

NO.2:91-5288-1

BANKRUPTCY CASE

NO. 91-05818

CIV. ACTION

NO.2:91-5289-1

BANKRUPTCY CASE

NO. 91-05819

CIV. ACTION

NO.2:91-5290-1

BANKRUPTCY CASE

NO. 91-05817

CIV. ACTION

NO.2:91-3291-1

BANKRUPTCY CASE

NO. 91-05816

CIV ACT. NO.

2:92-3548-1

BANKRUPTCY NO.

92-77109

Consolidated for

Purposes of Joint

Administration Only

Under Chapter 11

App 4)

ORDER ON ATTORNEYS FEES FOR

DEBTOR EMPLOYEES AND DEBTOR

OFFICERS AND DIREC’ TORS

(Filed May 27, 1994)

On March 26, 1992, the Debtors filed a Joint Motion

for an order Authorizing Debtors to Reimburse Certain

Costs of Defense Incurred By Officers, Directors and

Employees in Administrative Proc eedings. Debtors

sought to reimburse certain Debtor personnel who were

called upon to defend themselves against charges made

in connection with the Debtors’ decision to file for Chap-

ter 11 protection. Specifically Debtors sought indemni-

fication for Gerald G. Barton, Bernard G. Ille, William W

Vaughan, II, and Joe W. Walser, Jr. for the period that each

were employed by Debtors, but prior to November 21

1991, when the Office of Thrift Supervision amended its

charges against the four named individuals. The Resolu

tion Trust Corporation (RTC), acting as Conservator for

Oak Tree Federal Savings Bank, filed opposition to

Debtors’ joint motion

Hearing was held on the matter on June 3, 1992. At

the conclusion of the hearing the Court ordered that the

record remain open so that the parties could make post-

hearing submissions of additional evidence and authority

for their positions. Pursuant thereto, the Debtors filed

additional evidence and authorities on June 8, 1992. The

RTC responded to the Debtors’ post-hearing submission

by letter to the court, which was filed as a responsive

pleading by the Clerk of Court

On or about October 13, 1991, the Office of Thrift

Supervision filed administrative charges against Messrs

App. 42

Barton, Ille, Vaughan, and Walser. Substantially the

Notice of Charges stemmed the decision to place the

Debtor corporations under the protection of the bank-

ruptcy court. The OTS also issued a Temporary Order to

Cease and Desist which, in relevant part, required the

directors to “take all necessary steps to cause the with-

drawal or dismissal of any and all bankruptcy petition

(sic) or complaints filed . . . on or since October 9, 1991.”

The Notice of Charges against the directors was

Amended on November 21, 1991. Evidence was presented

of a document entitled AGREEMENT REGARDING

CONFIDENTIAL INFORMATION by and between Fed-

eral Deposit Insurance Corporation, acting in its own

behalf and as a manager of Resolution Trust Corporation

and the Office of Thrift Supervision, dated April 29, 1991.

The document memorialized the agreement between the

two government agencies to exchange information gath-

ered from Debtor employees in the bankruptcy and in the

OTS administrative proceedings regarding the activities

of the Debtors’ officers, directors, and employees.

Sometime after the original administrative proceed-

ing began, the Office of Thrift Supervision also filed a

Notice of Charges against Mr. D. Scott Cone and Mr.

Mohamad Motahari. As a result of the new charges, the

Debtors filed a supplemental Motion on August 5, 1992,

to be appended to their Joint Motion for the reimburse-

ment of legal fees to include the payment of fees on

behalf of Mr. Motahari and Mr. Cone.

Thereafter, the Office of the United States Attorney

for the District of Louisiana instituted a federal grand

jury investigation into the activities of the officers, direc-

tors, and employees of the Debtors. Four Debtor

App. 43

employees, Messrs. Cone and Motahari, and Gary Braun

and Gina Trapani, were all questioned in relation to the

OTS charges and the grand jury investigation.

On August 7, 1992, Oak Tree Federal Savings Bank

submitted a Motion to Compel Chapter 11 Debtors to

Recover Attorneys fees and Expenses wrongfully paid

from the Chapter 11 Debtors’ Estates to Certain Individ-

uals and Attorneys. Oak Trees submitted to the court, as

an exhibit to its motion, a copy of the Minutes of Meeting

of the Board of Directors of Landmark Land Company of

Louisiana, Inc., dated April 21, 1992, in which the Board

resolved that the corporation would indemnify

employees Gary Braun, D. Scott Cone, Mohamad

Motahari, and Gina Trapani against all expenses, includ-

ing attorneys fees, actually and reasonably incurred, in

connection with a suit or action brought by a third party

relating to actions taken in the discharge of their duties of

employment. The Official Landmark Unsecured Credi-

tors’ Committee and the Debtors each filed responses.

Messrs. Habans, Campbell, Larson, Popper and Reed,

and the law firms of Popper & Popper, and Glass & Reed,

also filed opposition to Oak Tree’s Motion to Compel.

In addition, Robert N. Habans, Jr. and his law firm,

Habans, Bologna & Carrier have applied to this court for

reimbursement for reasonable attorneys fees, cost [sic]

and expenses incurred in representing Ms. Gina Trapani

for the period from March 13, 1992 through September 12,

1992. Ms. Trapani! was an assistant to Mr. Scott Cone and

1 Ms. Trapani remained an employee of at least one of the

Debtor corporations even after the management was replaced in

the September of 1992.

App. 44

Mr. Joe Olree, officers of the Debtor. Mr. John Wilson

Reed and the law firm of Glass & Reed have applied to

this court for reimbursement for reasonable attorneys

fees, costs and expenses incurred in representing Mr. D.

Scott Cone for the period from Marsh 9, 1992 to Septem-

ber 12, 1992. Mr. Cone? was an officer of Debtors. Mr.

David Popper has applied to this court for reimburse-

ment for reasonable attorneys fees, costs and expenses

incurred in representing Mr. Mamal Matahari [sic] for the

period from January 22, 1992 through June 10, 1992. Mr.

Motahari was employed by the Debtor Landmark Land

Company of Louisiana, Inc. Mr. Herbert V. Larson, Jr. has

applied to this court for reimbursement of reasonable

attorney fees, costs and expenses incurred in representing

Mr. Mohamad Motahari for the period from March 12,

1992 through September 12, 1992. Mr. Motahari was

employed by the Debtor Landmark Land Company of

Louisiana, Inc. Finally, Mr. William R. Campbell, Jr. has

applied to this court for reimbursement for reasonable

attorneys fees, costs and expenses incurred for represent-

ing Mr. Gary Braun for the period from March 14, 1992

through September 12, 1992. Mr. Braun was employed by

the Debtor Landmark Land Company of Louisiana, Inc.

Mr. Braun filed a Motion on June 29, 1993, seeking court

approval nunc pro tunc of his employment of Mr. Camp-

bell as counsel.

On or about September 12, 1992, the Debtors’ man-

agement headed by Mr. Barton, was replaced by a direc-

torship elected by the RTC, as conservator for Oak Tree

Savings Bank, which then owned a majority of the stock

2 Mr. Cone is now deceased.

App 45

in the Debtor companies. The new directorship elected to

keep the Debtors in Chapter 11 reorganization proceed-

ings in this district court. On or about October 7, 1992,

Oak Tree Federal Savings Bank filed a stipulation of

withdrawal of its Motion to Compel the Chapter 11

Debtors to Recover Attorneys Fees and Expenses Wrong-

fully Paid.

Under applicable state law, Debtors’ officers, direc-

tors, agents and employees are entitled to indemnifica-

tion, including the reimbursement of legal fees, if it is

determined that the party acted in good faith and in a

manner reasonably believed to be in the best interest of

the corporation. See Cal. Corp. Code, § 317(b) and Cal.

Civ. Code § 2802; see also Del. Code Ann. tit. 8, § 145(a);

Fla. St. § 607.0850; La. Corp. Code, tit. 12, § 83; tit. 18,

Okla. State § 1031; S.C. Code Ann. § 33-8-560. In addition

to the resolution of the Board of Directors Landmark of

Louisiana to pay the legal expenses of four individual

employees, the Board of Directors of Clock Tower Place

Investments, Ltd., authorized the indemnification of Mr.

Barton and Mr. Vaughan for expenses incurred in the

defense of their action taken on behalf of the corporation.

Also, the Board of Directors of Landmark Land Company

of Oklahoma, Inc., voted to indemnify Mr. Walser and Mr.

[lle for attorneys fees, costs and expenses incurred in

defense of their actions taken on behalf of the Debtor

corporation

Further the Debtors obtained the opinions of the law

firm of Berman, Blanchard, Mausner & Kindem of Los

Angeles, California and of the law firm of Mock,

Schwabe, Waldo, Elder, Reeves, & Bryant of Oklahoma

App. 46

City, Oklahoma, which both gave the Debtors their opin-

ions as to the a [sic] corporation’s right or obligation to

indemnify its agents and officers.

An Oklahoma corporation shall have the power

to indemnify any person who was or is a party

. to any threatened, pending or completed

action .. . whether civil, criminal, administrative

or investigative . . . by reason of the fact that he

is Or was a director, officer ... or agent. . . or is

or was serving at the request of the corporation

as a director. .. . an agent or employee

. against expenses incurred . . . in connection

with such action . . . if he acted in good faith and

in a manner he reasonably believed to be in or

not opposed to the best interests of the corpora-

tion .. . and had no reasonable cause to believe

his conduct was unlawful.

18 Okla. Stat. § 1301A (1991).3

The legal fees paid on behalf of Barton, Ille, Walser

and Vaughan, prior to the OTS amendment of the

charges, are reportedly as follows:

Law Firm Date of Bill Fees Expenses

Jones, Day, 10/91 124,155.00 1,485.40

Reavis & Pogue 11/1-20/91 40,697.50 10,943.95

McGlinchey, 10/91 28,380.00 2,799.01

Stafford, 11/1-20/91 26,390.00 2,803.65

Cellini & Lang

Lawrence & 10/91 780.00 46

Ellis 11/91-12/91 1,872.50 7.53

3 The California Code states substantially the same view

that a corporation may indemnify an agent of the corporation,

including an agent who is serving at the request of the

corporation. Cal. Corp. Code § 317{(a).

App. 47

Mr. Ille was the President and Chief Executive Officer

of a subsidiary of the Debtor Landmark Land Company

of Oklahoma, Inc. at the time the Debtors filed for bank-

ruptcy protection. The charges brought against Mr. Ille by

the OTS are undoubtedly the result of his association

with the Debtors and for actions he took at the request of

the Debtors. If Mr. Ille acted in good faith and not in a

manner opposed to the best interests of the Debtors, at

the behest of the Debtors, he is entitled to indemnifica-

tion by the Debtors’ estates, for the cost of defending

himself for those actions he took on behalf of the Debtor

corporations.

Mr. Barton, Mr. Vaughan and Mr. Walser were all

officers or directors of one or more of the Debtor com-

panies at the time of the bankruptcy filings and thereafter

when called upon to defend themselves as to actions

taken on behalf of the Debtors. Although, much has been

made of the fact that Mr. Walser ultimately decided to

resign his position with the Debtors voluntarily, Mr. Wal-

ser is as entitled to indemnification for his actions just as

any other officer or agent of the Debtor.

Oklahoma statutory law further states that if a direc-

tor or agent of a corporation is successful in the defense

of any action under § 1301A, § 1301C requires that the

corporation indemnify him for his expenses. Further-

more, the fact that an action is terminated by “judgment,

order, settlement, conviction, or upon a plea of nolo con-

tendere of its equivalent creates no presumption that a

person did not act in good faith or in a manner reason-

ably believed to be in the best interest of the corporation.

Further still, the right to indemnification and advance-

ment of expenses continues as to a person who has

App. 48

ceased to be a director officer, or agent, and shall also

inure to the benefit of the heirs, executors, and adminis-

trators of such a person. 18 Okla. Stat. § 1301) (1991).

However, in order to advance expenses the corporation

must require a written undertaking on behalf of the

indemnitee that if it is determined that advancement of

expenses was improper that the corporation will be re-

paid.

The Debtor, Clock Tower Place Investments, is a Cali-

fornia corporation. The Board of Clock Tower voted to

indemnify Vaughan and Barton. Under the California

Labor Code § 2802, an employer is required to indemnify

his employee for costs expended by the employee which

are directly the consequence of the discharge of his duties

or his obedience to the directions of his employer, so long

as the employee did not believe at the time of his perfor-

mance that his actions were unlawful. Clock Tower

sought legal counsel on the issue of indemnification and

it was determined that a failure by Clock Tower to agree

to indemnify its employees for costs incurred and those

to be incurred, as required by California labor law, could

subject Clock Tower to a suit for damages for breach of a

duty to indemnify.

Testimony secured at the hearing shows that Mr.

Gerald Barton has paid the legal fees in question on

behalf of himself and the three others who were named in

the original OTS charges. Mr. Barton also testified that if

he were reimbursed by the Debtors for the legal fees

incurred for defending himself and the three other indi-

viduals, and later it was determined that the actions of

those parties in filing for Chapter 11 protection was not

taken in good faith on behalf of the Debtors, Mr. Barton

App. 49

would re-pay the Debtors’ estates for the monies reim-

bursed to him for his legal fees. The evidence presented

at the hearing indicated that the three other individuals,

for whom Barton paid their legal fees, do not have ade-

quate resources to re-pay the Debtors’ estates: but later

the Debtors’ supplemental motion papers included state-

ments indicating that all were willing to repay the

Debtors’ estate if it were determined that they had not

acted in good faith on behalf of the Debtors.

