PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Check the appropriate box:
[X] Definitive Proxy Statement
REPUBLIC NEW YORK CORPORATION
(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
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REPUBLIC NEW YORK CORPORATION
452 Fifth Avenue
New York, New York 10018
March 19, 1999
DEAR STOCKHOLDER:
The Directors and Officers of Republic New York Corporation cordially
invite you to attend the Annual Meeting of Stockholders of the Corporation
to be held on Wednesday, April 21, 1999 at 11:00 A.M., New York time. The
meeting will be held at the office of the Corporation at 452 Fifth Avenue,
New York, New York. Notice of the Annual Meeting and Proxy Statement are
enclosed.
You are urged to promptly vote and deliver your proxy. By voting your proxy now
you will not be precluded from attending the meeting. Your proxy is revocable;
in the event you find it convenient to attend the meeting, you may, if you wish,
withdraw your proxy and vote in person.
For your information, enclosed is the 1998 Annual Report of Republic New
York Corporation.
Very truly yours,
/s/ WALTER H. WEINER,
Chairman of the Board
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REPUBLIC NEW YORK CORPORATION
452 Fifth Avenue
New York, New York 10018
----------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
April 21, 1999
----------------------
NOTICE IS HEREBY GIVEN THAT, pursuant to the call of the Board of Directors
of Republic New York Corporation ("Republic Corporation"), the Annual
Meeting of Stockholders of Republic Corporation will be held on Wednesday,
April 21, 1999 at 11:00 A.M., New York time, at 452 Fifth Avenue, Borough of
Manhattan, City and State of New York, for the purpose of considering and
voting upon the following matters described in the attached Proxy
Statement:
1. Election of directors;
2. Reapproval of the 1994 Performance Based Incentive Compensation
Plan;
3. Approval of selection of auditors; and
4. Any other business which may properly be brought before
the meeting or any adjournment thereof.
The record date and hour for determining stockholders entitled to notice of
and to vote at the meeting, including any adjournment thereof, have been
fixed as of the close of business on March 4, 1999.
By Order of the Board of Directors,
WILLIAM F. ROSENBLUM, JR.,
Senior Vice President and
Corporate Secretary
March 19, 1999
YOU ARE URGED TO PROMPTLY VOTE AND DELIVER YOUR PROXY, WHETHER OR NOT YOU PLAN
TO ATTEND THE MEETING IN PERSON. IF YOU ATTEND THE MEETING, YOU MAY
NEVERTHELESS, IF YOU WISH, WITHDRAW YOUR PROXY AND VOTE IN PERSON.
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REPUBLIC NEW YORK CORPORATION
452 FIFTH AVENUE
NEW YORK, NEW YORK 10018
-----------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
APRIL 21, 1999
-----------------
This Proxy Statement is furnished to the stockholders of Republic New York
Corporation ("Republic Corporation") in connection with the solicitation of
proxies by the Board of Directors of Republic Corporation for the Annual
Meeting of Stockholders to be held on April 21, 1999.
The record date and hour for determining the stockholders of Republic
Corporation entitled to notice of and to vote at the meeting have been fixed
as of the close of business on March 4, 1999. At such date, 106,655,085 shares
of Republic Corporation Common Stock were outstanding and entitled to vote.
Each share of Republic Corporation Common Stock held on the record date
entitles the holder thereof to one vote for each director being elected (with
no cumulative voting permitted) and to one vote on each other matter. This
Proxy Statement and the form of proxy furnished herewith were first sent or
given to Republic Corporation stockholders on March 19, 1999.
INFORMATION ABOUT VOTING. Shareholders of record may vote using the toll-free
telephone number or the Internet voting site listed on the proxy card or by
signing, dating and mailing the proxy card in the postage-paid envelope
provided. If your shares of Republic Corporation Common Stock are held by a
bank, broker or other nominee, you will receive instructions from them,
including possibly instructions on how to vote by telephone or the Internet,
which you must follow in order to have your shares voted. When you use the
telephone system or Internet voting site, the system verifies that you are a
stockholder through the use of a unique Control Number assigned to you. The
procedure allows you to instruct the persons named on the enclosed proxy card
how to vote your shares and to confirm that your instructions have been
properly recorded. Specific directions for using the telephone and Internet
voting systems are included on the proxy card. Whichever of these methods you
select to transmit your instructions, the
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persons named on the enclosed proxy card will vote your shares in accordance
with those instructions. If you sign a proxy card without giving specific
voting instructions, your shares will be voted by the persons named on the
proxy card as recommended by the Board of Directors of Republic Corporation.
The method by which you vote will not limit your right to vote at the Annual
Meeting if you decide to attend in person. If your shares of Republic
Corporation Common Stock are held by a bank, broker or other holder of record,
you will need proof of ownership to be admitted to the meeting. A recent
brokerage statement or letter from your bank or broker are examples of proof of
ownership. If you are a beneficial owner of Republic Corporation Common Stock
and want to vote your shares in person, you must obtain a proxy in your name
from your bank, broker or other holder of record in order to vote at the Annual
Meeting.
FOR EMPLOYEES OF REPUBLIC CORPORATION, REPUBLIC BANK AND SUBSIDIARIES. If you
are a participant in the Profit Sharing and Savings Plan or the 1998 Long Term
Incentive Compensation Plan, you will receive a separate card for all the
shares of Republic Corporation Common Stock allocated to your account under
each of such Plans that will serve as your voting instructions card for
Wachovia Bank N.A. as Plan Trustee for such Plans. Your instructions to the
Plan Trustee will be held in strict confidence and will be made available only
to the inspectors of election at the Annual Meeting, none of whom is an
employee of Republic Corporation or any of its subsidiaries. Pursuant to the
terms of such Plans, any shares held by the Plan Trustee as to which it has not
received voting instructions by April 14, 1999 will be voted in the same
manner, proportionately, as the shares as to which voting instructions have
been received.
ELECTION OF DIRECTORS
In accordance with the By-Laws of Republic Corporation, the number of directors
of Republic Corporation to be elected at the Annual Meeting has been
established at twenty. If elected, each nominee will serve until the next
Annual Meeting of Stockholders and until the election and qualification of his
or her successor. Each of the nominees named below is presently a director of
Republic Corporation and, with the exception of Stephen J. Saali, who was
elected as a director on December 16, 1998, and Rodney G. Ward, who was elected
as a director on October 9, 1998, was elected to such office at last year's
Annual Meeting.
A plurality of the votes cast at the meeting is required for the election of
directors. Neither abstentions nor broker non-votes have any effect on the
election of directors. If any nominee becomes unwilling or unable to accept
nomination or election, which is not anticipated, it is intended that the
persons acting under the proxy will vote for the election in his or her stead
of such other person as the Nominating Committee of the Board of Directors may
recommend.
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Listed below are the names and ages of the nominees, the year in which each
first became a director, their principal occupations for the past five years
(including, where applicable, positions with Republic National Bank of New York
("Republic Bank"), Republic Corporation's principal subsidiary) and the number
of shares of Republic Corporation's Common Stock beneficially owned by each, as
of January 31, 1999.
<TABLE>
<CAPTION>
DIRECTOR BENEFICIAL OWNERSHIP
NOMINEE AND AGE SINCE PRINCIPAL OCCUPATION OF SHARES (1)<F1>
- ------------------------- --------- --------------------------------------------- --------------------
<S> <C> <C> <C>
Cyril S. Dwek 1974 Vice Chairman of the Board of Republic Bank 129,788 shares
62 Years and Vice Chairman of Republic
Corporation. Director of Republic Bank.
Ernest Ginsberg 1985 Vice Chairman of the Board of Republic Bank 54,279 shares
67 Years and Vice Chairman (and General Counsel (2)<F2>(3)<F3>
until April 1994) of Republic Corporation.
Director of Republic Bank.
Nathan Hasson 1993 Vice Chairman of the Board and Treasurer of 41,851 shares
53 Years Republic Bank and Vice Chairman of Republic (2)<F2>(4)<F4>
Corporation. Director of Republic Bank.
Peter Kimmelman 1979 A private investor. Director of Republic Bank. 4,724 shares
54 Years (5)<F5>
Leonard Lieberman 1990 A private investor. Director of Republic 1,500 shares
70 Years Bank. Also, a director of various companies,
including Celestial Seasonings, Inc. and
Sonic Corp.
William C. MacMillen, Jr. 1974 President of William C. MacMillen & Co., Inc., 13,404 shares
85 Years an investment firm. Also a director of
Financial Federal Corporation. Director of
Republic Bank.
Peter J. Mansbach 1994 Of counsel to Kronish, Lieb, Weiner & Hellman, 6,200 shares
61 years attorneys, and director of various companies;
Chairman of the U.S. Group and Member of the
DIRECTOIRE of the European Group of Van Cleef
& Arpels. From June 1994 through December 1997,
Chairman of the Executive Committees of the
Boards of Directors of Republic Corporation
and Republic Bank, and prior thereto, a
partner at Kronish, Lieb, Weiner & Hellman.
Director of Republic Bank.
Martin F. Mertz 1987 Director of Republic Bank. Formerly, Chairman of 15,000 shares
73 Years the Executive Committee of Republic Bank for
Savings, from May 1990 to January 1996.
James L. Morice 1987 Partner, Mirtz Morice, Inc., a management 660 shares
61 Years consulting firm. Director of Republic Bank. (6)<F6>
(TABLE CONTINUED ON NEXT PAGE)
3
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DIRECTOR BENEFICIAL OWNERSHIP
NOMINEE AND AGE SINCE PRINCIPAL OCCUPATION OF SHARES (1)<F1>
- ------------------------- --------- --------------------------------------------- --------------------
<S> <C> <C> <C>
E. Daniel Morris 1993 President of Corsair Capital Corporation, a 2,000 shares
57 Years private investment and real estate development
firm, since 1992. Formerly, Chairman of the
Board of Republic New York Trust Company of
Florida, N.A., a wholly-owned subsidiary of
Republic Corporation, from January 1995 to
April 1996. Also, a Director and Chief
Executive Officer of Republic New York
Securities Corporation, Republic Corpora-
tion's wholley-owned broker-dealer subsidiary,
from April to December 1994. Director, since
1996, of Safra Republic Investments Limited,
an asset management firm based in London,
England and owned jointly by Republic
Corporation and Safra Republic Holdings S.A.
