<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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 Rule 14a-11(c) or Rule 14a-12
Smithtown Bancorp, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] 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:
[x] 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>
<PAGE> 1
SMITHTOWN BANCORP, INC.
ONE EAST MAIN STREET
SMITHTOWN, NEW YORK 11787-2801
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held
TUESDAY, APRIL 2, 1996
The Annual Meeting of Shareholders of Smithtown Bancorp, Inc. (the
"Bancorp"), will be held at the Bavarian Inn, 422 Smithtown Boulevard, Lake
Ronkonkoma, New York, on April 2, 1996, at 10:30 AM, for the following
purposes:
1. The election of three directors to serve a term of three years.
2. To approve amendments to the Bancorp's
Certificate of Incorporation: (a) increasing the
number of authorized Common Shares, par value
$5.00 per share (the "Common Shares") of the
Bancorp from 500,000 to 1,500,000; and (b)
authorizing a new class of shares consisting of
100,000 preferred shares, par value $.01 per share
(the "Preferred Shares"). The Preferred Shares
would be authorized without any rights and
designations, such rights and designations to be
fixed by the Board of Directors at the time of
issuance of the Preferred Shares.
3. To approve an amendment to the Bancorp's
Certificate of Incorporation deleting Article
FIFTH of the Certificate of Incorporation, and
substituting a new Article FIFTH therefor
indicating that the shareholders do not have
preemptive rights. (Preemptive rights enable
holders of Common Shares, in certain
circumstances, to purchase newly issued capital
stock of the Bancorp to prevent dilution.) See
"AMENDMENT OF CERTIFICATE OF
INCORPORATION TO REPEAL
PREEMPTIVE RIGHTS" and "ANNEX A".
4. To approve the appointment of Albrecht,
Viggiano, Zureck & Company, P.C. as
independent auditors for the year ending
December 31, 1996.
5. To transact such other business as may properly
come before the meeting for any adjournment
thereof.
Pursuant to a resolution of the Board of Directors adopted at the
Board of Directors meeting on January 23, 1996, only shareholders of record
<PAGE>
<PAGE> 2
at the close of business on February 26, 1996, shall be entitled to notice of
and to vote at this meeting.
Dated: March 1, 1996
Smithtown, New York
BY ORDER OF THE BOARD OF DIRECTORS
Bradley E. Rock
Chairman of the Board, President
SMITHTOWN BANCORP, INC.
ONE EAST MAIN STREET
SMITHTOWN, NEW YORK 11787-2801
PROXY STATEMENT
GENERAL PROXY INFORMATION
This Proxy Statement (this "Proxy Statement") is furnished in connection
with the solicitation by and on behalf of the Board of Directors of Smithtown
Bancorp, Inc., (the "Bancorp") of proxies to be used at the Annual Meeting of
Shareholders of the Bancorp to be held at the Bavarian Inn, 422 Smithtown
Boulevard, Lake Ronkonkoma, New York, on April 2, 1996, and at any adjournment
thereof. The costs of the proxy solicitation are to be paid by the Bancorp.
Bank of Smithtown (the "Bank" or the "Bank of Smithtown" ) is a wholly-owned
subsidiary of the Bancorp. This Proxy Statement is being mailed on or about
March 1, 1996, to holders of the Common Shares.
Authorized Shares and Voting Rights
Holders of record of Common Shares as of the close of business on
February 26, 1996 (the "Record Date"), will be entitled to vote at the meeting.
Each shareholder is entitled to one vote for each share of stock held by him
or her. There were 433,268 Common Shares outstanding on the Record Date.
Revocability of Proxy
If the accompanying form of Proxy is executed and returned, it
nevertheless may be revoked by the shareholder at any time before it is
exercised. But if it is not revoked, the shares represented thereby will
be voted by the persons designated in each such Proxy.
Financial Statements
A copy of the Bancorp's Annual Report to Shareholders, including
financial statements for the fiscal year ended December 31, 1995, has
heretofore been mailed to the shareholders.
Matters To Be Voted On At The Meeting
There are four matters that are scheduled to be voted on at the Annual
Meeting. Shareholders are being asked to vote on (1) the election of three
directors, (2) amendments to the Bancorp's Certificate of Incorporation (a)
increasing the number of authorized Common Shares from 500,000 to 1,500,000
and (b) authorizing 100,000 Preferred Shares, (3) an amendment to the
Bancorp's Certificate of Incorporation deleting the shareholders' preemptive
rights and (4) the approval of Albrecht, Viggiano, Zureck & Co., P.C., as the
Bancorp's independent auditors for the year ending December 31, 1996.
<PAGE>
<PAGE> 3
It is intended that the shares of stock represented by the accompanying
form of Proxy will be voted for the election of the director nominees listed
in Table I and in favor of the other proposals, unless a contrary direction is
indicated on the form of Proxy. With respect to the director nominees, if any
of such nominees should become unavailable for any reason, which the directors
do not now contemplate, it is intended that, pursuant to the accompanying form
of Proxy, votes will be cast for a substitute nominee designated by the Board
of Directors.