Mr. Barton further testified that the members of the

Board of Directors who voted on the resolution to pay the

legal expenses of the Debtors’ agents did so to preserve

the management that remained in place during the diffi-

cult period immediately following the filing of the bank-

ruptcy petitions. Post-petition corporate stability

certainly includes providing employees with the reas-

surance employees that the corporate decision to enter

the reorganization process will not subject mid-level

employees to the cost of protecting themselves in crimi-

nal or quasi-criminal investigations into the Debtors’

activities. The evidence further shows that costs were

advanced to certain individuals on the advice of counsel.

Upon consideration of the applications of Campbell,

Larson, Habans, Reed and Popper, the court finds that all

are entitled to be paid for the reasonable Fees and

Expenses incurred in the representation of the named

Debtors’ employees, as indicated in their applications, to

wit:

A pp 50

Applicant Fees Expenses

William Campbell 1,612.50 2.81

Herbert Larson 5,077.00 1,728.50

Robert Habans 7,677.00 208.06

David Popper 51,850.00 5397.81

lohn W. Reed 35,550.00 2,391.23

Furthermore, the court finds that certain Fees and

expenses have been paid and further that there are sums

outstanding and yet to be paid by Debtors’ estates on

behalf of the named individual employees, as follows

Fees and

Applicant E xpenses Incurred Fees Paid Due

a = = .

Campbell 1,615.31 1,440.31 175.00

Larson 36,805.50 jess $370.0 36,528 .394 -92 89

Habans 7 885.06 7,000.00 RRS 06

Popper 57,247.81 48,113.00 9,134.81

Reed 42,341.23 29,411.50 12,929.73

The court further finds that the Debtors’ estates must

indemnify those officers, directors, and agents of the

Debtors for the costs of defending themselves for actions

taken in good faith and in a manner reasonably believed

to be in or not opposed to the best interests of the Debtors

4 Mr Larson attests that there was a credit on Mr

Motahari’s bil] in the amount of $370.00. If Mr. Larson’s other

figures as to “fees and expenses incurred” and “fees paid” are

correct, then with a $370.00 credit, Mr. Larson was over paid in

the amount of $92.89

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App. 91

in placing the Debtors in bankruptcy. Further, this court

finds that the evidence demonstrates that the officers and

directors of the Debtor companies sought the protectior

of the bankruptcy court in good faith. Further this court

finds that the Debtors’ new management ratified the de:

sion to reorganize under the protection of the bankrupt

court, demonstrating that the placement of the Debtor

into bankruptcy is reasonably viewed as being in the best

interest of the Debtors

Accordingly,

IT IS ORDERED THAT Debtors’ Joint Motion for ar

order Authorizing Debtors to Reimburse Certain Costs of

Defense Incurred By Officers, Directors and Employes r

Administrative Proceedings be and hereby is granted

IT IS FURTHER ORDERED THAT the applications of

Messrs. Habans, Campbell, Larson, Popper and Kead

and the law firms of Popper & Popper, and Blass & Kee

for the payment of attorneys fees and costs be and heret

are approved

IT IS FURTHER ORDERED THAT the motion otf ¢

|

Bruan [sic] to employ counsel nunc pro tur Ot

hereby is granted

IT IS ORDERED THAT Debtors’ estates shali pay

costs reasonably incurred by Mohamad Motahari, Gir

Trapani, D. Scott Cone, and Gary Braun in any

criminal, or investigative proceeding or from any thre.

ened or actual charges which are the result of

taken as employees in the discharge of their duties or

the direction of one of the Debtor companies

App. 52

[T IS FURTHER ORDERED THAT the Debtors’

estates shall indemnify Gerald G. Barton, Bernard G. Ille,

William W. Vaughan, II, and Joe W. Walser, Jr., for all

expenses reasonably incurred by them in the defense of

any civil, criminal or administrative charge or other pro-

ceeding stemming from their actions as officers, directors

and agents of the Debtor companies taken in good faith

with the reasonable belief that such actions were not

opposed to the best interests of the Debtor companies.

IT IS SO ORDERED.

/s/ Falcon B. Hawkins

Falcon B. Hawkins,

United States District Judge

Charleston, South Carolina

ee ee et ee

App 53

FILED: April 15, 1996

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 94-2475(L)

CA-91-5287-2-1

In Re: LANDMARK LAND COMPANY OF CAROLINA,

INCORPORATED, a Delaware Corporation, et al

Debtors

LANDMARK LAND COMPANY OF CAROLINA, INCOR-

PORATED, d/b/a West Beach Tennis Ranch, d/b/a West

Beach Tennis Parking, d/b/a Turtle Point, d/b/a Town

Center, d/b/a Osprey Point Golf Course, d/b/a Kiawah

Island Beach Resorts, d/b/a Kiawah Island Villa Rental,

d/b/a Kiawah Inn, Night Heron Park, d/b/a Marsh Point

Golf Course, d/b/a Links Golf Course, d/b/a Conference

Center, d/b/a East Beach Tennis Center, d/b/a Dune &

Lagoon Lodges, d/b/a Club Conference Center, a Dela-

ware Corporation, et al.

Debtor - Appellants,

RESOLUTION TRUST CORPORATION, a receiver (for-

merly conservator) for Oak Tree Federal Savings Bank

Creditor - Appellant,

versus

D. SCOTT CONE; JOHN WILSON REED

Respondents - Appellees,

App. 54

WILLIAM CAMPBELL, JR.; et al.,

Claimants - Appellees,

MCNAIR & SANFORD, P.A.; JONES, DAY,

REAVIS & POGUE; MCGLINCHEY,

STAFFORD, & LANG,

Parties in Interest - Appellees,

HOTEL OF PALM SPRINGS; et al.,

Creditors,

ANDREW M. MASCIARELLA,; et al.,

Claimants,

LANDMARK COMMUNITIES COMMITTEE,

INCORPORATED,

Intervenor - Plaintiff,

PGA WEST RESIDENTIAL ASSOCIATION,

INCORPORATED); et al.,

Respondents,

US TRUSTEE,

Trustee.

ORDER

Appellees, Gerald G. Barton, William W. Vaughan, II,

and Joe W. Walser filed a motion for reconsideration of

the court’s denial of the petition for rehearing with the

suggestion for rehearing en banc.

The Court denies the motion for reconsideration

App 55

Entered at the direction of Judge Russell with the

concurrence of Judge Michael and Judge Niemeyer

For the Court,

s/ Bert M Montague

Clerk

App. 56

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

FILED

April 2, 1996

No. 94-2475

BK-92-77109

CA-92-3548-2-1

BK-91-5818

CA-91-3288-2-

CA-91-5288-2-

BK-91-5819

CA-91-3289-

CA-91-5829-2-

BK-91-5817

CA-91-3290-2-

CA-91-5290-2-

BK-91-5816

CA-91-3291-2-

CA-91-5291-2-

BK-91-5815

CA-91-3286-2-

CA-91-5386-2-

BK-91-5814

CA-91-3287-2-1

CA-91-5287-2-1

In Re: LANDMARK LAND COMPANY OF CAROLINA,

INCORPORATED, a Delaware Corporation

LANDMARK LAND COMPANY OF FLORIDA, INCOR-

PORATED, a Delaware Corporation

LANDMARK LAND COMPANY OF OKLAHOMA,

INCORPORATED, an Oklahoma Corporation

LANDMARK LAND COMPANY OF CALIFORNIA,

INCORPORATED, a Delaware Corporation

LANDMARK LAND COMPANY OF LOUISIANA,

INCORPORATED, a Louisiana Corporation

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App. 57

CARMEL VALLEY RANCH, a California Corporation

CLOCK TOWER PLACE INVESTMENTS, LIMITED, a

California Corporation

Debtors

LANDMARK LAND COMPANY OF CAROLINA,

INCORPORATED, d/b/a West Beach Tennis Club, d/b/a

West Beach Tennis Parking, d/b/a Turtle Point, d/b/a

fown Center, d/b/a Osprey Point Golf Course, d/b/a

Kiawah Island Resorts, d/b/a Kiawah Island Villa Rental,

d/b/a Kiawah Inn, d/b/a Night Heron Park, d/b/a

Marsh Point Golf Course, d/b/a Links Golf Course,

d/b/a Conference Center, d/b/a East Beach Tennis Cen-

ter, d/b/a Dune & Lagoon Lodges, d/b/a Club Confer-

ence Center, a Delaware Corporation;

LANDMARK LAND COMPANY OF OKLAHOMA,

INCORPORATED, d/b/a Oak Tree Golf Club, d/b/a Oak

[ree Properties, d/b/a Caston Lumber Company, a/k/a

Oakridge Manor, d/b/a Oak Tree Communications, d/b/

a Oak Tree Country Club, d/b/a Oak Tree Development,

d/b/a Oklahoma Business Investments, Incorporated,

d/b/a Oak Tree Estates, d/b/a The Waterford Hotel,

d/b/a Redlands, an Oklahoma Corporation;

LANDMARK LAND COMPANY OF FLORIDA, INCOR-

PORATED, d/b/a Palm Beach Polo and Country Club, a

Delaware Corporation; :

LANDMARK LAND COMPANY OF LOUISIANA,

INCORPORATED, d/b/a Oak Tree Realty, d/b/a Oak

Harbor Yacht and Country Club, d/b/a Oak Harbor (for-

merly Eden Isles), d/b/a Landmark Realty, d/b/a Land-

mark Real Estate, d/b/a Landmark Homes, d/b/a

Landmark Asset Management Group, d/b/a LML Real

Estate Company, d/b/a Belle Terre Golf and Country

Club, a Louisiana Corporation;

App. 58

LANDMARK LAND COMPANY OF CALIFORNIA,

INCORPORATED, d/b/a Mission Hills Resort Condo-

miniums, d/b/a Thermal Nursery, d/b/a Stanford Oaks,

d/b/a Sanders Real Estate Company, d/b/a Recreational

Resort Marketing Venture, Limited, d/b/a PGA West,

d/b/a Oak Valley Country Club, d/b/a Oak Valley, d/b/

a Oak Tree Hotels, Incorporated, d/b/a Oak Summit,

d/b/a National Car Rental Agency, d/b/a Moreno Valley

Ranch Golf Club, d/b/a Moreno Valley Ranch, d/b/a

Moreno Valley Auto Mall, d/b/a Mission Hills Tennis

Club, d/b/a Mission Hills Resort Golf Club, d/b/a Mis-

sion Hills Resort Condominiums, d/b/a Mission Hills

Real Estate, d/b/a Mission Hills Real Estate Company,

d/b/a Mission Hills Golf Club, d/b/a Mission Hills Gen-

eral and Administrative Committee, d/b/a Mission Hills

Country Club, d/b/a Mission Hills Corporation, d/b/a

Mission Hills Company, d/b/a Landmark Special Events,

d/b/a Landmark Real Estate Company, d/b/a Landmark

Productions, d/b/a Landmark Mortgage Company, d/b/

a Landmark Land Golf Company, d/b/a Landmark Event

Management, d/b/a Landmark Communications, Incor-

porated, d/b/a La Quinta National Golf Club, d/b/a La

Quinta Leasing, d/b/a La Quinta Hotel Tennis Club,

d/b/a La Quinta Hotel Real Estate Company, d/b/a La

Quinta Hotel Golf Club, d/b/a La Quinta Hotel Golf and

Tennis Resort, d/b/a La Quinta Hotel, d/b/a La Quinta

Golf Academy, d/b/a La Quinta Cove, d/b/a La Quinta

Air Services, d/b/a LML Real Estate Company, Incorpo-

rated, d/b/a LML Mission Hills Corporation, d/b/a LML

Construction Co., d/b/a Greenspot, d/b/a Foster Turf

Products, d/b/a FTP Wholesale Growers, d/b/a FIP/

Bergen Nurseries, d/b/a Dixie Mortgage Company, d/b/

a Carmel Valley Ranch Real Estate Company, d/b/a

Bergen Nursery, d/b/a Acorn Purchasing, a Delaware

Corporation;

CLOCK TOWER PLACE INVESTMENTS, LIMITED, a

California Corporation;

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App. 59

CARMEL VALLEY RANCH, a/k/a Carmel Valley Ranch

Tennis Club, a/k/a Carmel Valley Ranch Resort, a/k/a

Carmel Valley Ranch, Incorporated, a California Corpora-

tion;

Debtor - Appellants

RESOLUTION TRUST CORPORATION, a receiver (for-

merly conservator) for Oak Tree Federal Savings Bank

Creditor - Appellant

y

D. SCOTT CONE, JOHN WILSON REED,

Respondents - Appellees

BERNARD G. ILLE, DAVID POPPER, GARY BRAUN,

GERALD G. BARTON, GINA TRAPANI, HERBERT V

LARSON, JR., JOE W. WALSER, JR., LAW FIRM OF POP-

PER & POPPER, LAW FIRM OF GLASS & REED,

MOHAMAD MOTAHARI, ROBERT H. HABANS, WIL-

LIAM W. VAUGHAN, III, WILLIAM CAMPBELL, JR.,

Claimants - Appellees

IONES, DAY, REAVIS & POGUE, MCGLINCHEY,

STAFFORD & LANG, MCNAIR & SANFORD, P.A.,

Parties in Interest - Appellees

ALPHA NURSERY, INCORPORATED, ARVIDA/JMB

PARTNERS, BART BOREN, BERNARDO GOUTHIER,

BORAL RESOURCES, INCORPORATED, C. M. HUB

BARD & SONS, CECIL ROTH FARMS, COASTAL INSTI

TUTIONAL DISTRIBUTORS, CRI, INCORPORATED, E

MCGRATH APPAREL COMPANY, ERNIE ZIELINSKI

FARMS, FARM CREDIT SERVICES OF SOUTHERN CAL-

IFORNIA, FLORIDA ROWING CENTERS, INCORPO

RATED, GLEN ROTH FARMS, GLEN ZIELINSKI FARMS,

GORDON WHEELER GALLERY, HAYWORTH FARMS,

App. 60

INCORPORATED, HIGH TECH IRRIGATION, INCOR-

PORATED, HOTEL OF PALM SPRINGS, IMAGE NET-

WORK, INCORPORATED, ITT ADMINISTRATORS, J. J.

