<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
CARVER BANCORP, INC.
-----------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
--------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was
determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[LETTERHEAD OF CARVER BANCORP, INC.]
July 17, 1997
Dear Stockholder:
You are cordially invited to attend the 1997 annual meeting of
stockholders of Carver Bancorp, Inc. ("Carver" or the "Company"), the holding
company for Carver Federal Savings Bank, which will be held on August 21, 1997
at 10:00 a.m., New York City time, in the Board Room at the American Stock
Exchange, 86 Trinity Place, New York, New York 10006 (the "Annual Meeting").
The attached Notice of Annual Meeting of Stockholders and Proxy
Statement describe the formal business to be transacted at the Annual Meeting.
Directors and officers of Carver, as well as a representative of Mitchell &
Titus, LLP, the accounting firm appointed by the Board of Directors to be
Carver's independent auditors for the fiscal year ending March 31, 1998, will be
present at the Annual Meeting. In addition, management will report on the
operations and activities of the Company and there will be an opportunity for
you to ask questions about Carver's business.
The Board of Directors of Carver has determined that an affirmative
vote on each of proposals one and two to be considered at the Annual Meeting is
in the best interests of Carver and its stockholders and unanimously recommends
a vote "FOR" proposals one and two.
For the reasons set forth in the Proxy Statement, the Board of
Directors of Carver has determined that proposal three, a stockholder proposal,
scheduled to be considered at the Annual Meeting if properly introduced thereat,
is not in the best interests of Carver and its stockholders and unanimously
recommends a vote "AGAINST" proposal three.
It is very important that your shares be represented at the Annual
Meeting, regardless of whether or not you plan to attend in person. I urge you
to mark, execute, date and return the enclosed proxy card in the enclosed
postage-paid envelope as soon as possible to ensure that your shares will be
voted at the Annual Meeting. If you are a stockholder whose shares are not
registered in your own name, you will need additional documentation from your
record holder to attend and to vote personally at the Annual Meeting.
YOUR VOTE IS IMPORTANT WHETHER OR NOT YOU PLAN TO ATTEND THE
ANNUAL MEETING IN PERSON.
On behalf of the Board of Directors and the employees of Carver, I wish
to thank you for your continued support.
Sincerely yours,
/s/Thomas L. Clark, Jr.
Thomas L. Clark, Jr.
President and Chief Executive Officer
<PAGE> 3
CARVER BANCORP, INC.
75 WEST 125TH STREET
NEW YORK, NEW YORK 10027-4512
--------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON AUGUST 21, 1997
--------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN that the 1997 annual meeting of stockholders of
Carver Bancorp, Inc. ("Carver" or the "Company") will be held on August 21, 1997
at 10:00 a.m., New York City time, in the Board Room at the American Stock
Exchange, 86 Trinity Place, New York, New York 10006 (the "Annual Meeting"). At
the Annual Meeting, stockholders will be asked to consider and vote upon the
following matters:
1. To elect two directors each to serve for a three-year term
expiring at the annual meeting of stockholders to be held in
the year 2000 and until their respective successors have been
elected and qualified;
2. To ratify the appointment of Mitchell & Titus, LLP as
independent auditors for the Company for the fiscal year
ending March 31, 1998;
3. To consider and vote upon a stockholder proposal, opposed by
the Board of Directors, if properly introduced at the Annual
Meeting; and
4. Authorization of the Board of Directors, in its discretion, to
direct the vote of proxies upon such matters incident to the
conduct of the Annual Meeting as may properly come before the
Annual Meeting, and any adjournment or postponement thereof,
including, without limitation, a motion to adjourn the Annual
Meeting. The Company is not aware of any other business that
may properly come before the Annual Meeting.
Pursuant to the Bylaws of Carver, the Board of Directors has fixed July
2, 1997 as the record date for the determination of stockholders entitled to
notice of and to vote at the Annual Meeting and at any adjournment or
postponement thereof. Only holders of the common stock of the Company as of the
close of business on the record date will be entitled to vote at the Annual
Meeting or any adjournment or postponement thereof. A list of stockholders
entitled to vote at the Annual Meeting will be available at Carver Federal
Savings Bank, 75 West 125th Street, New York, New York, for a period of ten days
prior to the Annual Meeting and will also be available at the Annual Meeting.
WE URGE YOU TO SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS
POSSIBLE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON. THE
PROXY MAY BE REVOKED AT ANY TIME PRIOR TO ITS EXERCISE IN THE MANNER DESCRIBED
IN THE ATTACHED PROXY STATEMENT. ANY STOCKHOLDER PRESENT AT THE ANNUAL MEETING,
INCLUDING ANY ADJOURNMENT OR POSTPONEMENT THEREOF, MAY REVOKE SUCH HOLDER'S
PROXY AND VOTE PERSONALLY ON EACH MATTER BROUGHT BEFORE THE ANNUAL MEETING.
By Order of the Board of Directors,
/s/ Raymond L. Bruce
Raymond L. Bruce
Senior Vice President, Corporate Counsel
and Corporate Secretary
New York, New York
July 17, 1997
<PAGE> 4
CARVER BANCORP, INC.
75 WEST 125TH STREET
NEW YORK, NEW YORK 10027-4512
-------------------
PROXY STATEMENT
-------------------
1997 ANNUAL MEETING OF STOCKHOLDERS
AUGUST 21, 1997
---------------------------------------------------
GENERAL INFORMATION
--------------------------------------------------
GENERAL
This Proxy Statement and accompanying proxy card are being furnished to
stockholders of Carver Bancorp, Inc. (the "Company" or "Carver"), in connection
with the solicitation of proxies by the Board of Directors of Carver to be used
at the Annual Meeting to be held on August 21, 1997, at 10:00 a.m., New York
City time, in the Board Room at the American Stock Exchange, 86 Trinity Place,
New York, New York 10006, and at any adjournment or postponement thereof (the
"Annual Meeting"). The accompanying Notice of Annual Meeting and this Proxy
Statement are being first mailed to stockholders on or about July 17, 1997.
On October 17, 1996, the Company became the holding company for Carver
Federal Savings Bank ("Carver Federal" or the "Bank") upon completion of the
reorganization (the "Reorganization") of the Bank as a wholly-owned subsidiary
of the Company. The Company, a Delaware corporation, operates as a savings and
loan association holding company for the Bank.
RECORD DATE AND VOTING
The Board of Directors of Carver has fixed the close of business on
July 2, 1997 as the record date (the "Record Date") for the determination of the
holders of the common stock, par value $.01 per share of Carver Bancorp, Inc.
("Common Stock") entitled to receive notice of and to vote at the Annual
Meeting. Only holders of record of Common Stock at the close of business on that
date will be entitled to vote at the Annual Meeting. At the close of business on
the Record Date, there were 2,314,275 shares of Common Stock outstanding. The
presence, in person or by proxy, of the holders of at least a majority of the
total number of outstanding shares of Common Stock entitled to vote at the
Annual Meeting is necessary to constitute a quorum at the Annual Meeting.
Each holder of shares of Common Stock outstanding on the Record Date
will be entitled to one vote for each share held of record (other than Excess
Shares, as defined below) upon each matter properly submitted at the Annual
Meeting. As provided in the Company's Certificate of Incorporation, record
holders of Common Stock who beneficially own in excess of 10% of the outstanding
shares of Common Stock ("Excess Shares") shall be entitled to cast only one
one-hundredth of one vote per share for each Excess Share. A person or entity is
deemed to beneficially own shares owned by an affiliate or associate as well as
by persons acting in concert with such person or entity. The Company's
Certificate of Incorporation authorizes the Board of Directors to interpret and
apply the provisions of the Certificate of Incorporation and Bylaws governing
Excess Shares, and to determine on the basis of information known to them after
reasonable inquiry, all facts necessary to ascertain compliance with the
Certificate of Incorporation, including, without limitation, (i) the number of
shares of Common Stock beneficially owned by any person or purported owner, (ii)
whether a person or purported owner is an affiliate or associate of, or is
acting in concert with, any other person or purported owner and (iii) whether a
person or purported owner has an agreement or understanding with any person or
purported owner as to the voting or disposition of any shares of Common Stock.
<PAGE> 5
If the enclosed proxy card is properly executed and received by the
Company in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon. IF NO
INSTRUCTIONS ARE GIVEN, EXECUTED PROXIES WILL BE VOTED FOR THE ELECTION OF THE
NOMINEES FOR ELECTION AS DIRECTORS ("PROPOSAL ONE"), FOR THE RATIFICATION OF THE
APPOINTMENT OF MITCHELL & TITUS, LLP AS INDEPENDENT AUDITORS FOR THE COMPANY
("PROPOSAL TWO") AND AGAINST THE STOCKHOLDER PROPOSAL DESCRIBED HEREIN
("PROPOSAL THREE").
Management is not aware of any matters other than those set forth in
the Notice of Annual Meeting of Stockholders that may be brought before the
Annual Meeting. If any other matters properly come before the Annual Meeting,
including, among other things, a motion to adjourn or postpone the Annual
Meeting to another time or place or both for the purpose of soliciting
additional proxies or otherwise, the persons named in the accompanying proxy
will vote the shares represented by all properly executed proxies on such
matters in such manner as shall be determined by a majority of the Board of
Directors of the Company.
VOTES REQUIRED
Proposal One. Directors are elected by a plurality of the votes cast in
person or by proxy at the Annual Meeting. The holders of Common Stock may not
vote their shares cumulatively for the election of directors. Shares underlying
broker non-votes will not be counted as having been voted in person or by proxy
and will have no effect on the election of directors.
Proposal Two and Proposal Three. The ratification of the appointment by
the Board of Directors of Mitchell & Titus, LLP as the Company's independent
auditors and approval of the stockholder proposal each require the affirmative
vote of the holders of a majority of the number of votes eligible to be cast by
the holders of the outstanding shares of Common Stock present and entitled to
vote at the Annual Meeting. Accordingly, shares as to which the "ABSTAIN" box
has been selected on the Proxy Card will be counted as present and entitled to
vote and will have the effect of a vote against Proposal Two or Proposal Three,
as applicable. Shares underlying broker non-votes will not be counted as having
been voted in person or by proxy and will have no effect on the vote for
Proposal Two or Proposal Three.
REVOCABILITY OF PROXIES
The presence of a stockholder at the Annual Meeting will not
automatically revoke such stockholder's proxy. However, a stockholder may revoke
a proxy at any time prior to its exercise by (1) filing a written notice of
revocation with the Corporate Secretary of the Company, (2) delivering to the
Corporate Secretary of the Company prior to the Annual Meeting a duly executed
proxy bearing a later date or (3) attending the Annual Meeting, filing a written
notice of revocation with the secretary of the meeting and voting in person. IF
YOU ARE A STOCKHOLDER WHOSE SHARES ARE NOT REGISTERED IN YOUR OWN NAME, YOU WILL
NEED ADDITIONAL DOCUMENTATION FROM YOUR RECORD HOLDER TO ATTEND AND TO VOTE
PERSONALLY AT THE ANNUAL MEETING. Examples of such documentation would include a
broker's statement, letter or other document that will confirm your ownership of
Common Stock.
SOLICITATION OF PROXIES
In addition to solicitation by mail, directors, officers and employees
of Carver may solicit proxies for the Annual Meeting from Carver stockholders
personally or by telephone or telegram without additional remuneration therefor.
The Company will also provide persons, firms, banks and corporations holding
shares in their names or in the names of nominees, which in either case are
beneficially owned by others, proxy material for transmittal to such beneficial
owners and will reimburse such record owners for their expenses in doing so. The
Company has retained Morrow & Co., Inc. ("Morrow") to assist in the solicitation
of proxies at a fee of $3,000 plus expenses. The cost of solicitation of proxies
for the Annual Meeting, including the fees of Morrow, will be borne by the
Company. A stockholder of the Company may authorize another person or persons to
act for him as proxy by transmitting or authorizing the transmission of a
telegram, cablegram or other means of electronic transmission
-2-
<PAGE> 6
to Morrow, provided that any such telegram, cablegram or other means of
electronic transmission must either set forth or be submitted with information
(such as a prescribed identification code) from which it can be determined that
the telegram, cablegram or other electronic transmission was authorized by the
stockholder.
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SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
-------------------------------------------------------------------------------
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information as to those persons
believed by management to be beneficial owners of more than 5% of the
outstanding shares of Common Stock on May 31, 1997, as disclosed in certain
reports regarding such ownership filed by such persons, with the Company or the
Securities and Exchange Commission (the "SEC") in accordance with Section 13 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Other than
those persons listed below, the Company is not aware of any person or group, as
such term is defined in the Exchange Act, that beneficially owns more than 5% of
the outstanding shares of Common Stock as of May 31, 1997. For purposes of the
table set forth below and the table set forth under "--Stock Ownership of
Management," an individual is considered to "beneficially own" any securities
(a) over which such individual exercises sole or shared voting or investment
power, or (b) of which such individual has the right to acquire beneficial
ownership, including the right to acquire beneficial ownership by the exercise
of stock options within 60 days after May 31, 1997. As used herein, "voting
power" includes the power to vote, or direct the voting of, such securities, and
"investment power" includes the power to dispose of, or direct the disposition
of, such securities.