Janet L. Norwood 1992 Senior Fellow of The Urban Institute, a 1,500 shares
75 years research organization in Washington, D.C.
Director of Republic Bank.
John A. Pancetti 1990 Chairman of the Board and Chief Executive 80,300 shares
69 Years Officer of Republic Bank for Savings from May (7)<F7>
1990 until January 1996. Vice Chairman of the
Board of Republic Bank from March 1991 until
January 1996, and Vice Chairman of Republic
Corporation from April 1991 until January 1996.
Director of Republic Bank.
Vito S. Portera 1986 Vice Chairman of Republic Corporation and 20,230 shares
56 Years Vice Chairman of the Board of Republic (2)<F2>(8)<F8>
Bank. Director of Republic Bank. Also,
Chairman of the Board of Republic
International Bank of New York (Miami),
the Florida-based Edge Act subsidiary of
Republic Bank.
William P. Rogers 1989 Senior Partner, Rogers & Wells, attorneys, 60,000 shares
85 Years Director of Republic Bank.
Elias Saal 1995 Vice Chairman of Republic Corporation since 40,800 shares
46 Years July 1995 and Vice Chairman of the Board (2)<F2>
since June 1995 of Republic Bank.
Chairman of the Executive Committees of
the Board of Directors of Republic
Corporation and Republic Bank since
December 1998. Executive Vice President
of Republic Bank prior to June 1995.
Director of Republic Bank.
Stephen J. Saali 1998 President of Republic Corporation and Vice 4,836 shares
34 Years Chairman of the Board of Republic Bank (2)<F2>
since December 1998. Prior thereto, served as
an officer of Republic Corporation for more than
five years, most recently as Managing Director.
(TABLE CONTINUED ON NEXT PAGE)
4
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DIRECTOR BENEFICIAL OWNERSHIP
NOMINEE AND AGE SINCE PRINCIPAL OCCUPATION OF SHARES (1)<F1>
- ------------------------- --------- --------------------------------------------- --------------------
<S> <C> <C> <C>
Dov C. Schlein 1987 President of Republic Bank and Vice Chairman 65,640 shares
51 Years of Republic Corporation. Chairman of the (2)<F2>(9)<F9>
Board - Designate and Chief Executive Officer
- Designate of Republic Corporation and
Republic Bank, subject to election by the Boards
of Directors of Republic Corporation and Republic
Bank. Director of Republic Bank.
Rodney G. Ward 1998 Vice Chairman of the Board of Republic Bank, 100 shares
54 Years and Regional General Manager of Republic
Bank's operations throughout the Asia Pacific
region, since September 1998. Director of
Republic Corporation since October 1998, and of
Republic Bank since March 1999. Prior thereto,
Regional Chairman - Emerging Europe, Africa and
the Middle East at SBC Warburg in Zurich,
Switzerland from 1997 to 1998, Regional Chairman
- Asia Pacific of SBC Warburg from 1995 to 1997,
and Managing Director and Regional Chairman -
Asia Pacific of S.G. Warburg in 1994.
Walter H. Weiner 1978 Chairman of the Board and Chief Executive 125,635 shares
68 Years Officer of Republic Bank and Republic (11)<F11>(12)<F12>
Corporation (10). Director of Republic
Bank.
George T. Wendler 1997 Vice Chairman since May 1997 and Chairman of 31,468 shares
54 Years the Credit Committee of Republic Corporation (2)<F2>(13)<F13>
since October 1994 and a director and Vice
Chairman of the Board of Republic Bank since
June 1995. Prior thereto, Executive Vice
President of Republic Bank.
- -------------
<FN>
<F1>(1)As of January 31, 1999, no nominee's ownership of shares of Republic
Corporation's Common Stock exceeded one percent (1%) of
the outstanding shares of such class.
<F2>(2)Includes 3,600 shares for Ernest Ginsberg, 15,600 shares for Nathan
Hasson, 11,000 shares for Vito S. Portera, 9,800 shares for Elias Saal,
4,686 shares for Stephen J. Saali, 22,500 shares for Dov C. Schlein and
13,250 shares for George T. Wendler which were awarded pursuant to
Republic Corporation's 1985 Restricted Stock Plan and 1995 Long Term
Incentive Stock Plan or selected pursuant to the 1998 Long Term
Incentive Compensation Plan, and which are subject to a substantial risk
of forfeiture for various restricted periods, the latest of which
expires on January 15, 2010.
<F3>(3)Includes 50,679 shares which Mr. Ginsberg owns jointly with his wife.
<F4>(4)Includes 26,251 shares which Mr. Hasson owns jointly with his wife.
<F5>(5)Includes 674 shares owned by Mr. Kimmelman's wife in which he disclaims
any beneficial interest.
<F6>(6)Includes 600 shares which Mr. Morice owns jointly with his wife and
60 shares owned by Mr. Morice's son, in which 60 shares Mr. Morice
disclaims any beneficial interest.
<F7>(7)Includes 80,000 shares which Mr. Pancetti owns jointly with his wife.
<F8>(8)Includes 4,150 shares held by a trust controlled by Mr. Portera.
<F9>(9)Includes 41,690 shares which Mr. Schlein owns jointly with his wife,
and 1,450 shares owned by Mr. Schlein's daughter, in which 1,450 shares
Mr. Schlein disclaims any beneficial interest.
5
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<F10>(10)Mr. Weiner has announced his intention to relinquish the position of
Chairman of the Board and Chief Executive Officer of Republic
Corporation at the time of the Annual Meeting.
<F11>(11)Includes 49,480 shares for Walter H. Weiner which were awarded pursuant
to Republic Corporation's 1985 Restricted Stock Plan and 1995 Long Term
Incentive Stock Plan, and 56,949 shares which were issued pursuant to
Republic Corporation's Restricted Stock Election Plan, all of which are
subject to a substantial risk of forfeiture until after the termination
of Mr. Weiner's employment with Republic Corporation.
<F12>(12)Includes 6,210 shares owned by a Keogh Plan pension trust of which Mr.
Weiner is the beneficiary and 3,430 shares owned by Mr. Weiner's wife in
which he disclaims any beneficial interest.
<F13>(13)Includes 18,218 shares which Mr. Wendler owns jointly with his wife.
</FN>
</TABLE>
As of January 31, 1999, all nominees as a group beneficially owned 699,915
shares of Republic Corporation's Common Stock or approximately .65% of the
outstanding shares.
For certain information concerning business relationships and transactions
between Republic Corporation, its subsidiaries and affiliates and certain
nominees, see "Transactions with Management and Related Persons" below.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. All Forms 3, 4 and 5
were filed in a timely fashion and in compliance with the applicable securities
laws and regulatory requirements, with the exception of the Form 3 filed in
February 1999 by Stephen J. Saali.
DIRECTORS' COMMITTEES
The Board of Directors of Republic Corporation has established Audit, Community
Reinvestment Act, Credit Review, Executive, Finance, Human Resources,
Investment, Nominating, Public Responsibility and Risk Assessment Committees.
The AUDIT COMMITTEE of the Board of Directors of Republic Corporation,
consisting of Peter Kimmelman, Leonard Lieberman, William C. MacMillen, Jr.
(Chairman), Peter J. Mansbach, Janet L. Norwood and William P. Rogers,
recommends the selection of the independent auditors, reviews the plan for the
current year's audit and the results of the prior year's audit, approves the
non-audit professional services provided by such auditors, and reviews and
supervises the scope and adequacy of Republic Corporation's internal audit and
internal accounting controls. No member of the Committee is an officer or
employee of Republic Corporation. During 1998, the Audit Committee held seven
meetings.
The COMMUNITY REINVESTMENT ACT COMMITTEE, consisting of Richard A. Kraemer (who
is not standing for reelection), Martin F. Mertz, James L. Morice (Chairman),
John A. Pancetti and Walter H. Weiner, is responsible for, and coordinates at
the holding company level, the federal Community Reinvestment Act activities of
Republic Bank, including the review and supervision of Republic Corporation's
compliance with the Community Reinvestment Act. During 1998, the Community
Reinvestment Act Committee held seven meetings.
The CREDIT REVIEW COMMITTEE, consisting of Peter Kimmelman (Chairman),
Leonard Lieberman, William C. MacMillen, Jr., E. Daniel Morris, Janet L.
Norwood, John A. Pancetti and Walter H. Weiner, reviews
6
<PAGE>
and monitors Republic Corporation's Credit Policy Statement, the allowance for
credit losses and the net debit cap levels. During 1998, the Credit Review
Committee held six meetings.
The EXECUTIVE COMMITTEE, consisting of Peter Kimmelman, William C. MacMillen,
Jr., Elias Saal (Chairman), Dov C. Schlein and Walter H. Weiner, meets, when
necessary, between meetings of the Board of Directors with the authority to
exercise all the powers of the Board of Directors to the extent permitted by
law and Republic Corporation's By-Laws. During 1998, the Executive Committee
held three meetings and took action ten times by unanimous written consent.
The FINANCE COMMITTEE, consisting of E. Daniel Morris, Thomas F. Robards (who
is not standing for reelection), Elias Saal, Dov C. Schlein (Chairman) and
Walter H. Weiner, is charged with monitoring the capital adequacy of Republic
Corporation and developing and supervising programs to fund the capital
requirements of Republic Corporation and its subsidiaries and recommending to
the Board of Directors the means necessary to carry out such programs. Pursuant
to delegated authority from the Board of Directors, the Finance Committee
establishes the price and related terms of certain securities publicly offered
by Republic Corporation. During 1998, the Finance Committee did not hold any
meetings.
The HUMAN RESOURCES COMMITTEE, composed of three outside directors, Peter
Kimmelman, Leonard Lieberman and James L. Morice (Chairman), oversees Republic
Corporation's human resources management policies and practices and the
compensation and benefits of its officers and employees. The Committee
considers and recommends to the Board of Directors compensation plans and
benefit programs in which officers and employees of Republic Corporation and
its subsidiaries are eligible to participate and administers such plans and
programs, with the authority to grant any awards or benefits thereunder. During
1998, the Human Resources Committee held eleven meetings and took action three
times by unanimous written consent.
The INVESTMENT COMMITTEE, consisting of Peter Kimmelman, Leonard Lieberman
(Chairman), E. Daniel Morris, Peter J. Mansbach, Janet L. Norwood and John A.
Pancetti, and Messrs. Hasson and Saal as EX OFFICIO members, authorizes and
supervises Republic Corporation's investments in securities and other property.