KREBS & SONS, INCORPORATED, LAIDLAW WASTE

SYSTEMS, INCORPORATED, LOUIS L. KOKKELER,

M&D MCKAY FARMS, INCORPORATED, MATT ROTH,

MIKE THOMPSON, MULLEN FARMS, an Oregon Part-

nership, PALM BEACH POLO AND COUNTRY CLUB

PROPERTY OWNERS’ ASSOCIATION, INCORPO-

RATED, PAN AMERICAN LIFE INSURANCE COM-

PANY, PGA WEST, POHLSCHNEIDER FARMS,

INCORPORATED, PRICE WATERHOUSE, PRUDENTIAL

INSURANCE COMPANY OF AMERICA, PRUDENTIAL

INSURANCE COMPANY, INCORPORATED, QUAIL

VALLEY MANAGEMENT, INCORPORATED, QUINN,

EMANUEL & URQUHART, SOUTHERN FARM

BUREAU, SUNRISE COMPANY, SUSAN VINEYARD,

UNSECURED CREDITORS COMMITTEE,

Creditors.

88314 ONTARIO LIMITED, 52ND STREET FARM MAR-

KETS, A&B BUILDING MAINTENANCE, A. BYRON

PERKINS, A. C. HOUSTON LUMBER COMPANY, A.C.

NEWMAN & COMPANY INSURANCE, A. C. PUMP

SERVICE, INCORPORATED, A. D. FRESHOUR, A. J.

AMENDOLA, A. LINC LANCET, A. N. SPENCER, A.

WALLY SANDACK, A-1 FIRE EQUIPMENT, A-ALADIN

TRAVEL, A-Z OFFICE SUPPLY, AAA RENTALS, INCOR-

PORATED, AABACO INDUSTRIES, INCORPORATED,

AAR/NEWAY UNIFORM SUPPLY, AB & ASSOCIATES,

ABACUS TEMPORARY SERVICES, INCORPORATED,

ABLE LAWNMOWER SALES AND SERVICE, ABOUT

TRAVEL, INCORPORATED, ABSOLUTE CLEANING

COMPANY, ACCENT LANDSCAPING & PAVING, ACE

ALTERNATORS, INCORPORATED, ACE HARDWARE,

ee ee ee er)

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ee ene

App 61

#2786F, ACE PRINTING COMPANY, ACKERLEY AIR-

PORT ADVERTISING, ACME DISPLAY FIXTURE COM-

PANY, INCORPORATED, ACME RESTAURANT SUPPLY,

ADAM J. MICHAEL, ADOHR FARMS, INCORPORATED,

ADRIAN GOLDSTEIN, ADRIAN MARSDEN,

ADVANCED AMENITIES, ADVANCED TELECOMMU-

NICATIONS CORPORATION, ADVANCED TELE-

PHONE TECHNOLOGY, ADVANCED DRAINAGE

SYSTEMS, INCORPORATED, ADVANTA LEASING

CORPORATION, AIRBORNE FREIGHT CORPORATION,

AJAX OF LOUISIANA, AJF LEASING, INCORPORATED,

a division of AJF Warehouse Distributors, Incorporated,

AL PACKER FORD WEST, ALAN C. FURTH, ALAN C.

NEWMAN, ALAN D. HIURA, DDS, ALAN H.

LAZARUS, ALAN G. DAVIS/AGD INVESTMENTS COR-

PORATION, ALAN G. GRAY, ALAN G. PEDERSEN,

ALAN H. BEYER, ALANNAH SINCLAIRE, ALBERT G.

SIMPSON, JR., ALBERT J. STODDART, ALBERT LEGIT-

TINO, ALBERT R. SIMON, ALDO J. TEST, ALEX N.

CAMPBELL, ALEX SHERMAN, dba A&S Coffee Services,

ALFRED A. LEVIN, ALFRED SHAIN, ALL YOUR NEEDS

MET, ALL CLEAR WINDOW CLEANING, INCORPO-

RATED, ALLEN H. OGLANDER, ALLEN O. HUFF,

ALLEN FREIDSON, ALLEN MERCHANT, ALLEN NEW-

TON, M.D., ALLEN T. BROWN, ALLEN W. SHARPE,

ALLIE MAE, ALMAR CHEMICAL COMPANY, INCOR-

PORATED, ALOE UP PALMS, ALTA DENA CERTIFIED

DIARY, INCORPORATED, ALTERMAN STUDIOS,

INCORPORATED, ALVIN H. BLAINE, ALVIN L. RUSSO,

ALVIN S. MORROW, M.D., ALYS M. BACHLER, AMBAS-

SADOR FACTORS DIVISION OF FLEET FACTORS COR-

PORATION, AMERICA’S CHOICE COMPANY,

AMERICAN COASTAL DEVELOPMENT CORPORA-

TION, AMERICAN LINEN SUPPLY COMPANY, AMERI-

CAN HOTEL REGISTER COMPANY, AMERICAN

EXPRESS TRAVEL RELATED, AMERICAN LUMBER &

SUPPLY, ANDERSEN & ASSOCIATES, ANDERSON

App. 62

ARMORED CAR SERVICE, INCORPORATED, ANDREW

C. SMITH, ANDREW INGRAM, ANDREW J. FENADY,

ANDREW KRISTO, ANDREW L. ANDERSON, ANDREW

M. MASCIARELLA, ANDREW P. LOMBARD, ANDREW

ROSSI, ANDY ZEHNDER, ANGELICA UNIFORM

GROUP, ANHEUSER-BUSCH COMPANIES, ANITA FEL-

LER, dba Anita’s, ANITA VORHEES JACKSON,

ANNABELLE SAFRAN, ANNANDALE GOLF CLUB,

ANNENBERG CENTER AT EISENHOWER, ANNELY M.

KLINGENSMITH, ANTHONY G. QUADROS,

ANTHONY J. CARR,. ANTHONY J. MARTINO,

ANTHONY J. PORCELLO; ANTIGUA SPORTSWEAR,

INCORPORATED, APPLAUSE, INCORPORATED,

APPLIED TECHNOLOGY & MANAGEMENT, INCOR-

PORATED, APPLIED SOIL MECHANICS, INCORPO-

RATED, AQUA-SERV ENGINEERS, INCORPORATED,

ARA SERVICES MAGAZINE & BOOK DIVISION,

ARETA B. MCKENZIE TRUST, ARIZONA MANUFAC-

TURING & EMBROIDERY, ARMIN F. STEINER, ARREST

A PEST, ARROW LANDSCAPES & MAINTENANCE,

INCORPORATED, ART & LETTER SERVICE, ARTESIA

IMPLEMENT, ARTHUR B. HORTON, ARTHUR C. LIN-

NEMEYER, ARTHUR C. SCHULER, ARTHUR E.

BRANDT, ARTHUR E. NELSON, ARTHUR L. JACOB-

SON, ARTHUR MAGISTER, ASAP ICE, ASHELY D.

HOFFMAN, ASHLAND CHEMICAL, INCORPORATED,

ASIAN AMERICAN PARTNERS, ASSIST COMPUTER

CONSULTANTS, ASSOCIATED UNIFORM RENTAL &

LINEN SUPPLY, INCORPORATED ASSUMPTION PAR-

ISH, AT ONCE TEMPORARY SERVICES, AT&T, ATKIN-

SON POOL COMPANY, INCORPORATED, ATLANTIC

SERVICES, INCORPORATED, ATLAS COATING COM-

PANY, INCORPORATED, AUBREY DEVINE, AUREUS

LIMITED, AVID SPORTSWEAR, INCORPORATED

B&C TURF PRODUCTS, INCORPORATED, B&C SEA-

FOOD, INCORPORATED, B&M MAPS, B. D. CHAMAS,

B. J. BUCHANAN, B. RENEE HAMEL, BAKER AUDIO,

App. 63

INCORPORATED, BANCBOSTON FINANCIAL COM-

PANY, BANCROFT-WHITNEY LAW PUBLISHERS,

BANKSOUTH, N.A., BANNING ACE HARDWARE

5826S, BARBARA EDEN, BARBARA MARCHITELLI,

BARBARA ROGERS, BARNEY J. BELLELI, BARRY M.

TAYLOR, BARRY PRESSMAN, BARRY W. GENDEL-

MAN, M.D., BASE DISTRIBUTORS, INCORPORATED,

BAUER TIRE INCORPORATED, dba Goodyear Tire Cen-

ter, BAUSCH & LOMB INCORPORATED, BAYLAUREL

CORPORATION, a California corporation, BAYSHORE

PUBLISHING GROUP, INCORPORATED, BEACH-

COMBERS, INCORPORATED, BEAUMONT SAFE &

LOCK, BEAUMONT TIRE & MUFFLER SERVICE,

INCORPORATED, BELLE POINT DRAINAGE DISTRICT,

#1, BELLERIVE COUNTRY CLUB, BELLSOUTH ADVER-

TISING & PUBLISHING COMPANY, BELLSOUTH COM-

MUNICATION SYSTEMS, INCORPORATED, BEN PON,

BEN HOGAN COMPANY, BEN HARRIS, BEN E. KEITH

FOOD COMPANY OF OKLAHOMA, BEN ARNOLD

COMPANY, INCORPORATED, BEN F. NIEMAN, BEN

RASKIN, BENTLEY PRITSKER, BENTON’S PAINT,

INCORPORATED, BERIT FALGE, BERKELEY ELECTRIC

COOPERATIVE, INCORPORATED, BERKLEY DAVID

DESIGNS, BERLE MANUFACTURING COMPANY, BER-

MUDA DUNES COUNTRY CLUB, BERNARD A. SCHLI-

FKE, BERNARD DICKENS, BERNARD E. MCKUNE,

BERNARD P. KIRKPATRICK, BERNICE BUSH-POPE,

BERNIE’S CUSTOM CLEANING, INCORPORATED,

BERT FULLER, BETSY B. BENNETT, BETTIE GRESHAM

YODER, fka Bettie Gresham Glover, BETTY BELDEN

PALMER, BEVERLY ANN RILEY, BEVERLY E. HAM-

ILTON, BEVERLY F. DAROCZY, Trustee, BIG “A” AUTO

PARTS, INCORPORATED, BIG CANYON COUNTRY

CLUB, BIGGERS BROTHERS, INCORPORATED, BILL D.

CATES, BILL D. SAXON, BILL HAWKS, BILL MORRIS,

BILL SIMPKINS, dba Re’Al Sportswear, BILL SLIFER,

BILL STUBBS, BILLY G. FIELDER, BILLY R. AUSTIN,

App. 64

BILLYE R. AUSTIN, BILLY’S PINESTRAW, BIOTECH

PRODUCTS, INCORPORATED, BJARNE QVALE,

BLACKIE SERVICES, BLANCHARD MACHINERY COM-

PANY, BLP MOBILE PLANT - LA PLACE, BLUE FLAME

GAS COMPANY, INCORPORATED OF CHARLESTON,

BMI SYSTEMS CORPORATION, BOAST, INCORPO-

RATED, BOB G. ALEXANDER, BOB MANFRE, BOBBIE

PRECKWINKLE, BOBBY M. CLARK, BOBBY PEULAUD,

BOBWHITE SPECIALISTS, INCORPORATED, BOCA

TIRES, INCORPORATED, BOHEMIAN DISTRIBUTING

COMPANY, BOHICKET YACHT CHARTERS, BOMARC

PAPER & PACKAGING INCORPORATED, BOOSE,

CASEY, CIFLIN, LUBITZ, MARTIS, MCBANE & O’CON-

NELL, BORDELON & HILL, BOSTON TRADING LIM-

ITED, INCORPORATED, BOUCHEREAU OIL

COMPANY, BOURG SIGNS, BOYD L. JEFFERIES, BOYN-

TON PUMP & IRRIGATION SUPPLY, BRADFORD A.

CARL, BRADFORD KING KROHA, BRADLEY HEATING

& AIR CONDITIONING, INCORPORATED, BRADLEY

K. PENCE, BRAUN/A-1 LINEN SERVICE, BRENT S.

ENRIGHT, BRIAN MILLEMAN, BRIAN O. SHANNON,

BRIAN W. HOLMES, BRIGMAN FOODS, INCORPO-

RATED, BRITISH OPEN FOR J&F, BROWNIE’S BLUE-

PRINT COMPANY, INCORPORATED, BROWNING

FERRIS INDUSTRIES, BRUCE A. KAPLAN, BRUCE C.

