<PAGE> 1
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 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for the Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
</TABLE>
RAMAPO FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
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
[RAMAPO LOGO]
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 6, 1997
- --------------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Annual Meeting") of Ramapo Financial Corporation (the "Corporation") will be
held at the Radisson Hotel, 690 Route 46 East, Fairfield, New Jersey at 4:00
p.m. on Tuesday, May 6, 1997.
A Proxy Card and a Proxy Statement for the Annual Meeting are enclosed.
The Annual Meeting is for the purpose of considering and acting upon:
1. The election of three directors of the Corporation;
2. The transaction of such other matters as may properly come
before the Annual Meeting or any adjournments thereof.
Note: The Board of Directors is not aware of any other business to come
before the Annual Meeting.
Any action may be taken on any one of the foregoing proposals at the
Annual Meeting on the date specified above or on any date or dates to which, by
original or later adjournment, the Annual Meeting may be adjourned. Stockholders
of record at the close of business on March 14, 1997 are the stockholders
entitled to notice of and to vote at the Annual Meeting and any adjournments
thereof.
A complete list of stockholders entitled to vote at the Annual Meeting
will be open for examination by any stockholder for any purpose germane to the
Annual Meeting during ordinary business hours at the Corporation's main office
during the ten days prior to the Annual Meeting.
You are requested to fill in and sign the enclosed form of proxy which is
solicited by the Board of Directors and to mail it promptly in the enclosed
envelope. The proxy will not be used if you attend and vote at the Annual
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
MORTIMER J. O'SHEA
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Wayne, New Jersey
March 21, 1997
- --------------------------------------------------------------------------------
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE YOUR CORPORATION THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
- --------------------------------------------------------------------------------
<PAGE> 3
- --------------------------------------------------------------------------------
PROXY STATEMENT
OF
RAMAPO FINANCIAL CORPORATION
64 MOUNTAIN VIEW BOULEVARD
WAYNE, NEW JERSEY 07470
(201) 696-6100
ANNUAL MEETING OF STOCKHOLDERS
MAY 6, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
GENERAL
- --------------------------------------------------------------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Ramapo Financial Corporation (hereinafter
called the "Corporation") to be used at the 1997 Annual Meeting of Stockholders
of the Corporation (hereinafter called the "Annual Meeting"), which will be held
at the Radisson Hotel, 690 Route 46 East, Fairfield, New Jersey on Tuesday, May
6, 1997, at 4:00 p.m. The accompanying Notice of Annual Meeting and form of
proxy and this Proxy Statement are being first mailed to stockholders on or
about March 21, 1997.
- --------------------------------------------------------------------------------
VOTING AND REVOCABILITY OF PROXIES
- --------------------------------------------------------------------------------
Proxies solicited by the Board of Directors of the Corporation will be
voted in accordance with the directions given therein. WHERE NO INSTRUCTIONS ARE
INDICATED, PROXIES WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS SET FORTH BELOW.
The proxy confers discretionary authority on the persons named therein to vote
with respect to the election of any person as a director where the nominee
becomes unavailable to serve and with respect to matters incident to the conduct
of the Annual Meeting. If any nominee becomes unavailable to serve, proxies will
be voted by those named therein for the election of such substitute as a
majority of the Board of Directors may recommend or the size of the Board of
Directors may be reduced to eliminate the vacancy. If any other business is
presented at the Annual Meeting, proxies will be voted by those named therein in
accordance with the determination of a majority of the Board of Directors.
Proxies marked as abstentions will not be counted as votes cast. In addition,
shares held in street name which have been designated by brokers on proxy cards
as not voted will not be counted as votes cast. Proxies marked as abstentions or
as broker no votes, however, will be treated as shares present for purposes of
determining whether a quorum is present.
Stockholders who execute proxies retain the right to revoke them at any
time. Unless so revoked, the shares represented by properly executed proxies
will be voted at the Annual Meeting and all adjournments thereof. Proxies may be
revoked by written notice to the Secretary of the Corporation at the address
above or by the filing of a later dated proxy prior to a vote being taken on a
particular proposal at the Annual Meeting. A proxy will not be voted if a
stockholder attends the Annual Meeting and votes in person. The presence of a
stockholder at the Annual Meeting will not revoke such stockholder's proxy.
- --------------------------------------------------------------------------------
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
- --------------------------------------------------------------------------------
The securities entitled to vote at the Annual Meeting consist of the
Corporation's common stock, $1.00 par value per share (the "Common Stock").
Stockholders of record as of the close of business on March 14, 1997 (the
"Record Date") are entitled to one vote for each share of Common Stock then
held. As of the Record Date, there were 8,097,199 shares of Common Stock issued
and outstanding. At March 14, 1997, the Corporation knew of no beneficial owner
of more than 5% of the outstanding Common Stock.
<PAGE> 4
- --------------------------------------------------------------------------------
ITEM 1
ELECTION OF DIRECTORS
- --------------------------------------------------------------------------------
The Corporation's Board of Directors is currently composed of seven
members. Under the Corporation's Certificate of Incorporation, directors of the
Corporation are divided into three classes and elected for terms of three years
and until their successors are elected and qualified. At the Annual Meeting,
three directors will be elected for a term expiring at the 2000 annual meeting
of stockholders. Under New Jersey law, directors are elected by a plurality of
the votes present in person or represented by proxy at the Annual Meeting and
entitled to vote on the election of directors.
Other nominations for directors may be made pursuant to the Corporation's
Bylaws, which require, among other things, that advance written notice of any
such nomination shall be delivered or mailed to the Chairman of the Board of the
Corporation. Any such written nominations shall be delivered or mailed not less
than 14 days prior to the meeting of stockholders, that is, on or before April
22, 1997, provided, that if less than 21 days' notice of the meeting is given to
stockholders, then such nominations shall be mailed or delivered to the Chairman
of the Board not later than the close of business on the seventh day following
the day on which the Notice of Meeting was mailed.