During 1998, the Investment Committee held five meetings.
The NOMINATING COMMITTEE consists of E. Daniel Morris, Dov C. Schlein and
Walter H. Weiner (Chairman). Its principal function is to consider and
recommend a slate of nominees for election to the Board of Directors each year
at the Annual Meeting of Stockholders. Such Committee will consider candidates
suggested by stockholders by a letter directed to the Corporate Secretary of
Republic Corporation. The Nominating Committee acted by unanimous written
consent in March 1999 to recommend the slate of nominees presented to the 1999
Annual Meeting of Stockholders.
The PUBLIC RESPONSIBILITY COMMITTEE consists of Ernest Ginsberg, Leonard
Lieberman, William P. Rogers (Chairman) and Walter H. Weiner. This Committee
assists Republic Corporation in endeavoring to maintain the highest legal and
ethical standards as well as assists in evaluating other aspects of Republic
Corporation's activities and proposed activities in relation to its overall
public responsibility and public image. During 1998, the Public Responsibility
Committee held seven meetings.
The RISK ASSESSMENT COMMITTEE consists of Peter Kimmelman, Leonard Lieberman,
William C. MacMillen, Jr., E. Daniel Morris, Janet L. Norwood (Chairwoman) and
William P. Rogers, with Messrs. Portera, Saal,
7
<PAGE>
Schlein and Weiner as EX OFFICIO members. The Committee identifies, measures
and monitors risk relating to all activities of, and products offered by,
Republic Corporation, including evaluating the methodology employed by
management in determining the nature of risk inherent in a particular activity
or product. During 1998, the Risk Assessment Committee held eight meetings.
During 1998, Republic Corporation's Board of Directors held seven meetings.
With the exception of Mr. Morris, each director attended 75 percent or more of
the aggregate number of meetings held during 1998 of the Board of Directors of
Republic Corporation and the committees thereof, if any, on which he or she
served.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
DIRECTORS' COMPENSATION
Directors of Republic Corporation who are also officers of Republic Corporation
or any of its subsidiaries do not receive compensation for their services as
directors.
Directors of Republic Corporation, who are not officers of Republic Corporation
or any of its subsidiaries and who are not otherwise compensated through
additional arrangements with any such entities, are paid as follows: each
director who serves as a committee chair receives annual director's fees of
$50,000, together with attendance fees of $500 per directors' meeting of
Republic Corporation attended, $750 per meeting of a committee of the Board
attended at which he or she presides, and $400 per meeting of a committee of
the Board attended as a member; other non-officer directors who are not
otherwise compensated through additional arrangements with any Republic
entities are paid a quarterly retainer of $1,500 to attend directors' meetings
of Republic Corporation and $500 for each meeting they attend of the Board and
$400 for each meeting they attend of a committee of the Board of which they are
a member. Other directors of Republic Corporation, who are not officers of
Republic Corporation or any of its subsidiaries and who are otherwise
compensated through additional arrangements with any such entities, generally
are paid a quarterly retainer of $800 to attend directors' meetings of Republic
Corporation and $300 for each meeting they attend of the Board and $250 for
each meeting they attend of a committee of the Board of which they are a member.
For the fiscal year ended December 31, 1998, directors of Republic Corporation
who were not officers received the above-described directors' fees from
Republic Corporation aggregating $394,000.
In lieu of directors' fees, William P. Rogers received an aggregate of $150,000
for the fiscal year ended December 31, 1998 as compensation for serving as a
director of Republic Corporation as well as for serving as a director of and a
senior consultant to Republic Bank.
EXECUTIVE COMPENSATION
HUMAN RESOURCES COMMITTEE REPORT
RESPONSIBILITIES AND COMPOSITION OF THE COMMITTEE. The Human Resources
Committee of the Board of Directors of Republic Corporation (the "Committee")
reviews and approves the compensation levels for
8
<PAGE>
Republic Corporation's executive officers and oversees and administers Republic
Corporation's compensation and benefits programs. All the members of the
Committee are independent, non-employee directors who are not eligible to
participate in any of the programs that the Committee oversees. The following
report describes the actions of the Committee regarding compensation paid to
the Chief Executive Officer and the named executive officers for 1998.
COMPENSATION POLICIES AND STRATEGY. The main components of total compensation
for Republic Corporation's executive officers are base salary and annual
incentive awards. A portion of the annual incentive awards may be awarded in
the form of restricted stock or other kinds of deferred or restricted
compensation. Republic Corporation has a policy of maintaining base salaries
for executive officers at a constant level and using annual incentive awards to
reflect each executive officer's contribution to Republic Corporation's
performance.
Republic Corporation established its practice of linking executive compensation
to corporate performance in 1980, when Walter H. Weiner became Chief Executive
Officer. Since that time, Republic Corporation has utilized an overall
compensation strategy that provides for the determination of a significant
portion of executive officer compensation in relation to Republic Corporation's
performance as measured by the increase in its diluted earnings per common
share ("earnings per share") for the year over a base year of 1979, adjusted
for stock splits. By using this increase in earnings per share as the basis for
determining the amount of each executive officer's corporate performance-based
bonus, Republic Corporation is giving recognition to the fact that management
is shared by the Chief Executive Officer and the other named executive officers
as a team and, therefore, the performance of Republic Corporation, as measured
by the increase in earnings per share, reflects the joint efforts of the group.
This strategy has been incorporated into the awards granted to the Chief
Executive Officer and the named executive officers under the 1994 Performance
Based Incentive Compensation Plan (the "Performance Based Plan"), discussed
below. The Committee believes that an increase in earnings per share is a more
accurate measure of executive performance than an increase in cumulative total
shareholder return (SEE the stock performance graph on page 12 of this Proxy
Statement). Management has a more direct impact on earnings, by being able to
increase productivity and control expenses, than it does on shareholder return,
which is also subject to changes in market conditions that are beyond
management's control.
PERFORMANCE BASED PLAN. As noted above, Republic Corporation's established
strategy of linking a significant portion of executive officer compensation to
increased productivity and cost control, as measured by the increase in its
earnings per share, was incorporated into the Performance Based Plan. The
Performance Based Plan was adopted by the Board of Directors and approved by
the stockholders in 1994 and complies with Section 162(m) of the Internal
Revenue Code governing the deductibility of annual executive officer
compensation in excess of $1 million. In addition to adopting the Plan,
Republic Corporation has a policy of entering into agreements with its
executive officers to defer annual compensation in excess of the $1 million
limitation, should it become necessary to do so.
Within the first 90 days of each Plan Year, the Committee considers awards for
the Chief Executive Officer and the other executive officers. The Committee
determines who will participate in the Plan for the current year, the
participant's Base Year (which may not be prior to 1979) and the notional
number of shares ("Award Multiple") of Republic Corporation's Common Stock to
be used solely for the purpose of calculating the maximum amount payable to
each participant ("Award"). Following the completion of the Plan Year, the
maximum amount payable to each participant is determined by multiplying (i) the
amount by
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<PAGE>
which the earnings per share for the Plan Year (adjusted to eliminate
the effect of amounts paid or accrued with respect to any Award) exceeds the
earnings per share for the Base Year (adjusted as is necessary to preserve
inter-period comparability between earnings per share for the Base Year and the
Plan Year for any Award), by (ii) the Award Multiple for each participant.
For 1998, the Committee established different Award Multiples for each
participant and set a Base Year of 1979 for each participant. The Committee
also added an additional component to the formula for calculating Awards in the
form of an "award multiplier" of up to 1.5 by which a participant's notional
number of shares would be multiplied to determine the maximum amount payable to
each participant. The award multiplier allows the Committee greater flexibility
to grant competitive compensation arrangements and to provide further
incentives to participants in the Performance Based Plan. The Committee has the
discretion to reduce the amount payable pursuant to Awards and to distribute a
portion of the final amount payable in the form of restricted stock or other
kinds of deferred or restricted compensation. It is possible for the Committee
to award the Chief Executive Officer and the other named executive officers
compensation in excess of the Plan formula, but the amount of any such excess
must be included in the calculation of the $1 million annual limitation on the
deductibility of any such officer's compensation.
LONG TERM INCENTIVE COMPENSATION PLAN. The Board of Directors established the
1998 Long Term Incentive Compensation Plan (the "Long Term Incentive Plan") to
permit deferred awards of restricted cash compensation to a select group of
management and highly compensated employees designated by the Committee. The
Committee believes that Long Term Incentive Plan awards, used in conjunction
with other performance-based compensation, serves to attract and retain key
management personnel who make a material contribution to the successful
operation of Republic Corporation and its subsidiaries. Each Long Term
Incentive Plan award is deferred for a period of time determined by the
Committee and is subject to a substantial risk of forfeiture in the event of
termination of employment (for reasons other than death or disability of the
participant) prior to the vesting date for the award. During the restricted
period, a participant is permitted to invest his or her award in various
investment options, including Republic Corporation's Common Stock, provided by
the Long Term Incentive Plan.
The bonus payments which the Committee awarded to the named executive officers
for 1998 reflected the joint efforts of the group to the extent they were
related to their Performance Based Plan awards. Amounts awarded in excess of
the Performance Based Plan awards for 1998 were based on the recommendations of
the Chief Executive Officer, and in the case of two named executive officers, a
portion thereof was distributed in the form of deferred awards under the Long
Term Incentive Plan. In the aggregate, the performance-based compensation,
including the Long Term Incentive Plan awards, certified for the four named
executive officers as a group decreased by approximately 44% as compared with
1997 performance-based compensation. In Republic Corporation's opinion, the
pay-outs of compensation for 1998 to the named executive officers are fully
deductible.
CHIEF EXECUTIVE OFFICER'S COMPENSATION FOR 1998. Since becoming Chief Executive
Officer of Republic Corporation in January 1980, Mr. Weiner's base salary has
not increased and his annual bonus has been related to the amount by which the
earnings per share for the year exceeds the earnings per share for the base
year of 1979, multiplied by an attributed notional amount of shares used solely
for the purpose of calculating Mr. Weiner's bonus. This method of determining
Mr. Weiner's annual bonus, originally based on certain provisions in his
employment agreement (which expired by its terms on December 31, 1989), has
been effectively continued through the Performance Based Plan, as described
above. For 1998, the
10
<PAGE>
Committee granted Mr. Weiner an award under the Performance Based Plan pursuant
to which he was eligible to receive a performance-based bonus determined by
multiplying $1.46 (the amount by which the earnings per share for 1998 exceeded
the earnings per share in 1979, as adjusted pursuant to the Performance Based
Plan) by 472,500 (the notional amount of shares awarded by the Committee), and
further multiplied by 1.5 (the award multiplier applied by the Committee). Mr.