ANDERSON, BRUCE C. RICHARDS, BRUCE D. GRAY,

BRUCE G. SCHWARTZ, BRUCE GALVANEK, BRUCE J.

HOESMAN, BRUCE L. DOW, BRUCE M. GALLAHER,

BRUCE R. BAUMANN, BRUCE ROLLICH, BRUCE

ROTHMAN, BRUCE S. CRAMPTON, BRUCE W. FRANK-

LIN, BRUNO A. GIORDANO, BRUNO BURKLIN

PHOTO, BRYAN R. GERSTEL, BRYANT FINANCIAL

CORPORATION, BUCKHEAD BEEF COMPANY, INCOR-

PORATED, BUD D. KLEIN, BUILDERS SQUARE, BUR-

BERRY/BIDERMANN INDUSTRIES, BURBERRYS

WHOLESALE LIMITED, BUSH BROTHERS PROVISION

COMPANY, BUSINESS BASICS, BUTLER BOX & STAKE,

App. 65

INCORPORATED, BUTLER NATIONAL GOLF CLUB,

BUTLER PAPER COMPANY, BUTTERFLY FLOWER

SHOP, BYRON RONALD MILLER

C&H DESIGNS, C&S FURNITURE RENTALS, C&S

SOVRAN COMMERCIAL CORPORATION, fka C&S

Commercial Corporation, C. ANNETTE HARVEY, C.

COURTNEY WOOD, C. DWAINE CARVER, C. E. SIN-

GLETON, C. KENNETH SUGLER, C. MARVIN MAY, C.

R. BROWN, C. W. SPANGLE, CABLE & CONNECTOR

WAREHOUSE, INCORPORATED, CACTUS COVE SEA-

FOODS, INCORPORATED, CALI-FAME OF LOS

ANGELES, INCORPORATED, CALIFORNIA COUNTRY

CLUB, CALLAWAY GOLF, CALYX & COROLLA, INCOR-

PORATED, CAMELOT NURSERIES, INCORPORATED,

dba Mountain States Wholesale Nursery, CAMPBELL’S

LIGHTING & SIGNS, CANNINGS BREA HARDWARE,

INCORPORATED, CANNINGS SEA FOODS, INCORPO-

RATED, CAPITAL FACTORS, INCORPORATED, CAR-

COMM, INCORPORATED, CARDINAL PAPER COM-

PANY, CARL A. JONSON, CARL E. BROOKS, CARL

EUGENE FRANKLIN, CARL T. WILLINGHAM, CARLOS

LEITE, CARLSON TRAVEL NETWORK, CARMEL VAL-

LEY RANCH REAS ESTATE COMPANY, CAROL B.

PLUMMER, CAROL SLIFER, CAROLINA GOLF CAR

SYSTEMS, CAROLINA MOUNTAIN WATER, INCORPO-

RATED, CAROLINA RETAIL PACKAGING, INCORPO-

RATED, CAROLINA SOUND COMMUNICATIONS,

CAROLINA SUPPLIES & CEMENT COMPANY, INCOR-

PORATED, CAROLINA TURF FARMS, INCORPO-

RATED, CAROLINAS CHAPTER - M.P.I., CAROLYN

CRIST, CAROLYN H. HUNT, CARR EXTERMINATING

COMPANY, CARR PAPER COMPANY, INCORPO-

RATED, CARRIE SMITH, CARRIER CORPORATION,

CARYL E. ORANGES, CATHEDRAL CITY POSTAL

COMPANY, CATHERINE G. CROMER, CAVANAUGH

ELECTRIC, CELLULAR ONE, CENTRAL CONTROL

App. 66

COMPANY, CENTRAL OKLAHOMA PRODUCE SER-

VICE, CHANDLER CONSTRUCTION COMPANY,

CHARLENE DIMOND, CHARLES CHIPS OF PALM

BEACHES, INCORPORATED, CHARLES A. BONNETT,

Doctor, CHARLES A. POTTER, CHARLES B. MONT-

GOMERY, CHARLES D. EDISON, CHARLES D. SHUBIN,

CHARLES E. NOREEN, CHARLES F. ADAMS, CHARLES

F. WEHRLY, CHARLES F. WENDT, CHARLES GILBERT

COLBY, CHARLES GIORNESTO, JR., CHARLES H.

BOOTH, JR., CHARLES H. BROCK, CHARLES HARRIS,

CHARLES HOUGH, CHARLES KAMPINSLI, CHARLES

L. MCCUBBINS, CHARLES L. RUPPERT, III, CHARLES

M. MCCORKEE, CHARLES MERTEN, dba Studs & Duds,

CHARLES N. VAUGHN, CHARLES R. WINTERROWD,

CHARLES V. KLINE, CHARLES GRENADIER, CHARLES

P. FALCONE, CHARLES PIUS, CHARLES R. REED,

CHARLES R. STARR, CHARLES SCHWARTZ, CHARLES

SNYDER, CHARLES WEISBERG, CHARLESTON PAPER

COMPANY, CHARLESTON NEWS COMPANY, CHAR-

TER GOLF, INCORPORATED, CHEM-DRY OF

COACHELLA VALLEY, CHERRY VALLEY SANITATION

SERVICE, INCORPORATED, CHERYL M. HUDAK,

CHERYL SAVAGE, CHESTER R. SAZENSKI, CHIEF

SIGN CRAFTS, CHONG HOON KIM, aka (Tom) Chong

Hoon Kim, CHRIS M. PEDERSEN, CHRIS MALETIS, III,

CHRIS PALLES, CHRISTINE & ROB’S, INCORPORATED,

CHRISTINE CORONA, CHUNG BAE, CHURCH DIAL-

ING COMPANY, INCORPORATED, CHURCH CREEK

NURSERY, INCORPORATED, CIMTEX, INCORPO-

RATED, dba Roche, CINDY BAKER, CINDY GUILLOT,

CINDY SEBALD, CITIBANK LEASING CORPORATION,

fka Caribank Leasing Corporation, CITIZENS INVEST-

MENT CORPORATION, CITY OF BREA, CITY OF

MORENO VALLEY, CITY OF OKLAHOMA WATER

RESOURCES DEPARTMENT, CITY OF EDMOND,

OKLAHOMA, CITY ELECTRIC, INCORPORATED, CITY

OF RANCHO MIRAGE, CITY OF TULSA, CITY OF

App. 67

OKLAHOMA, CITY SEA FOODS, INCORPORATED,

CLAIR E. LEEDOM, CLARENCE H. FOSSIER, M.D.,

CLARENCE J. FERRARIE, JR., CLASSIC APPAREL,

CLASSY BASKETS & EDIBLES, CLAUDE ELLENA,

CLAYTON D. RUSSELL, CLEANING WIZARDS, CLIFF

N. MORTENSEN, CLIFFORD A. MORTON, CLIFFORD

C. CRANDALL, CLIFFORD H. EVANS, CLIFFORD L.

GANT, CLIFFORD SEWELL, CLIPPER UNLIMITED,

INCORPORATED, CLUB CAR, INCORPORATED, CNA

INSURANCE COMPANY, dba Transportation Insurance

Company, COACHELLA VALLEY MOSQUITO ABATE-

MENT DISTRICT, COACHELLA VALLEY PUMP & SUP-

PLY, INCORPORATED, COACHELLA VALLEY WATER

DISTRICT, COASTAL VIDEO REPAIR, COATS VIYELLA,

COBRA GOLF, INCORPORATED, COFFEE SERVICE

COMPANY, COLE HAAN, COLLEEN ANNE GALAVIZ,

COLLEGE HOUSE, INCORPORATED, COLORADO LEI-

SURE SPORTSWEAR CORPORATION, COLUM-

BIANKNIT, INCORPORATED, COM SER COMPANY,

COMMERCIAL FACTORS OF MINNESOTA, COMMER-

CIAL LINEN SUPPLY, COMPLETE BUSINESS SYSTEMS,

INCORPORATED, COMPUTERIZED SECURITY SYS-

TEMS/WINFIELD LOCKS, INCORPORATED, COMPUT-

ERLAND, COMPUTERS FOR TRACTS,

INCORPORATED, CONAGRA, INCORPORATED, dba

Mapelli Food Distribution Company, CONCO FOOD

SERVICE, CONNIE D. WILSON, CONNIE P. SIEGAL,

CONNIE W. JOHNSON, CONRAD LOPES, CONSOLI-

DATED WHOLESALE COMPANY, CONSOLIDATED

FOOD SERVICE COMPANIES, CONSOLIDATED ELEC-

TRICAL DIST., INCORPORATED, CONTINENTAL BAK-

ING COMPANY, COOPERRIDER FAMILY TRUST, COR

O. 1 REFINERY, CORBIN, LIMITED, CORRINE PATTON

MARTIN, COUNTY CHEMICALS OF RIVERSIDE

COUNTY, COUNTY OF RIVERSIDE, TREASURER TAX

COLLECTOR, COUNTRY CLUB PUBLICA, County Club

Publications, Incorporated, COUNTRY CLUB SALES,

App. 68

COVINGTON COUNTRY CLUB, COVINGTON TECH-

NOLOGIES, COWIN E. ROBERT, CP COMMUNICA-

TIONS, INCORPORATED, CRAIG E. KREIBICH, CRAIG

E. VOLLHABER, CRAIG RIDENOUR, CREIGHTON

LACEY-BAKER, CRAVENS AUTO ELECTRIC COM-

PANY, CROSS CREEK APPAREL, INCORPORATED,

CTI/CREATE THE IMAGE, INCORPORATED, CUL-

LIGAN WATER CONDITIONING, CURTIS F. WAHL,

CURTIS L. NORMAN, CUSACK WHOLESALE MEAT

COMPANY, CUSTOM GOLF CLUBS, CYNTHIA L.

BUSBY, CYPRESS ELECTRICAL CONTRACTOR, INCOR-

PORATED, CYRK, INCORPORATED

D&V CARTING INCORPORATED, D&S REBUILDERS,

INCORPORATED, D. A. FROMDAHL, D. ARTHUR SAN-

CHEZ, D. B. MCLELLAN, D. C. VIENT, D. EUGENE

MOENCH, D. GENE MCCRORY, D. MARK GOODING,

D. MICHAEL JONES, D. WENDELL DICKEY, DAILEY-

FOTORNY, INCORPORATED, DAIWA GOLF COMPANY,

DALE A. NORGREN, DALE HAASE, DALE HUSS, DALE

WIGLEY, DALE NOREREN, DAN WALDOCH, DAN J.

AGNEW, DAN J. REEVES, DAN L. CARLIN, DAN W.

LYONS, DANIEL E. WILKEN, DANIEL MILOSEVICH,

DANIEL P. DECLARK, DANIEL W. SHEPARDSON,

DANIEL V. WALDOCK, DANKA LEASING, DANKA

BUSINESS SYSTEMS, INCORPORATED, DANN DEE

DISPLAY FIXTURES, DANNY S. LASKOWITZ, DARLA J.

KERSHAW, DARLYN DESIGNS, INCORPORATED, DAR-

RELL J. WILLIAMS, DARRYL ELLINGSON, DAVE

YOUNGQUIST, DAVID & BARBARA SENESCU, DAVID

A. MARKMAN, M.D., DAVID ARCHER BAND, DAVID

BRIAN BOGGS, DAVID C. FARR, DAVID L. HOTT,

DAVID L. STEFFY, DAVID MARKEL, DAVID E. BUR-

TON, DAVID E. PALM, DAVID FARNELL, DAVID H.

HAYES, DAVID J. DEMAINE, DAVID J. MONAGHAN,

DAVID J. STORSTAD, DAVID L. CSNIKSHANK, DAVID

L. MITCHELL, DAVID L. WELCH, DAVID ROBERT

CLARK, DAVID R. FOSTER, DAVID R. SANDBERG,

App. 69

DAVID C. JAMES, DAVID C. MALPASS WAREHOUSE,

INCORPORATED, DAVID DAVIES, DAVID E. TIERNEY,

DAVID FRANCESCHINI, DAVID ARCHER, DAVID M.

CHAPMAN, DAVID S. LEWIS, DAVID SMITH/M O

M/ATLAS CAPITAL, DAVID T. SARI, DAVID W. FLEM-

ING, DAVID WILLIAM RALSTON, DAVIS PIPE & St'P-

PLY, INCORPORATED, DAVIS & COMPANY, DE

CASTRO, WEST, CHODOROW & BURNS, INCORPO-

RATED, DEAN BOWERS FARMS, DEAN SPALDING,

DEBBIE WALKER, DEBRA ANN HILL, DEBRA TURF

AND INDUSTRIAL, DECRATREND CORPORATION,

DEE’S GRAPHIC SUPPLY, DEGESHC AMERICA,

INCORPORATED, DEL MONTE AVIATION, INCORPO-

RATED, DELI DELITES DISTRIBUTING COMPANY,

DELTA AIRLINES, INCORPORATED, DEMPSEY MORK,

DENNIS A. ALEKEL, DENNIS E. BALE, DENNIS

EDWARD NEUSHUTZ, DENNIS R. SIBSON, DERRICK

W. BROWN, DDS, DERRYL COUSINS, DESERT BUSI-

NESS MACHINES, DESERT FIRE EXTINGUISHER COM-

PANY, INCORPORATED, DESERT GOLF

DISTRIBUTORS, INCORPORATED, DESERT HORI-

ZONS, INCORPORATED, DESERT PRINTING COM-

PANY, INCORPORATED, DESERT STEAM CLEANING

COMPANY, DEVANT, LIMITED, DEVOE & RAYNOLDS,

DEWE ROGERSON, INCORPORATED, DIANA C. LA

PIERRE, DIANE N. SAUNDERS, DICK LYTLE, DICK W.