Directors are elected by a plurality of the votes cast at the Annual
Meeting, either in person or by proxy. The approval referred to in (4) above
will be authorized if a majority of the votes cast at the Annual Meeting,
either in person or by proxy, are voted in favor of such approval and with
respect to the amendments to the Bancorp's Certificate of Incorporation
referred to in (2) and (3) above, such amendments will be authorized if a
majority of the outstanding Common Shares vote in favor of the respective
proposals.
Any abstention or broker non-vote with respect to the proposals referred
in (2) or (3) above will have the effect of a negative vote on the respective
proposal. With respect to the proposals referred to in (1) and (4) above,
abstentions and broker non-votes will be counted as not having voted and will
not be counted in determining if the plurality, with respect to (1), or the
majority, with respect to (4), was obtained.
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
The Certificate of Incorporation of the Bancorp provides that the Board of
Directors shall consist of 9 members and that the directors shall be
classified into three classes, each of which shall serve for a term of three
years, with the term of office of one class expiring each year.
Nominees for Election of Directors
Two of the nominees, James H. Glamore and Augusta Kemper, were elected
to their present term of office by the shareholders. The third, Barry
Seigerman, was elected by the Board of Directors on September 27, 1994,
pursuant to Article 2, Section 1, of the Bancorp's By-Laws to fill the
unexpired term of Frank Radau, who retired on May 1, 1994. All three nominees
are proposed for re-election for terms expiring in 1999.
<PAGE>
<PAGE> 4
<TABLE>
TABLE I
<CAPTION>
<S> <C> <C> <C> <C>
Date Experience and Shares of Stock
Directorship Director Principal Occupation Beneficially Owned <F2>(2)
Name and Age Term Expires Since <F1>(1) During Past 5 Years # %
NOMINEES
James H. Glamore, 76 1996 1979 President, Glamore Motor Sales, Inc.
(automobile sales). 4,755 1.09
Barry Seigerman, 55 1996 1993 Chairman & Chief Executive
Officer Seigerman-Mulvey, Co., Inc.,
Insurance Brokers, located at
31 Research Way, East Setauket,
New York. Active in business
and community non-profit
organizations. 514 .11
Augusta Kemper, 73 1996 1992 Horticulturist and Owner of Kemper
Nurseries until retirement in 1985. 24,933 5.75
DIRECTORS CONTINUING IN OFFICE
Attmore Robinson, Jr., 84 1997 1948 Partner, Elzon & Robinson,
Real Estate Brokers, until
retirement in 1993. 9,763 2.25
Bradley E. Rock, 43 1997 1988 Chairman of the Board, President
& Chief Executive Officer of the
Bancorp and the Bank, January 1992
to Present. President of the Bancorp
and the Bank, October 1990 to January
1992. Partner of Schechter Schechter
Kenney & Rock, Attorneys at Law,
1981 to 1992. 1,757 .40
Charles E. Rockwell, 79 1997 1984 Retired in 1976. Formerly a
commercial airline captain. Active
in community non-profit
organizations. 4,418 1.01
H. Melville Brush, 87 1998 1960 President of Island Asphalt Co.,
Inc. (asphalt sales and construction),
until retirement in 1979. 7,549 1.74
Patrick A. Given, 51 1998 1989 Real Estate Appraiser and
Consultant; Given Associates,
located at 550 Route 111,
Hauppauge, New York. 2,300 .53
Edith Hodgkinson, 73 1998 1979 Restaurateur, active in community
non-profit organizations. 28,203 6.50<PAGE>
<PAGE> 5
<FN>
<F1> (1) Each director of the Bancorp is also a director of Bank of Smithtown. The dates given are the dates on which the
director first served as a director of Bank of Smithtown.
<F2> (2) These figures include Common Shares owned by family members of directors as to which each of the directors
disclaim any beneficial ownership. Mrs. Hodgkinson's shares include shares held by Bank of Smithtown as Trustee
under the Last Will and Testament of Carlyle Hodgkinson. The amount of Common Shares beneficially owned and
listed in the table above is provided as of December 31, 1995.
</FN>
</TABLE>
Board of Directors
The Board of Directors holds regular monthly meetings. The
Board held twelve regular meetings and one special meeting during 1995. Each
director attended 75% or more of the aggregate number of meetings of the Board
of Directors and the committee or committees thereof on which such director
served during 1995.
Committees of the Board
The Board of Directors has established a number of committees to assist it in
the discharge of its responsibilities.
The Audit Committee, consisting of eight directors, had five meetings in 1995.
The chairman of the committee is Attmore Robinson, Jr. The committee reviews
results of regulatory examinations, internal audits and audits of the
independent auditor in conformance with regulations of the New York State
Banking Department and the laws of the State of New York. Current members of
this committee are H. Melville Brush, James H. Glamore, Edith Hodgkinson,
Augusta Kemper, Attmore Robinson, Jr., Charles E. Rockwell, Patrick A. Given
and Barry M. Seigerman.