The Corporation's Bylaws permit the Board of Directors to increase the
number of Directors by not more than three members, and to fill the vacancies
created by such increase, between annual meetings of the stockholders. In the
event of any such increase in the number of directors by the Board of Directors,
the terms of the directors filling such vacancies shall be fixed by the Board of
Directors in such manner as to result in each class consisting, as nearly as may
be, of one-third of the number of directors then constituting the whole Board of
Directors as so increased. A director elected by the Board of Directors to fill
a vacancy created in such manner will serve only until the next annual meeting
of stockholders, at which time the stockholders will elect such director's
successor for the succeeding term or, if applicable, for the remaining portion
of the full term previously fixed by the Board of Directors.
It is intended that the persons named in the proxies solicited by the
Board of Directors will vote for the election of the named nominees. If any
nominee becomes unavailable to serve, the shares represented by a majority of
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.
The following table sets forth, for each nominee and each continuing
director, his name, age as of the Record Date and the year he first became a
director of the Corporation. The table also sets forth the names, ages and
positions of the Corporation's current executive officers and the year each was
first elected to his current position. Each director of the Corporation also is
a member of the Board of Directors of The Ramapo Bank (the "Bank"), the
Corporation's primary operating subsidiary, and each executive officer
(excluding Chairman Victor C. Otley, Jr.) also serves as an executive officer of
the Bank. There are no arrangements or understandings between the Corporation
and any director or executive officer pursuant to which such person has been
elected a director or executive officer of the Corporation other than the
agreements respectively between Messrs. O'Shea and Knauer and the Corporation
and the Bank (discussed under "-- Certain Agreements"), and no director or
executive officer is related to any other director or executive officer by
blood, marriage or adoption. All executive officers other than Mr. O'Shea are
elected annually by the Board of Directors. Mr. O'Shea is serving pursuant to an
employment agreement dated March 14, 1996, which provides for a term of
employment of three years with the Corporation and one year with the Bank. See
- -- "Certain Agreements".
2
<PAGE> 5
BOARD NOMINEES FOR TERMS TO EXPIRE
AT THE 1999 ANNUAL MEETING
<TABLE>
<CAPTION>
AGE AS OF YEAR FIRST
THE RECORD ELECTED AS CURRENT TERM
NAME DATE DIRECTOR TO EXPIRE
---- ---------- ----------- ------------
<S> <C> <C> <C>
Directors:
Louis S. Miller 82 1974 1997
Mortimer J. O'Shea 51 1994 1997
Victor C. Otley, Jr. 61 1974 1997
DIRECTORS CONTINUING IN OFFICE
Donald W. Barney 56 1993 1998
James R. Kaplan 62 1993 1999
Erwin D. Knauer 51 1993 1999
Richard S. Miller 62 1974 1998
</TABLE>
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
AGE AS OF YEAR FIRST ELECTED
NAME OFFICE RECORD DATE TO CURRENT OFFICE
---- --------------------- ----------- ------------------
<S> <C> <C> <C>
Mortimer J. President and Chief 51 1994
O'Shea Executive Officer
Erwin D. Knauer Senior Vice President 51 1992
Walter A. Treasurer 47 1985
Wojcik, Jr.
</TABLE>
Presented below is certain information concerning the directors and the
executive officers of the Corporation. In addition to serving as Directors of
the Corporation and the Bank, all directors of the Corporation named below also
serve as Directors of one or more of the Corporation's nonbank subsidiaries.
LOUIS S. MILLER has served as a director of the Corporation since its
formation in 1974 and has been a director of the Bank since 1968. Mr. Miller is
a retired certified public accountant. Mr. Miller was a partner with the firm
Schotz, Simon Miller & Co., Certified Public Accountants, which merged in 1988
with R.D. Hunter & Co., Certified Public Accountants, of Paramus, New Jersey.
Mr. Miller continued to serve as a consultant with R.D. Hunter until 1993.
MORTIMER J. O'SHEA became Director, President and Chief Executive Officer
of the Corporation and Chairman and Chief Executive Officer of the Bank in March
1994. From 1985 to March 1994, he served in various capacities with The Summit
Bancorporation ("Summit") and its subsidiaries. From October 1993 until his
resignation, he served as Regional President of Summit Bank with responsibility
for its Western Region. He also served on Summit's Management Executive
Committee. From June 1990 to October 1993, he served as President and Chief
Executive Officer of Somerset Trust Company, which was a wholly owned subsidiary
of Summit. Mr. O'Shea was President and Chief Executive Officer of The Trust
Company of Princeton, also a wholly owned subsidiary of Summit, from its
organization in December 1985 through June 1990. During his tenure, this
start-up bank grew to $50 million in assets. Prior to joining Summit, Mr. O'Shea
held various lending and management positions with First Fidelity Bancorporation
and Irving Trust Corporation.
VICTOR C. OTLEY, JR. has served as a director of the Corporation since
1974 and has been a director of the Bank since 1970. From September 1993 to
March 1994, Mr. Otley served as President and Chief Executive Officer of the
Corporation and Chairman of the Board and Chief Executive Officer of the Bank on
a temporary basis. In January 1994, Mr. Otley became Chairman of the Board of
the Corporation and continues to serve in that capacity. Prior to assuming
executive officer positions with the Corporation and the Bank in September 1993,
he was a Director and a Vice President of the law firm of Williams, Caliri,
Miller & Otley, which acts as legal counsel to the Corporation and its
subsidiaries. See "-- Certain Relationships and Related Transactions." Mr. Otley
returned to that firm after stepping down as Chief Executive Officer of the
Corporation and the Bank in March 1994.
3
<PAGE> 6
DONALD W. BARNEY became a director of the Corporation in 1993, having
been a member of the Bank's Board of Directors since 1989. He joined the Union
Camp Corporation, Wayne, New Jersey in 1969 and currently serves as Vice
President and Treasurer, and is also a Certified Public Accountant. He is
President and a Trustee of the First Real Estate Investment Trust of New Jersey.
JAMES R. KAPLAN has been a director of the Corporation since 1993 and has
been a director of the Bank since 1991. He is currently Chairman, President and
Chief Executive Officer of Cornell Dubilier Electronics, Inc., located in Wayne,
New Jersey. He also serves on the Board of Governors of the Electronic
Industries Association.