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<PAGE> 7
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NATURE OF SHARES OF
NAME AND ADDRESS BENEFICIAL COMMON STOCK
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP OUTSTANDING (1)
- -------------- ------------------- --------- ---------------
<S> <C> <C> <C>
Common Stock EQSF Advisers, Inc. 218,500(2) 9.44%
767 Third Avenue
New York, NY 10017
Common Stock Paloma Securities, L.L.C. 192,000(3) 8.30%
2 American Lane, Box 2571
Greenwich, CT 06836
Common Stock Carver Bancorp, Inc. 182,132(4) 7.87%
Employee Stock Ownership
Plan Trust (the "ESOP Trust")
75 West 125th Street
New York, New York 10027
Common Stock FMR Corp. 142,000(5) 6.14%
82 Devonshire Street
Boston, MA 02109
</TABLE>
(1) The total number of shares of Common Stock outstanding on May 31, 1997
was 2,314,275 shares.
(2) Based on a Schedule 13G, dated February 13, 1997, and filed with the
SEC jointly by EQSF Advisers, Inc. ("EQSF") and Martin J. Whitman, the
Chief Executive Officer and controlling person of EQSF. EQSF
beneficially owns 218,500 shares of Common Stock. Mr. Whitman disclaims
beneficial ownership of such stock. Third Avenue Value Fund, Inc., an
investment company registered under the Investment Company Act of 1940,
has the right to receive dividends with respect to, and proceeds from
the sale of, such shares. EQSF has sole voting and dispositive power
over such shares.
(3) Based on a Schedule 13F, dated May 14, 1997, and filed with the SEC by
Paloma Securities, L.L.C.
(4) The Administrative Committee established to administer the Carver
Bancorp, Inc. Employee Stock Ownership Plan (the "ESOP") consists of
officers of the Bank. The ESOP's assets are held in the ESOP Trust, for
which Marine Midland Bank serves as trustee (the "ESOP Trustee"). The
Administrative Committee instructs the ESOP Trustee regarding the
investment of funds contributed to the ESOP. Common Stock purchased by
the ESOP Trust is held in a suspense account and allocated to
participants' accounts annually based on contributions made to the ESOP
by the Bank. Shares released from the suspense account are allocated
among participants in proportion to their compensation, as defined in
the ESOP, for the year the contributions are made, up to the limits
permitted under the Internal Revenue Code of 1986 (the "Code"). The
ESOP Trustee must vote all allocated shares held in the ESOP Trust in
accordance with the instructions of participants. As of May 31, 1997, a
total of 50,236 shares had been allocated, but not distributed, to
participants. Under the ESOP, unallocated shares or shares for which no
voting instructions have been received will be voted by the ESOP
Trustee in the same proportion as allocated shares with respect to
which the ESOP Trustee receives instructions. In the absence of any
voting instructions with respect to allocated shares, the Board of
Directors, on behalf of the Company, directs the voting of all shares
of unallocated stock, or in the absence of such directions from the
Board of Directors, the ESOP Trustee has sole discretion with respect
to the voting of such shares. Each member of the Board of Directors
disclaims beneficial ownership of the shares held in the ESOP Trust.
(5) Based on a Schedule 13G, dated February 14, 1997, and filed with the
SEC by FMR Corp. ("FMR"). According to FMR Corp.'s Schedule 13G,
Fidelity Management & Research Company ("Fidelity"), a wholly-owned
subsidiary of FMR Corp. and an investment adviser registered under the
Investment Advisers Act of 1940, is the beneficial owner of 142,000
shares or 6.14% of the Common Stock outstanding of Carver, as a result
of acting as investment adviser to various investment companies
registered under the Investment Company Act of 1940. The ownership of
one investment company, Fidelity Select Home Finance Portfolio,
amounted to 142,000 shares or 6.14% of the Common Stock outstanding.
Edward C. Johnson 3d, Chairman of the Board of FMR Corp., through its
control of Fidelity, and the funds each has sole power to dispose of
the 142,000 shares owned by the Funds. Neither FMR Corp. nor Mr.
Johnson, has the sole power to vote or direct the voting of the shares
owned directly by the Fidelity Funds, which power resides with the
Funds' Boards of Trustees. Fidelity carries out the voting of the
shares under written guidelines established by the Funds' Boards of
Trustees.
-4-
<PAGE> 8
STOCK OWNERSHIP OF MANAGEMENT
The following table sets forth information as of May 31, 1997 as to
shares of Common Stock beneficially owned by each director, each nominee and
each Named Executive Officer, as defined herein, identified in the Summary
Compensation Table, appearing elsewhere herein, and all directors, nominees and
executive officers of the Company or the Bank as a group. Ownership information
is based upon information furnished by the respective individuals. Except as
otherwise indicated, each person and the group shown in the table has sole
voting and investment power with respect to the shares indicated.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NATURE OF COMMON
BENEFICIAL STOCK
NAME TITLE OWNERSHIP(1)(2) OUTSTANDING(3)
- ----------------------- ---------------------------- --------------- ---------------
<S> <C> <C> <C>
Thomas L. Clark, Jr.(4) President and Chief 11,805 *
Executive Officer, Director
David N. Dinkins Director 3,021 *
Linda H. Dunham Director 1,821 *
Robert J. Franz Nominee 0 *
Herman Johnson(5) Director 2,108 *
David R. Jones Chairman of the Board, 4,308 *
Director
Biswarup Mukherjee(6) Executive Vice President and 8,537 *
Chief Financial Officer
All directors, nominees and executive 169,813 7.29%
officers as a group
(9 persons)(7)(8)(9)
</TABLE>
- --------------------------------------------
* Less than 1% of outstanding Common Stock.
(1) Includes 6,943, 200, 200, 1,388, 1,388 and 2,777 shares which may be
acquired by Messrs. Clark and Dinkins, Ms. Dunham and Messrs. Johnson,
Jones and Mukherjee, respectively, pursuant to options granted under
the Carver Bancorp, Inc. 1995 Stock Option Plan (the "Option Plan").
(2) Excludes 14,404, 800, 800, 2,777, 2,777 and 8,683 shares of restricted
stock granted to Messrs. Clark and Dinkins, Ms. Dunham and Messrs.
Johnson, Jones and Mukherjee, respectively, pursuant to the Carver
Bancorp, Inc. Management Recognition Plan (the "MRP") and/or the Carver
Bancorp, Inc. Incentive Compensation Plan (the "Incentive Compensation
Plan") with respect to which such individuals have neither voting nor
dispositive power. See "Directors' Compensation -- Management
Recognition Plans" and "-- Incentive Compensation Plan."
(3) Percentages with respect to each person or group of persons have been
calculated on the basis of 2,314,275 shares of Common Stock, the number
of shares of Common Stock outstanding as of May 31, 1997, plus the
number of shares of Common Stock which such person or group has the
right to acquire within 60 days after May 31, 1997 by the exercise of
stock options.
(4) Includes 2,314 shares held by the trustee of the Carver Federal Savings
Bank 401(k) Savings Plan in RSI Retirement Trust ("401(k) Plan") which
are attributable to the account of Mr. Clark, and as to which he shares
voting and dispositive power, and 1,351 shares allocated to the account
of Mr. Clark under the ESOP as to which he has sole voting power, but
no dispositive power, except in limited circumstances.
(5) Includes 50 shares held jointly by spouse and son and 50 shares held
individually by son over which Mr. Johnson has shared voting power and
dispositive power.
(6) Includes 1,191 shares held by the trustee of the 401(k) Plan which are
attributable to the account of Mr. Mukherjee, and as to which he shares
voting and dispositive power, and 2,646 shares allocated to Mr.
Mukherjee under the ESOP as to which he has sole voting power, but no
dispositive power, except in limited circumstances.
(7) Includes 5,799 shares held by the ESOP Trust that have been allocated
as of May 31, 1997 to the individual accounts of the executive officers
under the ESOP and as to which such executive officers have sole voting
power, but no dispositive power, except in limited circumstances. Also
includes 131,896 unallocated shares held by the ESOP Trust as to which
the Board of Directors share voting and dispositive power. Each member
of the Board of Directors disclaims beneficial ownership of the shares
held in the ESOP.
(8) Includes 3,856 shares attributable to the individual accounts of the
executive officers under the 401(k) Plan and as to which such executive
officers have sole dispositive power and shared voting power with the
members of the committee established to administer the 401(k) Plan.
(9) Includes 15,044 shares which may be acquired by the directors and
executive officers pursuant to options granted under the Option Plan.
-5-
<PAGE> 9
--------------------------------------------
PROPOSAL ONE
ELECTION OF DIRECTORS
--------------------------------------------
GENERAL
The Certificate of Incorporation of the Company provides that the Board
of Directors shall be divided into three classes, as nearly equal in number as
possible. The directors of each class serve for a term of three years, with one
class elected each year. In all cases, directors serve until their successors
are elected and qualified.
Carver's Board currently consists of seven members. Richard T. Greene
and M. Moran Weston will retire from the Board effective as of the expiration of
their terms of office on the date of the Annual Meeting. The Board of Directors
has nominated for election as directors Linda H. Dunham and Robert J. Franz each
to serve for a term of three years and until their successors are elected and
qualified. On June 17, 1996, the Board of Directors of the Company voted to
decrease the size of the Board of Directors from seven to six members, effective
as of the date of the Annual Meeting.
Each nominee has consented to being named in the Proxy Statement and to
serve if elected. However, if any nominee is unable to serve, the shares
represented by all properly executed proxies which have not been revoked will be
voted for the election of such substitute as the Board of Directors may
recommend or the size of the Board of Directors may be reduced to eliminate the
vacancy. At this time, the Board knows of no reason why any nominee might be
unavailable to serve.
INFORMATION WITH RESPECT TO NOMINEES AND CONTINUING DIRECTORS
The following table sets forth certain information with respect to each
nominee for election as a director and each director whose term does not expire
at the Annual Meeting ("Continuing Director"). There are no arrangements or
understandings between the Company and any director or nominee pursuant to which
such person was elected or nominated to be a director of the Company. For
information with respect to security ownership of directors and nominees, see
"General Information -- Security Ownership of Certain Beneficial Owners and
Management -- Stock Ownership of Management."
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<PAGE> 10
<TABLE>
<CAPTION>
END OF POSITION HELD WITH THE
NAME AGE(1) TERM COMPANY AND THE BANK DIRECTOR SINCE(2)
---- ------ ---- -------------------- -----------------
<S> <C> <C> <C> <C>
NOMINEES FOR A THREE-
YEAR TERM EXPIRING IN
2000
Linda H. Dunham 47 2000 Director 1996
Robert J. Franz 59 2000 Nominee for Director -
CONTINUING DIRECTORS
Thomas L. Clark, Jr. 53 1998 President, Chief Executive 1995
Officer and Director
David N. Dinkins 70 1999 Director 1996
Herman Johnson, CPA 61 1998 Director 1981
David R. Jones 49 1999 Chairman of the Board, Director 1989
</TABLE>
- ------------------------------
(1) As of April 30, 1997.
(2) Includes terms as directors of Carver Federal prior to the
incorporation of the Company in 1996.
The principal occupation and business experience of each nominee for
election as director, each Continuing Director and each director who is retiring
as of the date of the Annual Meeting ("Retiring Director") is set forth below.
NOMINEES FOR ELECTION AS DIRECTORS
LINDA H. DUNHAM is Vice President of TCB Management Corporation, a
management company which oversees the McDonald's restaurants which she co-owns
and operates. Prior to joining TCB Management Corporation, Ms. Dunham was
employed by Chemical Bank for 16 years in various capacities. Ms. Dunham is also
Secretary of the Board of Directors of The Children's Oncology Society of New
York, the Vice Chair of the Board of Trustees of Community Service Society of
New York and a member of the National Board of Directors of Ronald McDonald
Children's Charities.
ROBERT J. FRANZ is currently a senior vice president of Booz-Allen &
Hamilton, Inc. which he joined in 1989, and leads the firm's financial
industries information technology practice. His entire business career has been
focused on the financial services industries in technology and operations
consulting, technology management and financial management. He began his
business career at The Travelers Corporation where he managed the implementation
of one of the first large-scale on-line computer systems in the country.
Subsequently, he founded and managed their Corporate Systems Department. Mr.
Franz spent twelve years at Arthur Andersen & Co. in New York where he was
partner-in-charge of their worldwide capital markets and insurance consulting
practices. He also was a member of their global management team for the banking
industries. Subsequently, he was Managing Director at Morgan Stanley where he
was Controller and Director of Financial Planning and Analysis.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE
ELECTION OF THE NOMINEES FOR ELECTION AS DIRECTORS.