The Compensation Review Committee, consisting of four members, had one
meeting during 1995. The chairman of the committee is Attmore Robinson, Jr.
This committee makes recommendations to the Board of Directors with respect
to the compensation of elected officers. Current members of this committee
are H. Melville Brush, Edith Hodgkinson, Attmore Robinson, Jr. and Charles E.
Rockwell.
The Board of Directors does not have a standing nominating committee.
Director Compensation
Directors of the Bank received a fee of $600 per month during 1995. The
members of the Loan Committee who are not officers of the Bank also received a
monthly fee of $300 for committee membership. The total amount of directors'
fees paid during 1995 was $83,700.
<PAGE>
<PAGE> 6
The Board of Directors recommends a vote FOR the election of all Nominees .
(Proposal No. 1 on the proxy).
AMENDMENT TO THE BANCORP'S CERTIFICATE OF INCORPORATION
TO INCREASE AUTHORIZED COMMON SHARES AND AUTHORIZE
PREFERRED SHARES
(PROPOSAL NO. 2)
The Board of Directors recommends that Article FOURTH of the Bancorp's
Certificate of Incorporation be amended in order (a) to increase the number of
authorized Common Shares which the Bancorp is authorized to issue, from 500,000
to 1,500,000 and (b) to establish a new class of shares consisting of 100,000
Preferred Shares. The Preferred Shares would be authorized without any rights
and designations; such rights and designations would be fixed by the Bancorp's
Board of Directors at the time of issuance of such Preferred Shares.
The following description of this proposal is qualified in its entirety by
reference to the proposed amendments to Article FOURTH of the Bancorp's
Certificate of Incorporation, set forth below.
At its regularly held meeting on February 27, 1996, the Board of Directors
adopted a resolution recommending to the shareholders amendments to the
Bancorp's Certificate of Incorporation (a) increasing the number of authorized
Common shares from 500,000 to 1,500,000 and (b) authorizing a new class of
shares consisting of 100,000 Preferred Shares.
As of February 26, 1996 the Corporation's authorized capital stock consisted of
500,000 Common Shares of which 433,268 Common Shares were issued and
outstanding on February 26, 1996.
The Preferred Shares would be of the type of shares known as "blank check
preferred." Such Preferred Shares would be available for issuance at any
time, but the terms of such securities would not be established until the time
of issuance. The Board of Directors would, if the proposal is adopted by the
shareholders, have the authority, within its sole discretion, to issue the
Preferred Shares in one or more series, and to fix for each such series the
designations and relative rights and preferences, including conversion rights
and prices, voting powers, restrictions, limitations as to dividends,
qualifications or terms or conditions of redemption and redemption prices, as
are permitted by the New York State Business Corporation Law (the "BCL").
The Board of Directors believes that it is desirable to increase the authorized
capital stock of the Bancorp (including by providing for Preferred Stock) in
order to have such stock available for future use in connection with
acquisitions, financing, employee benefit plans, stock dividends or other
corporate purposes including the possible issuance in reaction to an
unsolicited acquisition proposal (as set forth more fully below). Subject to
the requirements of applicable law and regulations, the Board of Directors
generally will have the sole discretion to issue either Common Shares or
Preferred Shares without further shareholder approval.
Although the Bancorp has no current plans, has made no arrangements and has
not entered into any understandings whereby it would be required to issue any
of the additional shares of stock for which authority now is sought for any
specific purpose, the Board of Directors believes that it is in the best
interests of the Bancorp to increase the capital as stated above in order to
meet possible contingencies and opportunities for which the issuance of
shares may be deemed advisable. From time to time the Bancorp has given, and
<PAGE>
<PAGE> 7
in the future is likely to give, consideration to the feasibility of obtaining
funds for appropriate corporate objectives through the public sale of equity
securities. Because questions of timing are always central to whether
or on what basis public financing is to be undertaken, the Bancorp wishes to
obtain maximum flexibility in this regard by increasing its authorized capital
stock at this time, thereby avoiding the need for, and the expense and delay
occasioned by, a special shareholders' meeting to take similar actions at a
later time. Other purposes for which such additional shares could be issued
include: (a) the acquisition of the shares or assets of other corporations; (b)
share distributions to shareholders of the Bancorp; (c) employee benefit plans;
and (d) in reaction to unsolicited acquisition proposals, including the
possible adoption of a poison pill rights plan. In the Board of Directors'
view the additional authorized shares will provide greater flexibility in
achieving these purposes. It is intended that the newly authorized capital
stock would be subject to issuance at the discretion of the Board
of Directors from time to time for any proper corporate purpose without further
action by the shareholders, except as may be required by law or regulation or
by the rules of any stock exchange on which the Bancorp's securities may then
be listed (or by the by-laws of the National Association of Securities
Dealers, Inc., if applicable at such time).