ERWIN D. KNAUER has been a director of the Corporation since 1993 and a
director of the Bank since 1989. He has served as Vice President of the
Corporation from April 1984 to April 1992 and Senior Vice President of the
Corporation from that date to the present. Mr. Knauer has served as President of
the Bank since 1989, prior to which he served as Executive Vice President of the
Bank.
RICHARD S. MILLER has served as a director of the Corporation since 1974
and has been a director of the Bank since 1970. Mr. Miller is a director and the
President of the law firm of Williams, Caliri, Miller & Otley, a professional
corporation, of Wayne, New Jersey ("Williams, Caliri, Miller & Otley"), which
acts as legal counsel to the Corporation and its subsidiaries. See "-- Certain
Relationships and Related Transactions."
WALTER A. WOJCIK, JR. has served as Treasurer of the Corporation since
1985 and Senior Vice President and Treasurer of the Bank from 1989 to the
present. Prior to that, he was Vice President and Treasurer of the Bank. He also
served as Treasurer of Pilgrim State Bank, which was then a subsidiary of the
Corporation, from 1988 to its sale in June 1993. He is a certified public
accountant.
- --------------------------------------------------------------------------------
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
The Corporation's Board of Directors conducts its business through
meetings of the Board of Directors and of its committees. The Board of Directors
of the Corporation meets monthly and may have additional special meetings.
During the year ended December 31, 1996, the Board met 13 times. No director
attended fewer than 75% in the aggregate of the total number of Board meetings
held during 1996 and the total number of meetings held by committees on which he
served during such year, except Donald W. Barney.
The Board of Directors has a standing Audit Committee. The Audit
Committee, consisting of Donald W. Barney, Louis S. Miller and Victor C. Otley,
Jr., performs the following customary functions: (i) making recommendations to
the full Board of Directors as to the engagement of independent auditors; (ii)
directing and supervising investigations into matters relating to audit
functions; (iii) reviewing with the independent auditors the plan and results of
the audit engagement; (iv) reviewing the scope and results of the Corporation's
internal auditing procedures; (v) recommending to the full Board of Directors
each service to be performed by the independent auditors before such services
are performed; (vi) reviewing the degree of independence of the auditors; (vii)
considering the range of audit and non-audit fees; and (viii) reviewing the
adequacy of the Corporation's system of internal accounting controls. The Audit
Committee met four times during 1996.
The Board of Directors also has a standing Stock Option Committee
consisting of all directors other than Messrs. O'Shea and Knauer. This committee
administers the Corporation's 1995 Employee Stock Option Plan. The committee met
once in 1996.
The Board of Directors also had a standing Compliance Committee,
consisting of James R. Kaplan, Louis S. Miller and Richard S. Miller, which
monitored the Corporation's compliance with the regulatory agreement entered
into between the Corporation and the Federal Reserve Bank of New York in
November 1993 and terminated on March 15, 1996 by the Federal Reserve Bank of
New York. Such Committee met once during 1996 prior to the termination of the
agreement.
In addition, various Board members serve on various committees of the
Bank's Board of Directors and through these committees facilitate communication
between the Corporation and the Bank.
4
<PAGE> 7
- --------------------------------------------------------------------------------
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION
- --------------------------------------------------------------------------------
Each executive officer of the Corporation, with the exception of Chairman
Victor C. Otley, Jr., also serves as an executive officer of the Bank. These
executive officers devote the great majority of their time to and receive their
salaries from the Bank. Neither the Bank nor the Corporation has a compensation
committee. Compensation decisions for the Bank are made by its Board of
Directors. The Corporation's Board reviews and approves the compensation
decisions of the Bank's Board for the two most highly compensated
executives -- Messrs. O'Shea and Knauer.
The Corporation's policy with respect to executive compensation is to
compensate its executives fairly and adequately for their responsibilities,
taking into account (i) the profitability of the operating unit for which the
executive is responsible (except in the case of the Corporation's Chief
Executive Officer, who is responsible for the profitability of the Corporation
as a whole), (ii) the profitability of the Corporation as a whole and (iii)
prevailing levels of compensation for executives of other institutions in New
Jersey with comparable responsibilities and experience.
Within the foregoing general guidelines, the Boards' specific
compensation strategy is to attempt to arrive at appropriate individual levels
of compensation for each executive officer by looking at total compensation
including annual base salary, incentive bonus potential, and employee benefit
plans and stock option awards.
In an effort to link compensation directly to performance and enhanced
stockholder values, the Bank Board implemented a Management Incentive Bonus Plan
for the year 1996. Bonuses under the Plan are awarded by the Bank's Board based
50% upon overall earnings performance of the Corporation and 50% upon the
individual executive's performance. During 1996, $150,000 was accrued to fund
the Plan of which $149,150 was awarded in January of 1997 based upon 1996
performance. The Plan has been renewed for the year 1997, and a total bonus pool
of $180,000 has been budgeted.
In an effort to further link compensation to performance, the Board's Stock
Option Committee granted additional options during 1996 in accordance with the
previously adopted 1995 Employee Stock Option Plan. Options to purchase a total
of 249,500 shares were granted to a total of 34 officers in 1996. (See "Option
Grants in Last Fiscal Year" below.)
When Mr. O'Shea joined the Corporation in March 1994 as President and CEO
of the Corporation and Chairman and CEO of the Bank, he entered into an
employment agreement with the Corporation and the Bank. In March 1996 that
agreement was modified and extended. Also in March 1996 Mr. Knauer entered into
a salary continuation agreement with the Corporation and the Bank (See "Certain
Agreements," below).
This report and the performance graph which follows shall not be deemed
incorporated by reference by any general statement incorporating by reference
this proxy statement into any filing under the Securities Act of 1933 or the
Securities Exchange Act of 1934, except to the extent that the Corporation
specifically incorporates this information by reference, and shall not otherwise
be deemed filed under such Acts.
Respectfully submitted,
Donald W. Barney
James R. Kaplan
Erwin D. Knauer
Louis S. Miller
Richard S. Miller
Mortimer J. O'Shea
Victor C. Otley, Jr.
5
<PAGE> 8
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Board of Directors of the Bank reviews the compensation of employees
of the Bank. The Board of Directors of the Corporation reviews and approves the
compensation decisions of the Bank's Board for Messrs. O'Shea and Knauer.