-7-
<PAGE> 11
CONTINUING DIRECTORS
THOMAS L. CLARK, JR., is currently President and Chief Executive
Officer of the Company and Bank, a position he assumed on February 1, 1995.
Prior to assuming his current position, Mr. Clark was employed by the New York
State Banking Department from 1976 until 1995 and, from 1987 until 1995, served
as Deputy Superintendent of Banks for New York State and as secretary of the New
York State Banking Board. From 1970 until 1976, Mr. Clark was employed by
Buffalo Savings Bank in various capacities. Mr. Clark is one of the founders and
a past president of African-American Men of Westchester, Inc., a partner of the
New York City Partnership, Inc. and a member of the Board of Directors of the
New York City Housing Partnership, the Board of Directors of the 125th Street
Business Improvement District, the 100 Black Men, Inc., the Harlem Business
Alliance and the Harlem Task Force of the City of New York, Department of
Business Services. In addition, Mr. Clark serves as Chairman of the American
League of Financial Institutions, the national trade association representing
minority savings institutions, serves as Vice Chairman of the Community Bankers
Association of New York State's Community Reinvestment Committee, is a member of
the Board of Trustees of the American Institute of Banking of Greater New York,
serves on the New York Advisory Committee of Fannie Mae's New York partnership
office and serves on the Advisory Board of Small Business Development Centers of
New York State.
DAVID N. DINKINS, the 106th Mayor of New York City, is Professor in the
Practice of Public Affairs at the Columbia University School of International
and Public Affairs and is a Senior Fellow at the Barnard-Columbia Center for
Urban Policy. He is a member of the Advisory Board of the Taubman Center for
State and Local Government at Harvard University's Kennedy School of Government
and of the Visiting Committee of the Robert J. Milano Graduate School of
Management and Urban Policy at the New School for Social Research. Mr. Dinkins
is also the host of "Dialogue with Dinkins," a twice-weekly public affairs radio
program on WLIB-AM. He serves on the boards of directors of the American Stock
Exchange, AMREP, Cosmetic Center Inc., Transderm Laboratories Corporation,
Wertheim Schroder Investment Services and on the International Advisory Board of
Independent Newspaper Holdings. He is also on the board of directors of the
Aaron Diamond Foundation, the Andrew Goodman Foundation, the Association to
Benefit Children, the Federation of Protestant Welfare Agencies, Friends of the
Nelson Mandela Children's Fund, Goods for Guns, Hope for Infants, the Howard
Samuels Foundation, International House, the Lennox Hill Neighborhood
Association, the March of Dimes, the New York State International Partnership
Program and the New York Junior Tennis League. He is a member of the Advisory
Board of the Children's Health Fund, Citizens for Service, Shared Interest, the
South African-American Organization, the Advisory Council of the Respect for Law
Alliance, the Board of Advisors of the Aristide Foundation for Democracy and the
Steering Committee of the Association for a Better New York. He is a member of
the Honorary Board of Directors of the Rowell Foster Children's Positive Plan,
an Honorary Life Trustee of the Community Service Society of New York and an
Honorary Trustee of the Friends of Harlem Hospital. He is a founding member of
the Black and Puerto Rican Legislative Caucus of New York State, the Council of
Black Elected Democrats of New York State, 100 Black Men and the Black Americans
in Support of Israel Committee. He is the first male member of the National
Women's Political Caucus and was the former Vice President of the United States
Conference of Mayors.
HERMAN JOHNSON is currently self-employed as a certified public
accountant in Brooklyn, New York, and has been so employed in such profession
since 1962. Mr. Johnson currently serves as Chairman of the Board of Trustees of
Mt. Sinai Baptist Church in Brooklyn and has been a Trustee since 1966. He
formerly served as a Trustee of the Interfaith Medical Center in Brooklyn from
1987 to 1991.
DAVID R. JONES is President and Chief Executive Officer of the
Community Service Society of New York ("CSS"). One of the nation's oldest and
largest nonprofit social welfare organizations, the 150-year-old agency uses
direct help, research, advocacy and litigation to alleviate the effects of
poverty, focusing on the areas of education, health delivery, income security
and affordable housing. Prior to joining CSS, Mr. Jones served for three years
as Executive Director of the New York City Youth Bureau and as Special Advisor
to Mayor Edward I. Koch. A member of the New York State and Federal Bars, he
previously worked for four years as a litigator at the law firm of Cravath,
Swaine & Moore. Earlier, he had been a clerk for federal Judge Constance Baker
-8-
<PAGE> 12
Motley and one of the last interns for U.S. Senator Robert F. Kennedy. Mr. Jones
is currently on the boards of directors of the New York City Health and Hospital
Corporation, which runs 21 public hospitals and clinics; the Puerto Rican Legal
Defense and Education Fund; and the New York Foundation. A charter trustee of
Wesleyan University, he also serves on the advisory boards of the John F.
Kennedy School of Government of Harvard University and the Barnard-Columbia
Center for Leadership on Urban Public Policy, and as a trustee of the New York
Historical Society. He is the author of the "Urban Agenda" column which appears
in the Amsterdam News and ethnic papers throughout the nation and host of the
CUNY-TV show of the same name.
RETIRING DIRECTORS
RICHARD T. GREENE is the immediate past President and Chief Executive
Officer of Carver Federal, positions he had held since joining the Bank in 1960.
Mr. Greene currently serves on the boards of directors for the New York City
Housing Partnership and Thrift Association Service Corporation. He is also a
director and the chairman of the finance committee of the Apollo Theatre
Foundation and is on the board of advisors of Black Enterprise. Mr. Greene is
also a member of various community organizations, including Harlem Business
Alliance, President's Council, Museum of the City of New York and One Hundred
Black Men, Inc. Mr. Greene also served two terms as a director of the Federal
Home Loan Bank of New York from 1989 to 1990 and from 1991 and 1992.
M. MORAN WESTON, PH.D. is a founding director of Carver Federal and has
served continuously as a director since 1948. He was President of Carver Federal
during 1968 and 1969, Chairman of the Board from 1980 to 1995 and has served as
Vice Chairman of the Board since 1995. He is Rector Emeritus of the St. Philip's
Episcopal Church and Canon-Emeritus of the Episcopal Cathedral of St John the
Divine, both in New York City. In addition, Dr. Weston has served as a Trustee
of St. Augustine's College in Raleigh, North Carolina and of Mt. Sinai Medical
Center and Hospital since 1971. He is Trustee Emeritus of Columbia University
and Professor Emeritus of Social History of the State University of New York,
and has been awarded honorary doctorate degrees by Fordham University, Columbia
University and the Virginia Theological Seminary. He is also a member of various
community organizations, including Weston United Community Renewal, the National
Association of Affordable Housing, the NAACP Legal Defense Fund and six
nonprofit housing companies providing approximately 1,000 units of housing. He
was Trustee of the Foreign Policy Association for nine years, a Director of the
New York City Chapter of the American Red Cross for nine years, and a founding
President of the Greater Harlem Nursing Home, the Greater Harlem Community
Service Counsel, the Upper Manhattan Day Care Center and a residential service
facility for mentally handicapped persons.
The Board of Directors recognizes the excellent, distinguished and
intelligent service which directors Richard T. Greene and M. Moran Weston, PhD
have rendered the Bank during their incumbency. The Board feels that the success
which the Bank has attained has been in large measure due to their earnest
efforts and untiring devotion. In recognition of their contributions, the
Company has nominated directors Greene and Weston to serve as directors emeritus
of the Company, effective as of their retirement from the Board of Directors.
BOARD AND COMMITTEE MEETINGS
The Board of Directors of the Company holds regular monthly meetings
and holds special meetings as needed. During the year ended March 31, 1997, the
Board met 6 times. No director attended fewer than 75% in the aggregate of the
total number of Board meetings held while he or she was a member during the
fiscal year ended March 31, 1997 and the total number of meetings held by
committees on which he or she served during such fiscal year. The Board of
Directors has standing Audit, Executive and Compensation Committees, the nature
and composition of which are described below.
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<PAGE> 13
Audit Committee. The Audit Committee consists of Directors Herman
Johnson (Chairman), David R. Jones, Richard T. Greene and Thomas L. Clark, Jr.
(ex officio). This committee meets at least once annually to review and approve
the independent audit report. This committee did not meet during fiscal year
1997. The Bank's audit committee met on a monthly basis during the year ended
March 31, 1997.
Executive Committee. The Executive Committee is authorized to act as
appropriate between meetings of the Board of Directors. Members of this
committee are Directors Thomas L. Clark, Jr. (Chairman), Richard T. Greene,
David R. Jones, Herman Johnson and Linda H. Dunham. This committee met 5 times
during fiscal year 1997.
Compensation Committee. The Compensation Committee consists of
directors David R. Jones (Chairman), Herman Johnson, Linda H. Dunham and Thomas
L. Clark, Jr. (ex officio). This committee is expected to evaluate the
performance of the executive officers and to establish compensation for those
individuals. This committee did not meet during fiscal year 1997. Instead, the
Board of Directors took all necessary actions with respect to compensation
matters.
Nominating Committee. The Nominating Committee, which consists of
directors David R. Jones (Chairman), Thomas L. Clark, Jr., Herman Johnson and
David N. Dinkins, met in March 1997 to select the nominees for election as
directors at the Annual Meeting. In accordance with the Bylaws of the Company,
no nominations for election as directors, except those made by the Nominating
Committee, shall be voted upon at the Annual Meeting unless properly made by a
stockholder. No nominations for directors have been received from stockholders
for the elections to be held at the Annual Meeting as of the date of this Proxy
Statement. For a description of the procedure to be followed for a stockholder
to nominate persons for election as a director, see "Additional Information --
Notice of Business to be Conducted at Annual Meeting."
DIRECTORS' COMPENSATION
Directors' Fees. The Bank's directors, other than Mr. Clark, receive
$600 per meeting attended of the Bank's Board of Directors except that the
Chairman and Vice Chairman receive a fee of $850 per meeting. In addition, the
Chairman and Vice Chairman of the Board each receive a quarterly retainer fee of
$1,000. Fees for executive committee meetings are $700 per meeting and $475 for
all other committee meetings. Mr. Clark does not receive fees for his attendance
at meetings of the either the Bank's board of directors or their respective
committees. Directors of the Bank also serve as directors of the Company, but do
not receive additional fees for service as directors of the Company.
Directors' Retirement Plan. The Bank maintains the Carver Federal
Savings Bank Retirement Plan for Nonemployee Directors (the "Directors' Plan")
to provide retirement benefits to directors of the Bank who are neither
employees nor officers of the Bank. The Directors' Plan provides for a
retirement benefit equal to the product of a director's "Vested Percentage" and
the fees such director received for service on the Board during the calendar
year preceding his or her retirement. A participant's "Vested Percentage" is
based on his or her overall years of service on the Board of Directors of the
Bank, and increases from 0% for less than six years of service, to 33% for
between six and ten years of service, to 67% for between eleven and nineteen
years of service and to 100% for more than twenty years of service. However, in
the event a participant terminates service on the Board due to "disability" (as
such term is defined in the Directors' Plan) or death, the participant's Vested
Percentage becomes 100% regardless of his or her years of service. In the event
of a director's death, a survivor benefit equal to 50% of the annual amount
which would have been payable to such director had he or she survived will be
paid to his or her surviving spouse. The Bank will pay such benefits from its
general assets.
Option Plan. The Company maintains the Option Plan for the benefit of
its directors and certain key employees. Under the Option Plan, each outside
director who was a director on the effective date of the Option Plan was granted
options to purchase 6,943 shares of Common Stock, except that directors Richard
T. Greene and M. Moran Weston each were granted stock options to purchase 10,415
shares of Common Stock. Such
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<PAGE> 14
options were granted on September 12, 1995 at an exercise price of $10.38 per
share. Any individual who becomes an outside director following the effective
date of the Option Plan will be granted options to purchase 1,000 shares of
Common Stock with an exercise price equal to the fair market value of Common
Stock on the date of the grant. Accordingly, upon becoming a director, David N.
Dinkins was granted stock options to purchase 1,000 shares of Common Stock on
January 12, 1996 with an exercise price of $9.00 per share, and Linda H. Dunham
was granted stock options to purchase 1,000 shares of Common Stock on April 15,
1996 with an exercise price of $8.75 per share. In addition, Mr. Franz, upon his
election to the Board of Directors, is expected to be granted stock options to
purchase 1,000 shares of Common Stock. Options granted under the Option Plan
vest in five equal annual installments commencing on the first anniversary of
the effective date of the grant, provided the recipient is still a director of
the Company or the Bank on such date. Upon death or disability, all options
previously granted automatically become exercisable.