Weiner's notional amount of shares is based on the amount that was used in the
formula under his original employment agreement and reflects all stock splits
since the 1979 base year.
For 1998, taking into account both Republic Corporation's overall performance
and Mr. Weiner's individual performance, the Committee awarded Mr. Weiner an
annual incentive award of $1,275,000, of which $240,225 was above that
calculated pursuant to the Performance Based Plan. The Committee awarded such
additional amount for Mr. Weiner's overall performance during his tenure as
Chief Executive Officer (which, it has been announced, he will be relinquishing
at the Annual Meeting). In total, Mr. Weiner's annual incentive compensation
decreased approximately 33% from that awarded for 1997. In Republic
Corporation's opinion, all of Mr. Weiner's compensation for 1998 is fully
deductible.
CONCLUSION. Through the programs described above, a significant portion of
Republic Corporation's executive officer compensation is based on corporate
performance and an evaluation of the results of each officer's individual
performance. For 1998, over 80% of the total compensation of the Chief
Executive Officer and the other named executive officers consisted of these
variable performance-related elements. The Committee intends to continue its
policy of relating executive compensation to corporate performance as well as
to individual performance.
JAMES L. MORICE, CHAIRMAN
PETER KIMMELMAN
LEONARD LIEBERMAN
11
<PAGE>
FIVE-YEAR COMPARATIVE STOCK PERFORMANCE
The following graph compares the cumulative total shareholder return on the
Common Stock of Republic Corporation for the last five fiscal years with the
cumulative total return on the Standard & Poor's 500 Stock Index and the
Standard & Poor's Money Center Bank Index over the same period (assuming the
investment of $100 in the Common Stock of Republic Corporation, the S&P 500 and
the S&P Money Center Banks on December 31, 1993, and reinvestment of all
dividends as indicated below the graph). Note: Given the recent combinations in
the banking and financial services industries, management believes that it is
more meaningful to focus on the last five-years' performance of Republic
Corporation's Common Stock than on such performance over a longer period.
Accordingly, the prior years' graph on Republic Corporation's 25-year
comparative stock performance has been omitted from this year's Proxy Statement.
[GRAPH - Comparison of Five-Year Cumulative Total Return Among Republic
New York Corporation, S&P 500 Stock Index and S&P Money Center Banks Index -
has been omitted. The information set forth in such graph is found in the
table "Comparison of Five-Year Cumulative Total Return..." below.]
<TABLE>
Comparison of Five-Year Cumulative Total Return
Among Republic New York Corporation, S&P 500 Stock Index and S&P
Money Center Banks Index
<CAPTION>
Measurement Period Republic Corporation S&P Money Center Banks
(Fiscal Year Covered) (formerly Republic Bank) S&P 500 Index (formerly S&P Banks NYC)
----------------------- ------------------------ ------------- ------------------------
<S> <C> <C> <C>
Measurement Point:
12/31/93 $ 100 $ 100 $ 100
FYE 12/31/94 100 101 98
FYE 12/31/95 140 139 159
FYE 12/31/96 189 171 238
FYE 12/31/97 268 228 321
FYE 12/31/98 218 293 332
<FN>
Sources:
S&P 500, S&P Money Center Banks: Standard & Poor's
RNB: Company Statistics
</FN>
</TABLE>
12
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth the cash and noncash compensation for each of
the last three fiscal years awarded to or earned by the Chief Executive Officer
and the four other most highly compensated executive officers of Republic
Corporation.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------- -------------------------------------------------
RESTRICTED RESTRICTED ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) STOCK AWARD($)1<F1>,2<F2>,3<F3> CASH AWARD($)4<F4> COMPENSATION($)5<F5>
- ----------------------------- ---- -------- --------- ------------------------------ ----------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
WALTER H. WEINER 1998 220,750 1,275,000 -- -- 4,925
Chairman of the Board and 1997 220,750 1,505,000 -- 400,000 7,763
Chief Executive Officer of 1996 220,750 1,328,937 471,700 -- 7,763
Republic Corporation and
of Republic Bank
DOV C. SCHLEIN 1998 200,000 945,000 -- 125,000 4,925
Vice Chairman of Republic 1997 200,000 1,550,000 -- 350,000 7,763
Corporation and President 1996 200,000 1,310,000 462,800 -- 7,763
of Republic Bank
ELIAS SAAL 1998 200,000 1,075,000 -- 150,000 4,925
Vice Chairman of Republic 1997 200,000 1,720,000 -- 480,000 84,748
Corporation and Vice 1996 200,000 1,200,000 436,100 -- 115,676
Chairman of the Board of
Republic Bank
CYRIL S. DWEK 1998 250,000 730,000 -- -- 4,925
Vice Chairman of Republic 1997 250,000 1,150,000 -- -- 7,763
Corporation and Vice 1996 250,000 1,045,000 -- -- 7,763
Chairman of the Board of
Republic Bank
VITO S. PORTERA 1998 300,000 750,000 -- -- 4,925
Vice Chairman of Republic 1997 300,000 1,150,000 -- 300,000 7,763
Corporation and Vice 1996 300,000 635,000 222,500 -- 7,763
Chairman of the Board of
Republic Bank
- --------------
<FN>
<F1>(1)Awards of restricted stock were not made for performance in 1997 or 1998.
Awards of restricted stock for performance in 1996 were made on March 27,
1997, pursuant to the terms of Republic Corporation's 1995 Long Term
Incentive Stock Plan, to Messrs. Weiner, Schlein, Saal and Portera. A
portion of such awards to Messrs. Weiner and Portera constituted part of
their Performance Based Plan compensation for 1996. The value of each
restricted stock award was calculated by multiplying the closing market
price of Republic Corporation's Common Stock on the date of the award by
the number of shares awarded.
<F2>(2)As of December 31, 1998, Mr. Weiner owned an aggregate of 105,851
restricted shares (10,600 of which were awarded for 1996 performance), Mr.
Schlein owned an aggregate of 35,000 restricted shares (including 10,400
shares awarded for 1996 performance), Mr. Saal owned an aggregate of 9,800
restricted shares (all of which were awarded for 1996 performance) and Mr.
Portera owned an aggregate of 21,000 restricted shares (including 5,000
shares awarded for 1996 performance). At December 31, 1998, such shares of
restricted stock held by Messrs. Weiner, Schlein, Saal and Portera had an
aggregate value of $4,822,836, $1,594,687, $446,513 and $956,813,
respectively.
<F3>(3)Pursuant to the terms of Republic Corporation's 1995 Long Term Incentive
Stock Plan and Restricted Stock Election Plan, participants are entitled
to receive all dividends paid on their restricted shares or may be given
the option by the Human Resources Committee to elect to receive additional
restricted shares in lieu of such dividend payments.
(FOOTNOTES CONTINUED ON NEXT PAGE)
13
<PAGE>
(FOOTNOTES CONTINUED FROM PREVIOUS PAGE)
<F4>(4)Awards of restricted cash for performance in 1998 were made on March 2,
1999 pursuant to the terms of Republic Corporation's 1998 Long Term
Incentive Compensation Plan to Mr. Schlein ($125,000) and Mr. Saal
($150,000). Awards of restricted cash for performance in 1997 were made on
March 20, 1998 pursuant to the terms of Republic Corporation's 1998 Long
Term Incentive Compensation Plan to Mr. Weiner ($400,000), Mr. Schlein
($350,000), Mr. Saal ($480,000) and Mr. Portera ($300,000).
<F5>(5)The compensation reported represents the amount of the annual company
allocations under the Profit Sharing and Savings Plan. Each executive
officer is fully vested in such amounts under the Plan. In addition, the
amounts reported for Mr. Saal represent the value of annual lease payments
made by Republic Bank for Mr. Saal's temporary residence in 1997 ($50,400)
and 1996 ($90,400).
</FN>
</TABLE>
PENSION PLAN
The following table sets forth the estimated annual benefits payable upon
retirement at age 65 in 1999 pursuant to Republic Bank's Retirement Plan (which
is a defined benefit plan) in relation to specified classifications of average
base salary for the highest paid five consecutive years during the last ten
years of employment (excluding bonuses, overtime and other adjustments to base
salary) and years of creditable service:
<TABLE>
<CAPTION>
Average Annual Salary
for Five Highest Paid YEARS OF SERVICE
Consecutive Years -------------------------------------------------------
During Last Ten Years 15*<F1> 20*<F1> 25*<F1> 30*<F1> 35*<F1>
- --------------------- -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$125,000 . . . $ 29,400 $ 39,190 $ 48,990 $ 58,790 $ 61,920
150,000 . . . 35,770 47,690 59,620 71,540 75,290
175,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
200,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
225,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
250,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
300,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
400,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
450,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
500,000 **<F2>. . 38,320 51,090 63,870 76,640 80,640
- -----------
<FN>
<F1>*During 1999, the maximum annual benefit as a result of the Tax Reform
Act of 1986 is $130,000.
<F2>**These figures have been limited by the annual compensation cap of $160,000
in 1999 resulting from the Omnibus Budget and Reconciliation Act of 1993.
</FN>
</TABLE>
The amounts in the foregoing table do not reflect various survivorship options
which participants may elect under the Retirement Plan and, depending on the
survivorship arrangement chosen, such amounts could be substantially reduced.
The following table presents (a) the credited years of service pursuant to the
Retirement Plan and (b) the current remuneration covered by the Plan (I.E.,
base salary) for each of the five most highly compensated executive officers of
Republic Corporation.
14
<PAGE>
<TABLE>
<CAPTION>
Credited Years Covered By
Name of Service Retirement Plan (1)<F1>
- -------------------------------- -------------- -------------------
<S> <C> <C>
Walter H. Weiner . . . . . .. . 19 $220,750
Dov C. Schlein . . . . . . .. . . 22 200,000
Elias Saal . . . . . . . . . . . 16 200,000
Cyril S. Dwek . . . . . . . . . . 33 250,000
Vito S. Portera . . . . . .. . . . 31 300,000
- --------------------
<FN>
<F1>(1)Such amounts are subject to an annual compensation cap of $160,000 for
1999 in accordance with the Omnibus Budget and Reconciliation Act of 1993.