Options under the Corporation's 1995 Employee Stock Option Plan are awarded by
the Corporation's Stock Option Committee, which is comprised of all of the
directors of the Corporation other than Messrs. O'Shea and Knauer. The
Corporation does not have any employees of its own.
During 1996, Victor C. Otley, Jr. served as Chairman of the Board of
Directors of the Corporation and as a Director of the Bank. Mortimer J. O'Shea
served as a Director, Chief Executive Officer and President of the Corporation
and Chairman of the Board of Directors and Chief Executive Officer of the Bank.
Erwin D. Knauer, Senior Vice President of the Corporation and President of the
Bank, is also a member of the Corporation's Board of Directors. Each of Messrs.
O'Shea and Knauer absented himself from all discussions, and abstained from all
voting, with respect to his own compensation.
- --------------------------------------------------------------------------------
COMPARATIVE STOCK PERFORMANCE GRAPH
- --------------------------------------------------------------------------------
The following graph compares the cumulative total shareholder return on a
hypothetical $100 investment made on December 31, 1991, assuming reinvestment of
dividends, in (1) the Corporation's Common Stock, (2) the NASDAQ Stock Market
(U.S.) Index, and (3) the NASDAQ Bank Stock Index.
<TABLE>
<CAPTION>
Measurement Period Ramapo Financial
(Fiscal Year Covered) Corporation NASDAQ Bank Stock NASDAQ (U.S.)
<S> <C> <C> <C>
12/31/91 100.00 100.00 100.00
12/31/92 60.41 116.38 145.55
12/31/93 32.09 133.59 165.99
12/30/94 41.06 130.59 165.38
12/29/95 60.41 184.67 246.32
12/31/96 75.81 227.16 325.60
</TABLE>
6
<PAGE> 9
- --------------------------------------------------------------------------------
EXECUTIVE COMPENSATION AND OTHER BENEFITS
- --------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
The following table summarizes compensation earned or awarded during the
years ended December 31, 1996, 1995 and 1994 to the Corporation's Chief
Executive Officer, and its other executive officers whose total salary and bonus
in 1996 exceeded $100,000.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG-TERM COMPENSATION
----------------------------------------------------------------------------------------
AWARDS PAYOUTS
--------------------------------------------------------
OTHER
ANNUAL RESTRICTED ALL OTHER
NAME AND COMPEN- STOCK OPTIONS LTIP COMPEN-
PRINCIPAL POSITION YEAR SALARY BONUS SATION(1) AWARDS($) (SHARES) PAYOUTS SATION
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Mortimer J. O'Shea 1996 $210,000 $ -- $ -- $ -- $ 30,000(3) $ -- $ 8,787(4)
Chief Executive 1995 195,000 -- -- -- 30,000(3) -- 6,383
Officer(2) 1994 147,750 -- -- -- 218,934(2) -- 816
=====================================================================================================================
Erwin D. Knauer 1996 151,000 -- -- -- 30,000(3) -- 17,437(6)
Senior Vice 1995 137,338 -- -- -- 30,000(3) -- 13,662
President(5) 1994 117,000 -- -- -- -- -- 8,529
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------------------
(1) The Corporation provides certain perquisites and other benefits to
executive officers. The aggregate amount of such compensation did not
exceed the lesser of $50,000 or 10% of the total of annual salary and bonus
reported for each of the named executive officers during any of the years
reported.
(2) In March 1994, Mortimer J. O'Shea was appointed President and Chief
Executive Officer of the Corporation and Chairman of the Board and Chief
Executive Officer of the Bank. At that time, Mr. O'Shea entered into an
employment agreement and a nonstatutory stock option agreement with the
Corporation and the Bank. See "-- Certain Agreements."
(3) Incentive stock options granted pursuant to the Corporation's 1995 Employee
Stock Option Plan. See "-- Option Grants" below.
(4) Consists of $1,287 in life insurance premiums and $7,500 in employer 401(k)
matching contributions.
(5) In July 1996 Mr. Knauer entered into a salary continuation agreement with
the Corporation and the Bank. See "-- Certain Agreements."
(6) Consists of $937 in life insurance premiums, $7,500 in employer 401(k)
matching contributions, and $9,000 in automobile allowance.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning options granted in
1996 to individuals listed in the Summary Compensation Table.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- -----------------------------------------------------------------------------------------------------------------
POTENTIAL
REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
% OF TOTAL APPRECIATION FOR
NUMBER OF SECURITIES OPTIONS GRANTED EXERCISE OPTION TERM
UNDERLYING OPTIONS TO EMPLOYEES PRICE EXPIRATION -------------------
NAME GRANTED(1) IN FISCAL YEAR ($/SHARE) DATE 5% 10%
- ------------------------------------------ --------------- -------- ------------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Mortimer J. O'Shea 30,000 12.0% $ 4.8125 June 28, 2006 $90,797 $230,097
Erwin D. Knauer 30,000 12.0% $ 4.8125 June 28, 2006 90,797 230,097
</TABLE>
- ------------------------------
(1) Incentive Stock Options were granted to certain officers of the Bank
pursuant to the Ramapo Financial Corporation 1995 Employee Stock Option
Plan. In accordance with that plan the exercise price was set equal to the
last sale price of the Corporation's stock on the date of grant. Options
granted are exercisable at the rate of 25% at 6 months from date of grant
and an additional 25% on the date of each of the succeeding three years.
7
<PAGE> 10
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
The following table sets forth information concerning the value of
options held by the individuals listed in the Summary Compensation Table at
December 31, 1996.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT FISCAL OPTIONS AT FISCAL
ACQUIRED ------------------------------------------
ON EXERCISE VALUE YEAR-END(#) YEAR-END($)
(#) REALIZED EXERCISABLE/ EXERCISABLE/
NAME ($) UNEXERCISABLE UNEXERCISABLE
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Mortimer J. O'Shea(1) -0- $-0- 82,811/196,123 $194,523/$441,395
- ------------------------------------------------------------------------------------------------------
Erwin D. Knauer(2) -0- $-0- 22,500/ 37,500 $ 19,218/$ 22,031
- ------------------------------------------------------------------------------------------------------
</TABLE>
- ------------------------------
(1) Mr. O'Shea's options consist of non-statutory stock options to purchase
218,934 shares which he received concurrent with his employment with the
Corporation (see "-- Certain Agreements," below) and incentive stock
options to purchase 60,000 shares which were granted to him pursuant to the
Corporation's 1995 Employee Stock Option Plan (see "-- Option Grants in
Last Fiscal Year," above).
