SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
( ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 [NO FEE REQUIRED]
FOR THE FISCAL YEAR ENDED JUNE 30, 2000
( TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transaction period from to
Commission file Number 0-27782
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES, INC. AND
CERTAIN AFFILIATES
(Full Title of the Plan)
DIME COMMUNITY BANCSHARES, INC.
209 Havemeyer Street, Brooklyn, NY 11211
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office.)
Registrant's telephone number, including area code: (718) 782-6200
<PAGE>
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES,
INC. AND CERTAIN AFFILIATES
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS' REPORT 3
FINANCIAL STATEMENTS FOR THE YEARS ENDED
JUNE 30, 2000 AND 1999:
Statements of Net Assets Available for Plan Benefits 4
Statements of Changes in Net Assets Available for Plan Benefits
for the Years Ended June 30, 2000 and 1999 5-6
Notes to Financial Statements 7-10
SUPPLEMENTAL INFORMATION:
Schedule H, Item 4 (i) - Schedule of Assets Held for
Investment Purposes as of June 30, 2000 11
SIGNATURES 12
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<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Dime Community Bancshares, Inc. & Subsidiary
We have audited the accompanying statements of net assets available for plan
benefits of The Employee Stock Ownership Plan of Dime Community Bancshares,
Inc. And Certain Affiliates (the "Plan") as of June 30, 2000 and 1999, and the
related statements of changes in net assets available for plan benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements present fairly, in all material
respects, the net assets available for plan benefits as of June 30, 2000 and
1999, and the changes in net assets available for plan benefits for the years
then ended in conformity with accounting principles generally accepted in the
United States of America.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets
held for investment purposes is presented for the purpose of additional
analysis and is not a required part of the basic financial statements but is
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental schedule of assets held for investment
purposes is the responsibility of the Plan's management, and has been subjected
to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, is fairly stated in all material respects, when
considered in relation to the 2000 basic financial statements taken as a whole.
/s/ DELOITTE & TOUCH LLP
New York, New York
December 15, 2000
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<PAGE>
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES, INC. AND
CERTAIN AFFILIATES
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AS OF JUNE 30, 2000 AND
1999
<TABLE>
<CAPTION>
JUNE 30, 2000 JUNE 30, 1999
------------------------------------------- ----------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ALLOCATED UNALLOCATED TOTAL ALLOCATED UNALLOCATED TOTAL
---------- ------------ ---------- ---------- ------------ ----------
ASSETS:
Investment in HSBC Bank, USA
short-term investment fund $232,229 $8,035 $240,264 $146,174 $4,289 $150,463
Investments in shares of Dime Community
Bancshares, Inc. common stock, at fair
value 7,237,131 11,044,216 18,281,347 7,814,370 18,637,969 26,452,339
---------- ------------ ---------- ---------- ------------ ----------
Total investments 7,469,360 11,052,251 18,521,611 7,960,544 18,642,258 26,602,802
---------- ------------ ---------- ---------- ------------ ----------
Accrued income receivable 1,262 639 1,901 564 301 865
---------- ------------ ---------- ---------- ------------ ----------
TOTAL ASSETS 7,470,622 11,052,890 18,523,512 7,961,108 18,642,559 26,603,667
========== ============ ========== ========== ============ ==========
LIABILITIES:
Borrowing from Dime Community Bancshares,
Inc. - 6,852,526 6,852,526 - 8,016,326 8,016,326
---------- ------------ ---------- ---------- ------------ ----------
TOTAL LIABILITIES - 6,852,526 6,852,526 - 8,016,326 8,016,326
---------- ------------ ---------- ---------- ------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS $7,470,622 $4,200,364 $11,670,986 $7,961,108 $10,626,233 $18,587,341
========== ============ ========== ========== ============ ==========
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES,
INC. AND CERTAIN AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR
ENDED JUNE 30, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ALLOCATED UNALLOCATED TOTAL
---------- ------------ ----------
ADDITIONS:
Investment income - dividends $228,621 $533,161 $761,782
Contributions from Dime Savings Bank of
Williamsburgh, net - 1,277,785 1,277,785
Allocation of 121,989 shares of Dime
Community Bancshares, Inc. common stock to
participant accounts 1,982,321 - 1,982,321
---------- ------------ ----------
TOTAL ADDITIONS 2,210,942 1,810,946 4,021,888
---------- ------------ ----------
SUBTRACTIONS:
Investment activities - Depreciation in
market value of Dime Community Bancshares,
Inc. common stock 2,324,358 5,611,431 7,935,789
Allocation of 121,989 shares of Dime
Community Bancshares, Inc. common stock to
participant accounts - 1,982,321 1,982,321
Cash benefit payments 279,662 - 279,662
Release of 4,899 shares for benefit payments 97,408 - 97,408
INTEREST EXPENSE ON BORROWING FROM DIME
COMMUNITY BANCSHARES, INC. - 643,063 643,063
---------- ------------ ----------
TOTAL SUBTRACTIONS 2,701,428 8,236,815 10,938,243
---------- ------------ ----------
CHANGE IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS DURING THE YEAR (490,486) (6,425,869) (6,916,355)
---------- ------------ ----------
NET ASSETS AVALABLE FOR PLAN BENEFITS:
BEGINNING OF YEAR 7,961,108 10,626,233 18,587,341
---------- ------------ ----------
END OF YEAR $7,470,622 $4,200,364 $11,670,986
========== ============ ==========
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES, INC. AND
CERTAIN AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR
ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ALLOCATED UNALLOCATED TOTAL
------------ ----------- -----------
ADDITIONS:
Investment income - dividends $118,543 $471,004 $589,547
Contributions from Dime Savings Bank of
Williamsburgh, net - 1,424,385 1,424,385
Allocation of 115,832 shares of Dime Community
Bancshares, Inc. common stock to participant
accounts 2,693,094 - 2,693,094
------------ ----------- -----------
TOTAL ADDITIONS 2,811,637 1,895,389 4,707,026
------------ ----------- -----------
SUBTRACTIONS:
Investment activities - Depreciation in market value
Community of Dime Community Bancshares, Inc.