</FN>
</TABLE>
Benefits under the Retirement Plan are based on the participant's base salary
(exclusive of bonuses, expense allowances, profit sharing contributions, fees,
overtime and other special payments) and length of employment. The Retirement
Plan provides that, in general, the normal benefit to which a participant is
entitled at or after age 65 or after completion of at least 30 years of service
is an annual amount equal to 1.2% of average annual compensation (as defined)
up to covered compensation (as defined) plus 1.7% of average annual
compensation in excess of covered compensation, TIMES years of service up to
30, PLUS .5% of average annual compensation times the number of years of
service in excess of 30 years of service. For purposes of the Plan, average
annual compensation means the participant's average compensation during the
participant's highest paid five consecutive years of employment during the
participant's last ten years of employment and covered compensation means the
average of the Social Security wage bases for the 35 years ending with the
participant's Social Security retirement age (which is between ages 65 and 67
depending on the year the participant was born). For example, the covered
compensation amount for a participant attaining age 65 in 1999 is $33,060.
EMPLOYMENT AGREEMENTS
Pursuant to an agreement dated December 23, 1997, Walter H. Weiner, a director
and Chief Executive Officer of Republic Corporation, has agreed to make his
services as a consultant available to Republic Corporation after the date he
retires from full-time employment with Republic Corporation (the "Termination
Date"). Mr. Weiner has publicly announced his intention to relinquish his
positions as Chairman of the Board and Chief Executive Officer of Republic
Corporation and Republic Bank at the time of the 1999 Annual Meeting. Pursuant
to the terms of this agreement, Mr. Weiner will provide consulting services, on
a part-time basis, for a period of three years from the Termination Date. Such
services will consist of such advisory services concerning the business,
affairs and management of Republic Corporation and its subsidiaries and
affiliates as may be requested by the Board of Directors or the new Chief
Executive Officer of Republic Corporation. Mr. Weiner will be paid $200,000 per
year, plus additional compensation, if any, at Republic Corporation's
discretion, for such consulting services, provided he is in compliance with the
terms of the non-competition provisions of the agreement. The agreement also
defers the vesting of Mr. Weiner's previously awarded shares of restricted
stock until after the Termination Date, and makes those shares forfeitable if
Mr. Weiner fails to comply with the terms of the non-competition provisions. If
not previously vested or forfeited, any remaining shares of restricted stock
will vest upon Mr. Weiner's death or disability.
15
<PAGE>
Vito S. Portera, a director and executive officer of Republic Corporation, had
an employment agreement with Republic Corporation and Republic Bank dated as of
May 27, 1988 (as amended March 7, 1989) which terminated pursuant to its terms
on December 31, 1996. The agreement provided, among other things, that Republic
Corporation and Republic Bank would buy Mr. Portera's house at any time during
the term of the agreement upon Mr. Portera's election. Republic Corporation and
Republic Bank have agreed to extend such option beyond December 31, 1996 for so
long as Mr. Portera remains in their employ, plus six months after termination
of his employment, subject to termination of such option by Republic
Corporation and Republic Bank upon twelve months' prior written notice.
TRANSACTIONS WITH MANAGEMENT
AND RELATED PERSONS
During 1998, certain directors and executive officers of Republic Corporation
or persons related to them were customers of, and had transactions with,
Republic Corporation and its subsidiaries, including Republic Bank, in the
ordinary course of business; additional transactions may be expected to take
place in the ordinary course of business in the future. In most cases, all such
outstanding loans and commitments were made upon substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons and did not involve more than normal
risks of collectibility or present other unfavorable features. In addition,
Republic Corporation and Republic Bank carry residential mortgage and
cooperative apartment loans made to Mr. Weiner outstanding in the principal
amount of $991,785 as of December 31, 1998, and to seven other executive
officers (five of whom were also directors of Republic Corporation during 1998),
outstanding in the aggregate principal amount of $5,559,234 as of December 31,
1998. Such loans were made at more favorable effective rates, including the
waiver of "points", than were available to customers of Republic Bank generally,
although no more favorable than the terms available to other employees of
Republic Corporation and its subsidiaries who are not executive officers.
Safra Republic Holdings S.A. ("Safra Republic"), a Luxembourg holding company
established by Republic Corporation in 1988, owns six European banks; its stock
is held, as of December 31, 1998, by Republic Bank (49.1%), by Saban S.A.
("Saban"), a Panamanian corporation wholly-owned by Edmond J. Safra (20.8%),
and by international investors (30.1%). Safra Republic and Republic Bank,
although independently managed, cooperate closely and have formulated their
policies based on certain common principles. Each of Safra Republic's banks and
Republic Bank also acts as a principal correspondent bank to each other's
respective locations around the world. At December 31, 1998, Safra Republic had
total assets of approximately $21.0 billion, total deposits of approximately
$16.4 billion and total stockholders' equity of approximately $1.9 billion.
In addition, Republic National Bank of New York (Suisse) S.A. ("RNB Suisse"),
the Geneva-based banking subsidiary of Safra Republic and an affiliate of
Republic Bank, leases office space in various locations in Geneva, Switzerland
for use in its banking business from Edmond J. Safra and several real estate
companies owned by Mr. Safra. Such transactions involved aggregate rental
payments for 1998 of approximately $9,795,853. The rents pursuant to all such
leases are based on independent appraisals of the fair rental value of such
properties. Such transactions were conducted in the normal course of business
on substantially the same terms as those prevailing for comparable transactions
with other persons and do not involve more than the normal risk of
collectibility nor present other unfavorable features.
16
<PAGE>
Messrs. Dwek and Weiner, who are directors and executive officers of Republic
Corporation and Republic Bank, are also directors of Safra Republic.
Accordingly, situations will arise from time to time in which potential
conflicts of interest could be present for such persons. In addition, the
nature of the businesses of Safra Republic's banks and Republic Bank is such
that competing interests among such companies may also arise with respect to,
among other things, areas of business in which such companies compete, business
dealings among such companies, the election of directors, issuances of capital
stock, declaration of dividends and similar corporate matters, corporate
opportunities in which such companies have an interest and other matters
involving the use of Republic Bank's trade name and trademarks and Republic
Bank's legal and regulatory status.
There are no agreements or arrangements that restrict or otherwise govern
competition between the two organizations in markets where both are entitled or
wish to act, nor is either of them obligated to advise the other of particular
business opportunities. All business transactions between Safra Republic's
banks and Republic Bank are conducted on an arm's-length basis, and it is their
intention to resolve all such conflicts described above consistent with each
organization's responsibilities to its stockholders.
As of January 31, 1999, approximately 29.1% of Republic Corporation's Common
Stock was beneficially owned, through two wholly-owned corporations, by Edmond
J. Safra. See "Ownership of Voting Securities -- Certain Beneficial Owners"
below. Mr. Safra, in addition to being the principal stockholder of Republic
Corporation, is Honorary Chairman of the Boards of Directors of Republic
Corporation and Republic Bank. Mr. Safra is also Chairman of the Board of Safra
Republic and of RNB Suisse. As Chairman of the Board of RNB Suisse, Mr. Safra
earned approximately $746,267 during 1998 for services performed for RNB Suisse.
The advice of Mr. Safra, as Republic Corporation's principal stockholder, is
often sought by Republic Corporation with respect to major policy decisions and
other significant matters.
In addition, Republic Corporation and its subsidiaries, principally Republic
Bank and its subsidiaries, have a broad range of business relationships with
Banco Safra S.A., a Brazilian banking corporation, and its United States
national bank subsidiary, Safra National Bank of New York, and Banque
Safra-Luxembourg S.A., a Luxembourg banking corporation, all of which are
associated through family members with Edmond J. Safra. Such relationships
include credit transactions, deposit relationships, foreign exchange dealings,
precious metals dealings, and securities clearing transactions and custodial
services. Such transactions have been conducted in the normal course of
Republic Corporation's business on substantially the same terms as those
prevailing for comparable transactions with other customers or suppliers and
have not involved more than normal risks of collectibility or any other
unfavorable features.
Republic New York (U.K.) Limited, a wholly-owned subsidiary of Republic Bank,
has also entered into a number of relationships with Banco Safra S.A. and its
subsidiaries as an underwriter or dealer of securities issued by them. Republic
New York (U.K.) Limited is also a Joint Lead Manager and Dealer on the
U.S.$250,000,000 Global Medium Term Note Program established in December 1996
by Globex Utilidades S.A., a Brazilian corporation in which Mrs. Lily Safra,
the wife of Mr. Safra, is a principal stockholder.
17
<PAGE>
OWNERSHIP OF VOTING SECURITIES
CERTAIN BENEFICIAL OWNERS
Set forth below is certain information as of December 31, 1998 as to the
persons who are known by Republic Corporation to own beneficially more than
five percent of the outstanding Common Stock of Republic Corporation.
<TABLE>
<CAPTION>
Amount and Nature Percent
Name and Address of Beneficial Ownership of Class
- ---------------------------------- ----------------------- --------
<S> <C> <C>
Edmond J. Safra . . . . . . . . 30,844,226 (a)<F1> 28.7%
2, Place du Lac
Geneva, Switzerland
Sanford C. Bernstein & Co., Inc. . . . 9,084,806 (b)<F2> 8.5%
767 Fifth Avenue
New York, NY 10153
Dodge & Cox . . . . . . . . . . . . . . 6,557,658 (c)<F3> 6.1%
One Sansome Street, 35th Floor
San Francisco, CA 94104
- ---------------
<FN>
<F1>(a)Mr. Safra is the principal stockholder of Republic Corporation through
his ownership of all the outstanding shares of Saban, which owns 30,844,226
shares of Republic Corporation (including 29,786,070 shares through its
wholly-owned subsidiary, RNYC Holdings Limited, a Gibraltar bank holding
company). Mr. Safra has acquired 200,000 additional shares since December
31, 1998, increasing his ownership to 31,044,226, or approximately 29.1%,
as of the date hereof.
<F2>(b)Sanford C. Bernstein & Co., Inc. has filed a Form 13-G reporting its
beneficial ownership, as of December 31, 1998, of 9,084,806 shares, over
which it had sole dispositive power. As of such date, Bernstein also
disclosed that it had sole voting power over 4,510,590 shares, and shared
voting power over 1,174,845 shares.