Although the Board is not aware of any effort by any person to acquire control
of the Bancorp and effect a change of control of the Bancorp, the authorized
but unissued shares of the Bancorp could be used to make it more difficult to
effect a change in control of the Bancorp and thereby make it more difficult
for shareholders to obtain an acquisition premium for their shares. Such
shares could be used to create impediments for persons seeking to gain control
of the Bancorp by means of a merger, tender offer, proxy contest or other
means. Such shares could be privately placed with purchasers who might
cooperate with the Board of Directors in opposing such an attempt by a third
party to gain control of the Bancorp. The issuance of new shares of the
Bancorp could be used to dilute the stock ownership of a person or entity
seeking to obtain control of the Bancorp. Additionally, this proposal, if
adopted, would dilute voting powers or equity interests of current stockholders
through the issuance of additional shares of capital stock.
The Bancorp's Certificate of Incorporation currently contains several
provisions that may be deemed to have the effect of discouraging and defeating
certain forms of acquisition proposals. Article SEVENTH of the Certificate of
Incorporation provides for a classified board of directors comprised of three
classes, each of which is elected to a three-year term. Article EIGHTH
provides that certain business combinations involving the Bancorp and holders
of more than 5% of the Bancorp's outstanding shares must be approved by the
affirmative vote of 80% of the outstanding shares unless the Board of
Directors approves the transaction prior to the time the acquiror became a 5%
owner or the Board of Directors unanimously approves the transaction. Each of
these provisions has previously been adopted by the shareholders.
Under the current provisions of the Bancorp's Certificate of Incorporation the
shareholders have the preemptive rights specified in Section 622 of the BCL.
In certain circumstances these preemptive rights will afford shareholders a
right of first refusal when the Bancorp issues additional shares of capital
stock. However, as discussed below, the Bancorp is also proposing to amend
its Certificate of Incorporation to repeal the preemptive rights held by the
shareholders. If such proposal is adopted by the shareholders, the
shareholders will not have preemptive rights. The preemptive rights
currently held by the shareholders are described below under "Amendment of
<PAGE>
<PAGE> 8
the Certificate of Incorporation to Repeal Preemptive Rights."
The affirmative vote of the holders of a majority of the outstanding Common
Shares is required to adopt the proposed amendments to the Certificate of
Incorporation. If the amendments to Article FOURTH of the Bancorp's
Certificate of Incorporation are authorized, Article FOURTH will read as
follows:
"FOURTH: Number of Shares. The aggregate
number of shares which the corporation shall have
authority to issue shall be 1,600,000, of which 1,500,000
shall be designated as Common Shares with a par value
of $5.00 each and 100,000 shall be designated as
Preferred Shares with a par value of one cent ($0.01)
each. Preferred Shares may be issued in series from
time to time by the board of directors, and the board
of directors is expressly authorized to fix by resolution
or resolutions the designations and the powers,
preferences and rights, and the qualifications,
limitations and restrictions thereof, of the Preferred
Shares, including without limitation the following:
(a) the distinctive serial designation of such
series which shall distinguish it from other series;
(b) the number of shares included in such
series, which number may be increased or decreased
from time to time unless otherwise provided by the
board of directors in the resolution or resolutions
providing for the issue of such series;
(c) the dividend rate (or method of
determining such rate) payable to the holders of the
shares of such series, any conditions upon which such
dividends shall be paid and the date or dates upon
which such dividends shall be payable;
(d) whether dividends on the shares of such
series shall be cumulative and, in the case of shares of
any series having cumulative dividend rights, the date
or dates or method of determining the date or dates
from which dividends on the shares of such series shall
be cumulative;
(e) the amount or amounts which shall be
payable out of the assets of the corporation to the
holders of the shares of such series upon voluntary or
involuntary liquidation, dissolution or winding up the
corporation;
(f) the price or prices at which, the period or
periods within which and the terms and conditions
upon which the shares of such series may be redeemed,
in whole or in part, at the option of the corporation or
at the option of the holder or holders thereof or upon
the happening of a specified event or events;
(g) the obligation, if any, of the corporation to
purchase or redeem shares of such series pursuant to
a sinking fund or otherwise and the price or prices at
which, the period or periods within which and the
<PAGE>
<PAGE> 9
terms and conditions upon which the shares of such
series shall be redeemed or purchased, in whole or in
part, pursuant to such obligation;
(h) whether or not the shares of such series
shall be convertible or exchangeable, at any time or at
times at the option of the holder or holders thereof or
at the option of the corporation or upon the happening
of a specified event or events, into shares of any other
class or classes or any other series of the same or any
other class or classes of stock of the corporation, and
the price or prices or rate or rates applicable thereto;
and
(i) the voting rights, if any, of the holders of
the shares of such series."
The Board of Directors recommends a vote FOR the proposal to amend the
Bancorp's Certificate of Incorporation (a) to increase the number of
authorized Common Shares from 500,000 to 1,500,000 and (b) to authorize a new
class of shares consisting of 100,000 Preferred Shares (Proposal No. 2 on the
proxy).