(2) Mr. Knauer's options consist of incentive stock options to purchase 60,000
shares which were granted pursuant to the Corporation's 1995 Employee Stock
Option Plan (see "-- Option Grants in Last Fiscal Year," above).
CERTAIN AGREEMENTS
On March 14, 1996, the Corporation and the Bank extended and modified the
original employment agreement with Mortimer J. O'Shea, President and Chief
Executive Officer of the Corporation and Chairman of the Board and Chief
Executive Officer of the Bank, that had been originally entered into March 17,
1994.
The extended and modified employment agreement (the "Employment
Agreement") provides for a term of employment of three years with the
Corporation while his term of employment with the Bank shall be for a period of
one year. The Employment Agreement provides for inclusion of Mr. O'Shea in all
of the employee benefit plans that the Corporation or the Bank maintain for the
benefit of their employees and which include any medical or other insurance
plans, the 401(k) plan and vacation policies. The Employment Agreement provides
for an annual base salary of $215,000, which will be paid by the Bank so long as
the Bank is an employer of Mr. O'Shea and by the Corporation for the remaining
term of the Employment Agreement. In December 1996 Mr. O'Shea's annual base
salary was increased to $220,000 effective in January 1997.
The Employment Agreement will terminate upon Mr. O'Shea's death or
disability, and is terminable by the Corporation or the Bank with or without
"just cause" (as such term is defined in the Employment Agreement). If Mr.
O'Shea is terminated without "just cause", he shall be entitled to his salary at
the annual rate then in effect up to the date of the termination of the term of
the Employment Agreement (plus any renewal term). In the event of termination
for "just cause," Mr. O'Shea will not be entitled to any salary for any period
after such termination. If Mr. O'Shea's employment is terminated or suspended as
a result of an order or notice being served under Section 8 of the Federal
Deposit Insurance Act, all obligations of the Corporation and the Bank shall
terminate as of the effective date of the order or notice. If such an order or
notice suspends or temporarily prohibits Mr. O'Shea from participating in the
conduct of the Corporation's or the Bank's affairs, the Employment Agreement
shall be suspended as of the effective date of such order or notice. If the
charges in the order or notice are dismissed, the Bank shall pay Mr. O'Shea all
or part of the compensation withheld while the Employment Agreement was
suspended and reinstate any of its obligations thereunder.
If the Employment Agreement is terminated due to Mr. O'Shea's
"disability" (as defined in the Employment Agreement), he will be entitled to a
continuation of his compensation and benefits through the date of the
establishment of his disability and for a period of six months thereafter. In
addition, he shall be entitled to one-half of his base salary plus any other
employee benefits in effect at such time for an additional six month period. Any
and all such payments made as the result of disability shall be reduced by the
amount he receives under any disability insurance policy maintained by the
Corporation or the Bank.
8
<PAGE> 11
Mr. O'Shea may voluntarily terminate his Employment Agreement by
providing 60 days written notice to the Boards of Directors of both the
Corporation and the Bank, in which case he will be entitled to receive only his
compensation, vested rights and employee benefits up to the date of his
termination.
The Employment Agreement contains provisions stating that in the event of
Mr. O'Shea's involuntary termination in connection with, or within one year
after, any change in control of the Corporation or the Bank, other than for
"just cause," Mr. O'Shea will be paid within 10 days of such termination an
amount equal to two times his base annual compensation less that amount of base
compensation actually paid after the change of control, unless the Bank was
placed in conservatorship or receivership in connection with such change in
control and the Board of Directors of the Corporation or the Bank determines in
good faith that the change of control was directed by or otherwise required by
the Federal Deposit Insurance Corporation. In no event, however, may the
aggregate amount payable in the event of a change in control equal or exceed the
difference between (i) the product of 2.99 times Mr. O'Shea's "base amount" as
defined in Section 280G(b)(3) of the Code and regulations promulgated
thereunder, and (ii) the sum of any other parachute payments (as defined in
Section 280G(b)(2) of the Code) that he receives on account of the change in
control.
"Control" generally refers to the acquisition, by any person or entity,
of the ownership or power to vote more than 25% of the Corporation's voting
stock, the control of the election of a majority of the Corporation's or the
Bank's directors or the exercise of a controlling influence over the management
or policies of the Corporation or the Bank. In addition, under the Employment
Agreement, a change in control occurs when, during any consecutive two-year
period, directors of the Bank or the Corporation at the beginning of such period
cease to constitute two-thirds of the Board of Directors of the Bank or the
Corporation, unless the election of replacement directors was approved by a
two-thirds vote of the initial directors then in office. The Employment
Agreement also provides for a similar lump sum payment to be made in the event
of Mr. O'Shea's voluntary termination of employment within one year following a
change in control, upon the occurrence, or within 90 days thereafter, of certain
specified events following the change in control, which have not been consented
to in writing by Mr. O'Shea, including (i) requiring the Executive to move his
personal residence, (ii) the assignment of duties and responsibilities which are
substantially inconsistent with those normally associated with his position with
the Bank or the Corporation, and (iii) materially diminishing his authority and
responsibility. The aggregate payments that would be made to Mr. O'Shea assuming
his termination of employment under the foregoing circumstances would be
$440,000. This provision may have an anti-takeover effect by making it more
expensive for a potential acquiror to obtain control of the Corporation.