BOYCE, DICK’S TIRE MART, DICK’S VW FOREIGN &

DOMESTIC, DISCOUNT HARDWARE, DIVOTS SPORTS-

WEAR COMPANY, DIXIE ELECTRONICS, INCORPO-

RATED, DIXIENSURANCE, INCORPORATED, DIXON

TRAVEL AGENCY, DON D. TOBEY, DON HAMBLIN,

DON & HEIDI BROWN, DON JONES, dba Mesa Lawn

Maintenance, DON K. EDEN, DON R. HAGLER, DON

WADE, DONALD A. BENNETT, DONALD A. BUNCH,

DONALD A. DONOVAN, DONALD A. PELTON,

DONALD A. LEWIS, DONALD A. PELTON, DONALD

App. 70

A. WHITNEY, DDS, DONALD BOGDON, DONALD CIS-

NEY, DONALD D. DOTY, M.D., DONALD D. RANDALL,

DONALD DAVIDSON, DONALD E. FOLEY, DONALD

G. ELLIS, DONALD G. WHITMAN, DONALD J. HOLM,

DDS, DONALD J. MCGLYNN, DONALD J. TROY,

DONALD KELLEHER, DONALD L. JEFFERS, DONALD

L. ROBINSON, DONALD L. WILKERSON, DONALD R.

MARKLAND, DONALD R. REISFIELD, DONALD R.

ROBINSON, DONALD R. WADE, DONALD RAY

CHASE, DONALD S. LIEBMAN, DONALD S. MACKIN-

NON, DONALD T. BELDOCK, DONALD W. MAN-

LOWE, DONNA WICKSELL, DORI G. CREE, DORIS

SCHAFFER, DOROTHY NADINE PACE, DOUGLAS A.

WILLIS, DOUGLAS B. MCLELLAN, DOUGLAS K.

DUSENBURY, DOUGLAS P. VELING, DOUGLAS R.

MORRICE, DOUGLAS VIENT, DOUGLAS W. FLATT,

DOUGLAS WOOD & ASSOCIATES, INCORPORATED,

DOWDLE, INCORPORATED, dba General Air, DOW

JONES & COMPANY, INCORPORATED, DR. JAMES G.

SUNDERMAN, DR. & MRS. JAMES S. MANION, DRI-

TEC, INCORPORATED, dba Auto Flow & Systematic Ser-

vices, DUANE A. LONG, DUANE R. JACOBS, DUANE

TERRY COMPANY, INCORPORATED, DUNCAN INSTI-

TUTIONAL FOODS, DUNLOP SLAZENGER CORPORA-

TION, DUNMORE HOMES OF SOUTHERN

CALIFORNIA, DURHAM HOSIERY MILLS, INCORPO-

RATED, DURHAM MEAT COMPANY, DURWARD A.

LYON, DURWARD A. YOUNGBLOOD, DWAINE L.

CANOVA, DWIGHT L. STUART

E. BEACH LEIGHTON, E. BRENT MARCHETTI, E. C.

HOLLENBECK H&H LUMBER & HARDWARE, E. V.

CLEVELAND, JR., E. HARRISON WILLIAMS, E. JOY

MURRELL, E. THOMAS EDQUIST, E-Z-GO DIVISION

TEXTRON, INCORPORATED, EAGLE DEVELOPMENT

CORPORATION, EARL C. SILVA, EARL E. ANDERSON,

EAST COAST FIRE EQUIPMENT, INCORPORATED,

App. 71

EASTERN CHEMICAL COMPANY, EASTERN MUNICI-

PAL WATER DISTRICT, EASTERN TURF EQUIPMENT,

INCORPORATED, ECOLAB, INCORPORATED, ECOLAB

PEST ELIMINATION, ECONOMY AUTO SUPPLY,

INCORPORATED, ED KROICHICK, ED SAVAGE, ED

SMITH’S STENCIL WORKS, EDDIE CHANDLER,

EDGAR ROBINSON, EDMOND EVENING SUN,

EDMOND G. EBERTS, EDMOND TROPHY COMPANY,

INCORPORATED, EDMUND J. LINDEMAN, EDMUND

MIDDLETON, EDWARD DON AND COMPANY,

EDWARD G. ZWASCHKA, EDWARD HERBERT, dba

Herbert Plumbing, EDWARD BOESCH, EDWARD A.

BERON, M.D., EDWARD A. RAUSCHER, EDWARD A.

ROBINSON, EDWARD ARNOLD, EDWARD CICOUREL,

EDWARD GALL, EDWARD H. STIRM, EDWARD H.

WHITE, EDWARD L. BRYAN, EDWARD L. LAMBERT,

EDWARD LARRY BRYAN, EDWARD M. KASHIAN,

EDWARD MALETIS, II, EDWARD S. CLEVELAND, DDS,

EDWARD W. HARBERT, III, EDWARD W. MUELLER,

EDWIN B. REESER, III, EDWIN H. NOVASCONE,

EDWIN H. SASAKI, aka Sasaki Living Trust, EDWIN J.

GUIDRY, EDWIN KING, EDWIN R. SLADE, EDWIN S.

FUKUMOTO, EILENE R. SHADLER, EJB ENTERPRISES,

INCORPORATED, EKELTON, a subsidiary of Prince,

ELAINE MCKINLAY, ELAYNE BRYANT PHOTOGRA-

PHY, ELBERT H. HAYS, ELEANOR P. LONG, ELECTRIC

CAR DISTRIBUTORS, INCORPORATED, ELITE IMPRES-

SIONS, INCORPORATED, ELIZABETH FIORENTINO,

ELIZABETH M. ELIASON, ELLIE LAVELLE, ELLER

AND DETRICH, a professional corporation, ELLINGTON

ACE HARDWARE, INCORPORATED, ELLISON

GRAPHICS CORPORATION, ELMER AND ASSOCI-

ATES, INCORPORATED, ELMER J. NOONAN, ELWIN L.

NEWKIRK, ELYSE DEL FRANCIA, EMANUEL E. MAR-

MER, EMILY SCHULTZ & ASSOCIATES, EMPIRE

SOUTHWEST COMPANY, EMPLOYMENT DEVELOP-

MENT DEPARTMENT OF THE STATE OF CALIFORNIA,

App. 72

ENDICOTT ASSOCIATES, INCORPORATED, ENDO

ENGINEERING, EO KOHLER, EQUIPMENT TRANS-

PORT, INCORPORATED, ERGUN BAKALL, ERICH A.

QUER, M.D., ERLINDA BLOCK, ERNEST ‘. VOSSLER,

ERNEST W. PETERSON, ESPECIALLY FOR YOU

FLOWERS & GIFTS, INCORPORATED, ESTATE OF PHIL-

LIP LUKIN, ESTEGARD FARMS, ESTES, INCORPO-

RATED, ESTHER H. SHEPHARD, ETHEL KIEVMAN,

EUGENE GOLDBERG, EUGENE C. WHEARY, EUREKA

WATER COMPANY, EVANS ELECTRIC MOTORS,

INCORPORATED, EVE MORROW, EVELYN KRONICK,

EVELYN MOUNT, EVENING POST PUBLISHING COM-

PANY, EVERGREEN LAWNCARE SERVICE,

EVERGREEN SERVICE, D.A. EAKIN, dba Evergreen Ser-

vices, EXPRESSIONS OF MARI-LYNN, EXTRA TOUCH

FLOWERS

F. DIANNE KOSARIN, F. H. FOSTER OIL CORPORA-

TION, INCORPORATED, F. PATRICK SMITH, F.

STRAUSS & SON, INCORPORATED, F-MATIC OF

OKLAHOMA, F&D PARTNERSHIP, LIMITED, FANCY

PANTS, FAR NIENTE WINERY, FARM CREDIT SER-

VICES OF SOUTHERN CALIFORNIA, FARM IRRIGA-

TION EQUIPMENT, INCORPORATED, FARMER’S

GRAIN COMPANY, FARRELL G. HINKLE, FEDERAL

EXPRESS, FELICE FORNACA, FERN’S FENCE COM-

PANY, FIESTA PARTY RENTALS, FILA SPORTS, INCOR-

PORATED, FINANCIAL PRODUCTS C, FINE ARTS

ENGRAVING COMPANY, INCORPORATED, FIPPS &

SONS GARAGE, FIRST UNITED LEASING CORPORA-

TION, FIRST STATE INSURANCE COMPANY, FIRST

BROADCASTING COMPANY, FIRST FORMS COM-

PANY, FLORENCE GENDEL, FLORIDA PRESSURE

CLEAN & PAINT COMPANY, INCORPORATED, FLOR-

IDA SUPERIOR SAND, INCORPORATED, FLORIDA A &

M TAPE & PACKAGING, INCORPORATED, FLORINE P.

FIELDS, FLOWERS DISTRIBUTING COMPANY OF

BATON ROUGE, INCORPORATED, FLOW-RITE PUMP

App. 73

SERVICE, FLOYD F. TWIGHT, FLOYD H. HOUSE,

FOASBERG LAUNDRY & CLEANERS, INCORPO-

RATED, FOLEY & LARDNER, FOOD SERVICE SUP-

PLIES, INCORPORATED, FORD AUDIO-VIDEO

SYSTEMS, INCORPORATED, FORNACA FAMILY BAK-

ERY, FORREST NEWHALL, FOSTER CONSTRUCTION,

INCORPORATED, FORSTER-GARDNER, INCORPO-

RATED, FOUNDERS CLUB GOLF COMPANY, INCOR-

PORATED, FRANCES GROSSMAN, FRANCES M.

HANKEY, FRANCES M. VORHES, FRANCES P.

WILSON, FRANCIS S. FERRARO, FRANK A. GOD-

CHAUX, III, FRANK BLOOM, FRANK CRIST, FRANK E.

MOREY, FRANK E. PIERSON, FRANK FIORENTINO,

FRANK FORNACA, FRANK G. SAINT, FRANK

HAYNES, SR., FRANK HIRSCH, INCORPORATED,

FRANK R. JACKSON, FRANK SCHIRO, FRANKLIN

QUEST COMPANY, FRED ALEXANDER, FRED C.

WILSON, FRED E. KIEVMAN, FRED E. PERI, FRED J.

MCBRIDE, FRED M. HELLER, FRED P. THOMPSON, JR.,

FRED R. STONE, FRED W. MARBLE, JR., FRED SARNO,

dba Sarno Sport, FREDERICK A. ZANE, FREDERICK

JAMES GRANT, M.D., FREDERICK POE TRAVEL SER-

VICE, INCORPORATED, FREDERICK S. PRESCOTT,

Trustee, FREDERICK SMITH, FRICTION SHIELD, FRI-

DAY NEWSPAPER, FRITO-LAY, INCORPORATED,

FRONTIER CHEVROLET, FULTON DISTRIBUTING

COMPANY

G&K SERVICES, G&S FABRICATION SERVICE, INCOR-

PORATED, G. BUCKLEY ENTERPRISES, INCORPO-

RATED, G. EUGENE LUNDSTROM, G. H. BOGAN, G. P.

BURNETT, GAIL M. DOE, GAIL W. GLASS, GALE R.

HARBOUR, GARNER IMPLEMENT COMPANY, GAR-

NET F. WYNNE, GARNET HILL LABATUT, GARRETT

BUTLER, GARRY & SUSAN BROOKS, GARTRELL

TRAVEL SERVICE, INCORPORATED, GARY C. GREER,

GARY WILLIAM BURKE, GARY A. BRYANT, GARY

App. 74

APPLEGATE, GARY C. WARNER, GARY GOOD ENTER-

TAINMENT, GARY D. DOUBLIN, GARY L. FLANDERS,

GARY L. MYKLES, GARY R. OSBORN, GATE CITY BEV-

ERAGE DISTRIBUTORS, GEAR FOR SPORTS, GENE A.

BROWN, GENE COLLINS, GENE GLADDEN, GENE L.

MUSE, GENE NORRIS, GENERAL ELECTRIC COM-

PANY, GENSTAR RENTAL ELECTRONICS, INCORPO-

RATED, GEORGE W. FOWLER COMPANY, GEORGE

ANSBRO, GEORGE B. PENTZ, GEORGE B. PICKETT,

GEORGE BISTAGNE, GEORGE C. WOODWARD,

GEORGE E. GALLOGLY, GEORGE E. GILES, GEORGE E.

HANDTMANN, III, GEORGE E. MIDDLETON, GEORGE

EDGAR, GEORGE G. HEISLER, GEORGE H. JACOBSEN,

GEORGE J. ALLISON, Doctor, GEORGE J. FLYNN,

GEORGE J. NEYER, GEORGE L. RICHARDS, GEORGE L.

SNYDER, GEORGE L. WOODFORD, JR., GEORGE M.