AMENDMENT OF THE CERTIFICATE OF INCORPORATION TO
REPEAL PREEMPTIVE RIGHTS (PROPOSAL NO. 3)
The Board of Directors recommends that Article FIFTH of the
Bancorp's Certificate of Incorporation be deleted in its entirety and have
substituted therefor a new Article FIFTH eliminating the preemptive rights of
the Shareholders.
At its regularly held meeting on February 27, 1996, Board of Directors
adopted a resolution recommending to the Shareholders an amendment to the
Bancorp's Certificate of Incorporation amending Article FIFTH of the Bancorp's
Certificate of Incorporation.
The following discussion of preemptive rights is qualified in its entirety by
reference to Section 622 of the BCL which is attached hereto as Annex A and by
the proposed amendment to Article FIFTH set forth below.
Section 622 of the BCL provides that unless specified otherwise in the
Certificate of Incorporation the shareholders of a corporation will have
preemptive rights. The Bancorp's Certificate of Incorporation indicates that
the shareholders have preemptive rights.
Preemptive rights consist of an option to acquire newly issued shares of any
class of a security if the issuance of such security would adversely affect
a shareholder's unlimited dividend rights or voting rights. If the issuance
of the new security wouldnot adversely affect either a shareholder's
unlimited dividend rights or voting rights then the shareholder will not
have a right to purchase such newly issued securities. The preemptive rights
entitle the shareholders to purchase the securities offered for
sale as nearly as practicable in such proportions as would, if all of the
preemptive rights were exercised, preserve the relative unlimited dividend
rights and voting rights of the holders at a price not less favorable than the
price at which such shares are offered for sale to others. The repeal of
preemptive rights may have the effect of increasing or decreasing the value
of a shareholder's Common Shares. <PAGE>
<PAGE> 10
The Board of Directors is of the opinion that the existence of preemptive
rights is a serious impediment to the Bancorp's ability to take advantage of
business opportunities that may arise and for possible future financings and
other corporate purposes. Preemptive rights severely curtail the ability of
a corporation to finance itself by accessing the public markets (and are
nearly universally eliminated in public companies). The existence of
preemptive rights hinders the ability of corporations to engage in offerings
and makes difficult the issuance process due to the additional expenses
involved. Preemptive rights were prevalent at a time when access to public
markets was limited (the shareholders of the Bancorp have always had preemptive
rights pursuant to the Bancorp's Certificate of Incorporation). Companies
require ready access to such markets and the Board believes that elimination
of such an antiquated concept will provide the Board with increased
flexibility in accessing such markets if the Board determines that an issuance
of capital stock is in the best interests of the Bancorp and its shareholders.
The affirmative vote of the holders of a majority of the outstanding Common
Shares is required to adopt the proposed amendment. If the amendment to
Article FIFTH of the Bancorp's Certificate of Incorporation is authorized,
Article FIFTH will read as follows:
"FIFTH: Preemptive Rights.
Notwithstanding anything to the
contrary contained in Section 622 of
the Business Corporation Law, the
shareholders shall not have preemptive
rights."
The Board of Directors recommends a vote FOR the proposal to amend the
Bancorp's Certificate of Incorporation by deleting Article FIFTH and
substituting a new Article FIFTH therefor indicating that the shareholders
do not have preemptive rights. (Proposal No. 3 on the proxy).
<PAGE>
<PAGE> 11
APPROVAL OF INDEPENDENT AUDITORS
(PROPOSAL NO. 4)
The Audit Committee has recommended that Albrecht, Viggiano, Zureck & Co.,
P.C., Certified Public Accountants, continue as the independent auditors for
the Bank and the Bancorp for 1996. The firm has served as the independent
auditors for the Bank and the Bancorp since 1992. Representatives of the firm
will be present at the annual meeting to answer questions and are free to make
statements during the course of the meeting.
The Board of Directors recommends a vote FOR the proposal
to approve the independent auditors (Proposal No. 4 on the proxy).
EXECUTIVE OFFICERS AND
PRINCIPAL SHAREHOLDERS
Security Ownership of Certain Beneficial Owners
The persons listed below are beneficial owners of more than 5% of the
outstanding Common Shares of the Bancorp as of February 26, 1996.
Name and Address Common Shares Percent
of Beneficial Owner Beneficially Owned of Class
Elizabeth Radau 30,296 6.99%
43 Edgewood Avenue
Smithtown, New York 11787-2723
Edith Hodgkinson 28,203 6.50%
P.O. Box 756
Bayport, New York 11705-0756
Augusta Kemper 24,933 5.75%
51 Mills Pond Road
St. James, New York 11780-2111
The following table shows stock ownership as of February 26, 1996, of all
directors and officers of the Bancorp as a group:
TABLE II
Amount of Common Shares Percentage of
Beneficially Owned (Note 1) Outstanding Common
Shares
Eleven directors and
executive officers of the
Bancorp as a group 84,330 Common Shares 19.46%
Note 1
Includes Common Shares owned by spouses and children of directors as to
which the directors disclaim any interest.