Management Recognition Plan. The Company maintains the MRP for the
benefit of its directors and certain key employees. Under the MRP, each outside
director who was a director on the effective date of the MRP received an
automatic grant of 3,471 shares of restricted stock, except that Directors
Richard T. Greene and M. Moran Weston each received 5,207 shares of restricted
stock. Any individual who becomes an outside director following the effective
date of the MRP will be granted 1,000 shares of restricted stock. Accordingly,
upon becoming directors, David N. Dinkins and Linda H. Dunham were each granted
1,000 shares of restricted stock and it is expected that, upon becoming a
director, Mr. Franz will be granted 1,000 shares of restricted stock. Awards
vest in five equal annual installments commencing on the first anniversary date
of the award, provided the recipient is still a director of the Company or the
Bank on such date. Awards will be 100% vested upon termination of service due to
death or disability. When shares become vested and are distributed, the
recipients will receive an amount equal to any accrued dividends with respect
thereto.
Supplemental Executive Retirement Agreement. In order to secure and
reward the services of Richard T. Greene (the "SERA Participant"), the President
and Chief Executive Officer of the Bank at the time, the Bank entered into a
supplemental executive retirement agreement with him (the "SERA"), effective
January 30, 1995. Pursuant to the terms of the SERA, upon the SERA Participant's
termination of employment with the Bank effective February 1, 1995, he became
entitled to receive annual payments from the Bank in an amount equal to (i) 50%
of his "Average Annual Compensation," less (ii) his "Annual Offset Amount."
Under the SERA, "Average Annual Compensation" means the average of the SERA
Participant's highest annual compensation for three of the five calendar years
preceding his termination of employment, and "Annual Offset Amount" means the
sum of the SERA Participant's primary social security benefits and the benefits
which the SERA Participant would receive in the form of an annuity under the
Pension Plan or the 401(k) Plan (but only to the extent attributable to Bank
matching contributions) upon his termination of employment. Such annual payments
shall be made for 10 years, except that in the event of the SERA Participant's
death, a 50% death benefit will be payable to his surviving spouse, if any.
Incentive Compensation Plan. Under the Incentive Compensation Plan,
effective as of September 12, 1995, directors and eligible employees may elect
to defer the receipt of all or part of their future fees and/or compensation.
Prior to the establishment of the Incentive Compensation Plan, the Bank
maintained the Carver Federal Savings Bank Deferred Compensation Plan (the
"Deferred Compensation Plan"). Amounts previously deferred under the Deferred
Compensation Plan are now held and invested in accordance with the terms of the
Incentive Compensation Plan. Pursuant to the terms of the Incentive Compensation
Plan, any deferred amounts will be credited to a bookkeeping account in
accordance with the terms of the deferred compensation agreement ("Deferred
Compensation Agreement") entered into with the individual director or employee.
Such accounts will be adjusted annually to reflect the investment return which
would have resulted if such deferred amounts had been invested, based on the
participant's choice, in one of the following: (i) Common Stock; (ii) the Bank's
highest annual rate of interest on 12-month certificates of deposit; or (iii)
the "Multiplier," which generally is the sum of certain indicators with respect
to the Bank's performance, times 2 percent. A participant will receive
distributions of deferred amounts in accordance with the terms of their
respective Deferred Compensation Agreements. A participant may change the
investment selection applicable to his or her account or elections as to the
timing and form of distributions from such account only with respect to
subsequently deferred fees or compensation.
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<PAGE> 15
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT.
The Report of the Compensation Committee of the Company (the
"Compensation Committee") and the Performance Graph shall not be deemed to be
incorporated by reference by any general statement incorporating by reference
this Proxy Statement into any filing under the Securities Act of 1933
("Securities Act") or the Exchange Act, except to the extent that Carver
specifically incorporates this information by reference, and shall not otherwise
be deemed to be filed under the Securities Act or the Exchange Act.
The Compensation Committee is responsible for establishing the policies
which govern employee annual compensation and stock ownership programs. The
Compensation Committee did not meet during fiscal 1997. In its stead, the Board
of Directors took all necessary actions with respect to compensation matters.
However, Mr. Clark did not participate in any decisions affecting his
compensation. Compensation decisions for fiscal 1998 are expected to be made by
the Compensation Committee. References to the Compensation Committee herein with
respect to specific actions regarding compensation shall also refer to the Board
of Directors.
The Compensation Committee annually reviews and makes recommendations
to the Board of Directors regarding the compensation of the Company's executive
officers, including the compensation of Mr. Clark, the President and Chief
Executive Officer ("CEO") of the Company and Bank. The overall compensation
structure of the Company is aimed at establishing a total compensation package
that both rewards strong individual and Bank performance and remains competitive
with compensation levels at similar institutions.
For the 1997 fiscal year, base salaries were set at levels determined,
in the subjective judgment of the Compensation Committee, to be commensurate
with the respective executive officer's customary duties and responsibilities.
Benefit plans, consisting of a pension plan, 401(k) Plan, ESOP and group
insurance coverages, are designed to provide for the health and welfare of all
employees, including the executives, and their families, as well as for their
long-term financial and retirement needs.
When determining salary levels, the Compensation Committee took into
account awards to executives under the Option Plan, the MRP and the Incentive
Compensation Plan. The Compensation Committee concluded that, considering the
prevailing salary levels combined with longer-term performance incentives using
options and restricted stock, the Bank's compensation program constituted a
total compensation package that was competitive with that of comparable
institutions. The Compensation Committee reviews and updates the Bank's
compensation program on an ongoing basis in order to continue to offer a total
compensation package that provides incentive for strong individual and Bank
performance and is competitive with comparable banking institutions.
Incentive Compensation. The Incentive Compensation Plan provides for
incentive compensation in the form of cash bonuses, stock options and restricted
stock based upon the annual performance of the Bank in comparison to its
pre-established goals. For each fiscal year, eligible employees will receive a
bonus equal to 4% of such employee's compensation, multiplied by the lesser of 8
and the "Multiplier," which generally is the sum of certain indicators with
respect to the Bank's performance. In addition, each such employee will receive
a restricted stock award of shares having a market value equal to 30% of the
employee's bonus and an option to purchase 4 times the number of shares of
restricted stock awarded to such employee. For the fiscal year ending March 31,
1996, Mr. Clark was awarded a cash bonus of $13,926, as well as 518 shares of
restricted stock and an option to purchase 2,072 shares of Common Stock. Awards
under the Incentive Compensation Plan for the 1997 fiscal year have not yet been
determined. The Compensation Committee believes that incentive compensation
should be an integral component of the Bank's total compensation package.
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<PAGE> 16
Stock Ownership Programs. The Compensation Committee believes that
providing executive officers with significant stock ownership and stock options
aligns the interests of executive officers with the interests of stockholders.
In this regard, the Company maintains the ESOP, the Option Plan, the MRP and the
Incentive Compensation Plan. Pursuant to the ESOP, each of the other executive
officers has an individual account within the ESOP Trust which is invested
primarily if not exclusively in employer securities, with the result that a
portion of each executive officer's long-term retirement savings is tied to the
performance of the Company.
Following the adoption of the Option Plan, the Bank granted stock
options to provide employees, including Messrs. Clark and Mukherjee, with an
incentive for future performance through their equity interests in the Company.
The size of the grants was based in part on practices of other similar
institutions and in part on the executive officer's performance and position in
the organization. Since these grants, no further stock options have been granted
to the Bank's executive officers under the Option Plan. In addition, the MRP is
designed to encourage valued executive officers to remain with the Bank through
the potential of having increased equity interests in the Company. Following the
adoption of the MRP, the Company made awards under the MRP to certain employees,
including Messrs. Clark and Mukherjee. Since these awards, no further shares
under the MRP have been awarded to the Bank's executive officers.
Chief Executive Officer. The Compensation Committee reviewed the
performance of Mr. Clark as CEO of the Bank over the past year. The Committee
concluded that his performance was outstanding, in terms of achieving the Bank's
goals and objectives as set forth in the Bank's strategic operating plan,
building a solid and talented management team and managing the Bank's growth
since the successful initial public offering of the Bank and the reorganization
of the Bank as a wholly-owned subsidiary of the Company. Mr. Clark also actively
participated in a variety of outside organizations and causes which served to
benefit the Bank and the banking industry. These factors were used to determine
Mr. Clark's salary, options and restricted stock awards.
THE BOARD OF DIRECTORS
Thomas L. Clark, Jr.*
David N. Dinkins
Linda H. Dunham*
Richard T. Greene
Herman Johnson, CPA*
David R. Jones (Chairman)
M. Moran Weston, Ph.D.
- -------------------
* Indicates a member of the Compensation Committee. Mr. Clark serves on
the Compensation Committee as an ex officio member without power to
vote.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
One of the responsibilities of the Compensation Committee is to
determine the level of compensation for executive officers of the Company and
the Bank. There are no other interlocks, as defined under the SEC's rules,
between the Compensation Committee and corporate affiliates of members of the
Compensation Committee or otherwise.
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<PAGE> 17
PERFORMANCE GRAPH
In accordance with the regulations of the SEC, set forth below is a
line graph comparing the cumulative total return of Common Stock with that of
The Nasdaq Stock Market and the Nasdaq Stocks-Savings Institutions index for the
period from October 25, 1994, the date that the Bank became a public company,
through March 31, 1997. On October 17, 1996, the Company became the holding
company for Carver Federal pursuant to the Reorganization. In connection with
the Reorganization, each share of the Bank's common stock was exchanged for one
share of Common Stock. At that time, the Company replaced the Bank as the issuer
listed by The Nasdaq Stock Market trading under the symbol "CARV." Accordingly,
through October 17, 1996, the graph below represents the performance of the
Bank's common stock, and not the performance of the Company's Common Stock. In
addition, the Common Stock began trading on the American Stock Exchange on May
21, 1997 under the symbol "CNY."
[PERFORMANCE GRAPH]
LEGEND
<TABLE>
<CAPTION>
SYMBOL CRSP TOTAL RETURNS INDEX FOR: 10/25/94 03/31/95 09/29/95 03/29/95 09/30/96 03/31/97
- ------ ----------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
_______ - CARVER BANCORP, INC. 100.0 89.8 129.0 114.3 102.9 125.7
- -- -- -- * Nasdaq Stock Market (US Companies) 100.0 108.5 139.1 147.3 165.0 163.8
- --------- O Nasdaq Stocks-Savings Institutions 100.0 108.0 137.7 147.6 162.1 201.9
(SIC 6030-6039, US Companies)
</TABLE>
NOTES:
A. The lines represent monthly index levels derived from
compounded daily returns that include all dividends.
B. The indexes are reweighted daily, using the market
capitalization on the previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not
a trading day, the preceding trading day is used.
D. The index level for all series was set to $100.00 on 10/25/94.
E. This performance graph includes the Nasdaq Stock-Savings
Institutions index, which the Company believes is comparable
to the SNL Thrift Index, as presented in the performance graph
included in Carver Federal Savings Bank's 1996 Proxy
Statement.
THERE CAN BE NO ASSURANCE THAT STOCK PERFORMANCE WILL CONTINUE INTO THE
FUTURE WITH THE SAME OR SIMILAR TRENDS DEPICTED IN THE GRAPH ABOVE.
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<PAGE> 18
SUMMARY COMPENSATION TABLE
The following table sets forth cash and noncash compensation for the fiscal
years ended March 31, 1997, 1996 and 1995 awarded to or earned by the Company's
Chief Executive Officer and by each other executive officer whose compensation
exceeded $100,000 for services rendered in all capacities to the Company and the
Bank during the fiscal year ended March 31, 1997 ("Named Executive Officers").
No other officers received total compensation in excess of $100,000 in fiscal
1997.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------------- ---------------------- --------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
OTHER RESTRICTED
ANNUAL STOCK LTIP ALL OTHER
NAME AND PRINCIPAL FISCAL COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION
POSITIONS YEAR SALARY($) BONUS($)(2) ($)(3) ($)(2)(4) (#)(2) ($) ($)(5)(6)
--------- ---- --------- ----------- ------ --------- ------ --- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Thomas L. Clark 1997 200,000 -- -- 4,274 2,072 -- 17,766
President and Chief Executive 1996 165,000 13,926 -- 186,588 34,715 -- 1,103
Officer (1) 1995 27,288 -- -- -- -- -- --
Biswarup Mukherjee 1997 115,000 -- -- 2,978 1,444 -- 13,354
Executive Vice President and 1996 115,001 9,706 -- 111,961 13,886 -- 13,808
Chief Financial Officer 1995 103,903 -- -- -- -- -- 6,482
</TABLE>
- -----------------------------------
(1) The compensation earned by Mr. Clark for his service for fiscal year
ended March 31, 1995 reflects his appointment to the position of
President and CEO of the Bank on February 1, 1995.