Concurrently with entering into the Employment Agreement, the Corporation
also entered into a Nonstatutory Stock Option Agreement (the "Stock Option
Agreement") with Mr. O'Shea. Pursuant to the terms of the Stock Option
Agreement, the Corporation granted to Mr. O'Shea an option to purchase shares of
Common Stock having an aggregate exercise price of $500,000. Exercise of any
options granted to Mr. O'Shea pursuant to the Stock Option Agreement was
conditioned upon the successful completion by the Corporation of a public
offering of the Corporation's Common Stock (the "Offering") by December 31, 1994
resulting in gross proceeds of at least $10 million. This condition has been
satisfied. The options are granted in three separate tiers as follows: (1) Tier
1 Options for Common Stock having an aggregate exercise price of $170,000
exercisable at $2.00 per share, the price at which the Common Stock was sold in
the Offering (the "Offering Price"), (2) Tier 2 Options for Common Stock having
an aggregate exercise price of $165,000 exercisable at the Offering Price plus
50% of the difference between the Adjusted Book Value of the shares (as defined
in the Stock Option Agreement) and the Offering Price and (3) Tier 3 Options for
Common Stock having an aggregate exercise price of $165,000 exercisable at the
greater of the Offering Price or the Adjusted Book Value of the shares.
Twenty-five percent of Tier 1 Options became exercisable on the first two
anniversaries of March 17, 1994 (the "Effective Date") with an additional 25% to
vest on each of the two subsequent anniversaries of the Effective Date.
Twenty-five percent of Tier 2 Options became exercisable two years after the
Effective Date with an additional 25% to vest on each of the three subsequent
anniversaries of the Effective Date. Twenty-five percent of Tier 3 Options
become exercisable three years after the Effective Date with an additional 25%
to vest on each of the three subsequent anniversaries of the Effective Date. The
Stock Option Agreement further provides that the vesting schedule shall be
accelerated and all options are to become immediately exercisable upon a "change
in control" as that term is defined in the Employment Agreement. All unexercised
options expire in seven years from the Effective Date.
9
<PAGE> 12
Exercise of the options granted pursuant to the Stock Option Agreement is
also subject to the Corporation's achieving certain annual performance standards
relating to the Corporation's profitability and return on equity. Based upon the
Corporation's performance relative to such performance standards during 1996,
100% of the options which would be otherwise exercisable during 1997 are
exercisable. In addition, Mr. O'Shea may not exercise options in any given
taxable year of the Corporation to the extent that such exercise would result in
Mr. O'Shea's having taxable compensation that is not deductible to the
Corporation. If such restriction results in Mr. O'Shea's being unable to
exercise options that are otherwise exercisable, then, notwithstanding any other
provision of the Stock Option Agreement, if the term of the option would have
expired in such year, its term shall be extended until December 31st of the next
succeeding year. In the event of such an extension of exercisability, the
applicable performance standards shall be those applicable in the first year in
which exercise was denied.
In the event of Mr. O'Shea's termination for "just cause" as that term is
defined in the Employment Agreement or by resignation, the options granted shall
immediately become null and void. If employment is terminated without "just
cause", any options which are otherwise exercisable on such termination date may
be exercised for an additional 90 days following the termination date. In the
event of termination of employment due to disability, all outstanding options
will immediately become fully vested and may be exercised by Mr. O'Shea for a
period of 90 days following the date of his termination due to disability. All
outstanding options become fully vested upon the death of Mr. O'Shea and may be
exercised for a period of one year following his death by the personal
representative of his estate unless the Corporation elects to extend such
period.
The Corporation and the Bank have entered into a salary agreement
("Salary Agreement"), dated as of July 31, 1996, with Erwin D. Knauer, Senior
Vice President of the Corporation and President of the Bank. The Salary
Agreement provides that Mr. Knauer shall be paid an amount equal to his annual
salary in the event he is terminated in connection with or within 12 months
after a change in control of the Corporation or the Bank, unless such
termination is with Mr. Knauer's prior written consent or is for one of a number
of specified reasons which are collectively defined in the Salary Agreement as
"Just Cause." The Salary Agreement may be terminated pursuant to a resolution of
the Board of Directors of the Corporation effective as of the date of the
Corporation's 1997 annual meeting of shareholders or any subsequent annual
meeting, provided that no change of control of the Corporation or the Bank shall
have occurred.
SUPPLEMENTAL EMPLOYEE BENEFITS PLAN
The Supplemental Employee Benefits Plan ("SEBP"), which the Corporation's
Board of Directors adopted in 1989, became fixed as to participants and benefits
January 1, 1994. The SEBP provides a combination of benefits for designated
salaried officers or other designated key employees of the Corporation and its
subsidiaries. Participants in the SEBP had been designated annually by the Board
of Directors of the Corporation on a prospective basis for each of the years
1990 through 1994. The Board also had designated the type and amount of benefits
to be granted to each SEBP participant.
Three types of benefits have been granted under the SEBP: (i) a
pre-retirement death benefit which is payable in 10 equal annual installments if
a participant dies while actively employed during the period for which benefits
have been granted; (ii) a severance benefit which is payable in a lump sum if a
participant's employment terminates during the period for which benefits have
been provided other than by reason of the participant's death, retirement,
permanent disability or termination by the employer for certain specified
causes; and (iii) a retirement benefit payable in 10 equal annual installments
following a participant's retirement after attaining age 65 or such other date
as may be approved by the Board of Directors, or after attaining age 65 or such
earlier date as may be approved by the Board of Directors if the participant's
employment was previously terminated due to total disability. Each participant
has been granted a Supplemental Benefits Agreement which specifies benefits to
which such participant will be entitled as long as he or she remains actively
employed by the Corporation or its subsidiaries.
10
<PAGE> 13
The following table sets forth benefits payable under SEBP in 10 equal
annual installments following retirement at age 65 to the only individual named
in the Summary Compensation Table above who was a participant in the SEBP.
<TABLE>
<CAPTION>
ANNUAL
RETIREMENT
NAME BENEFIT
- ---- -----------
<S> <C>
Erwin D. Knauer $34,900
</TABLE>
DIRECTOR COMPENSATION
Directors of the Corporation who are not members of management receive an
annual fee for serving as a director and a fee for attending each meeting of the
Corporation's Board and of the Bank's Board and, as applicable, each meeting of
the Corporation's Audit Committee, the Bank's Asset/Liability Management
Committee and the Bank's Executive Committee. The current fees are as follows:
The annual fee is $10,000; Board meeting fees are $300 per meeting; and
Committee meeting fees are $250 per meeting. Directors are not compensated for
attendance at any other Corporation or Bank committee meetings. If the Board of
Directors of the Corporation and the Board of Directors of the Bank meet on the
same day, the directors are only compensated for the Bank's Board meeting.