<PAGE>
<PAGE> 12
Material Proceedings
There are no material proceedings to the best of management's knowledge
to which any director, officer or affiliate of the Bancorp or any record
holder or beneficial owner of more than five percent of the Bancorp's stock,
or any associate of any such director, officer, affiliate of the Bancorp, or
security holder is a party adverse to the Bancorp or any of its subsidiaries
or has a material interest adverse to the Bancorp.
EXECUTIVE OFFICERS
The following table sets forth information as to each executive officer
of the Bancorp who is also an executive officer of the Bank as of January,
1996.
TABLE III
Name Age Position
Bradley E. Rock 43 Chairman of the Board, President & Chief
Executive Officer of the Bancorp since January
1992. President of the Bancorp and the Bank
October 1990 to January 1992. Director of the
Bancorp and the Bank since 1988.
Anita M. Florek 45 Executive Vice President & Chief Financial
Officer of the Bank since January 1993.
Executive Vice President & Treasurer of the
Bancorp since January 1993. Senior Vice
President & Comptroller of the Bank January 1992
to January 1993. Senior Vice President &
Comptroller of the Bank March 1989 to January
1992. Treasurer of the Bancorp January 1991 to
January 1992.
Marc DeSimone 38 Executive Vice President & Chief Lending Officer
of the Bank since January 1993. Senior Vice
President & Chief Lending Officer of the Bank
January 1992 to January 1993. Vice President &
Chief Lending Officer of the Bank January 1991
to January 1992.
Executive Compensation
The table appearing below sets forth all compensation paid in 1995 to
each executive officer whose total compensation exceeded $100,000 for such
year. All remuneration was paid by Bank of Smithtown.<PAGE>
<PAGE> 13
<TABLE>
TABLE IV
Summary Compensation Table
<CAPTION>
<S> <C> <C> <C> <C>
Name and Principal Position Year Salary Incentive Other Compensation
Compensation <F1>(1) <F2>(2)
Bradley E. Rock 1993 $168,000.00 -0- $16,763.40
Chairman, President & CEO 1994 $176,337.01 -0- $14,353.05
of the Bancorp and the Bank 1995 $185,325.00 $20,021.30 $19,077.76
Anita M. Florek 1993 $80,000.00 -0- $4,710.37
Executive Vice President 1994 $86,000.00 -0- $4,620.31
of the Bancorp and the Bank 1995 $95,000.00 $10,615.79 $6,042.98
Marc DeSimone 1993 $80,000.00 -0- $3,105.57
Executive Vice President 1994 $86,000.00 -0- $2,881.10
of the Bank 1995 $95,000.00 $10,615.79 $7,023.63
<FN>
<F1>(1) This amount includes director's fees. These amounts also include employer matching contributions paid in
connection with the Bank's 401(k) plan, amounts accrued during 1995 under the defined contribution plan and
premiums paid on behalf of the officers for a group term life insurance policy.
<F2>(2) Amounts reported do not include any amount expended by the Bank which may have provided an incidental
benefit to the persons listed in the table above, but which were made by the Bank in connection with its business.
While the specific amounts of such incidental benefits cannot be precisely determined, after due inquiry,
management does not believe that such value would exceed $5,000 in the aggregate for any of such persons.
</FN>
</TABLE>
Certain Transactions
Some of the directors and officers of the Bancorp, and some of the
corporations and firms with which these individuals are associated, are also
customers of Bank of Smithtown in the ordinary course of business, or are
indebted to the Bank in respect of loans of $60,000.00 or more. It is
anticipated that some of these individuals, corporations and firms will
continue to be customers of and indebted to the Bank on a similar basis in the
future. All loans extended to such individuals, corporations and firms were
made in the ordinary course of business, did not involve more than the normal
risk of collectability or present other unfavorable features, and were made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the same time for comparable Bank transactions with unaffiliated
persons.
No director of the Bank or the Bancorp had an aggregate amount of
unsecured indebtedness to the Bank in excess of 15 percent of the Bank's equity
capital account during the period of January 1, 1995, through December 31,
1995.
In 1994, Edith Hodgkinson, a director of the Bancorp and the Bank, sold
16,566 Common Shares to the Bancorp and used the proceeds of the sale to
repay loans from the Bank that were in nonaccrual status. $309,677 from the
sale of Common Shares was used to decrease the principal and $98,261 was used
to pay interest on these loans. She also deeded two properties to the Bank
which were placed in Other Real Estate Owned on the Bank's balance sheet.
<PAGE>
<PAGE> 14
Outside of normal customer relationships, none of the directors or
officers of the Bank or the Bancorp, or the corporations or firms with which
such individuals are associated, currently maintains or has maintained within
the last fiscal year any significant business or personal relationship with
the Bank or the Bancorp other than such as arises by virtue of such
individual's or entity's position with and/or ownership interest in the Bank
or the Bancorp.
PENSION PLAN
The Employee Stock Ownership Plan ( the "ESOP") and the 401(k) plans
cover full-time employees who have attained the age of 21 years and who have
completed 1,000 hours of employment during the year they are eligible to
participate in the plan.