(2) As of May 31, 1997, the committee established to administer the
Incentive Compensation Plan has not determined the amount, if any, of
cash bonuses, stock options and restricted stock to be awarded to Mr.
Clark and Mr. Mukherjee under such plan for the 1997 fiscal year.
(3) Does not include perquisites and other personal benefits the value of
which did not exceed the lesser of $50,000 or 10% of salary and bonus.
(4) Pursuant to the Incentive Compensation Plan, awards of 518 and 361
shares of restricted stock were made to Mr. Clark and Mr. Mukherjee,
respectively, on August 20, 1996, which vest in five equal installments
commencing on August 20, 1997. In addition, awards of 17,357 and 10,415
shares of restricted stock were made to Mr. Clark and Mr. Mukherjee,
respectively, under the MRP on September 12, 1995, which vest in five
equal installments beginning on September 12, 1996. The dollar amounts
in the table for 1997 are based on the closing price of $8.25 per share
of Common Stock on August 20, 1996, as reported on The Nasdaq Stock
Market, and the dollar amounts in the table for 1996 are based on the
closing price of $10.75 per share of Common Stock on September 12,
1996, as reported on The Nasdaq Stock Market. When shares become vested
and are distributed, the recipient also receives an amount equal to
accumulated dividends and earnings thereon, if any. As of March 31,
1997, the aggregate value of the unvested shares of restricted stock
awarded to Mr. Clark and Mr. Mukherjee under both the Incentive
Compensation Plan and the MRP was $138,639 and $83,670, respectively,
based on the closing stock price of $9.625 per share of Common Stock,
as reported on The Nasdaq Stock Market.
(5) Includes $3,830 and $95.00 in matching contributions allocated to Mr.
Clark's account under the Bank's 401(k) Plan for the fiscal years ended
March 31, 1997 and 1996, respectively, and $2,087, $2,897 and $4,784 in
matching contributions allocated to Mr. Mukherjee's account under the
Bank's 401(k) Plan for the fiscal years ended March 31, 1997, 1996 and
1995, respectively.
(6) Includes allocations under the ESOP of 1,351 shares of Common Stock for
the plan year ending December 31, 1996 with a total market value of
$13,003 as of March 31, 1997 for the account of Mr. Clark and
allocations of 1,123, 1,247 and 247 shares of Common Stock for the plan
years ending December 31, 1996, 1995 and 1994 with a total market value
of $10,809, $10,911 and $1,698, respectively, as of March 31, 1997,
1996 and 1995 for the account of Mr. Mukherjee.
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<PAGE> 19
EMPLOYEE BENEFIT PLANS AND EMPLOYMENT AGREEMENTS
Employment Agreements. The Company and the Bank have entered into
employment agreements with Mr. Clark in his capacity as President and CEO of the
Company and the Bank, and the Bank has entered into an employment agreement
(collectively, the "Employment Agreements") with Mr. Mukherjee in his capacity
as Executive Vice President and Chief Financial Officer of the Bank.
The Employment Agreements with Mr. Clark, each effective as of April 1,
1997, provide for three-year terms. The Bank's Employment Agreement provides
that, commencing on the first anniversary date and continuing each anniversary
date thereafter, the Board of Directors may, after conducting a performance
evaluation of Mr. Clark and with Mr. Clark's concurrence, extend its Employment
Agreement for an additional year, so that the remaining term shall be three
years. The Company's Employment Agreement provides for automatic daily
extensions such that the remaining term of the employment Agreement shall be
three years unless written notice of non-renewal is given by the Board of
Directors or Mr. Clark. The Employment Agreements provide that Mr. Clark's base
salary will be reviewed annually. As of May 31, 1997, Mr. Clark's base salary is
$200,000. In addition to base salary, the Employment Agreements provide for,
among other things, entitlement to participation in stock, retirement and
welfare benefit plans and supplemental retirement benefits to compensate Mr.
Clark for the benefits he cannot receive under the Company's and the Bank's
tax-qualified employee benefit plans due to the limitations imposed under the
Code and eligibility for fringe benefits applicable to executive personnel such
as a company car and fees for club and organization memberships deemed
appropriate by the Bank or Company and Mr. Clark. The Employment Agreements
provide for termination by the Bank or the Company at any time for cause as
defined in the Employment Agreements. In the event the Bank or the Company
chooses to terminate Mr. Clark's employment for reasons other than for cause, or
in the event of Mr. Clark's resignation from the Bank and the Company upon: (i)
failure to re-appoint, elect or re-elect him to the office of President and CEO;
(ii) failure to re-elect or nominate him for Board membership; (iii) a material
adverse change in his functions, duties or responsibilities; (iv) a relocation
of his principal place of employment more than 30 miles from its current
location without his consent; (v) liquidation or dissolution of the Bank or the
Company; (vi) a "change of control" (as defined below); or (vii) a breach of the
Employment Agreement by the Bank or the Company, Mr. Clark, or, in the event of
death, his beneficiary, would be entitled to a lump sum cash payment in an
amount equal to the remaining base salary and bonus payments due to Mr. Clark
and the additional cash compensation, contributions or benefits that he would
have earned under any employee benefit plans of the Bank or the Company during
the remaining term of the Employment Agreements. The Bank and the Company would
also continue Mr. Clark's life, health and disability insurance coverage for the
remaining term of the Employment Agreements.
Payments to Mr. Clark under his Employment Agreement with the Bank will
be guaranteed by the Company in the event that payments or benefits are not paid
by the Bank. To the extent that payments under the Company's Employment
Agreement and the Bank's Employment Agreement are duplicative, payments due
under the Company's Employment Agreement would be offset by amounts actually
paid by the Bank. Mr. Clark would be entitled to reimbursement of certain costs
incurred in negotiating, interpreting or enforcing the Employment Agreements.
Each Employment Agreement also provides for the Bank and the Company to
indemnify Mr. Clark to the fullest extent allowable under federal and Delaware
law, respectively.
Cash and benefits paid to Mr. Clark under the Employment Agreements
together with payments under other benefit plans following a "change in control"
of the Bank or the Company may constitute an "excess parachute" payment under
Section 280G of the Code resulting in the imposition of a 20% excise tax on Mr.
Clark. For purposes of Mr. Clark's Employment Agreements, a "change of control"
will generally be deemed to have occurred during the term of the employment
agreement: (i) if a person or group of persons acting in concert acquires
beneficial ownership of 20% or more of any class of equity security, such as
Common Stock, of the Company or Bank; (ii) in the event of certain mergers,
reorganizations, consolidation of assets; (iii) in the event of a complete
liquidation or dissolution of the Company or the Bank; or (iv) in the event of a
contested election of directors which results in a change of control of a
majority of the Board of Directors of the Company or the Bank. In the event that
any amounts paid to Mr. Clark following a change of control would constitute
"excess
-16-
<PAGE> 20
parachute payments" under section 280G of the Code, the Employment Agreement
with the Company provides that he will be indemnified for any excise taxes
imposed due to such excess parachute payments, and any additional income and
employment taxes imposed as a result of such indemnification of excise taxes.
Any excess parachute payments and indemnification amounts paid will not be
deductible compensation expenses for the Company or the Bank.
The Employment Agreement with Mr. Mukherjee became effective as of
October 24, 1994 and provides for a term of three years, with an annual base
salary of $100,000. On each anniversary date of the effective date of
commencement of the Employment Agreement, the term of employment may be extended
for an additional one-year period beyond the then effective expiration date so
that the remaining term shall be three years, upon a determination by the Board
of Directors that the performance of Mr. Mukherjee has met the required
performance standards and that such Employment Agreement should be extended. The
Employment Agreement provides Mr. Mukherjee with a salary review by the Board of
Directors not less often than annually, as well as with participation in any
discretionary bonus plans, retirement and medical plans, customary fringe
benefits and vacation and sick leave. The Employment Agreement will terminate
upon his death or disability (as defined in the Employment Agreement), and is
terminable by the Bank for "just cause" (as defined in the Employment
Agreement). In the event of termination for just cause, no severance benefits
are available. If the Bank terminates Mr. Mukherjee without just cause, he will
be entitled to severance benefits equal to his salary from the date of
termination through the remaining term of the Employment Agreement (but in no
event less than a 12 month period) and the cost to him of obtaining all health,
life, disability and other benefits which he would have been eligible to
participate in through the remaining term of the Employment Agreement, based
upon benefit levels substantially equal to those that the Bank provided for him
at the date of termination of employment. If the Employment Agreement is
terminated due to his disability, Mr. Mukherjee will be entitled to compensation
and benefits for the term of the Employment Agreement. Severance benefits
payable to him or to his estate will be paid in a lump sum or in installments,
as he (or his estate) elects. In the event that Mr. Mukherjee prevails over the
Bank in a legal dispute as to the Employment Agreement, he will be reimbursed
for his legal and other expenses.
The Employment Agreement with Mr. Mukherjee provides that, in the event
of Mr. Mukherjee's involuntary or voluntary (under certain specified
circumstances) termination of employment in connection with, or within one year
after, any "change in control" of the Bank (as defined in the Employment
Agreement) other than for "just cause," he will be paid an amount equal to the
difference between (i) 2.99 times his "base amount," as defined in Section
280G(b)(3) of the Code, and (ii) the sum of any other parachute payments, as
defined under Section 280G(b)(2) of the Code, that he receives on account of the
change in control. Such payment would be made in the case of Mr. Mukherjee's
voluntary termination of employment following a change in control only upon the
occurrence of certain specified events which have not been consented to in
writing by Mr. Mukherjee, including: (i) the requirement that he perform his
principal executive functions more than 35 miles from the Bank's current primary
office; (ii) a material reduction in his base compensation; (iii) the failure of
the Bank to continue to provide him with compensation and benefits provided for
under the Employment Agreement or with substantially similar benefits; (iv) the
assignment to him of duties and responsibilities that are materially different
from those normally associated with his position with the Bank; or (v) a
material reduction in his authority and responsibility. For purposes of the
Employment Agreement, Mr. Mukherjee's "base amount" is generally the average of
Mr. Mukherjee's annual taxable compensation from the Bank for each of the most
recent five taxable years ending before the date on which a change of control
occurs. A "change in control" generally refers to the acquisition, by any person
or entity, of the ownership of or power to vote more than 25% of the Bank's
voting stock, the control of the election of a majority of the Bank's directors,
or the exercise of a controlling influence over the management or policies of
the Bank. In addition, under the Employment Agreement, a change in control
occurs when, during any consecutive two-year period, directors of the Bank at
the beginning of such period cease to constitute two-thirds of the Board of
Directors of the Bank unless the election of replacement directors was approved
by a two-thirds vote of the initial directors then in office. The Employment
Agreement provides that within five business days of a change in control, the
Bank shall fund, or cause to be funded, a trust in the amount
-17-
<PAGE> 21
of 2.99 times Mr. Mukherjee's base amount, that will be used to pay Mr.
Mukherjee amounts owed to him upon termination other than for just cause within
one year of the change in control. The amount to be paid to Mr. Mukherjee from
this trust upon his termination is determined according to the procedures
outlined in the Employment Agreement with the Bank, and any money not paid to
Mr. Mukherjee is returned to the Bank.
Pension Plan. The Bank maintains a non-contributory, tax-qualified
defined benefit plan (the "Pension Plan"). As required, the Bank annually
contributes an amount to the Pension Plan necessary to satisfy the actuarially
determined minimum funding requirements in accordance with the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
Employees who are 18 years of age or older and who have completed one
year of service with the Bank are eligible to participate in the Pension Plan.
Participants become 100% vested after five years of service, death, or
termination of the Pension Plan, regardless of the participant's years of
service. The Pension Plan also provides for early retirement benefits, on an
actuarially reduced basis, at the election of a participant who terminates
employment after age 55.
Under the Pension Plan, each participant is entitled to a retirement
benefit equal to the greater of (a) the product of 50% of final earnings (as
defined in the Pension Plan) reduced by 50% of the social security amount (as
defined in the Pension Plan) times the ratio of number of years of credited
service (as defined in the Pension Plan) up to a maximum of 15, over 15 if the
participant's employment ceased after the normal retirement age (as defined in
the Pension Plan) or multiplied by the ratio of the number of years of credited
service divided by the greatest of (i) 15 and (ii) the number of years of
credited service he or she would have had on his or her normal retirement date,
if the participant's employment ceased prior to the normal retirement age (as
defined in the Pension Plan), or (b) $25 multiplied by the number of the
participants' months of credited service.
The following table sets forth the estimated annual benefits that would
be payable under the Pension Plan in the form of a single life annuity before
reduction for the social security amount upon retirement at the normal
retirement date. The amounts are expressed at various levels of compensation and
years of service.