Directors who are members of management do not receive any fees for their
service as directors.
At the 1995 Annual Meeting of Shareholders the 1995 Stock Option Plan for
Nonemployee Directors was approved. This plan provides for the granting of
nonqualified stock options to nonemployee directors of the Corporation and its
subsidiaries. The maximum number of shares of Common Stock of the Corporation,
$1 par value, that may be made subject to options granted pursuant to this plan
is 200,000. Upon approval of this plan each director received a grant based upon
his years of service according to the following schedule:
<TABLE>
<CAPTION>
NUMBER OF SHARES
YEARS OF SERVICE SUBJECT TO OPTION
------------------------------------------------------------------- -----------------
<S> <C>
at least three, but less than ten 5,000
at least ten, but less than fifteen 10,000
at least fifteen 15,000
</TABLE>
Options to purchase a total of 55,000 shares at $3.50 per share were granted
upon approval of the 1995 Stock Option Plan for Nonemployee Directors as
provided above. In addition, commencing in 1996 and thereafter until the
expiration date of the plan, the plan provides for automatic grants of options
to purchase 1,800 shares to each person who, on the date of the annual meeting
for such year, is then a Nonemployee Director of the Corporation and/or any
subsidiary of the Corporation regardless of the number of boards on which they
serve.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Williams, Caliri, Miller & Otley, of which Director Richard S. Miller and
Chairman of the Board Victor C. Otley, Jr. are principals, serves as the
Corporation's general counsel. The Corporation and its subsidiaries paid
$247,718 in legal fees to such firm during 1996. In addition, borrower customers
of the Bank paid $103,065 to that firm in 1996 in connection with loans made by
the Bank. It is believed that the amounts paid to such firm are reasonable and
competitive. It is anticipated that during 1997, the Corporation will continue
to use the services of such firm, together with other law firms, to handle the
legal aspects of troubled loans, regulatory and corporate matters.
The Corporation provides a liability insurance policy for all its
officers and directors. Coverage is provided by a policy with a major insurance
company for $5 million per occurrence, with a standard deductible clause. The
policy also insures the Corporation against amounts paid by it to indemnify
directors and officers. The policy runs for a period of three years from July 1,
1996 to June 30, 1999 at a cost to the Corporation of $83,100.
Directors and officers of the Corporation and their associates are
customers of and had transactions with the Bank during 1996, and it is expected
that they will continue such transactions in the future. All deposit accounts
and commitments comprising such transactions were made in the ordinary course of
business of the Bank on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for
11
<PAGE> 14
comparable transactions with other persons, and, in the opinion of management of
the Corporation and the Bank, do not involve more than the normal risks of
collectibility or present other unfavorable features.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth as of February 28, 1997 certain
information concerning the ownership of Common Stock by each director of the
Corporation, by the officers named in the Summary Compensation Table and by all
directors and executive officers as a group.
<TABLE>
<CAPTION>
PERCENT OF
AMOUNT AND NATURE OUTSTANDING
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1) COMMON STOCK (2)
------------------------------------- ------------------------ ----------------
<S> <C> <C>
Donald W. Barney 62,900(3) 0.78%
James R. Kaplan 20,900(4) 0.26
Erwin D. Knauer 29,017(5) 0.36
Louis S. Miller 19,900(6) 0.25
Richard S. Miller 99,765(7) 1.23
Mortimer J. O'Shea 165,544(8) 2.01
Victor C. Otley, Jr. 124,733(9) 1.54
All Directors and Executive
Officers as a Group (11
persons) 673,723 8.07%
</TABLE>
- ------------------------------
(1) In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, a
person is deemed to be the beneficial owner, for purposes of this table, of
any shares of Common Stock if he or she has or shares voting or investment
power with respect to such Common Stock or has a right to acquire
beneficial ownership at any time within 60 days from February 28, 1997. As
used herein, "voting power" is the power to vote or direct the voting of
shares and "investment power" is the power to dispose or direct the
disposition of shares. Except as otherwise noted, ownership is direct, and
the named individuals and group exercise sole voting and investment power
over the shares of the Common Stock.
(2) In calculating the percentage ownership of each named individual and the
group, the number of shares outstanding includes any shares of the Common
Stock which the individual or the group has the right to acquire within 60
days of February 28, 1997.
(3) Includes 5,900 shares Mr. Barney has the right to acquire pursuant to the
exercise of options.
(4) Includes 5,900 shares Mr. Kaplan has the right to acquire pursuant to the
exercise of options.
(5) Includes 22,500 shares Mr. Knauer has the right to acquire pursuant to the
exercise of options and 2,500 shares owned by Mr. Knauer's wife.
(6) Includes 15,900 shares Mr. Miller has the right to acquire pursuant to the
exercise of options.
(7) Includes 15,900 shares Mr. Miller has the right to acquire pursuant to the
exercise of options. Also includes 2,728 shares owned of record by
Williams, Caliri, Miller & Otley. Mr. Miller disclaims beneficial ownership
of all but 767 of the shares owned by Williams, Caliri, Miller & Otley.
Also includes 3,000 shares owned by Mr. Miller's wife directly. Mr. Miller
disclaims beneficial ownership of his wife's shares. Also includes 14,000
shares held by Mr. Miller as Trustee for himself and others; Mr. Miller
disclaims beneficial ownership of 7,000 of such shares in which others have
a beneficial interest.
(8) Includes 137,544 shares Mr. O'Shea has the right to acquire pursuant to the
exercise of options. Also includes 7,500 shares owned by Mr. O'Shea's wife.
Mr. O'Shea disclaims beneficial ownership of his wife's shares.
(9) Includes 15,900 shares Mr. Otley has the right to acquire pursuant to the
exercise of options. Also includes 58,584 shares owned by Mr. Otley's wife.
Mr. Otley disclaims beneficial ownership of his wife's shares. Also
includes 2,728 shares owned of record by Williams, Caliri, Miller & Otley.