Benefits under the ESOP are based solely on the amount contributed to the
ESOP which is used to purchase Common Shares. A participant's allocation is
the total employer contribution multiplied by the ratio of that participant's
applicable compensation over the amount of such compensation for all
participants for that year. Benefits are not subject to deduction of social
security or other offset amounts.
SHAREHOLDER PROPOSALS
Shareholder proposals to be presented at the 1997 Annual Meeting must be
received by the Secretary of the Board of Directors by October 4, 1996, to be
included in the proxy statement.
OTHER BUSINESS
So far as the Board of Directors of the Bancorp now knows, no business
other than that referred to above will be transacted at the Annual Meeting.
The persons named in the Board of Directors' Proxies may, in the absence of
instructions to the contrary, vote upon all matters presented for action at
the Meeting according to their best judgment.
Dated: March 1, 1996
SMITHTOWN BANCORP, INC.
Bradley E. Rock
Chairman of the Board, President
& Chief Executive Officer
<PAGE>
<PAGE> 1
ANNEX A
SECTION 622 OF THE
BUSINESS CORPORATION LAW
Section 622. Preemptive rights
(a) As used in this section, the term:
(1) "Unlimited dividend rights" means the right without limitation as to
amount either to all or to a share of the balance of current or liquidating
dividends after the payment of dividends on any shares entitled to a
preference.
(2) "Equity shares" means shares of any class, whether or not preferred
as to dividends or assets, which have unlimited dividend rights.
(3) "Voting rights" means the right to vote for the election of one or
more directors, excluding a right so to vote which is dependent on the
happening of an event specified in the certificate of incorporation which
would change the voting rights of any class of shares.
(4) "Voting shares" means shares of any class which have voting rights,
but does not include bonds on which voting rights are conferred under section
518 (Corporate bonds).
(5) "Preemptive right" means the right to purchase shares or other
securities to be issued or subject to rights or options to purchase, as such
right is defined in this section.
(b) Except as otherwise provided in the certificate of incorporation, and
except as provided in this section, the holders of equity shares of any class,
in case of the proposed issuance by the corporation of, or the proposed
granting by the corporation of rights or options to purchase, its equity
shares of any class or any shares or other securities convertible into or
carrying rights or options to purchase its equity shares of any class, shall,
if the issuance of the equity shares proposed to be issued or issuable upon
exercise of such rights or options or upon conversion of such other securities
would adversely affect the unlimited dividend rights of such holders, have the
right during a reasonable time and on reasonable conditions, both to be fixed
by the board, to purchase such shares or other securities in such proportions
as shall be determined as provided in this section.
(c) Except as otherwise provided in the certificate of incorporation, and
except as provided in this section, the holders of voting shares of any class,
in case of the proposed issuance by the corporation of, or the proposed
granting by the corporation of rights or options to purchase, its voting
shares of any class or any shares or other securities convertible into or
carrying rights or options to purchase its voting shares of any class, shall,
if the issuance of the voting shares proposed to be issued or issuable upon
exercise of such rights or options or upon conversion of such other securities
would adversely affect the voting rights of such holders, have the
right during a reasonable time and on reasonable conditions, both to be fixed
by the board, to purchase such shares or other securities in such proportions
as shall be determined as provided in this section.
<PAGE>
<PAGE> 2
(d) The preemptive right provided for in paragraphs (b) and (c) shall
entitle shareholders having such rights to purchase the shares or other
securities to be offered or optioned for sale as nearly as practicable in such
proportions as would, if such preemptive right were exercised, preserve the
relative unlimited dividend rights and voting rights of such holders and at a
price or prices not less favorable than the price or prices at which such
shares or other securities are proposed to be offered for sale to others,
without deduction of such reasonable expenses of and compensation for the
sale, underwriting or purchase of such shares or other securities by
underwriters or dealers as may lawfully be paid by the corporation. In case
each of the shares entitling the holders thereof to preemptive rights does not
confer the same unlimited dividend right or voting right, the board shall
apportion the shares or other securities to be offered or optioned
for sale among the shareholders having preemptive rights to purchase them in
such proportions as in the opinion of the board shall preserve as far as
practicable the relative unlimited dividend rights and voting rights of the
holders at the time of such offering. The apportionment made by the board
shall, in the absence of fraud or bad faith, be binding upon all shareholders.
(e) Unless otherwise provided in the certificate of incorporation, shares
or other securities offered for sale or subjected to rights or options to
purchase shall not be subject to preemptive rights if they:
(1) Are to be issued by the board to effect a merger or consolidation or
offered or subjected to rights or options for consideration other than cash;
(2) Are to be issued or subjected to rights or options under paragraph
(d) of section 505 (Rights and options to purchase shares; issue of
rights and options to directors, officers and employees);
(3) Are to be issued to satisfy conversion or option rights theretofore
granted by the corporation;
(4) Are treasury shares;
(5) Are part of the shares or other securities of the corporation
authorized in its original certificate of incorporation and are issued, sold
or optioned within two years from the date of filing such certificate; or
(6) Are to be issued under a plan of reorganization approved in a
proceeding under any applicable act of congress relating to reorganization of
corporations.