STRODE, GEORGE N. E. CROSS, GEORGE NICHOLAU,

GEORGE O. HOLLAND, GEORGE PETERSON, GEORGE

S. RAUSCH, GEORGE S. WILLIAMS, GEORGE T.

ARATANI, GEORGE T. SHERIDAN, GEORGE

VUCANOVICH, GEORGE’S SMALL ENGINE REPAIR,

GERALD A. CRAKER, GERALD A. JEUTTER, JR., GER-

ALD A. TARSITANO, GERALD CALDERA, JR., GERALD

D. ANKENBRANDT, GERALD E. HAMILTON, GERALD

SKIP SULLINS, GERALD T. OWENS, GERALD H.

BOGAN, GERALD MIKOUZMANOFF, GERALD W.

CUNNINGHAM, GERALD W. WALKER, GERALDINE

A. HALL, GERALDINE E. DONOVAN, GERARD MAR-

TIN, GEROLD EDDS, G.F.l. HOLDING COMPANY,

INCORPORATED, t/a IXSPA 2000, GILBERT AND SUL-

LIVAN SOCIETY, GILBERT L. WIGGAN, GILT EDGE

FARMS, INCORPORATED, GIN D. WONG, FAIA, GIN-

THER EQUIPMENT CORPORATION, GIRARD S.

BREWER, GLADYS WEEKS, GLASCON, INCORPO-

RATED, GLEN OAK COUNTRY CLUB, GLENN A. PEA-

RSON, GLENN HAMMER, GLENN RODANO, GLENN

YOUNG, GMK INTERIORS. GOLD CREST LIMITED,

App. 75

GOLDBERG AND SOLOVY FOODS, INCORPORATED,

GOLDEN GOLF ENTERPRISES, GOLF DESIGN, U.S.A.,

GOLF TEES, GOLF TOURNAMENTS, INCORPORATED,

GOLF VENTURES, INCORPORATED, GOOD STUFF

FOOD COMPANY, INCORPORATED, GOODMAN KNIT-

TING COMPANY, INCORPORATED, GORDON L.

DAVIS, GORDON O. GARIS, GORDON W. GILLIS, GOR-

DON WHEELER GALLERY, GORDON’S INCORPO-

RATED, GRAEME YOUNG, GRAHAM M. KEMSLEY,

GRAIN PRODUCERS, GRANITE CONSTRUCTION

COMPANY, GRANT HORNBEAK, GRAPHIC CENTER,

GRAPHICS ILLUSTRATED, INCORPORATED, GREAT

PLAINS COCA-COLA BOTTLING COMPANY, GREAT

AMERICAN SIGNS, GREEN’S CHEM DRY, GREG L.

COOK, GREGG ELECTRIC, INCORPORATED,

GRETCHEN V. HEYER, GRO-RITE FERTILIZER COM-

PANY, GROUP SOUTH APPAREL, INCORPORATED,

GROW MORE, INCORPORATED, GRUND GUIDE, GTE

CALIFORNIA, INCORPORATED, GTE SPACENET COR-

PORATION, GTEL FINANCE, GUDIO MARCHITELLI,

GULF SHORE TURF SUPPLY, INCORPORATED

H. BUD BOYER, H. C. WINNARD, H. E. NANCE, H.

KENNETH GRAY, H. N. T. WELDING, H. WAYNE

HANSON, HAAS JORDAN COMPANY, HAD BURGER,

HAINES FOOD SERVICE OF FLORIDA, INCORPO-

RATED, HALSEY & GRIFFITH, INCORPORATED,

HAMES ELECTRIC, HAMMES PERSONNEL SERVICE,

INCORPORATED, HANSON MANAGEMENT COM-

PANY, HARLAN C. ERICKSON, HAROLD A. RESKIN,

HAROLD E. WAKE, HAROLD E. WILSON, HAROLD F.

ELLINGTON, HAROLD G. CASSRIEL, HAROLD G.

HATCH, HAROLD R. PINCHIN, HAROLD SAMPSON,

HAROLD S. GOLDMAN, HAROLD WRIGHT, HAR-

RISON TRAVEL MARQUIS, INCORPORATED, HARRIS

PACKING COMPANY, HARRY A. LEE, HARRY BOOTH,

HARRY BURNS, HARRY D. SCHROEDER, HARRY PAR-

KER, HARVEY OTT, JR., HARVEY S. BROWN, HAYDEN

App. 76

H. BOWER, HAYWORTH FARMS, INCORPORATED,

HEAD SPORTS WEAR, HEE KUN LEE, HELENA CHEM-

ICAL COMPANY, HEMET OIL COMPANY, HENRY D.

CALVERT, HENRY S. BURDICK, HENRY SANCHEZ,

HENRY SHERMAN, HENRY W. TATIJE, III, HERALD

TRAVEL SERVICE, HERBERT ADERHOLT, HERBERT A.

FLEMING, HERBERT C. HILLIARD, HERBERT C.

WINWARD, HERBERT P. ADERHOLT, HERBERT P.

HALL, HERBERT PLUMBING, HERMAN BACHREDL,

HERMAN R. SCHOWE, JR., (Trust), HERMAN SAFRAN,

HERMAN WEISSKER, INCORPORATED, HER-

RINGTON, INCORPORATED, HERTZ EQUIPMENT

RENT, HICKEY-FREEMAN COMPANY, INCORPO-

RATED, HIDEKI YAMADA, HIDEO KARAHASHI, HIGH

SPORTSWEAR, INCORPORATED, aka High Horse

Sportswear, Incorporated, dba Line-Up, HIGH TECH

IRRIGATION, INCORPORATED, HILLCREST COUNTRY

CLUB, HILTI, INCORPORATED, HILTON HEAD LABO-

RATORIES, HIROBUMI OGINO, HITOSHI UMINO,

HODGES RENT ALL, INCORPORATED, HOLDERS OF

CLUB MEMBERSHIPS, HOMEOWNERS, LOT OWNERS,

AND HOMEOWNERS ASSOCIATES, HONEYWELL

PROTECTION SERVICES, INCORPORATED, HORN-

UNG’S PRO GOLF SALES, INCORPORATED, HORST

WHOLESALE FLORIST, INCORPORATED, HORTON

INSURANCE AGENCY, INCORPORATED, HOTEL

ASSOCIATES FOR PALM SPRINGS, HOWARD A. JOHN-

SON, HOWARD J. SHIPLEY, HOWARD M. KOFF, HOW-

ARD P. ALLEN, HOWARD PEARCH, HOWARD YOSHII,

HUGH RAPHAEL, HUNTER STEWART, HUNTON

FARMS, HURD SERVICE COMPANY, HYATT R.

MCWILLIAMS, HYDE DRUG, INCORPORATED,

HYDRO-SCAPE PRODUCTS, INCORPORATED,

HYMAN’S WHOLESALE, HYMEL FLORIST, HYUN

CHUL KIM

I. B.S, INCORPORATED, I. I. T. ADMINISTRATORS,

INCORPORATED, Pate & Payne, P.C, as agent, I. PAGE

ia

App. 77

SOWERS, M.D., I. WILLIAM OBERFELDER, IAN B. CAR-

TER, ICE CREAM PRODUCTS, ICHIRO TAJIMA,

IDABELL BEDNAR, IDEAS INCORPORATED/INTER-

NATIONAL MATCH, IGLOO PRODUCTS INCORPO-

RATED, IMAGE MASTERS PRINTING, IMPERIAL

IRRIGATION DISTRICT, IMPERIAL HEADWEAR,

INCORPORATED, INDIO PIPE & SUPPLY, INCORPO-

RATED, INLAND CITY SECURITY, INCORPORATED,

INLAND CONSTRUCTION AND ENGINEERING,

INLAND TRACTOR, INNOTECH AVIATION LIMITED,

INSTAPLAK OF FLORIDA, INTERCOASTAL PACKING,

INCORPORATED, INTERIOR SHUTTERS, INCORPO-

RATED, INTERNATIONAL COMPUTER MAINTE-

NANCE, INTERNATIONAL LINKS, INCORPORATED,

INTERSTATE BATTERYS OF OKC, IRMA M. GIROIR,

IRVIN A. ROBINSON, IRVIN A. SHERMAN, IRVING

DEVINE, IRVING J. HEINEN, IRVIN M. KIPNES, ISAB-

ELLA VASQUEZ, ISLAND ERRAND COMPANY,

ISLAND TREE SERVICE, ISLAND ALTERATIONS, IT’S

MY BAG, IVAN C. SIMMOVICH, IVAN J. THORNLEY,

IVS MEDIA, INCORPORATED, dba IVS Media Produc-

tions, IZOD LACOSTE GOLF AND TENNIS

J. A. RAUCH CONSTRUCTION COMPANY, INCORPO-

RATED, J. B. MOSER, J. BLAINE ROOTH, J. BRENT

BOURDEAU, J. E. RUSSELL, aka Jimmy, J. F. PORTER

COMPANY, INCORPORATED, J. FREDERICK WILSON,

J. GARY HAMILTON, J. J. KREBS & SONS, INCORPO-

RATED, J. 1 ARRY FUGATE, J. M. PETERS COMPANY,

INCORPOF .TED, J. MICHAEL RIBAUDO, M.D., J. P.

REPROGRA.PH1CS, J. PATRICK MCMAHON, J. R. JOHN-

SON, J. R. MCMAHON, J. R. ROWELL PRINTING COM-

PANY, INCORPORATED, J. ROBERT JACOBS, M.D., J. V.

CORBETT, J. WADE TUCKER, J. WILLIAM TURPIN, J&J

MASTERS OIL COMPANY, J&P GARDEN SUPPLY COM-

PANY, INCORPORATED, JACK A. FOX, JACK O. STEP-

HAN, SR., JACK A. STEPHENS, JACK B. CAMPBELL,

JACK B. SNOW, JACK BERGMAN, JACK C. CLARKE,

a

App. 78

JACK COTTON, JACK D. DAHLGREN, JACK DZAMAN,

JACK E. BAILEY, JACK F. CUNNINGHAM, JACK F. TAY-

LOR, JACK H. FARRIOR, JACK HEINZ, JACK J. BLU-

MENTHAL, JACK L. CLARK, JR., JACK L. CLARK, SR.,

JACK L._ RICHARDSON, JACK O. STEPHAN, SR., JACK

R. COLLINS, JACK ROBINSON, JACK RULE, JR., JACK

T. CROLLARD, JACK TAYLOR, JACK MARGOLIES,

JACK MOORE, JACK N. HAMILTON, JACK TALLEY,

JACK W. MORRIS, JACK WALL, JACK WITTEMORE,

JACKSON’S AUTO SUPPLY, JACKSON’S GREASE TRAP

SERVICE, INCORPORATED, JACQUES S. YEAGER,

JAKE O’DONNELL, JAMES A. HAMILTON, JAMES A.

JOHNSON, JAMES A. SCHELBLE, M.D., JAMES ISLAND

CLEANERS AND LAUNDRY, JAMES P. LINN, JAMES H.

FLIPPEN, M.D., JAMES EDWARD SWICEGOOD, dba

Palmetto First Aid, JAMES B. HUNT, JAMES C. CAIN,

JAMES C. CARTER, JAMES C. CHALFANT, JAMES C.

FOSTER, JAMES C. GILSTRAP, JAMES D. HANN, JAMES

D. MILOVINA, JAMES D. TUCKER, JAMES E. DUNN,

JAMES E. TIBONE, JAMES G. SUNDERMAN, JAMES H.

CORNING, JAMES H. CROOKER, JAMES H. LEITZKE,

JAMES H. WILCOX, JAMES J. POPE, JAMES L. BARNEY,

JAMES L. LATTA, JR., JAMES L. DONNELLY, JAMES M.

POLLARD, JAMES P. YOUNG, JAMES T. DESMOND,

JAMES DONELAN, III, JAMES E. HAYES, JAMES

EMERY, dba Emery Landclearing, JAMES G. HARDY

COMPANY, INCORPORATED, JAMES G. VORHES,

JAMES H. MACKENZIE, JAMES H. YAHR, JAMES K.

AUSTIN, JAMES L. WALKER, JAMES M. BUCHANAN,

JAMES M. MURPHY, JAMES M. PIPPIN, JAMES NEAL

HARRIS, JAMES P. METZLER, JAMES PARKHOUSE,

JAMES R. DEERING, JAMES R. ROWELL, JAMES R.

STEIN, JAMES S. BARBER, JAMES SHRODE, JAMES T.

MOON, JAMES T. MURPHY, JAMES VINCENT RHODU-

NDA, JAMES ISLAND TV SERVICE, JAMES W.

BELLAMY, JAMES W. CONNOR, JAMES W. MCKINZIE,

JAMES W. MILLER, JAMES W. SMITH, JAMES WILTSE,

App. 79

JAMMIN, JANET A. SPIDELL, JANE E. O’CONNOR,

JANE E. SKOGEN, JANI-KING OF CALIFORNIA,

INCORPORATED, JANICE M. JUNKIN, JAY C. KIM, JAY

F. TRESSEN, JAY GRIFFEY, JAY »'LLS, JAY R. ZUBRIN,

M.D., JAY SHULMAN, JAYMAR-RUBY, INCORPO-

RATED, JEAN A. DENIKE, JEAN BELL DESIGNS, JEAN

C. YOUTIE, JEAN W. HORAN, JEAN WHEELER,

JEANETTE STEWART, JEFF HAWKINS, JEFF J. WHITE,

JEFF ROBINSON, JEFFCO, INCORPORATED, JEFFREY

BERKLEY, JEFFREY M. READ, JEROLD BEEVE, JEROLD

P. GREEN, JEROME A. THRALL, JEROME SHELBY, JER-

OME H. SPITZ, JEROME T. CABAKOFF, JERRY A.