<F3>(c)Dodge & Cox has filed a Form 13-G reporting its beneficial ownership, as
of December 31, 1998, of 6,557,658 shares, over which it had sole
dispositive power. As of such date, Dodge & Cox also disclosed that it had
sole voting power over 5,953,908 shares, and shared voting power over
73,800 shares.
</FN>
</TABLE>
On October 28, 1994, Mr. Safra, through Saban and RNYC Holdings Limited,
received approval from the Board of Governors of the Federal Reserve System to
acquire up to two million (subsequently increased from the 1.6 million shares
remaining at that time to 3.2 million because of a two-for-one stock dividend
on June 1, 1998) additional shares of Republic Corporation Common Stock, which
approval, as extended, lapses on July 2, 1999, unless further extended. If the
remaining 2,934,200 shares of Common Stock covered by the approval were
acquired, Mr. Safra would increase his ownership to approximately 31.9% of the
Corporation's outstanding Common Stock.
MANAGEMENT
Information concerning the beneficial ownership of Republic Corporation's
Common Stock by each director is set forth in the table under "Election of
Directors" above. The following table shows, as of January 31, 1999, the
beneficial ownership of Republic Corporation's Common Stock by all directors
and executive officers of Republic Corporation as a group.
Amount and Nature Percent
of Beneficial Ownership of Class
----------------------- --------
All directors and executive
officers as a group (28 persons) . . . 998,041 shares .9%
18
<PAGE>
RESUBMISSION OF
1994 PERFORMANCE BASED INCENTIVE COMPENSATION PLAN
FOR APPROVAL
DESCRIPTION OF 1994 PERFORMANCE BASED INCENTIVE COMPENSATION PLAN
THE FOLLOWING DESCRIPTION OF THE PLAN IS A SUMMARY, DOES NOT PURPORT TO BE
DETAILED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE PROVISIONS OF THE
PLAN ITSELF. A COPY OF THE PLAN IS ATTACHED TO THIS PROXY STATEMENT AS APPENDIX
A.
GENERAL. The Board of Directors adopted the 1994 Performance Based Incentive
Compensation Plan (the "Plan") and first submitted it for the approval of the
stockholders of Republic Corporation at the 1994 Annual Meeting. It is being
re-submitted at this Annual Meeting in order to meet the requirements of the
performance based compensation exclusion of Section 162(m) of the Internal
Revenue Code to ensure that Republic Corporation will continue to be allowed a
deduction for the payment of awards thereunder. The Plan will be resubmitted to
the stockholders for subsequent approvals as may be required by Section 162(m).
The Plan is administered by the Human Resources Committee (the "Committee") of
the Board of Directors of Republic Corporation which has the exclusive power to
designate recipients of awards, to establish the basis for the amount to be
paid pursuant to the awards and to administer the Plan in all other respects.
No member of the Committee (see "Directors' Committees" above under "Election
of Directors") may be granted an award under the Plan.
CLASS OF PERSONS ELIGIBLE TO RECEIVE AWARDS. The Plan is designed to provide an
incentive to officers who serve on the Management Executive Committee of
Republic Corporation and are in a position to make a material contribution to
the successful operation of Republic Corporation and its subsidiaries. The
members of the Management Executive Committee are officers who perform
policy-making functions for Republic Corporation and, as such, comprise the
group of officers whose compensation is subject to disclosure to the
stockholders in accordance with the requirements of the Securities Exchange Act
of 1934. At present, there are thirteen persons who are eligible to participate
in the Plan. Participants in the Plan are also eligible to participate in
Republic Corporation's other incentive compensation and bonus plans.
MATERIAL FEATURES OF PLAN. The Plan provides that, within the first 90 days of
each fiscal year of Republic Corporation ("Plan Year"), the Committee shall
determine the members of the Management Executive Committee who will
participate in the Plan ("Participants") as well as the Base Year (which may
not be prior to 1979) and the notional number of shares ("Award Multiple") of
Republic Corporation's Common Stock to be used to calculate the amount payable
to each Participant ("Award"). No more than one Award may be granted to any
Participant for the same Plan Year, but the Base Years and the Award Multiples
for Awards to different Participants for the same Plan Year need not be
identical.
The amount, if any, to be paid pursuant to any Award granted to any Participant
for any Plan Year shall be equal to the LESSER of: (a) the PRODUCT of (i) the
excess, if any, of (A) the diluted consolidated net income per share of
Republic Corporation's Common Stock ("earnings per share") for the Plan Year
(adjusted to eliminate the effect of amounts paid or accrued with respect to
any Award) over (B) the earnings per share for the Base Year (adjusted as is
necessary to preserve inter-period comparability between earnings per share for
each of the Base Year and Plan Year for any Award), MULTIPLIED BY (ii) the
Award Multiple for
19
<PAGE>
such Award OR (b) 0.7% of the consolidated net income of Republic Corporation
and its subsidiaries for such Plan Year.
In the event that the adjusted earnings per share for any Plan Year does not
exceed the adjusted earnings per share for the Base Year for any Award, no
amount shall be paid pursuant to such Award, which Award shall thereupon
terminate. Also, after taking into account a Participant's individual
performance during the applicable Plan Year, the Committee may, in its sole
discretion, reduce, in whole or in part, the amount otherwise to be paid
pursuant to such Participant's Award for such Plan Year.
Following each Plan Year, the Committee shall certify in writing: (i) the
adjusted Plan Year earnings per share, (ii) whether such earnings per share
exceeds the adjusted Base Year earnings per share for each Award, and (iii) the
amount, if any, to be paid pursuant to each Award. Any amount payable shall be
paid as soon as practicable following each Plan Year UNLESS, prior to the last
day of such Plan Year, the Participant elected to defer the payment of all or
any portion of such amount to any later year or years. Deferral elections are
subject to such terms as may be agreed upon by each Participant's employer.
If a Participant's employment with Republic Corporation or any of its
subsidiaries is terminated prior to the end of a Plan Year by reason of the
Participant's death, disability or retirement (in accordance with Republic
Corporation's policy), the Participant or the Participant's estate or
beneficiary, as the case may be, shall only be entitled to the pro rata portion
of the amount that would otherwise have been payable to the Participant pursuant
to the terms of his or her Award for that Plan Year. Such pro rata portion shall
be based on the number of days in the Plan Year prior to the date the
Participant's employment was so terminated relative to the total number of days
in the Plan Year. If, however, a Participant's employment with Republic
Corporation or any of its subsidiaries is terminated prior to the end of a Plan
Year for any reason other than death, disability or retirement (in accordance
with Republic Corporation's policy), any amount that would have been otherwise
payable to the Participant pursuant to the terms of his or her Award for that
Plan Year shall be deemed forfeited.
A Participant's rights and interests under the Plan (including the right to
payment of any unpaid Award) may not be assigned or transferred except in the
case of the Participant's death to the Participant's designated beneficiary or,
in the absence of such designation, by will or the laws of descent and
distribution. No award shall be subject to execution, attachment or other
process.
AMENDMENT AND TERMINATION. The Board of Directors may amend the Plan from time
to time; PROVIDED, HOWEVER, that any amendment that (i) materially changes the
formula used to determine the amount to be paid pursuant to Awards (including
the maximum amount of any Award that may be granted to a Participant in a
single Plan Year), (ii) permits a Base Year prior to 1979, (iii) changes the
class of persons eligible to receive awards, or (iv) otherwise requires
stockholder approval pursuant to Section 162(m) of the Internal Revenue Code,
shall be submitted to the stockholders for approval and, if such approval is
not obtained, such amendment shall be null and void. The Board of Directors
also has the right to terminate the Plan at any time. No such amendment or
termination may affect the rights of a Participant under an outstanding Award
without the consent of the Participant.
AWARDS. Awards for the 1998 Plan Year, which are disclosed in the table below,
were granted on December 2, 1997 and certified by the Committee on March 2,
1999. The Base Year used to calculate each of the 1998 Plan Year awards was
1979.
20
<PAGE>
<TABLE>
PLAN BENEFITS
<CAPTION>
NAME AND POSITION DOLLAR VALUE 1<F1> NUMBER OF UNITS 2<F2>
- -------------------------------- ------------- ----------------
<S> <C> <C>
WALTER H. WEINER $ 1,034,775 472,500
Chairman of the Board and Chief
Executive Officer of Republic
Corporation and of Republic Bank
DOV C. SCHLEIN 918,385 419,354
Vice Chairman of Republic
Corporation and President of
Republic Bank
ELIAS SAAL 876,000 400,000
Vice Chairman of Republic
Corporation and Vice Chairman of
the Board of Republic Bank
CYRIL S. DWEK 730,000 338,710
Vice Chairman of Republic
Corporation and Vice Chairman of
the Board of Republic Bank
VITO S. PORTERA 657,000 300,000
Vice Chairman of Republic
Corporation and Vice Chairman of
the Board of Republic Bank
- ---------------
<FN>
<F1>(1)The Dollar Values represent the amounts certified for payment to each
Participant. In the case of Mr. Dwek, such amount was less than the
maximum amount payable pursuant to his award grant.
<F2>(2)The Number of Units represent the Award Multiples approved for each
Participant for the 1998 Plan Year. The maxi-mum amount of each award
was determined by the application of a multiplier of 1.5.
</FN>
</TABLE>
STOCKHOLDER APPROVAL
The Board of Directors recommends a vote FOR the re-approval of the 1994
Performance Based Incentive Compensation Plan. In order for the Plan to be
approved, a majority of the shares of Common Stock present and voting on the
proposal at the meeting must be voted in favor of the proposal. Neither
abstentions nor broker non-votes are counted for purposes of determining the
number of votes cast. Edmond J. Safra, who owns approximately 29.1% of the
outstanding Common Stock (see "Ownership of Voting Securities" above), has
indicated his intention to vote his shares in favor of such approval.
APPROVAL OF SELECTION OF AUDITORS
The Board of Directors considers it appropriate to submit for approval by the
stockholders its selection of KPMG LLP, as auditors of the financial statements
of Republic Corporation for the current fiscal year. KPMG LLP, independent
certified public accountants, have examined the financial statements of
Republic
21
<PAGE>
Corporation since it commenced operations in 1974. Such firm has also examined
the financial statements of Republic Bank since 1966.