common stock 1,143,501 4,128,593 5,272,094
Allocation of 115,832 shares of Dime Community
Bancshares, Inc. common stock to participant
accounts - 2,693,094 2,693,094
Cash benefit payments 315,674 - 315,674
Release of 11,895 shares for benefit payments 246,513 - 246,513
INTEREST EXPENSE ON BORROWING FROM DIME
COMMUNITY BANCSHARES, INC. - 733,972 733,972
------------ ----------- -----------
TOTAL SUBTRACTIONS 1,705,688 7,555,659 9,261,347
------------ ----------- -----------
CHANGE IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS DURING THE YEAR 1,105,949 (5,660,270) (4,554,321)
------------ ----------- -----------
NET ASSETS AVALABLE FOR PLAN BENEFITS:
BEGINNING OF YEAR 6,855,159 16,286,503 23,141,662
------------ ----------- -----------
END OF YEAR $7,961,1088 $10,626,233 $18,587,341
============ =========== ===========
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY BANCSHARES, INC. AND
CERTAIN AFFILIATES
NOTES TO FINANCIAL STATEMENTS YEARS ENDED JUNE 30, 2000 AND 1999
1. SUMMARY DESCRIPTION OF PLAN
The following is a brief description of The Employee Stock Ownership Plan
of Dime Community Bancshares, Inc. And Certain Affiliates (the "ESOP").
This description of the ESOP is provided for general information purposes
only. Participants should refer to the ESOP document for a more complete
description of the ESOP's provisions.
a. GENERAL - The ESOP was adopted by the Board of Directors of the Dime
Savings Bank of Williamsburgh (the "Bank") on February 8, 1996, with
an effective date of July 1, 1995.
On June 26, 1996, the Bank converted from a federally chartered mutual
savings bank to a federally chartered stock savings bank and all of
its outstanding capital stock was acquired by Dime Community
Bancshares, Inc. (the "Company"). Simultaneously, the Company issued
14,547,500 shares of common stock in a Subscription and Community
offering to eligible investors in the following order of priority: (1)
depositors whose deposits in qualifying accounts in the Bank totaled
$50 or more on October 31, 1994; (2) the Employee plans of the Bank;
including the ESOP, up to a maximum of 10% of the total shares issued,
(3) depositors whose deposits in qualifying accounts in the Bank
totaled $50 or more on March 31, 1996; and (4) members of the Bank,
consisting of depositors of the Bank as of May 9, 1996, the voting
record date for the special meeting of members to vote on the
Conversion, other than those members who otherwise qualified as
Eligible Account Holders or Supplemental Eligible Account Holders.
The ESOP purchased 1,163,800, or 8%, of the shares issued by the
Company in its community offering at the initial issuance price of
$10.00 per share.
The ESOP is designed to comply with Section 4975(e)(7) and the
regulations thereunder of the Internal Revenue Code of 1986, as
amended (the "Code"), and is subject to the applicable provisions of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). The ESOP is administered by the Compensation Committee
appointed by the Company's Board of Directors. The trust services
department of HSBC Bank, USA (formerly Marine Midland Bank)
("Trustee") acts as the trustee for the ESOP.