(f) Shareholders of record entitled to preemptive rights on the record
date fixed by the board under section 604 (Fixing record date), or, if no
record date is fixed, then on the record date determined under section 604,
and no others shall be entitled to the right defined in this section.
(g) The board shall cause to be given to each shareholder entitled to
purchase shares or other securities in accordance with this section, a notice
directed to him in the manner provided in section 605 (Notice of meetings of
shareholders) setting forth the time within which and the terms and conditions
upon which the shareholder may purchase such shares or other securities and
also the apportionment made of the right to purchase among the shareholders
entitled to preemptive rights. Such notice shall be given personally or by
mail at least fifteen days prior to the expiration of the period during which
the shareholder shall have the right to purchase. All shareholders entitled
to preemptive rights to whom notice shall have been given as aforesaid shall
be deemed conclusively to have had a reasonable time in which to exercise
their preemptive rights.
<PAGE>
<PAGE> 3
(h) Shares or other securities which have been offered to shareholders
having preemptive rights to purchase and which have not been purchased by them
within the time fixed by the board may thereafter, for a period of not
exceeding one year following the expiration of the time during which
shareholders might have exercised such preemptive rights, be issued, sold or
subjected to rights or options to any other person or persons at a price,
without deduction of such reasonable expenses of and compensation for the
sale, underwriting or purchase of such shares by underwriters or dealers as
may lawfully be paid by the corporation, not less than that at which they
were offered to such shareholders. Any such shares or other securities not
so issued, sold or subjected to rights or options to others during such
one year period shall thereafter again be subject to the preemptive rights of
shareholders.
(i) Except as otherwise provided in the certificate of incorporation
and except as provided in this section, no holder of any shares of any class
shall as such holder have any preemptive right to purchase any other shares
or securities of any class which at any time may be sold or offered for sale
by the corporation. Unless otherwise provided in the certificate of
incorporation, holders of bonds on which voting rights are conferred under
section 518 shall have no preemptive rights.
<PAGE>
<PAGE> 1
ANNEX B
THIS PROXY IS SOLICITED BY
BOARD OF DIRECTORS OF SMITHTOWN BANCORP, INC.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
To Be Held
Tuesday, April 2, 1996
The undersigned shareholder of Smithtown Bancorp, Inc., revoking all
proxies heretofore given with respect to the shares represented herewith,
hereby constitutes and appoints BARRY BROWN, DAVID LONG, DORIS MASTERS and
ROBERT SCHERDEL or any of them, the true and lawful attorneys, agents and
proxies of the undersigned, with full power of substitution for and in the
name, place and stead of the undersigned, with all the powers which the
undersigned would possess if personally present, to vote all common shares
of Smithtown Bancorp, Inc., held of record by the undersigned on February 26,
1996, at the Annual Meeting of Shareholders of Smithtown Bancorp, Inc., to be
held at the Bavarian Inn, 422 Smithtown Boulevard, Lake Ronkonkoma, New York,
on April 2, 1996, at 10:30 AM, or any adjournment thereof.
1. ELECTION OF JAMES H. GLAMORE, BARRY SEIGERMAN
AND AUGUSTA KEMPER AS DIRECTORS
The Board recommends a vote FOR All Nominees
/ /For ALL NOMINEES.
/ /Against ALL NOMINEES.
/ /For ALL NOMINEES EXCEPT ________________________________________
/ /Abstain ________________________________________
2. INCREASE AUTHORIZED SHARES
The Board recommends a vote FOR Proposal No 2.
/ /For proposal
/ /Against Proposal
/ /Abstain
3. DELETE PREEMPTIVE RIGHTS (Preemptive rights enable holders of Common
Shares, in certain circumstances, to purchase newly issued capital stock
of the Bancorp to prevent dilution.) See "AMENDMENT OF THE CERTIFICATE
OF INCORPORATION TO REPEAL PREEMPTIVE RIGHTS" and "ANNEX A."
The Board recommends a vote FOR Proposal No 3.
/ /For proposal
/ /Against Proposal
/ /Abstain
4. APPROVAL OF INDEPENDENT AUDITORS
The Board recommends a vote FOR Proposal No 4.
/ /For proposal
/ /Against Proposal
/ /Abstain
5. TO TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING
AND ANY ADJOURNMENT THEREOF.
Unless otherwise specified, this proxy will be voted for the election of the
nominated directors, in favor of the other proposals and in the discretion
<PAGE>
<PAGE> 2
of the persons in whose favor this proxy is granted, upon matters that may
properly come before the meeting.
Dated: , 1996 L.S.
(Please insert date) Signature of Shareholder
L.S.
Signature if Held Jointly
Please check if you plan to attend
the meeting on April 2, 1996.
This proxy should be returned in the enclosed envelope.