YEARS OF CREDITED SERVICE
<TABLE>
<CAPTION>
FINAL EARNINGS 15 20 25 30 35
-------------- ---------------- ---------------- ---------------- ---------------- ---------
<S> <C> <C> <C> <C> <C>
$100,000 $50,000 $50,000 $50,000 $50,000 $50,000
150,000 75,000 75,000 75,000 75,000 75,000
200,000(1) 100,000 100,000 100,000 100,000 100,000
250,000(1) 125,000 125,000 125,000 125,000 125,000
</TABLE>
- ------------------------
(1) Under Section 401(a)(17) of the Code, a participant's compensation in
excess of $160,000 (as adjusted to reflect cost-of-living increases) is
disregarded for purposes of determining final earnings. The amounts
shown in the table include the supplemental retirement benefits payable
to Mr. Clark under his employment agreement to compensate for the
limitation on includible compensation.
Final earnings equal the average of the participant's highest three
consecutive calendar years of taxable compensation during the last 10 full
calendar years of employment prior to termination, or the average of the
Participant's annual compensation over his or her total service, if less.
-18-
<PAGE> 22
The following table sets forth the years of credited service and the
final earnings determined as of March 31, 1997 for each of the individuals named
in the Summary Compensation Table.
YEARS OF CREDITED SERVICE
<TABLE>
<CAPTION>
NAME YEARS MONTHS FINAL EARNINGS
- -------------------------------- -------------- -------------- -------------------------------
<S> <C> <C> <C>
Thomas L. Clark, Jr. 2 2 $173,503
Biswarup Mukherjee 10 4 $106,625
</TABLE>
Management Recognition Plan. The MRP provides for automatic grants of
restricted stock to certain employees as of the effective date of the MRP,
including Mr. Clark and Mr. Mukherjee who received 17,357 and 10,415 shares of
restricted stock, respectively. In addition, the MRP provides for additional
discretionary grants of restricted stock to those employees selected by the
committee established to administer the MRP. Awards vest in five equal annual
installments commencing on the first anniversary date of the award, provided the
recipient is still an employee of the Company or the Bank on such date. Awards
will be 100% vested upon termination of service due to death or disability. When
shares become vested and are distributed, the recipients will receive an amount
equal to any accrued dividends with respect thereto.
Incentive Compensation Plan. The Incentive Compensation Plan provides
incentive compensation to certain eligible employees, including Mr. Clark and
Mr. Mukherjee, in the form of bonuses, stock options and restricted stock. For
each fiscal year, eligible employees will receive a bonus equal to 4% of such
employee's compensation, multiplied by the lesser of 8 and the "Multiplier." In
addition, each such employee will receive a restricted stock award of shares
having a market value equal to 30% of the employee's bonus and an option to
purchase 4 times the number of shares of restricted stock awarded to such
employee. For the fiscal year ended March 31, 1996, Mr. Clark was awarded a cash
bonus of $13,926, as well as 518 shares of restricted stock and an option to
purchase 2,072 shares of Common Stock. In addition, Mr. Mukherjee was awarded a
bonus of $9,706, as well as 361 shares of restricted stock and an option to
purchase 1,444 shares of Common Stock. The awards under Incentive Compensation
plan for the fiscal year ended March 31, 1997 have not yet been determined.
Option Plan. The Option Plan provides for automatic option grants to
certain employees as of the effective date of the Option Plan, including Mr.
Clark and Mr. Mukherjee, who were granted options to purchase 34,715 and 13,886
shares of Common Stock, respectively, on September 12, 1995 at an exercise price
of $10.38 per share. In addition, the Option Plan provides for additional
discretionary option grants to those employees selected by the committee
established to administer the Option Plan with an exercise price equal to the
fair market value of Common Stock on the date of the grant. Options granted
under the Option Plan vest in five equal annual installments commencing on the
first anniversary of the effective date of the grant, provided the recipient is
still an employee of the Company or the Bank on such date. Upon death or
disability, all options previously granted automatically become exercisable.
-19-
<PAGE> 23
The following table discloses for the Named Executive Officers, the
gain or "spread" that would be realized if the stock options granted to such
individuals were exercised when the Bank's stock price had appreciated by the
percentage rates indicated from the closing market price on the date of the
grant.
OPTION/SAR GRANTS IN FISCAL YEAR 1997
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------- POTENTIAL REALIZABLE
PERCENT OF VALUE OF ASSUMED ANNUAL
NUMBER OF TOTAL RATE OF STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM
OPTIONS/SARS EMPLOYEES EXERCISE OR ------------------------
GRANTED FISCAL YEAR BASE PRICE EXPIRATION 5% 10%
NAME (#) (%) ($ PER SHARE) DATE ($) ($)
---- --- --- ------------- ---- --- ---
<S> <C> <C> <C> <C> <C> <C>
Thomas L. Clark, Jr. 2,072 22.8 8.06 8/20/06 10,505 21,818
Biswarup Mukherjee 1,444 15.9 8.06 8/20/06 7,321 15,205
</TABLE>
The following table provides certain information with respect to the
number of shares of Common Stock acquired through the exercise of, or
represented by, outstanding stock options held by the Named Executive Officers
on March 31, 1997. Also reported is the value for any "in-the-money" options,
which represent the positive spread between the exercise price of any such
existing stock options and the fiscal year-end price of Common Stock, which was
$9.625 per share.
FISCAL YEAR END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT FISCAL OPTIONS/SARS AT FISCAL
YEAR-END YEAR-END(2)
(#) ($)
NAME(1) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- -------------------------------- ------------------------------ -------------------------------
<S> <C> <C>
Thomas L. Clark, Jr. 6,943/29,884 -- /3,243
Biswarup Mukherjee 2,777/12,553 -- /2,260
</TABLE>
- ---------------------
(1) Neither of the Named Executive Officers exercised options during the
fiscal year ended March 31, 1997.
(2) Of the total outstanding stock options held by Mr. Clark and Mr.
Mukherjee, 2,072 and 1,444, respectively, of the unexercisable options
are "in-the-money" options.
TRANSACTIONS WITH CERTAIN RELATED PERSONS
Under current law, Carver Federal offers loans to its directors,
officers and employees, which loans are made in the ordinary course of business,
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons and
do not involve more than the normal risk of collectibility or present other
unfavorable features. Furthermore, loans above the greater of $25,000 or 5% of
the Bank's capital and surplus (up to $500,000) to the Bank's directors and
executive officers must be approved in advance by a disinterested majority of
the Bank's Board of Directors. Under prior law, however, Carver had a policy of
offering loans to directors, officers, employees and their immediate family
members residing at the same address on terms substantially equivalent to those
offered to the public, except the interest rates on loans were reduced so long
as the director, officer or employee remained at the Bank.
-20-
<PAGE> 24
The following table sets forth information at March 31, 1997 relating
to loans made to directors and executive officers of the Bank whose terms
included reduced interest rates or other preferential terms and whose total
aggregate balances exceeded $60,000 at any time since April 1, 1996.
<TABLE>
<CAPTION>
HIGHEST
BALANCE
BALANCE AT SINCE
TYPE OF DATE ORIGINAL INTEREST MARCH 31, APRIL 1,
NAME AND RELATION TO COMPANY LOAN ORIGINATED AMOUNT RATE 1997 1996
- --------------------------------- ---------- ------------ ---------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Biswarup Mukherjee
Executive Vice President
and Chief Financial Officer Mortgage 9/13/88 $160,000 8.25% $121,411 $126,998
Herman Johnson
Director Mortgage 10/18/89 150,000 8.50% $121,359 $126,428
</TABLE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires the Company's directors and
certain officers, and persons who own more than ten percent of a registered
class of the Company's equity securities to file reports of ownership and
changes in ownership with the SEC and the American Stock Exchange. Officers,
directors and greater than ten percent shareholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on a review of copies of such reports of ownership
furnished to the Company or the Bank, or written representations that no forms
were necessary, the Company believes that, during the last fiscal year, all
filing requirements applicable to its officers, directors and greater than ten
percent shareholders of the Company and the Bank were complied with.
-----------------------------------------------------
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS
-----------------------------------------------------
The Board of Directors of Carver has appointed the firm of Mitchell &
Titus, LLP as independent auditors for Carver for the fiscal year ending March
31, 1998, subject to ratification of such appointment by the stockholders.
Representatives of Mitchell & Titus, LLP are expected to be present at the
Annual Meeting. They will have an opportunity to make a statement if they desire
to do so, and will be available to respond to questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE
RATIFICATION OF THE APPOINTMENT OF MITCHELL & TITUS, LLP AS INDEPENDENT
AUDITORS FOR CARVER.
-21-
<PAGE> 25
--------------------------------------------
PROPOSAL THREE
STOCKHOLDER PROPOSAL
--------------------------------------------
A stockholder of the Company has submitted the proposal set forth
below. The name, address and stock ownership of the proponent will be furnished
promptly upon request to the Corporate Secretary of the Company.
"RESOLVED, that the shareholders assembled in person and by proxy,
recommend that in order to enhance shareholder value, the Board of Directors
sell the company for cash and/or securities valued at no less than TWENTY
DOLLARS per share."
SUPPORTING STATEMENT
I propose that Carver Bancorp be sold at no less than TWENTY DOLLARS
per share (which is about 133% of the $15.08 December 31, 1996 book value). A
sale leading to a takeover of Carver Bank would be beneficial for both the
shareholders and the customers of the Bank.
I URGE YOUR SUPPORT. VOTE FOR THIS RESOLUTION
STATEMENT OF THE BOARD OF DIRECTORS OF CARVER BANCORP, INC.
IN OPPOSITION TO THE STOCKHOLDER PROPOSAL
The Board of Directors of the Company vigorously opposes the
stockholder proposal for the following reasons:
Under the leadership of Thomas L. Clark, Jr., the Board and management
have developed and implemented a strategy, which includes a restructuring of the
Company's balance sheet, that has produced a significant increase in the price
of Carver's Common Stock, has enabled the Bank's loan portfolio to grow
substantially and has gained independent recognition for the Bank. Since Mr.
Clark joined Carver in February 1995, the price of the Common Stock has
increased from $6.85 per share, the closing sales price as of January 31, 1995,
to $12.00 per share the closing sales price as of July 11, 1997. This represents
a 75% increase over a two-and-one-half year period. During this period, total
assets have grown from $368 million at March 31, 1995 to $424 million at March
31, 1997, representing a 15% increase, and significantly, the loan portfolio has
grown from $48 million to $198 million, representing a 313% increase over the
same period.
The Company's business strategy, which is premised upon its unique
status as a community-based institution, has also produced results for the
communities that the Bank serves. The Bank has received numerous awards
including the 1996 Federal Home Loan Bank of New York's Award for Excellence in
Community Lending for the New York City metropolitan region and the 1996 Black
Enterprise Financial Company of the Year Award. These accomplishments confirm
the effective management by Carver's management team under the supervision of
the Board of Directors.
The Board of Directors is aware of its fiduciary duties and will
continue to consider all available strategic alternatives in managing the
business affairs of the Company to enhance stockholder value. The Board of
Directors believes that by remaining an independent financial institution Carver
will be able to continue to capitalize on its strategic advantages in the
current business environment, which include being the only financial institution
headquartered in Harlem, New York. Carver is just beginning to realize rewards
from its business
-22-
<PAGE> 26
strategy. Carver's stockholders deserve to reap the benefits of this success.
The Board of Directors believes that the performance of Mr. Clark's management
team to date has fully justified the confidence that the Board has in the
management team. A vote against the stockholder proposal will allow Carver to
continue enhancing stockholder value.
THE BOARD FIRMLY BELIEVES THAT THE STOCKHOLDER PROPOSAL IS NOT IN THE
BEST INTEREST OF THE COMPANY AND OUR STOCKHOLDERS.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST
THE STOCKHOLDER PROPOSAL
Unless marked to the contrary, the shares represented by the Company's
signed proxy card will be voted "AGAINST" the stockholder proposal.
--------------------------------------------
ADDITIONAL INFORMATION
--------------------------------------------
PROPOSALS FOR 1998 ANNUAL MEETING
Any stockholder wishing to have a proposal considered for inclusion in
the Company's proxy statement and form of proxy relating to the 1998 Annual
Meeting of Stockholders must, in addition to other applicable requirements, set
forth such proposal in writing and file it with the Corporate Secretary of the
Company on or before March 19, 1998.