The appointment of the firm was recommended to the Board of Directors of
Republic Corporation by its Audit Committee. No member of the Audit Committee
is an officer or employee of Republic Corporation. A representative of the firm
will be present at the meeting to make a statement, if he desires to do so, and
to respond to appropriate questions by stockholders.
The Board of Directors recommends a vote FOR the approval of the selection of
auditors.
MISCELLANEOUS
OTHER MATTERS
As of the date hereof, Republic Corporation has not been informed of any
matters to be presented by or on behalf of Republic Corporation or its Board of
Directors for action at the meeting other than those listed in the notice of
meeting and referred to herein. If any other matters come before the meeting or
any adjournment thereof, it is intended that the proxies will be voted in
respect thereof in accordance with the judgment of the person or persons voting
the proxies.
STOCKHOLDERS' PROPOSALS
Stockholder proposals to be included in Republic Corporation's Proxy Statement
for the next Annual Meeting of Stockholders must be received by the Corporate
Secretary of Republic Corporation not later than November 20, 1999. Upon
receipt of any such proposal, Republic Corporation will determine whether or
not to include such proposal in the Proxy Statement and proxy in accordance
with regulations governing the solicitation of proxies.
Also, pursuant to Republic Corporation's By-Laws, in order for a stockholder to
nominate a candidate for director or raise other business from the floor of the
next Annual Meeting of Stockholders, written notice of such nomination or other
business proposal must be given to the Corporate Secretary of Republic
Corporation not later than December 23, 1999 and not earlier than November 23,
1999. The notice must include the information required by the By-Laws. These
advance notice requirements are separate from and in addition to the
requirements a stockholder must meet to have a proposal included in the Proxy
Statement. Notice must be given to the Corporate Secretary of Republic
Corporation at its principal executive offices, 452 Fifth Avenue, New York, New
York 10018.
Copies of Republic Corporation's By-Laws will be furnished without charge to
any stockholder upon written request to the Corporate Secretary.
22
<PAGE>
SOLICITATION OF PROXIES
The cost of solicitation of proxies will be borne by Republic Corporation. In
addition to the use of the mails, proxies may be solicited by personal
interview, telephone and telegraph. Banks, brokerage houses and other
institutions, nominees or fiduciaries will be requested to forward the
soliciting material to their principals and to obtain authorizations for the
execution of proxies. Directors, officers and regular employees of Republic
Corporation and Republic Bank may also solicit proxies by such methods without
additional remuneration therefor. Republic Corporation will, upon request,
reimburse banks, brokerage houses and other institutions, nominees and
fiduciaries for expenses in forwarding proxy solicitation material to their
principals.
GENERAL
Only stockholders of record at the close of business on March 4, 1999 will be
entitled to notice of and to vote at the meeting. Stockholders are urged to
mark, date and sign the enclosed form of proxy, solicited on behalf of the
Board of Directors, and return it at once in the envelope enclosed for that
purpose. Unless instructed otherwise, proxies will be voted for the election of
directors, for the approval of the 1994 Performance Based Incentive
Compensation Plan and for approval of the selection of auditors. On any such
matter generally a vote of a majority of the votes cast on the matter will be
required for approval. Broker non-votes and abstentions will not be counted for
purposes of determining the number of votes cast. The proxy does not affect the
right to vote in person at the meeting and may be revoked prior to its exercise
by appropriate notice to the undersigned.
Dated: March 19, 1999
New York, New York
By Order of the Board of Directors,
/s/WILLIAM F. ROSENBLUM, JR.,
Senior Vice President and
Corporate Secretary
23
<PAGE>
APPENDIX A
AMENDED 1994 PERFORMANCE BASED INCENTIVE COMPENSATION PLAN
OF
REPUBLIC NEW YORK CORPORATION
AND SUBSIDIARIES
The purpose of this Plan is to attract and retain the services of
officers who serve on the Management Executive Committee of Republic New York
Corporation (the "Corporation"), are in policy-making positions with the
Corporation or its subsidiaries and, by virtue of their positions, are in a
position to make a material contribution to the successful operation of the
business of the Corporation and its subsidiaries.
SECTION 1 - DEFINITIONS
For the purposes hereof, the following terms have the meanings
specified or referred to below:
(a) "Adjusted Base Year Earnings Per Share" means, for any Award, the
Earnings Per Share for the Base Year for such Award; provided, that (i) if
following such Base Year the outstanding shares of Common Stock shall have been
changed by reason of reorganization, merger, consolidation, recapitalization,
reclassification, stock split-up, combination or exchange of shares or the like,
or dividends payable in shares of Common Stock, the Adjusted Base Year Earnings
Per Share shall be proportionately adjusted by the Compensation Committee to
reflect any increase or decrease in the number of issued shares of Common Stock
that resulted from such change insofar as necessary to preserve inter-period
comparability between Earnings Per Share for such Base Year and the Plan Year
for which such Award is granted; (ii) the Adjusted Base Year Earnings Per Share
shall be adjusted by the Compensation Committee insofar as is necessary or
appropriate to preserve inter-period comparability, between Earnings Per Share
for each of the Base Year and Plan Year for any Award, in accordance with
generally accepted accounting principles (including APB Opinion No. 15, as
amended), applicable to the computation of earnings per share; and (iii) in the
event of (A) any change subsequent to the Base Year for any Award in the
accounting principles or methods applied by the Corporation in the preparation
of the consolidated financial statements of the Corporation and its subsidiaries
of a character required to be mentioned as an exception in the opinion of the
independent accountants with respect to the consistency of accounting principles
applied to periods subsequent to such Base Year, or (B) any change in the fiscal
year of the Corporation, which change affects the inter-period comparability
between Earnings Per Share for each of such Base Year and such Plan Year, the
Adjusted Base Year Earnings Per Share shall be adjusted by the Compensation
Committee insofar as is necessary or appropriate to preserve such inter-period
comparability.
A-1
<PAGE>
(b) "Award" means a right, granted by the Compensation Committee pursuant
to Section 2.1 for any Plan Year, to participate under this Plan, subject to the
terms of this Plan and such grant.
(c) "Award Multiple" means, for any Award, the number of shares of Common
Stock designated by the Compensation Committee pursuant to Section 2.2 solely
for use in determining the amount, if any, to be paid pursuant to such Award;
provided, that if, after the Award Multiple is so designated, the outstanding
shares of Common Stock shall be changed by reason of reorganization, merger,
consolidation, recapitalization, reclassification, stock split-up, combination
or exchange of shares or the like, or dividends payable in shares of Common
Stock (which change is reflected in the consolidated income statement from which
Earnings Per Share for the relevant Plan Year is derived), the Award Multiple
originally designated by the Compensation Committee shall be proportionately
adjusted by the Compensation Committee to reflect any increase or decrease in
the number of issued shares of Common Stock that resulted from such change.
(d) "Base Year" means, for any Award, the fiscal year of the Corporation
designated by the Compensation Committee pursuant to Section 2.2.
(e) "Board" means the Board of Directors of the Corporation.
(f) "Code" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
(g) "Common Stock" means the Common Stock, par value $5.00 per share, of
the Corporation.
(h) "Compensation Committee" means the Human Resources Committee of the
Board.
(i) "Corporation" has the meaning provided in the preamble to this Plan.
(j) "Earnings Per Share" for any year means the diluted consolidated net
income per share of Common Stock of the Corporation for such year as set forth
in the consolidated income statement of the Corporation and its subsidiaries for
such year as presented to the Board at the first quarterly meeting for the
subsequent year, but adjusted to eliminate the effect of amounts paid or accrued
with respect to any Award (i.e., Earnings Per Share shall be determined before
taking into account amounts paid or accrued with respect to any Award).
(k) "Management Executive Committee" means the committee designated by the
Board as the Management Executive Committee of the Corporation and which shall
consist of such officers of the Corporation as the Board or the Chief Executive
Officer may appoint from time to time.
(l) "Net Income" for any year means the consolidated net income of the
Corporation and its subsidiaries for such year as set forth in the consolidated
income statement of the Corporation and its subsidiaries for such year as
presented to the Board at the first quarterly meeting for the subsequent year.
A-2
<PAGE>
(m) "Participants" has the meaning provided in Section 2.1.
(n) "Plan" means this 1994 Performance Based Incentive Compensation Plan of
the Corporation and Subsidiaries.
(o) "Plan Year" means any fiscal year of the Corporation.
SECTION 2 - AWARDS
2.1 Subject to Section 4.1 and this Section 2, the Compensation Committee
may grant Awards for any Plan Year to members of the Management Executive
Committee ("Participants").
2.2 The Compensation Committee shall determine, at the time it grants any
Award for a Plan Year to a Participant, the Base Year (which may not be prior to
1979) and the Award Multiple for that Award. Promptly following the grant of an
Award to a Participant, the Compensation Committee shall give notice (or cause
notice to be given) to such Participant of such grant, together with the Base
Year and the Award Multiple for such Award. The Base Years and Award Multiples
for Awards granted to different Participants for the same Plan Year need not be
identical.
2.3 Awards for any Plan Year may be granted at any time within the first 90
days of such Plan Year. No more than one Award may be granted to any Participant
for the same Plan Year.
2.4 The amount, if any, to be paid pursuant to any Award granted to any
Participant for any Plan Year shall be equal to the lesser of
(a) the product of (i) the excess, if any, of (A) the Earnings Per Share
for such Plan Year over (B) the Adjusted Base Year Earnings Per Share for such
Award, multiplied by (ii) the Award Multiple for such Award; and
(b) 0.7% of the Net Income for the Plan Year.
If the Earnings Per Share for a Plan Year do not exceed the Adjusted Base Year
Earnings Per share for any Award granted for such Plan Year, no amount shall be
paid pursuant to such Award, which shall thereupon terminate. Notwithstanding
anything to the contrary contained in this Plan, the Compensation Committee,
after taking into account a Participant's individual performance during the
applicable Plan Year, may, in its sole discretion, reduce, in whole or in part,
the amount otherwise to be paid pursuant to such Participant's Award for such
Plan Year.
A-3
<PAGE>
2.5 Following each Plan Year, the Compensation Committee shall certify in
writing the Earnings Per Share for such Plan Year, whether such Earnings Per
Share exceeds the Adjusted Base Year Earnings Per Share for each Award granted
for such Plan Year, and the amount, if any, to be paid pursuant to each such
Award. Such certification shall be set forth in approved minutes of the
Compensation Committee meeting (or written consent in lieu of meeting) in which
such certification is made.