In order to purchase the shares of the Company's common stock, the
ESOP obtained a borrowing from the Company of $11,638,000, which, as
of June 30, 2000, was to be repaid over a ten year period at a fixed
interest rate of 8.0%. Effective July 1, 2000, the maturity of the
ESOP loan was extended from June, 2006 to December, 2025, with the
continued option of prepayment. Repayments of the borrowing are made
from fully deductible contributions from the Bank to the ESOP. As the
ESOP makes each payment of principal on the borrowing, an appropriate
percentage of stock will be allocated to eligible participants
accounts in accordance with applicable regulations under the Code.
Shares fully vest upon allocation.
The borrowing is collateralized by the unallocated shares of stock
held by the ESOP. The Company, as lender, has no rights against
shares once they are allocated under the ESOP.
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<PAGE>
Accordingly, the financial statements of the ESOP for the years
ended June 30, 2000 and 1999, present separately the assets and
liabilities and changes therein pertaining to:
(1) the accounts of employees with vested rights in allocated stock
(Allocated) and
(2) stock not yet allocated to employees (Unallocated)
b. ELIGIBILITY AND PARTICIPATION -All Eligible Employees, defined as
salaried, common law employees of the Company or the Bank and its
subsidiaries, who have completed a period of service of at least one
year, automatically participate in the ESOP. An employee is not an
eligible employee if he or she is compensated principally on an
hourly, daily, commission fee or retainer basis, or has waived any
claim to membership in the Plan.
c. CONTRIBUTIONS AND DISTRIBUTIONS- The Company or the Bank shall
contribute to the ESOP an amount which, at minimum, shall serve to
finance the ESOP's obligation under its outstanding borrowing from the
Company. The Company or the Bank may contribute additional amounts,
if designated by the ESOP Committee, to the ESOP, which shall be
applied as a prepayment of principal or interest for the outstanding
borrowing from the Company. Any additional contributions approved by
the Committee shall be treated as an ESOP contribution and shall be
allocated among the accounts of Eligible Participants in accordance
with a pre-established formula. Participant contributions are not
permitted.
No distributions from the ESOP will be made until a participant
retires, dies (in which case, payment shall be made to his or her
beneficiary or, if none, his or her legal representatives), or
otherwise terminates employment with the Company or the Bank and its
subsidiaries. Distributions are made in cash or, if participant
elects, in the form of shares of common stock of the Company plus cash
for fractional shares.
d. VESTING - The balance credited to each Participant's account shall
become vested in accordance with the following schedule:
NUMBER OF YEARS OF SERVICE VESTED PERCENTAGE
Less than 2 years 0%
Less than 3 years 25
Less than 4 years 50
Less than 5 years 75
5 or more years 100
Under the provisions of the ESOP, participants were granted credit,
for purposes of vesting, for years of service at the Bank prior to the
establishment of the ESOP. Any previously unvested portion shall
become fully vested to participants upon attainment of age 65, or, if
earlier, upon the termination of his or her participation by reason of
death, disability, retirement or upon occurrence of change in control
of the Employer.
e. INVESTMENTS - As of June 30, 2000 and 1999, the ESOP's investments
consists solely of investments in common stock of the Company. The
ESOP is permitted, under the Plan Document, to invest in any commingled
or group trust fund, or common trust fund that are exempt from taxes
under Section 501(a) of the Internal Revenue Code.
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<PAGE>
f. ALLOCATION OF SHARES TO PARTICIPANT ACCOUNTS - As of the last day
of each plan year during which a borrowing is outstanding, a portion
of the financed shares purchased with the proceeds of the borrowing
shall be released in accordance with a predetermined formula. The
released shares are allocated to Eligible Participant accounts in the
proportion that each such Eligible Participant's compensation, as
measured under the terms of the Plan Document, for the portion of the
immediately preceding calendar year during which he or she was a
participant, bears to the aggregate compensation of all Eligible
Participants, as measured under the terms of the Plan Document.
Released shares allocated to participant accounts totaled 121,989 and
115,832 during the years ended June 30, 2000 and 1999, respectively.
Each participant's account reflects an allocation of the Bank's
contributions, ESOP earnings and the forfeiture of terminated
participant non-vested accounts.
Each participant is entitled to exercise voting rights attributable to
the shares allocated to his or her account and is notified by the
Trustee prior to the time that such rights are to be exercised. The
Trustee is permitted, upon grant of authority by the Plan
Administrator, to vote shares for which instructions have not been
given by a participant within the stated time period. Such vote is
made in direct proportion to the votes received from participants.
g. FORFEITURES - Upon the termination of employment of a participant
or former participant for reason other than death, disability, or
retirement, that portion of the balance credited to his or her account
which is not vested at the date of termination shall be forfeited as of
the last Valuation Date, defined as the last business day of March,
June, September, or December. The proceeds of such forfeitures shall
be treated as loan repayments and ESOP contributions as designated by
the ESOP committee.
h. ESOP TERMINATION - The Company reserves the right to terminate the
ESOP at any time, subject to the provisions of ERISA. Upon such
termination of the ESOP, the interest of each participant in the ESOP
will be distributed to such participant or his or her beneficiary at
the time prescribed by the ESOP provisions and the Code. Upon
termination of the ESOP, the Compensation Committee shall direct the
Trustee to pay all liabilities and expenses of the trust fund and to
sell the shares of financed stock held in the loan suspense account to
the extent it determines such sale to be necessary in order to repay
the borrowing.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The accompanying financial statements of the ESOP are
maintained on the accrual basis of accounting.