NOTICE OF BUSINESS TO BE CONDUCTED AT ANNUAL MEETING
The Bylaws of the Company provide an advance notice procedure for a
stockholder to properly bring business before an annual meeting or to nominate
any person for election to the Company's Board of Directors. The stockholder
must be a stockholder of record and have given timely notice thereof in writing
to the Secretary of the Company. To be timely, a stockholder's notice must be
delivered to or received by the Secretary not later than the following dates:
(i) with respect to an annual meeting of stockholders, sixty (60) days in
advance of such meeting if such meeting is to be held on a day which is within
thirty (30) days preceding the anniversary of the previous year's annual
meeting, or ninety (90) days in advance of such meeting if such meeting is to be
held on or after the anniversary of the previous year's annual meeting; and (ii)
with respect to an annual meeting of stockholders held at a time other than
within the time periods set forth in the immediately preceding clause (i), the
close of business on the tenth (10th) day following the date on which notice of
such meeting is first given to stockholders. Notice shall be deemed to first be
given to stockholders when disclosure of such date of the meeting of
stockholders is first made in a press release reported to Dow Jones News
Services, Associated Press or comparable national news service, or in a document
publicly filed by the Company with the SEC pursuant to Section 13, 14 or 15(d)
of the Exchange Act. A stockholder's notice to the Corporate Secretary shall set
forth such information as required by the Bylaws of the Company. Nothing in this
paragraph shall be deemed to require the Company to include in its proxy
statement and proxy card relating to an annual meeting any shareholder proposal
or nomination which does not meet all of the requirements for inclusion
established by the SEC in effect at the time such proposal or nomination is
received. See "Proposals For 1998 Annual Meeting."
OTHER MATTERS
As of the date of this Proxy Statement, management does not know of any
other matters to be brought before the stockholders at the Annual Meeting. If,
however, any other matters not now known are properly brought before the Annual
Meeting, the persons named in the accompanying proxy will vote the shares
represented by all properly executed proxies on such matters in such manner as
shall be determined by a majority of the Company's Board of Directors.
-23-
<PAGE> 27
--------------------------------------------
FINANCIAL STATEMENTS
--------------------------------------------
A copy of the Annual Report to Stockholders for the year ended March
31, 1997, containing financial statements as of March 31, 1997 and March 31,
1996 and for each of the years in the three-year period ended March 31, 1997,
prepared in conformity with generally accepted accounting principles,
accompanies this Proxy Statement. The consolidated financial statements have
been audited by Mitchell & Titus, LLP whose report thereon appears in the Annual
Report. The Annual Report serves as Carver's Annual Disclosure Statement for
purposes of the regulations of the Federal Deposit Insurance Corporation. An
additional copy of the Annual Report will be promptly furnished without charge
to stockholders upon request.
THE COMPANY HAS FILED AN ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR
ENDED MARCH 31, 1997 WITH THE SEC. STOCKHOLDERS MAY OBTAIN, FREE OF CHARGE, A
COPY OF SUCH ANNUAL REPORT (EXCLUDING EXHIBITS) BY WRITING TO RAYMOND L. BRUCE,
SENIOR VICE PRESIDENT, CORPORATE COUNSEL AND CORPORATE SECRETARY, CARVER
BANCORP, INC., 75 WEST 125TH STREET, NEW YORK, NEW YORK 10027, OR BY TELEPHONING
(212) 876-4747.
By Order of the Board of Directors,
/s/ Raymond L. Bruce
Raymond L. Bruce
Senior Vice President,
Corporate Counsel and Corporate Secretary
New York, New York
July 17, 1997
TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE ANNUAL MEETING,
PLEASE SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING
PROXY CARD IN THE POSTAGE-PAID ENVELOPE PROVIDED.
-24-
<PAGE> 28
CARVER BANCORP, INC. REVOCABLE PROXY
75 WEST 125TH STREET
NEW YORK, NEW YORK 10027
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF CARVER
BANCORP, INC. FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON AUGUST 21,
1997
The undersigned stockholder of Carver Bancorp, Inc. hereby appoints
Raymond L. Bruce, Thomas L. Clark, Jr. and Herman Johnson, or any of them, with
full powers of substitution, to represent and to vote as proxy, as designated,
all shares of common stock of Carver Bancorp, Inc. held of record by the
undersigned on July 2, 1997, at the Annual Meeting of Stockholders (the "Annual
Meeting") to be held at 10:00 a.m., on August 21, 1997, or at any adjournment or
postponement thereof. The undersigned hereby revokes all prior proxies.
This Proxy, when properly executed, will be voted in the manner
directed herein by the undersigned stockholder. IF PROPERLY EXECUTED, BUT NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE ELECTION OF NOMINEES LISTED
IN ITEM 1, FOR THE PROPOSAL IN ITEM 2 AND AGAINST THE STOCKHOLDER PROPOSAL IN
ITEM 3 (IF PROPERLY INTRODUCED AT THE ANNUAL MEETING).
PLEASE MARK, SIGN AND DATE THIS PROXY ON THE REVERSE SIDE AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
<PAGE> 29
PLEASE MARK YOUR CHOICE LIKE THIS [X] IN BLUE OR BLACK INK.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR ALL
NOMINEES" IN ITEM 1 AND "FOR" THE PROPOSAL IN ITEM 2.
....................................................................
1. Election of Directors to a Three Year Term.
Nominees: Linda H. Dunham and Robert J. Franz.
INSTRUCTION: TO WITHHOLD AUTHORITY FOR ANY INDIVIDUAL
NOMINEE, WRITE THAT NOMINEE'S NAME IN THE SPACE
PROVIDED:
FOR all WITHHOLD for all
Nominees Nominees
[ ] [ ]
....................................................................
2. Ratification of Appointment of Mitchell & Titus, LLP as
independent auditors for the Company.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- --------------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
"AGAINST" THE STOCKHOLDER PROPOSAL IN ITEM 3.
....................................................................
3. Adoption of the stockholder proposal described in the
accompanying Proxy Statement, if properly introduced at
the Annual Meeting.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
....................................................................
4. If any other matters properly come before the Annual
Meeting, including, among other things, a motion to adjourn
or postpone the Annual Meeting to another time and/or
place for the purpose of soliciting additional proxies or
otherwise, the persons named in this Proxy will vote on
such matters in such a manner as shall be determined by a
majority of the Board of Directors. As of the date of the
Proxy Statement for the Annual Meeting, management of
the Company is not aware of any other such business.
- --------------------------------------------------------------------
I WILL ATTEND THE ANNUAL MEETING [ ]
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders and the Proxy Statement for the Annual Meeting.
_________________________________________________________________
_________________________________________________________________
Signature(s)
Dated: ______________________________________________________, 1997
Please sign exactly as your name appears on this proxy. Joint owners should each
sign personally. If signing as attorney, executor, administrator, trustee or
guardian, please include your full title. Corporate or partnership proxies
should be signed by an authorized officer.
<PAGE> 30
July 17, 1997
Dear Plan Account Holder:
The Carver Bancorp, Inc. ("Company") Employee Stock Ownership Plan
("ESOP") has a related rust ("ESOP Trust") which holds common stock ("Common
Stock") of the Bank. Marine Midland Bank, as the trustee of the ESOP Trust
("ESOP Trustee"), is therefore a shareholder of the Company and may vote on
matters presented for shareholder action at the Company's Annual Meeting of
Stockholders scheduled to be held on August 21, 1997 ("Annual Meeting").
The ESOP Trust provides that in casting votes at the Annual Meeting,
the ESOP Trustee is to follow the instructions given by participants, former
participants and beneficiaries of deceased former participants ("Participants")
with respect to the Common Stock allocated to their accounts in the ESOP as of
July 2, 1997.
The records for the ESOP indicate that you are among the Participants
who may give voting instructions. You may give your instructions by completing
and signing the enclosed Confidential Voting Instruction ("Voting Instruction")
and returning it in the envelope provided to CT Corporation Systems ("CT Corp").
The Voting Instruction lets you give instructions for each matter expected to be
presented for shareholder action at the Annual Meeting. The ESOP Trustee expects
CT Corp to tabulate the instructions given on a confidential basis and to
provide the ESOP Trustee with only the final results of the tabulation.
The voting of the Common Stock held by the ESOP Trust is subject to
legal requirements under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"). The ESOP Trustee, in consultation with its legal advisors,
considers these requirements in establishing voting instruction procedures and
voting the Common Stock allocated to Participants' accounts. The remainder of
this letter describes the voting procedures which the Committee expects to
follow for the Annual Meeting.
How your voting instructions count depends on whether it was
anticipated that the matter being voted upon would be presented for shareholder
action at the Annual Meeting; whether you had an interest in the ESOP Trust on
the proper date; and how large your interest was, as follows:
ANTICIPATED PROPOSALS
(a) Allocated Common Stock. In general, the ESOP Trustees will vote the
number of shares of Common Stock, if any, held by the ESOP Trust and allocated
as of July 2, 1997 to your individual account under the ESOP according to the
instructions specified on the Voting Instruction. The Voting Instruction shows
the number of shares of Common Stock allocated to your individual account under
the ESOP Trust as of July 2, 1997. In general, if you do not file the Voting
Instruction by August 8, 1997, the ESOP Trustee will vote the number of shares
allocated to your account FOR or AGAINST each proposal identified on the Voting
Instruction in the same proportions as instructions to cast votes FOR or AGAINST
such proposal are given with respect to shares allocated to the accounts of
Participants who do file Voting Instructions.
(b) Unallocated Common Stock. The ESOP Trust holds certain shares of
Common Stock that are not allocated to any individual's account. In general, the
ESOP Trustee will vote
<PAGE> 31
2
the Common Stock not allocated to any individual's account by casting votes FOR
or AGAINST each proposal identified on the Voting Instruction, in the same
proportions as instructions to cast votes FOR or AGAINST such proposal are given
with respect to allocated Common Stock. However, if the ESOP Trustee does not
receive instructions from any of the Participants, the Board of Directors of the
Company will direct the ESOP Trustees with respect to the voting of any shares
of unallocated stock, or, in the absence of such direction by the Board of
Directors, the ESOP Trustee will have sole discretion as to the voting of such
shares.
If you do not file the Voting Instruction by August 8, 1997 or if you
ABSTAIN as to a proposal, your instructions will not count in voting any
allocated Common Stock for which no voting instructions have been received from
Participants or the unallocated Common Stock. Each individual's instructions for
such purposes are weighted according to the number of shares of Common Stock
allocated to all individuals' accounts for which instructions to vote FOR or
AGAINST have been received. However, the ESOP Trustee may be required to vote
the allocated Common Stock for which no instructions have been received and the
unallocated Common Stock held by the ESOP Trust in a different manner, if it
determines such a vote to be in the best interests of Participants, in
accordance with the legal requirements of ERISA.
UNANTICIPATED PROPOSALS
It is possible, although very unlikely, that proposals other than those
specified on the Voting Instruction will be presented for shareholder action at
the Annual Meeting. If this should happen, the ESOP Trustees will vote upon such
matters in their discretion, or cause such matters to be voted upon in the
discretion of the individuals named in any proxies executed by them.
Your interest in the ESOP Trust offers you the opportunity to
participate, as do the Company shareholders, in decisions that affect the future
of the Company and Carver Federal Savings Bank ("Bank") and we encourage you to
take advantage of it. To help you decide how to complete the Voting Instruction,
enclosed is a copy of the Proxy Statement and Annual Report that is being
furnished to all holders of Common Stock in connection with the Annual Meeting.
Please complete, sign and return your Voting Instruction today. Your
instructions are important regardless of the size of your interest in the ESOP
Trust.
If you have questions regarding the terms of the ESOP or how to
complete the Voting Instruction, please call the Human Resources Department of
the Bank at (212) 876-4747.
Sincerely,
CARVER BANCORP, INC.
EMPLOYEE STOCK OWNERSHIP COMMITTEE
Enclosure
<PAGE> 32
- -------------------------------------------------------------------------------
CARVER BANCORP, INC. CONFIDENTIAL VOTING INSTRUCTION
This Instruction is solicited by the Employee Stock Ownership Plan Committee
of Carver Bancorp, Inc.
as named fiduciary for the
CARVER BANCORP, INC.
EMPLOYEE STOCK OWNERSHIP PLAN ("ESOP")
For the Annual Meeting of Stockholders of Carver Bancorp, Inc. to be held
on August 21,1997
The undersigned Participant, Former Participant or Beneficiary of a
deceased Former Participant in the ESOP (the "Instructor") hereby provides the
voting instructions hereinafter specified to Marine Midland Bank, as the trustee
of the ESOP ("ESOP Trustee"), which instructions will be taken into account by
the ESOP Trustee in voting, in person, by limited or general power of attorney,
or by proxy, the shares and fractional shares of common stock (the "Shares") of
Carver Bancorp, Inc. ("Carver") which are held by the ESOP Trustee, in its
capacity as ESOP Trustee, as of July 2, 1997 (the "Record Date") at the August
21, 1997 Meeting of Stockholders of Carver (the "Annual Meeting") to be held at
the American Stock Exchange, 86 Trinity Place, New York, New York at 10:00 a.m.,
or at any adjournment or postponement thereof.
As to the proposals listed below, which are more particularly described
in the Proxy Statement dated July 17, 1997, the Trustee will vote the common
stock of Carver Bancorp, Inc. held by the ESOP Trust to reflect the voting
instructions on this Confidential Voting Instruction, in the manner described in
the accompanying letter from the Committee dated July 17, 1997.