Mr. Otley disclaims beneficial ownership of all but 767 of the shares owned
by Williams, Caliri, Miller & Otley.
- --------------------------------------------------------------------------------
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
The principal accountant for the Corporation and its subsidiaries for
1996 was Arthur Andersen LLP, Roseland, New Jersey. The Corporation has not
appointed a principal accountant for 1997 at this time. In accordance with the
Corporation's prior practice, when the principal accountant's term of engagement
has expired, the Audit Committee will recommend the selection of principal
accountant to the Board of Directors. This will occur subsequent to the Annual
Meeting. Arthur Andersen LLP has served in that capacity since 1984. It is
expected that one or more representatives from Arthur Andersen LLP will be
present at the Annual Meeting with
12
<PAGE> 15
the opportunity to make a statement, if they desire to do so, and will be
available to respond to appropriate questions.
- --------------------------------------------------------------------------------
OTHER MATTERS
- --------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy Statement
and matters incident to the conduct of the Annual Meeting. However, if any other
matters should properly come before the Annual Meeting, it is intended that
proxies in the accompanying form will be voted in respect thereof in accordance
with the determination of a majority of the Board of Directors.
- --------------------------------------------------------------------------------
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
- --------------------------------------------------------------------------------
The exercise price of the nonstatutory stock options granted to Mortimer
J. O'Shea pursuant to his nonstatutory stock option agreement with the
Corporation (See "-- Certain Agreements") became fixed upon the completion of
the Corporation's public offering of Common Stock in October 1994. Mr. O'Shea
inadvertently failed to file a report regarding said options under Section 16(a)
at the Securities and Exchange Act of 1934 on a timely basis. The report was
subsequently filed.
- --------------------------------------------------------------------------------
MISCELLANEOUS
- --------------------------------------------------------------------------------
The cost of soliciting proxies will be borne by the Corporation. The
Corporation will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitations by mail,
directors, officers and regular employees of the Corporation may solicit proxies
personally or by telegraph or telephone without additional compensation.
The Corporation's 1996 Annual Report to Stockholders, including financial
statements, has been mailed to all stockholders of record as of the close of
business on the Record Date. Any stockholder who has not received a copy of such
Annual Report may obtain a copy by writing to the Secretary of the Corporation.
Such Annual Report is not to be treated as a part of the proxy solicitation
material or as having been incorporated herein by reference.
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS
- --------------------------------------------------------------------------------
In order to be eligible for inclusion in the Corporation's proxy
materials for next year's Annual Meeting of Stockholders, any stockholder
proposal to take action at such meeting must be received at the Corporation's
executive office at 64 Mountain View Boulevard, Wayne, New Jersey 07470 no later
than December 3, 1997. Any such proposals shall be subject to the requirements
of the proxy rules adopted under the Securities Exchange Act of 1934, as
amended.
BY ORDER OF THE BOARD OF DIRECTORS
MORTIMER J. O'SHEA
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Wayne, New Jersey
March 21, 1997
13
<PAGE> 16
- --------------------------------------------------------------------------------
ANNUAL REPORT ON FORM 10-K
- --------------------------------------------------------------------------------
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1995 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE
FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF THE RECORD DATE UPON WRITTEN
REQUEST TO: STOCKHOLDER RELATIONS, RAMAPO FINANCIAL CORPORATION, 64 MOUNTAIN
VIEW BOULEVARD, WAYNE, NEW JERSEY 07470.
- --------------------------------------------------------------------------------
<PAGE> 17
RAMAPO
FINANCIAL P.O. BOX 221
CORPORATION WAYNE, NEW JERSEY 07470 REVOCABLE PROXY
- --------------------------------------------------------------------------------
SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF STOCKHOLDERS AT:
Radisson Hotel
690 Route 46 East
Fairfield, New Jersey
Tuesday, May 6, 1997 4:00 P.M.
The undersigned hereby appoints Vincent R. D'Accardi and Solomon W. Masters each
with the power to appoint his substitute, and hereby authorizes them to
represent and to vote, as designated on the reverse side, all shares of common
stock of Ramapo Financial Corporation held of record by the undersigned on
March 14, 1997, at the annual meeting of stockholders or any adjournment
thereof, and to vote, in accordance with the determination of a majority of the
Board of Directors, upon such other business as may properly come before the
meeting.
THE SHARES REPRESENTED BY THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS
DIRECTED BY THE STOCKHOLDER. IF NO DIRECTION IS GIVEN, SUCH SHARES WILL BE
VOTED "FOR" PROPOSAL 1.
(Continued, and to be signed, on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE> 18
<TABLE>
<CAPTION>
Please mark
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED your votes as
FOR PROPOSAL 1. indicated in [X]
this example
<S> <C> <C> <C> <C>
PROPOSAL NO. 1: ELECTION OF DIRECTORS. THE NOMINEES OF THE BOARD OF DIRECTORS ARE:
FOR ALL WITHHOLD Louis S. Miller Mortimer J. O'Shea Victor C. Otley, Jr.
NOMINEES AUTHORITY FOR
ALL NOMINEES
[ ] [ ] INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE THAT
NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
----------------------------------------------------------------------------------
Please sign below exactly as name appears. When
_______ shares are held by joint tenants, both should sign.
| When signing as attorney, executor, administrator,
| trustee or guardian, please give full title as such.
| If a corporation, please sign in full corporate name
by President or other authorized officer. If a
partnership or limited liability company please sign
by authorized person also indicating that
individual's capacity.
Signature
----------------------------------------------------
Signature
----------------------------------------------------
Date
----------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
- ------------------------------------------------------------------------------------------------------------------------------------
FOLD AND DETACH HERE
</TABLE>
[RAMAPO LOGO]
Dear Shareholder,
We are pleased to enclose the Notice of Annual Meeting and Proxy
Statement and our 1996 Annual Report. We hope that you will attend this
meeting. Your vote is very important to us and we encourage you to promptly
complete the above proxy card and return it in the envelope provided. A prompt
return of the proxy card is important to establish the quorum for the meeting
and would, thereby, preclude the corporation from incurring additional costs of
a second mailing or direct vote solicitation. We thank you for your continued
support.
Sincerely,
The Board of Directors