INVESTMENT VALUATION AND INCOME RECOGNITION - The shares of Dime
Community Bancshares, Inc. common stock are valued at fair value based
upon the closing price stated in the Wall Street Journal. The closing
price of the common stock was $16.25 and $23.25 per share, respectively,
as of June 30, 2000 and 1999.
Dividend income is accrued on the ex-dividend date for all dividends
declared. During the years ended June 30, 2000 and 1999, cash dividends
of $0.66 and $0.51 per share were declared and paid, respectively, on
Dime Community Bancshares, Inc. common stock.
Purchases and sales of securities are recorded on a trade date basis.
Realized gains and losses from security transactions are reported on the
average cost method.
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<PAGE>
USE OF ESTIMATES - The preparation of the financial statements in
accordance with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could
differ from these estimates.
3. FEDERAL INCOME TAXES
The ESOP is intended to be qualified under Section 401(a) of the Internal
Revenue Code (the "Code") and is intended to be exempt from taxation under
Section 501(a) of the Code. The Plan received a favorable IRS
determination letter dated March 16, 2000. The ESOP has been amended
since receiving the determination letter. However, the Plan Administrator
believes that the ESOP and its underlying trust are currently designed and
being operated in compliance with the applicable requirements of the
Internal Revenue Code. Therefore, no provision for income taxes has been
included in the ESOP's financial statements.
4. ADMINSTRATION OF PLAN ASSETS
The assets of the ESOP, which consist of investment in shares of Dime
Community Bancshares, Inc. common stock, investments in the HSBC Bank, USA
short-term investment fund and accrued interest and dividends receivable,
are held in safekeeping as designated by the Trustee.
Contributions to the ESOP are held and managed by the Trustee. All
contributions received during the years ended June 30, 2000 and 1999, were
utilized to service the principal and interest on the borrowing.
Certain administrative functions are performed by officers or employees of
the Company or Bank. No such officer or employee receives compensation
from the ESOP for the administrative functions they perform. All
administrative expenses of the ESOP are paid by the Company or the Bank.
5. INVESTMENTS
The investments, at June 30, 2000 and 1999, are presented in the following
table:
<TABLE>
<CAPTION>
JUNE 30, 2000 JUNE 30, 1999
-------------------------------------- ------------------------------------
<S> <C> <C> <C> <C>
ALLOCATED UNALLOCATED ALLOCATED UNALLOCATED
------------- ----------- ----------- ------------
Investment in HSBC
Bank, USA Short-Term
Investment Fund $232,229 $8,035 $146,174 $4,289
============= =========== =========== ============
Shares of Dime
Community Bancshares,
Inc. Common Stock:
Number of shares 445,362 679,644 336,102 801,633
============= =========== =========== ============
Cost $4,465,664 $6,899,951 $3,361,020 $8,016,330
============= =========== =========== ============
Market $7,237,131 $11,044,216 $7,814,370 $18,637,969
============= =========== =========== ============
</TABLE>
* * * * * *
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<PAGE>
SCHEDULE 1
THE EMPLOYEE STOCK OWNERSHIP PLAN OF DIME COMMUNITY
BANCSHARES, INC. AND CERTAIN AFFILIATES
SCHEDULE H, ITEM 4 (i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF JUNE 30, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
(A) (B) ( C ) (D) (E)
PARTIES IN INTEREST Identity of ISSUER Description of INVESTMENT COST MARKET
-------------------- --------------------- ---------------------------- ----------- -----------
Dime Community
Yes Bancshares, Inc. Shares of common stock $11,365,615 $18,281,347
Yes HSBC Bank, USA Short-term investment fund 240,264 240,264
----------- -----------
Total $11,605,879 $18,521,611
=========== ===========
</TABLE>
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Dime
Community Bancorp, Inc. and Certain Affiliates (the Plan Administrator) duly
caused this report to be signed on their behalf by the undersigned thereunder
duly authorized.
Dated: December 23, 2000
/S/ VINCENT F. PALAGIANO
-------------------------
Vincent F. Palagiano
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
Dated: December 23, 2000
/S/ KENNETH J. MAHON
---------------------------
Kenneth J. Mahon
EXECUTIVE VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
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