GADDIS, JERRY D. CONN, JERRY E. AMEN, JERRY L.

ODEN, JERRY DON HUTTON, JERRY J. MOOK, JERRY

L. KRENZ, JERRY L. WILSON, JERRY L. SMITH, JERRY

M. GORDON, JERRY MORRIS, JILICH’S ON KIAWAH,

JILL TALLEY, JIM D. KRAHL, JIMMIE J. NELSEN, JIM-

MIE L. AUSTIN, JIMMY A. SHADLER, JOCK BOK-

KELEN, JOE C. GIUFFRE, JOE E. ALMANZA, JOE

KIRKWOOD, JR., JOE T. DUDLEY, JOE W. MAXEY, JR.,

JOEL R. KUSHELL, JOEL’S CAKES, JOHAN PERSLOW,

JOHN A. BAILEY, JOHN B. PACE, JOHN B. ZOELEZZI,

JR., JOHN BENCH, JOHN BORBA, JOHN BOS, JOHN C.

BEDROSIAN, JOHN C. BILLESDON, JOHN C. FOSMIRE,

JOHN C. MARELLI, JOHN C. MELONI, JOHN C.

WIXOM, JOHN CAZNOHAN, JOHN COULTRUP, JOHN

D. BURNS, JOHN D. CHUDACOFF, JOHN D. GOLD-

SON, JOHN D. INGLE, JOHN D. JACOBSON, JOHN D.

NELSON, JOHN D. RICHART, JOHN DERDIVANIS,

JOHN DICKMEYER, JOHN DOUBEK, JOHN DYKSTRA,

JOrN E. BOBBITT, JOHN E. BRITTAIN, III, JOHN E.

EVENSON, JOHN E. LOWE, JOHN E. NILAN, JOHN E.

SELi 3, JOHN E. VOORHIES, JOHN F. PFAFFL, JOHN H.

MU® LEY, JOHN LEDBETTER, JOHN M. COFFEY, JOHN

NFi©WENDER, JOHN J. BORER, JR., JOHN J. FARRELL,

JOHN JAY GRIFFEY, JOHN J. PFEIFFER, JOHN J. POW-

ELL, JOHN JESSE HARTMAN, JOHN L. GILCHRIST,

App. 80

JOHN M. POPKESS, JOHN NOUSKAJIAN, JR., JOHN P.

MCCORMACK, JOHN PHILIP HENEBRY, JR., JOHN

POLLIS, JOHN R. CARNOHAN, JOHN R. FORREST,

JOHN R. HUNDLEY, JR., JOHN RAIMAND, JOHN

RICHARD LOGAN, JOHN CASABLANCAS MODEL

MANAGEMENT, JOHN VANCE MOTORS, JOHN DAVID

DAVENPORT, JOHN F. RUEDI, JOHN H. BENNETT,

JOHN H. BIGGE, JOHN H. BOTTOMLEY, JOHN H.

GUENTHER, JR., JOHN H. HARPER, JOHN H. CLARK,

Tax Collector, JOHN H. WILLIAMS, JOHN IBERTI, JOHN

J. REEN, JOHN M. TRIANA, JOHN R. BANDOCZI,

JOHN R. DELFINO, JOHN R. PARRISH, JOHN READ,

JOHN ROUZIE, JOHN ROWEN, JOHN S. HEIL, JR.,

JOHN S. HUISKAMP, JOHN SEXTON COMPANY, JOHN

MCCLURE, JOHN MORGAN, JOHN MUGNIL, JOHN O.

CHAMBORLAIN, JOHN ROBERT SNYDER, JOHN S.

GASPER, JOHN STUART FITTS, JOHN W.

HECKENLIVELY, JOHN W. MOAKLER, III, Doctor,

JOHN W. NELSEN, JOHNSON GRADING EXCAVA-

TION, JOHNSTONE SUPPLY, JON B. HEDBERG,

JONAH’S RESTAURANT, JONATHAN MORK, JONES

APPAREL GROUP, INCORPORATED, JONES, FOSTER,

JOHNSTON & STUBBS, INCORPORATED, JONES

SPORTS COMPANY, JOO LEE, JOSEPH & NELLIE

INCORVAIA, JOSEPH E. DEUPREE, JOSEPH ALAN

GIELLERUr JOSEPH ALJIAN, JOSEPH B. HENNEN-

FENT, JOScPH DELEDANNE, JOSEPH E. BASHORE,

JOSEPH E. DEUPREE, JOSEPH HEITZLER, JOSEPH J.

AMORUSO, JOSEPH J. DOOLING, JOSEPH J. FIJAK,

JOSEPH J. KUZMANIC, JOSEPH L. DONDERO, JOSEPH

L. WILSON, JOSEPH LOUIS NEWMAN, JOSEPH M. FIN-

LEY, JOSEPH R. ROSENBERG, JOSEPH SARRATORE,

JOSEPH W. SCHEUER, JOY’S LAPLACE FLORIST,

JOYCE CAROL HALL, JOYCE FEDERGREEN, JOYCE’S

FRAMING, JUDGE LOUIS M. GREENBLOTT, JUDITH G.

ECONOMOU, JUDITH LAURENCE, JUDY COX, JUDY

VOSSLER WOODARD, JULIAN ATTAWAY, JUNICHI

App. 81

MURATA, JUSTICE GOLF CAR CO8'PANY, INCORPO-

RATED, JUSTIN GRAF

K&J SPECIALTY PRODUCTS, INC\JRPORATED, K&L

TESTING, INCORPORATED, K&M. INCORPORATED,

dba Acti nm Printers, K. BELL, K. FAWLEY JACKSON,

KAMAN INDUSTRIAL TECHNOLOGIES CORPORA-

TION, KARFN PELLETIER, KAREN WESTHEROF, KARL

V. KELLERY, KARSTEN MANUFACTURING CORPORA-

TION, KASCO CORPORATION OF AMERICA,

KATHERINE SAUTER, KATHLEEN A. HAIRSTON,

KATHLEEN HUGHES AVERETT, KATHY BROWN,

KATHY P. HELGESON, KAWASAKI OF RIVERSIDE, KAY

MOSER, KAYE KEDDIE THORTON, KAYLOR SWEEP-

ING, KAZU MIYANA, KELLY C. PETILLO, KEN SNIDER

SCALES, KENNETH A. JENSEN, KENNETH A. KUEBEL &

ASSOCIATES, KENNETH E. WILT, KENNETH F.

YONTZ, KENNETH J. SORACE, KENNETH M. WHITE,

KENNETH P. BASKIN, KENNETH P. KRIEGER, KEN-

NETH R. HOOD, KENNETH R. KRIEGER, KENNETH R.

SEBBY, M.D.. KENNETH S. LEVINSON, KENNETH W.

DAVIS, JR., KENNY STRICKLAND, INCORPORATED,

KENT M. CORNELL, KENT RANDAL MEREDITH, KEN-

TUCKY TEXTILES, KERRY KETTER, KERRY W. &

SUSAN MULLIGAN REVOCABLE TRUST OF 1990,

Trustee, KEVAN & THERESA JUERGENS, KEVIN B.

MCAREE KEVIN J. MCCLOSKEY, KIAWAH RESORT

ASSOCI4TES, KIAWAH ISLAND UTILITY COMPANY,

KIAWAH SEABROOK SEAFOOD, INCORPORATED,

KIAWAH ISLAND COMMUNITY ASSOCIATION, KIM

ROMINE DESIGNS, KIPLING IMPORTS, INCORPO-

RATED, KIRSTEN R. FOSTER, KITCHEN GARDEN,

KOHEI HATA, KONICA BUSINESS MACHINES USA,

INCORPORATED, KRA/STRAWMARKET, L.P., KRAFT

FOODSERVICE, INCORPORATED, KRIST LEOVICH,

KRUEGER, INCORPORATED, KURT RATHJEN, KWANG

KYUN PYUN, KYLE DENNING

App. 82

L&M DISTRIBUTORS, L. A. EXPRESS, L. E. ACKER

COMPANY, L. C. S. AMERICA, INCORPORATED, L. G.

MURRELL, L. NEVILLE RIEMAN, L’OBSERVATEUR, LA

JOLLA PACIFIC EQUITIES, INCORPORATED AND

INLAND PACIFIC REAL ESTATE, INCORPORATED, LA

QUINTA ACE HARDWARE, LA QUINTA HOTEL GOLF

MEMBERS ASSOCIATION, LA QUINTA MEDICAL/

COMMERCIAL PLAZA, LIMITED, LA PLACE DRAIN-

AGE DISTRICT #1, LA PLACE LUMBER COMPANY, LA

BAGUETTE, INCORPORATED, LA PLACE PRINTER, LA

RINCONADA COUNTRY CLUB, LAIDLAW ENVIRON-

MENTAL SERVICES, INCORPORATED, LAKE ARROW-

HEAD COUNTRY CLUB, LAKE CHARLES AMERICAN

PRESS, LAMONT D. HEYER, LANCE, INCORPORATED,

LANDMARK MASONRY, INCORPORATED, LANGERT

GOLF COMPANY, LA QUINTA HOTEL GOLF MEM-

BERS ASSOCIATION, LARRY A. RAY, LARRY C. BARE-

NBAUM, LARRY E. BARCLAY, LARRY E. BELGER,

LARRY GARFINKEL, LARRY L. TOPP, LARRY M.

CHAMBERLAIN, LARRY R. SMITH, LARRY LEE SISCO,

LARRY ROSSMAN, LARRY TAYLOR, JR., LAS CASTAS

HOMEOWNERS ASSOCIATION, INCORPORATED, LAS

POSAS COUNTRY CLUB, LAURENCE P. HORAN, LAW-

RENCE E. LARSON, LAWRENCE G. LYON, LAWRENCE

N. PASQUALE, LAWRENCE M. SPICER, LAWRENCE M.

THRONEBURG, III, LAWSON PRODUCTS, INCORPO-

RATED, LAZARD FRERES & COMPANY, LE COQ

SPORTIF, INCORPORATED, LE TRIOMPHE GOLF &

COUNTRY CLUB, LEASEAMERICA CORPORATION,

LEE A. ELLMAKER, LEE ESCHER OIL COMPANY,

INCORPORATED, LEE TRACTOR COMPANY, INCOR-

PORATED, LEFCOURT IMPORTS, INCORPORATED,

LELAND SCHEU, LEO J. MURPHY, LEO KOHLER, LEO

N. BINDMAN, LEON LEVIN, LEONARD DON MATHIS,

LEONARD E. LICHTER, LEONARD FELD, Doctor,

LEONARD GROSS, LEONARD HARRIS, LEONARD P.

CLARK, LEONARD SPITZER, LEONIAK, LIMITED,

App. 83

LEROY W. HUNSAKER, LES WIENER, LESCO, INCOR-

PORATED, LESLIE R. MALONE, LEWIS & ANNA BYRD,

LEWIS WALDEISON, Doctor, LIBERTY TRAVEL INCOR-

PORATED, LIEN INFECTION CONTROL SYSTEMS,

LIFE BROADCASTING, INCORPORATED, dba KTNT,

LIGHT BULB SUPPLY COMPANY, LIGHT SOURCE,

LILY’S OF BEVERLY HILLS, LIMITED, LIMEHOUSE

PRODUCE COMPANY, LINCOLN PLAZA ASSOCIATES,

LITTLE GIANT PRINTERS, LITTLE MISS TENNIS,

INCORPORATED, LLOYD R. ANDERSEN, LOIS R. LAW,

LONG PAINT WEST, LOOMIS ARMORED, INCORPO-

RATED, LORETTA SADIS, LORIN L. MOENCH, LORNE

FROATS, LOU JONES, LOUBAT L. FRANK, INCORPO-

RATED, dba American Beauty, LOUIS E. JENIK, LOUIS E.

SCOTT, LOUIS G. IMPERATORE, LOUIS J. RAMPINO,

LOUISIANA MACHINERY COMPANY, INCORPO-

RATED, LOUISIANA DEPARTMENT OF TRANSPORTA-

TION & DEVELOPMENT, LOUISIANA UTILITIES

SUPPLY COMPANY, LOUISIANA POWER & LIGHT

COMPANY, LOUISIANA’S OUTDOOR WORLD OF

WOODS & WATERS MAGAZINE, LOWCOUNTRY

AQUACULTURE CORPORATION, LOWCOUNTRY LIM-

OUSINE SERVICE, INCORPORATED, LOWELL S.

PETHLEY, LUCILLE MARIE AUSTIN, LUMBER WORLD,

LYLE HILL LYLE & SCOTT

M&M OIL, INCORPORATED, M&L MAINTENANCE, M.

E. APPLEBEE, M. GORDON BRYAN, M. H. RACQUET

CLUB ESTATES III HOMEOWNERS ASSOCIATION, M.