2.6 Payment of the amounts payable pursuant to Awards for each Plan Year
(as certified by the Compensation Committee pursuant to Section 2.5) shall be
made, as soon as practicable following such Plan Year, by the Corporation or, in
the case of any participant employed by a subsidiary of the Corporation (and not
the Corporation), by such subsidiary; provided, however, that prior to the last
day of a Plan Year for which an Award is granted to a Participant, such
participant may elect to defer, subject to such terms as agreed upon by such
Participant and his or her employer, the payment of all or any portion of the
amounts payable pursuant to such Award to any later year or years. Each payment
made pursuant to this Section 2.6 shall be accompanied by a written statement
setting forth the amount to be paid and the calculation of such amount pursuant
to Section 2.4. If a Participant's payment is deferred in accordance with this
Section 2.6, a written statement setting forth the amount payable pursuant to
his or her Award and the calculation of such amount shall be furnished to such
Participant at the time such payment would have otherwise been required to be
made hereunder.
SECTION 3 - DEATH, TERMINATION OF EMPLOYMENT, ETC.
Notwithstanding any other provision of this Plan, (i) if a Participant's
employment with the Corporation or its subsidiaries is terminated by reason of
such Participant's death or disability, or due to such Participant's retirement
in accordance with Corporation policy, such Participant or such Participant's
estate or beneficiary, as the case may be, shall be entitled only to be paid, in
the case of any Award granted to such Participant for the Plan Year during which
such Participant's employment was so terminated, the pro rata portion of the
amount that would otherwise have been payable to such Participant pursuant to
Section 2 (based on the number of days in such Plan Year prior to the date on
which such Participant's employment was so terminated relative to the total
number of days in such Plan Year), and the balance of the amount that would
otherwise have been so payable to such Participant shall be deemed forfeited to
the Corporation, and (ii) if, prior to the end of any Plan Year, a Participant's
employment with the Corporation and its subsidiaries is terminated for any
reason (other than by reason of death, disability or retirement as heretofore
provided), no payment shall be made pursuant to any Award granted to such
Participant for such Plan Year (and the amount that would otherwise have been
payable to such Participant pursuant to Section 2 shall be deemed forfeited to
the Corporation).
A-4
<PAGE>
SECTION 4 - ADMINISTRATION
4.1 This Plan shall be administered by the Compensation Committee, as it
may be composed from time to time. No member of the Compensation Committee may
be granted an Award under this Plan.
4.2 Within the limits of the express provisions of this Plan, the
Compensation Committee shall have the authority, in its sole discretion, (i) to
determine the time or times at which, and the Participants to whom, Awards may
be granted, together with the Base Year and Award Multiple for each such Award
(which need not be identical for each Participant), (ii) to interpret this Plan
or any Award granted under this Plan, and (iii) to establish, adopt, amend or
rescind such rules or regulations relating to this Plan and make all other
determinations and take all other actions as the Compensation Committee may deem
necessary or advisable for the administration of this Plan.
4.3 The determinations of the Compensation Committee under this Plan,
including without limitation as to the matters referred to in Section 2 and this
Section 4, shall be final and binding on all Participants.
SECTION 5 - EFFECTIVE DATE; AMENDMENT OR TERMINATION
5.1 This Plan shall become effective for the 1994 Plan Year provided that
the holders of Common Stock approve this Plan at the next annual or special
meeting after adoption of this Plan by the Board, and if such approval is not
obtained, this Plan shall be null and void. This Plan shall be resubmitted from
time to time for subsequent approvals by the holders of Common Stock as may be
required by Section 162(m) of the Code.
5.2 The Board may at any time and from time to time terminate, modify or
amend this Plan in any respect; provided, however, that any amendment that (i)
materially changes the formula provided in Section 2.4 for purposes of
determining the amount to be paid pursuant to Awards (including the maximum
amount of any Award or Awards that may be granted to a Participant in a single
Plan Year), (ii) permits a Base Year prior to 1979, (iii) changes the class of
persons eligible to receive Awards, or (iv) otherwise requires stockholder
approval pursuant to Section 162(m) of the Code, shall be submitted to the
holders of Common Stock for approval at the next annual or special meeting after
adoption of such amendment by the Board, and if such approval is not obtained,
such amendment shall be null and void. No such termination, modification or
amendment may affect the rights of a Participant under an outstanding Award
without the consent of the Participant.
A-5
<PAGE>
SECTION 6 - WITHHOLDING OF TAXES
The Corporation shall have the right to deduct from the payment of all
Awards any federal, state or local taxes required by law to be withheld with
respect to such Awards.
SECTION 7 - FUNDING OF PLAN
This Plan shall be unfunded. The Corporation shall not be required to
establish any special or separate fund or to make any other segregation of
assets to assure the payment of any Award.
SECTION 8 - TRANSFERABILITY OF AWARDS
A Participant's rights and interests under this Plan (including the right
to payment of any unpaid Award) may not be assigned or transferred except, in
the case of a Participant's death, subject to Section 3, to such Participant's
designated beneficiary as provided to the Compensation Committee in accordance
with such procedures as it may determine from time to time hereafter, or in the
absence of such designation, by will or the laws of descent and distribution. No
Award shall be subject to execution, attachment or other process.
SECTION 9 - MISCELLANEOUS
9.1 Nothing contained in this Plan or any written instrument evidencing any
Award granted under this Plan shall be deemed to confer upon any Participant to
whom an Award is or may be granted hereunder any right to remain in the employ
of the Corporation or any of its subsidiaries or any right to be granted an
Award (or be eligible therefor) in any subsequent Plan Year.
9.2 Except in the case of the Executive Supplemental Disability Plan, no
Award shall be taken into account in determining a Participant's compensation
for the purposes of any group life insurance or other employee benefit plan of
the Corporation or its subsidiaries.
9.3 This Plan shall not be deemed an exclusive method of providing
incentive compensation for the officers of the Corporation, nor shall it
preclude the Committee or the Board from authorizing or approving other forms of
incentive compensation.
9.4 All expenses and costs in connection with the operation of this Plan
shall be borne by the Corporation or the relevant subsidiary of the Corporation.
A-6
<PAGE>
INSERT
[GRAPHIC LOGO OMITTED] Republic New York Corporation
Two new ways to vote . . .
Vote by Telephone
It's fast, convenient, and your vote is immediately confirmed and posted.
Using a touch-tone phone, call 1-800-PROXIES.
Just follow these 4 easy steps:
1. Read the accompanying Proxy Statement and voting instruction form.
2. Call 1-800-PROXIES (1-800-776-9437).
3. Enter your 11 digit Control Number located on your voting instruction form.
4. Follow the simple recorded instructions.
Your vote is important!
Call 24 hours a day.
Vote by Internet
It's fast, convenient, and your vote is immediately confirmed and posted Do not
return Voting Form if you are voting by telephone or Internet. and you can get
all future materials by Internet.
WWW.VOTEPROXY.COM
Just follow these 4 easy steps:
1. Read the accompanying Proxy Statement and voting instruction form.
2. Go to website WWW.VOTEPROXY.COM.
3. Enter your 11 digit Control Number located on your voting instruction form.
4. Follow the simple instructions.
Your vote is important!
Go to the website 24 hours a day.
Do not return Voting Form if you are voting by telephone or Internet.
<PAGE>
[Front Side]
REPUBLIC NEW YORK CORPORATION
PROXY
Annual Meeting of Stockholders
April 21, 1999
This Proxy is solicited on behalf of the Board of Directors
The undersigned hereby appoints, jointly and severally, Peter Kimmelman,
William C. MacMillen, Jr., and James L. Morice, each with the power to
appoint his substitute, and hereby authorizes them to vote all shares of
Republic New York Corporation Common Stock that the undersigned is entitled
to vote, at the Annual Meeting of Stockholders of the Corporation to be
held at 452 Fifth Avenue, City and State of New York, on April 21, 1999, at
11:00 A.M., or any adjournment thereof, in accordance with the instructions
on the reverse side hereof and in their discretion upon such other business
as may properly come before the meeting.
Unless instructions are given on the reverse side, this Proxy will be voted
FOR the election of nominees for director, FOR Item 2 listed on the
reverse side hereof and FOR Item 3 listed on the reverse side hereof. With
respect to matters as to which discretionary authority is granted above, this
Proxy will be voted in accordance with the best judgment of the proxies
hereinabove appointed.
PLEASE MARK, DATE AND SIGN THIS PROXY ON THE REVERSE SIDE HEREOF AND RETURN
IT PROMPTLY WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING. YOU MAY
NEVERTHELESS VOTE IN PERSON IF YOU DO ATTEND.
(Continued and to be signed on other side)
<PAGE>
[Back Side]
PLEASE MARK YOUR CHOICE ON ITEMS 1 AND 2 LIKE THIS [CHECK] IN BLUE OR BLACK INK.
- ------------------------- --------------------
ACCOUNT NUMBER COMMON
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR ALL NOMINEES" IN ITEM 1.
Item 1--Election of the following nominees as Directors:
C. Dwek, E. Ginsberg, N. Hasson, P. Kimmelman, L. Lieberman,
W. MacMillen, P. Mansbach, M. Mertz, J. Morice, E. Daniel Morris,
J. Norwood, J. Pancetti, V. Portera, W. Rogers, E. Saal, S. Saali,
D. Schlein, R. Ward, W. Weiner, G. Wendler.
FOR WITHHOLD Withhold for the following only: (Write the
ALL FOR ALL name of the nominee(s) in the space below)
NOMINEES NOMINEES
[ ] [ ] ---------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEM 2.
Item 2-- Reapproval of the 1994 Performance Based Incentive
Compensation Plan.
For Against Abstain
[ ] [ ] [ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEM 3.
Item 3-- Approval of selection of auditors.
For Against Abstain
[ ] [ ] [ ]
I PLAN TO ATTEND MEETING
[ ]
RECEIPT IS HEREBY ACKNOWLEDGED OF THE REPUBLIC NEW YORK CORPORATION NOTICE
OF MEETING AND PROXY STATEMENT.
Signature(s)____________________________________ Date ____________, 1999
NOTE: PLEASE SIGN AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN. IF
SIGNER IS A CORPORATION, PLEASE SIGN THE FULL CORPORATE NAME BY DULY
AUTHORIZED OFFICER. WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR,
TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE AS SUCH.