As to other matters which may properly come before the Annual Meeting,
the ESOP Trustees will vote upon such matters in their discretion, or cause such
matters to be voted upon in the discretion of the individuals named in any
proxies executed by them.
The instruction set forth below will be taken into account as described
above in directing the ESOP Trustees how to vote the Shares of Carver held by
them as of the Record Date, in their capacity as Trustees, provided this
instruction is filed with CT Corporation Systems by August 8, 1997.
PLEASE MARK YOUR INSTRUCTIONS ON THIS
VOTING INSTRUCTION, SIGN AND DATE IT AND
RETURN IT IN THE ENCLOSED ENVELOPE.
===============================================================================
IF THIS VOTING INSTRUCTION IS SIGNED BUT NO
DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED
"FOR" PROPOSALS 1 AND 2 AND "AGAINST" PROPOSAL 3.
- ---------------------------------- -----------------------------------
PARTICIPANT ESOP PLAN COMMON (as of July 2, 1997)
PLEASE MARK YOUR CHOICE LIKE THIS /X/ IN BLUE OR BLACK INK.
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2.
- -------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS FOR A THREE YEAR
TERM
Nominees: Linda H. Dunham and Robert Franz
(Terms of Office Expire in 2000)
/ / For all nominees (except as / / WITHHOLD AUTHORITY to vote
indicated to the contrary for all nominees
below)
INSTRUCTIONS: To withhold
authority to vote for any
individual nominee, write
that nominee's name in the
space provided:
------------------------------
2. PROPOSAL TO APPOINT MITCHELL & TITUS, LLP as independent auditors for the
fiscal year ending March 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN*
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "AGAINST" PROPOSAL 3.
- -------------------------------------------------------------------------------
3. STOCKHOLDER PROPOSAL described in the accompanying Proxy Statement, if
properly introduced at the Annual Meeting.
/ / FOR / / AGAINST / / ABSTAIN*
4. If any other matters properly come before the Annual Meeting, including,
among other things, a motion to adjourn or postpone the Annual Meeting to
another time and/or place for the purpose of soliciting additional proxies
or otherwise, the ESOP Trustee will vote on such matters in such a manner
as shall be determined by a majority of the Board of Directors. As of the
date of the Proxy Statement for the Annual Meeting, management of the
Company is not aware of any other such business.
- -------------------------------------------------------------------------------
The undersigned hereby instructs the
Committee to direct the ESOP Trustee to vote
in accordance with the voting instructions
indicated above and hereby acknowledges
receipt of the letter from the Committee
dated July 17, 1997, a Notice of Annual
Meeting of Stockholders of Carver Bancorp,
Inc., a Proxy Statement for the Annual
Meeting and the 1997 Annual Report.
Date________________________________________
Signature___________________________________
Signature___________________________________
Please date and sign exactly as your name
appears on this instruction and return in the
enclosed envelope. If acting as attorney,
executor, administrator, trustee, guardian or
otherwise, please so indicate when signing.
If the signer is a corporation, please sign
the full corporate name, by a duly authorized
officer. If shares are held jointly, each
shareholder named should sign.
*For purposes of directing the voting of the
Shares for which no instructions are
received, abstentions will be disregarded.
<PAGE> 33
July 17, 1997
Dear Plan Account Holder:
The Carver Federal Savings Bank ("Bank") 401(k) Savings Plan in RSI
Retirement Trust ("401(k) Plan") has a related trust ("Employer Stock Fund
Trust") which holds common stock ("Common Stock") of Carver Bancorp, Inc.
("Company"). Marine Midland Bank ("Marine Midland"), as the trustee of the
401(k) Plan Employer Stock Fund Trust ("Employer Stock Fund Trustee"), is
therefore a shareholder of the Company and may vote on matters presented for
shareholder action at the Company's Annual Meeting of Stockholders scheduled to
be held on August 21, 1997 ("Annual Meeting").
The Employer Stock Fund Trust provides that in casting its votes at the
Annual Meeting, the Employer Stock Fund Trustee is to follow directions given by
the 401(k) Plan Committee ("Committee"). The Committee in turn follows
instructions provided by participants, former participants and beneficiaries of
deceased former participants ("Participants") with respect to the Common Stock
attributable to their accounts in the Employer Stock Fund as of July 2, 1997.
The records for the 401(k) Plan indicate that you are among the
Participants who may give voting instructions. You may give your instructions by
completing and signing the enclosed Confidential Voting Instruction ("Voting
Instruction") and returning it in the envelope provided to CT Corporation
Systems ("CT Corp"). The Voting Instruction lets you give instructions for each
matter expected to be presented for shareholder action at the Annual Meeting.
The Committee expects CT Corp to tabulate the instructions given on a
confidential basis and to provide the Committee with only the final results of
the tabulation. The final results will be used by the Committee in directing the
Employer Stock Fund Trustee.
The voting of the Common Stock held by the 401(k) Plan Trust is subject
to legal requirements under the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"). The Committee, in consultation with its legal advisors,
considers these requirements in establishing voting instruction procedures and
directing the Employer Stock Fund Trustee. The remainder of this letter
describes the voting procedures which the Committee expects to follow for the
Annual Meeting.
How your voting instructions count depends on whether it was
anticipated that the matter being voted upon would be presented for shareholder
action at the Annual Meeting; whether you had an interest in the Employer Stock
Fund Trust on the proper date; and how large your interest was, as follows:
<PAGE> 34
ANTICIPATED PROPOSALS
In general, the Employer Stock Fund Trustee will vote the number of
shares of Common Stock (if any) held by the Employer Stock Fund Trust and
attributable as of July 2, 1997 to your individual account under the 401(k) Plan
according to the instructions specified on the Voting Instruction. The Voting
Instruction shows the number of shares of Common Stock attributable to your
individual account under the 401(k) Trust as of July 2, 1997. In general, if you
do not file the Voting Instruction by August 8, 1997, the number of shares
attributable to your account will be voted FOR or AGAINST each proposal
identified on the Voting Instruction in the same proportions as instructions to
cast votes FOR or AGAINST such proposal are given with respect to shares
attributable to the accounts of Participants who do file Voting Instructions. In
addition, if you do not file the Voting Instruction by August 8, 1997 or if you
ABSTAIN as to a proposal, your instructions will not count in voting any Common
Stock attributable to Participants' accounts for which no voting instructions
have been received. Each individual's instructions for such purposes are
weighted according to the number of shares of Common Stock attributable to all
individuals' accounts for which instructions to vote FOR or AGAINST have been
received. Notwithstanding the foregoing, the Committee may be required to
instruct the Employer Stock Fund Trustee to vote the Common Stock for which no
instructions have been received in a different manner, if it determines such a
vote to be in the best interests of Participants, in accordance with the legal
requirements of ERISA.
UNANTICIPATED PROPOSALS
It is possible, although very unlikely, that proposals other than those
specified on the Voting Instruction will be presented for shareholder action at
the Annual Meeting. If this should happen, the Employer Stock Fund Trustee will
be instructed to vote upon such matters in its discretion, or to cause such
matters to be voted upon in the discretion of the individuals named in any
proxies executed by it.
Your interest in the Employer Stock Fund Trust offers you the
opportunity to participate, as do the Company's shareholders, in decisions that
affect the future of the Company and the Bank, and we encourage you to take
advantage of it. To help you decide how to complete the Voting Instruction,
enclosed is a copy of the Proxy Statement and Annual Report that is being
furnished to all holders of Common Stock in connection with the Annual Meeting.
Please complete, sign and return your Voting Instruction today. Your
instructions are important regardless of the size of your interest in the Common
Stock held by the 401(k) Plan.
If you have questions regarding the terms of the 401(k) Plan or how to
complete the Voting Instruction, please call the Human Resources Department of
the Bank at (212) 876-4247.
Sincerely,
401(k) PLAN COMMITTEE OF
CARVER FEDERAL SAVINGS BANK
Enclosure
<PAGE> 35
- -------------------------------------------------------------------------------
CARVER BANCORP, INC. CONFIDENTIAL VOTING INSTRUCTION
This Instruction is solicited by the 401(k) Plan Committee
of Carver Federal Savings Bank
as named fiduciary for the
CARVER FEDERAL SAVINGS BANK 401(k) SAVINGS PLAN
IN RSI RETIREMENT TRUST ("401(k) PLAN")
For the Annual Meeting of Shareholders of Carver Bancorp, Inc. to be
held on August 21, 1997
The undersigned Participant, Former Participant or Beneficiary of a
deceased Former Participant in the 401(k) Plan (the "Instructor") hereby
provides the voting instructions hereinafter specified to the 401(k) Plan
Committee (the "Committee") of Carver Bancorp, Inc. ("Carver"), which
instructions shall be taken into account in directing Marine Midland Bank, as
the trustee of the 401(k) Plan Employer Stock Fund ("Employer Stock Fund
Trustee") to vote, in person, by limited or general power of attorney, or by
proxy, the shares and fractional shares of common stock (the "Shares") of Carver
which are held by the Employer Stock Fund Trustee, in its capacity as Trustee,
as of July 2, 1997 (the "Record Date"), at the August 21, 1997, Meeting of
Stockholders of Carver (the "Annual Meeting") to be held at the American Stock
Exchange, 86 Trinity Place, New York, New York at 10:00 a.m., or at any
adjournment or postponement thereof.
As to the proposals listed below and as more particularly described in
the Proxy Statement dated July 17, 1997, the Committee will give voting
directions to the Employer Stock Fund Trustee. Such directions will reflect the
voting instructions filed by the Instructor on this Confidential Voting
Instruction, in the manner described in the accompanying letter from the
Committee dated July 17, 1997.
As to other matters which may properly come before the Annual Meeting,
the Employer Stock Fund Trustee will be instructed to vote upon such matters in
its discretion, or cause such matters to be voted upon in the discretion of the
individuals named in any proxies executed by them.
The instruction set forth below will be taken into account as described
above in directing the Employer Stock Fund Trustee how to vote the Shares of
Carver held by it as of the Record Date in its capacity as Trustee, provided
this instruction is filed with CT Corporation Systems by August 8, 1997.
PLEASE MARK YOUR INSTRUCTIONS ON THIS
VOTING INSTRUCTION, SIGN AND DATE IT
AND RETURN IT IN THE ENCLOSED ENVELOPE.
===============================================================================
IF THIS VOTING INSTRUCTION IS SIGNED BUT NO DIRECTION IS GIVEN, SUCH SHARES
WILL BE VOTED "FOR" PROPOSALS 1 AND 2 AND "AGAINST" PROPOSAL 3.
- ---------------------------------- -----------------------------------
PARTICIPANT 401(k) PLAN COMMON (as of July
2, 1997)
PLEASE MARK YOUR CHOICE LIKE THIS /X/ IN BLUE OR BLACK INK.
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2.
- -------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS FOR A THREE YEAR TERM
Nominees: Linda H. Dunham and Robert Franz
(Terms of Office Expire in 2000)
/ / For all nominees (except as / / WITHHOLD AUTHORITY to vote
indicated to the contrary below) for all nominees
INSTRUCTIONS: To withhold
authority to vote for any
individual nominee, write his or
her name in the space provided:
-------------------------------
2. PROPOSAL TO APPOINT MITCHELL & TITUS, LLP as independent auditors for the
fiscal year ending March 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN*
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "AGAINST" PROPOSAL 3.
- -------------------------------------------------------------------------------
3. STOCKHOLDER PROPOSAL described in the accompanying Proxy statement; if
properly introduced at the Annual Meeting.
/ / FOR / / AGAINST / / ABSTAIN*
4. If any other matters properly come before the Annual Meeting, including,
among other things, a motion to adjourn or postpone the Annual Meeting to
another time and/or place for the purpose of soliciting additional proxies or
otherwise, the Employer Stock Fund Trustee will vote on such matters in such
a manner as shall be determined by a majority of the Board of Directors. As
of the date of the Proxy Statement for the Annual Meeting, management of the
Company is not aware of any other such business.
- -------------------------------------------------------------------------------
The undersigned hereby instructs the
Committee to direct the Employer Stock Fund
Trustee to vote in accordance with the voting
instructions indicated above and hereby
acknowledges receipt of the letter from the
Committee dated July 17, 1997, a Notice of
Annual Meeting of Stockholders of Carver
Bancorp, Inc., a Proxy Statement for the
Annual Meeting and the 1997 Annual Report.
Date________________________________________
Signature___________________________________
Signature___________________________________
Please date and sign exactly as your name
appears on this instruction and return in the
enclosed envelope. If acting as attorney,
executor, administrator, trustee, guardian or
otherwise, please so indicate when signing.
If the signer is a corporation, please sign
the full corporate name, by a duly authorized
officer. If shares are held jointly, each
shareholder named should sign.
* For purposes of directing the voting of the
Shares for which no instructions are
received, abstentions will be disregarded.