LAMAR MUSE, MAC W. MCCALLUM, MACC, MACK

POGUE, MADDUX SUPPLY COMPANY, MAGERS

ALARM SYSTEMS, INCORPORATED, MAGERS PEST

CONTROL, INCORPORATED, MAGERUS TRUCKING

COMPANY, MAGIC MAINTENANCE, MAGIC

THREADS OF CALIFORNIA, MAGNOLIA FLORAL

DESIGNS AND GIFTS, INCORPORATED, MAGNUM

App. 84

PRODUCE, INCORPORATED, MAINTENANCE WARE-

HOUSE/ AMERICA CORPORATION, MALCOLM DEMI-

LLE, INCORPORATED, MALIBU FARMS,

INCORPORATED, MAN FRIDAY, INCORPORATED,

MANNY RIDER, MANSUR-DAUBERT-STRELLA,

INCORPORATED, MARC GLASSMAN, MARC T. WAN-

KIER, MARCELLA KUNSBERG, MARCIA JUERGENS,

MARCIA ORIGINALS, MARC’S GOLF SERVICE,

INCORPORATED, MARETH SHIRT COMPANY, INCOR-

PORATED, MARGARET R. CONELL, MARGUERIE

COOK, MARINE SERVICES NURSERY, INCORPORATED

dba MSA Nursery, MARION MUGGS AGONIA, MAR-

ION T. EICHBERG, MARK FIELDS, MARK D. AUSTIN,

MARK H. IOLA, MARK BOYER, MARK GOFF, MARK

HONORS, MARK JOHNSTON, Doctor, MARK MCKAY

FARMS, INCORPORATED, MARK S. MANDALA,

MARKING PRODUCTS, INCORPORATED, MARKS PAV-

ING COMPANY, MARLENE B. HAGGE, MARLENE G.

POPE, MARLENE E. FLOYD, MARQ-WEAR, INCORPO-

RATED, MARSEILLE VILLAGE CONDOMINIUMS,

MARSHALL B. LLOYD, MARSHALL M. JOHNSON,

MARTHA B. LEE, MARTHA SUE WEIMER, MARTIN

BROTHERS DIST, MARTIN JACOBS, MARTIN S.

RAKOWITZ, MARTIN WALLIS, MARVIN E. GOLLOB,

Trustee, MARVIN L. GALYAN, MARVIN SATIN, MAR-

VINS MEATS, INCORPORATED, MARY LOU BAXTER,

MARY MARTIN, MARY LYNN SMITH, aka Mimi Smith,

MASON CASE, MASTER PROTECTION CORPORA-

TION, dba Firemaster, MATICH CORPORATION, MATT

J. ROCCA, MATTHEW R. NELSON, MAURICE C. COR-

BETT, MAURICE W. GIBONEY, aka “Ace”, MAX

HONORS, MAYBANK FERTILIZER CORPORATION,

MAYDAY TOOL & SUPPLY COMPANY, INCORPO-

RATED, MCBRIAR SPORTSWEAR, MCCALIF GROWER

SUPPLIES, INCORPORATED, MCCALLA DIVISION OF

LAYNE-WESTERN COMPANY, MCCLAIN-CHITWOOD

OFFICE PRODUCTS, INCORPORATED, MCCOY

App. 85

TRUCKING, MCI TELECOMMUNICATIONS CORPORA-

TION, MCMULLAN COMPANIES, MDJ SPORTS JEWE-

LRY, MECCA AUTO & TRUCK SUPPLY, MEDX,

INCORPORATED, MEINEKE SHOP #285, MEL & MAR-

GIE SMITH, MELE MANUFACTURING COMPANY,

INCORPORATED, MELINDA G. BRIGNAC, MELVIN J.

YOUNG, MERIDIAN VALLEY COUNTRY CLUB, MERIL

GRAF, MERIT/OSBORNE/ELECTRICAL CONTRAC-

TORS, MERLE W. BARCLAY, METRO SUPPLY COM-

PANY, MEYER MILLER, MEYER’S TURF,

INCORPORATED, MGM POOL & PATIO FURNITURE,

MIA PRODUCTS, MICAH‘JENKINS NURSERY,

MICHAEL B. BURNS, MICHAEL C. FLING, MICHAEL

C. GERING, MICHAEL C. MCDONOUGH, MICHAEL C.

PALMER, MICHAEL DIRK DEYOUNG, MICHAEL DUN-

HAM, MICHAEL G. LAWLEY, MICHAEL H. SNITKOFF,

MICHAEL HUBERMAN, MICHAEL INGRAM,

MICHAEL J. ASSUM, MICHAEL J. SIMON, MICHAEL J.

HOUTERMAN, MICHAEL JUDD, MICHAEL L.

BENDON, M.D., MICHAEL L. MATKINS, MICHAEL R.

BOYD, MICHAEL R. CLARK, MICHAEL R. LEBER,

MICHAEL S. BROWNFIELD, MICHAEL SANTIN,

MICHAEL SMITH, MICHAEL T. FRY, MICHAEL W. FED-

DERLY, SR., MICHAEL WEXLER, MICHAL C. MOORE,

MICHELE PALMER, INCORPORATED, MIKE J. SCHWA-

RTZ, MIKE PILLSBURY, MIKE THOMPSON, MIKE

ZAREMBA, MILLER TOMBACK, MILLER NORRIS

COMPANY, INCORPORATED, MILLER GOLF, INCOR-

PORATED, MILTON L. HUGHES, MINORY NITTA, MIS-

SION BEVERAGE COMPANY, MISSION HILLS

FAIRWAY ESTATES OWNERS ASSOCIATION, MISSION

HILLS GOLF COURSE VILLAS, MISSION HILLS PHASE

V HOMEOWNERS ASSOCIATION, MISSION HILLS

VILLAS I, MISSION HILLS VILLAS Il HOMEOWNERS

ASSOCIATION, MISSION HILLS VISTAS HOME-

OWNERS ASSOCIATION PHASE VI, MISSION INDUS-

TRIES, a California corporation, dba Mission Uniform

App. 86

Services, MITCHELL FIELD, MITCHELL LEIT, MITSURU

YAMAMOTO, MITTO NISHIKAWA, MK BATTERY

COMPANY, INCORPORATED, MONROE C.

ROTHSCHILD, MONTE SCHEINBLUM, MONTEREY

COUNTRY TAX COLLECTION, MONTGOMERY ELEVA-

TOR COMPANY, MOOK FAMILY TRUST, MORENO

VALLEY BLUEPRINT, MORRIS D. MUSCATEL, MORRIS

E. OGLE, MOWER WORLD, MR. COOL A/C, MR.

KIYOSHI NAKAMURA, MR. ROOTER PLUMBING,

MRS. D. B. MCLELLAN, MRS. JAMES G. SUNDERMAN,

MRS. JAY C. KIM, MRS. KIYOSHI NAKAMURA, MUIR

VILLAS HOMEOWNERS ASSOCIATION, INCORPO-

RATED, MURPHY & HIBBS SEALANTS & WATER-

PROOFING INCORPORATED, MURRAY SAND

COMPANY, INCORPORATED, MUSCOGEE TEXTILES,

INCORPORATED, MUSIC-CAL OF THE DESERT,

MYOMA DUNES MUTUAL WATER COMPANY,

MYRON L. GORDON

NADINE C. KLINE, NANA’S, NANCY J. HIRSHFELD,

NANCY L. TERPSTRA, NAOMI G. MARTIN, NAPA

AUTO PARTS, NASCO SUPPLY, NATHAN S. SHORE,

NATIONAL ADVERTISING COMPANY, NATIONAL

CABLE LIMITED, NATIONAL CAR RENTAL SYSTEMS,

INCORPORATED, NATURAL GAS COMPANY OF LOUI-

SIANA, NATURE’S WILD RICE COMPANY, NCR COR-

PORATION, SYSTEMEDIA GROUP, NED K. RYDER,

NED S. KHOREY, NEEDLEWORKS, INCORPORATED,

NEIGHBORHOOD VARIETY STORES, INCORPORATED,

dba Ben Franklin, NELSON E. MILLS, NEW DESERT

PRODUCE, INCORPORATED, NEWS DISTRIBUTOR,

NEWSPAPER PRINTING CORPORATION, NEWTON

FIRE & SAFETY EQUIPMENT, INCORPORATED, NEW-

TON MANUFACTURING COMPANY, NIAL MORGAN,

M.D., NICHOLAS MAROTTA, JR., NICHOLAS VARZAK,

NIKE, INCORPORATED, NITTO AMERICA COMPANY,

LIMITED, dba Calabasa Golf & Country Club, NOEL

CURRY, M.D., NOR-CAL SCREEN PRINTING, NORMA

App. 87

R. LEWIS, NORMAN C. VAUGHN, NORMAN LEVEN,

NORTH SUPPLY COMPANY, NOTOCO INDUSTRIES,

INCORPORATED, NOVELTY SALES, INCORPORATED,

NU-LITE ELECTRICAL WHOLESALERS, INCORPO-

RATED, NUWAY SERVICES, INCORPORATED

O. CLIFTON GOODING, O. J. STROBEL OIL & TIRE

COMPANY, INCORPORATED, O. M. SCOTT & SONS

COMPANY, OAK TREE INVESTMENT COMPANY, OAK

TREE MORTGAGE CORPORATION, OAK TREE HOME-

OWNERS ASSOCIATION, OASIS MOTORCYCLES OF

P.S., INCORPORATED, ODYSSEY SPORTS, INCORPO-

RATED, OELSCHIG’S NURSERY, INCORPORATED,

OFFICE CLUB, OFFICES AT ST. MARTINS OWNERS

ASSOCIATION, O’HERON ENTERPRISES, OHLANDT’S

LIQUORS #2, OIL CHANGE PLUS, OKLAHOMA NATU-

RAL GAS COMPANY, OKLAHOMA GAS AND ELEC-

TRIC, OKLAHOMA PRESS SERVICE, INCORPORATED,

OKLAHOMA GAZETTE, OKLAHOMA TAX COMMIS-

SION, OKLAHOMA WATER, OLDHAM ACRES NURS-

ERY, OLIVER J. PRICE, ONE STOP LAWN & TURF

EQUIPMENT, ORAN HUSTON LUMBERT COMPANY,

ORCHID UNIFORM RENTAL SERVICE, OREGON

RYEGRASS GROWERS SEED COMMISSION, OREGON

STATE UNIVERSITY, ORIN G. COMPTE, ORIX CREDIT

ALLIANCE, INCORPORATE, ORMA O. CRANK,

ORVILLE E. MELBY, OSWALT EQUIPMENT COMPANY,

OTIS ELEVATOR COMPANY, INCORPORATED, OUT-

DOOR SYSTEMS, INCORPORATED, OVERHEAD DOOR

COMPANY OF CHARLESTON

P. BYRNE TERHORST, P/SYSCO, PACIFIC BELL,

PACIFIC EQUIPMENT & IRRIGATION, PACIFIC GOUR-

MET, INCORPORATED, PACIFIC GAS & ELECTRIC

COMPANY, dba PG&E, PACIFIC SUPPLIERS COMPANY,

PALIMAR CORPORATION, dba Kwik Kopy #45, PALM

BEACH NEWSPAPERS, INCORPORATED, PALM

App. 88

BEACH POLO & COUNTRY CLUB POA, INCORPO-

RATED, PALM BACH COUNTY TAX COLLECTOR,

PALM BEACH IRUN WORKS, PALM SPRINGS WHOLE-

SALE MEAT COMPANY, PALMETTO DATA PRODUCTS,

INCORPORATED, PANE ANORE BAKE SHOP, PAPER-

N-INK, PARELLE SPORTIVE, INCORPORATED, PARK

50 TRAVEL AGENCY, PARKWAY RESEARCH CORPO-

RATION, PARR GOLD CAR COMPANY, INCORPO-

RATED, PARTY MAGIC, INCORPORATED, PAT

MERCIER, PATI J. BYBEE, PATIOS PLUS, INCORPO-

RATED, PATRICIA B. HOFF, PATRICK C. FARBER,

PATRICK F. COLLINS, PATRICK H. WELCH, PATRICK

MCAULEY, PATRICK KELLY, PATRICK SAUTER,

PATRICK T. ENRIGHT, PATSY WYATT, PATTON GOLF,

INCORPORATED, PATTEN INDUSTRIES, INCORPO-

RATED, PAUL A. CHESNEY, PAUL A. NEFF, PAUL

CHASEY, PAUL H. BUSBY, PAUL H. & CYNTHIA L.

BUSBY, PAUL H. ERNEST, M.D., PAUL BLAKENEY

COMPANY, PAUL JEFFREY RODD, PAUL LADIN, PAUL

R. PUMA, PAUL S. MERCHANT, PAUL SAVAGE, PAUL

D. AUSTIN, PAUL E. NOWACK, PAUL E. STEVENSON,

PAUL EF. TORNAMBE, PAUL HORWOTH, PAUL LIN-

DLIEF, PAUL MERCHANT, PAULA WALTERS, PAULINE

AHMAD, PAYLESS CASHWAYS, INCORPORATED,

PBCC, PEADOR FARAMARZI, PEARL HAYES, PEARL-

STINE DIST, INCORPORATED, PEGGY FIELD LOVE,

PEGGY RIEMAN, PELICAN ICE & COLD STORAGE,

PENINSULA LASER PRINT, PENINSULAR ELECTRIC

DISTRIBUTORS, INCORPORATED, PENN ATHLETIC

PRODUCTS, PENN TULLOCH ASSOCIATES, d/b/a

Highland Games, PEPSI-COLA, PEOPLE POWER,

INCORPORATED, PERFORMANCE ENGINEERED

PRODUCTS, PERRY AIR CONDITIONING, INCORPO-

RATED, PERSONALIZED TRAVEL, PETE PETRAFESO,

PETE PORFIDO, PETE’S ROAD SERVI

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