<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Bay View Capital Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
NOTICE OF 1998 ANNUAL MEETING AND PROXY STATEMENT
[LOGO OF BAY VIEW CAPITAL CORPORATION APPEARS HERE]
April 20, 1998
Dear Stockholder:
On behalf of the Board of Directors and management of Bay View, I cordially
invite you to attend the Company's 1998 Annual Meeting of Stockholders. The
meeting will be held at 1:00 p.m., local time, on May 28, 1998 at Bay View's
main offices, located at 1840 Gateway Drive, San Mateo, California 94404.
The meeting is for the purpose of (i) the election of three directors of the
Company; (ii) the approval and adoption of the Company's 1998-2000 Performance
Stock Plan; (iii) the approval and adoption of the Company's 1998 Non-Employee
Director Stock Option and Incentive Plan; and (iv) such other matters as may
properly come before the meeting.
I encourage you to attend the meeting in person. Whether or not you do so,
however, I hope that you will read the enclosed Proxy Statement and then
complete, sign and date the enclosed proxy card and return it in the postage
prepaid envelope provided. This will save Bay View additional expense in
soliciting proxies and will ensure that your shares are represented. Please
note that you may vote in person at the meeting even if you have previously
returned the proxy card.
Thank you for your attention to this important matter.
Sincerely,
/s/ John R. McKean
John R. McKean
Chairman of the Board
<PAGE>
BAY VIEW CAPITAL CORPORATION
1840 GATEWAY DRIVE
SAN MATEO, CALIFORNIA 94404
(650) 573-7300
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 28, 1998
Notice is hereby given that the Annual Meeting of Stockholders (the
"Meeting") of Bay View Capital Corporation (the "Company") will be held at the
Company's main offices, located at 1840 Gateway Drive, San Mateo, California
94404, on May 28, 1998, at 1:00 p.m., local time.
A proxy card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon
I. the election of three directors of the Company;
II. the approval and adoption of the Company's 1998-2000 Performance Stock
Plan;
III. the approval and adoption of the Company's 1998 Non-Employee Director
Stock Option and Incentive Plan; and
such other matters as may properly come before the Meeting or any adjournments
or postponements thereof. The Board of Directors is not aware of any other
business to come before the Meeting. Any action may be taken on the foregoing
proposals at the Meeting on the date specified above, or on any date or dates
to which the Meeting may be adjourned or postponed. Stockholders of record at
the close of business on March 31, 1998 are the stockholders entitled to vote
at the Meeting and any adjournments or postponements thereof. A list of
stockholders entitled to vote at the Meeting will be available for examination
by any stockholder for any purpose germane to the Meeting at the main office
of the Company during the ten days prior to the Meeting, as well as at the
Meeting.
You are requested to complete, sign and date the enclosed proxy, which is
solicited on behalf of the Board of Directors, and to mail it promptly in the
postage prepaid envelope provided. The proxy will not be used if you attend
and vote at the Meeting in person.
By Order of the Board of Directors
/s/ Robert J. Flax
Robert J. Flax
Secretary
San Mateo, California
April 20, 1998
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A PRE-
ADDRESSED ENVELOPE IS PROVIDED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED
IF MAILED WITHIN THE UNITED STATES.
<PAGE>
PROXY STATEMENT
BAY VIEW CAPITAL CORPORATION
1840 GATEWAY DRIVE
SAN MATEO, CALIFORNIA 94404
(650) 573-7300
ANNUAL MEETING OF STOCKHOLDERS
MAY 28, 1998
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of Bay View Capital Corporation
("Bay View" or the "Company") to be used at the Annual Meeting of Stockholders
of the Company (the "Meeting"), to be held at Bay View's main offices, located
at 1840 Gateway Drive, San Mateo, California, on May 28, 1998 at 1:00 p.m.,
local time, and at all adjournments or postponements of the Meeting. The
accompanying Notice of Meeting and form of proxy and this Proxy Statement are
first being mailed to stockholders on or about April 20, 1998. Certain of the
information provided herein relates to Bay View Bank (the "Bank"), a wholly
owned subsidiary of the Company.
At the Meeting, stockholders of Bay View are being asked to (i) elect three
directors of the Company; (ii) approve and adopt the Company's 1998-2000
Performance Stock Plan (the "Performance Stock Plan"); (iii) approve and adopt
the Company's 1998 Non-Employee Director Stock Option and Incentive Plan (the
"Non-Employee Director Stock Option Plan"); and (iv) consider such other
matters as may properly come before the Meeting or any adjournments or
postponements thereof.
VOTING RIGHTS AND PROXY INFORMATION
All shares of Bay View common stock represented at the Meeting by properly
executed proxies received prior to or at the Meeting, and not revoked, will be
voted at the Meeting in accordance with the instructions thereon. If no
instructions are indicated, properly executed proxies will be voted for the
nominees set forth herein and for the proposals to adopt the Performance Stock
Plan and the Non-Employee Director Stock Option Plan. Bay View does not know
of any matters other than as described in the Notice of Meeting that are to
come before the Meeting. If any other matters are properly presented at the
Meeting for action, the persons named in the enclosed form of proxy and acting
thereunder will have the discretion to vote on such matters in accordance with
their best judgment.
Directors shall be elected by a plurality of the votes present in person or
represented by proxy at the Meeting and entitled to vote on the election of
directors. Votes withheld and broker non-votes will have no effect on the
election of directors. Approval of all other matters will require the
affirmative vote of a majority of the shares present in person or represented
by proxy at the Meeting and entitled to vote on the matter. Proxies marked to
abstain will have the same effect as votes against the matter. Broker non-
votes will have no effect on the matter. A majority of the shares of the
Company's common stock, present in person or represented by proxy, shall
constitute a quorum for purposes of the Meeting. Proxies marked to abstain and
broker non-votes are counted for purposes of determining a quorum.
A proxy given pursuant to this solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary
of Bay View at or before the Meeting a written notice of revocation bearing a
later date than the proxy; (ii) duly executing a subsequent proxy relating to
the
<PAGE>
same shares and delivering it to the Secretary of Bay View at or before the
Meeting; or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Robert J.
Flax, Esq., Executive Vice President, General Counsel and Secretary, Bay View
Capital Corporation, 1840 Gateway Drive, San Mateo, California 94404.
VOTING SECURITIES AND CERTAIN HOLDERS THEREOF
Record holders of common stock as of the close of business on March 31, 1998
will be entitled to one vote for each share then held. As of that date, the
Company had 20,309,936 shares of common stock issued and outstanding.
The following table sets forth, as of March 31, 1998, certain information as
to (i) those persons who were known by management to be beneficial owners of
more than 5% of the Company's outstanding shares of common stock, (ii) the
shares of common stock beneficially owned by the executive officers named
below and (iii) all directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES PERCENT
BENEFICIALLY OF
BENEFICIAL OWNER OWNED CLASS
---------------- ------------ -------
<S> <C> <C>
Southeastern Asset Management, Inc................... 1,855,400(1) 9.14
6075 Poplar Avenue, Suite 900
Memphis, Tennessee 38119
Edward H. Sondker.................................... 182,904(2) .89
David A. Heaberlin................................... 120,916(2) .59
Robert J. Flax....................................... 65,340(2) .32
John N. Buckley...................................... 38,549(2) .19
Rupert N. Ayton...................................... 12,871(2) .06
All directors and executive officers as a group (17 833,959(2) 3.98
persons)..........................................
</TABLE>
- --------
(1) As reported by Southeastern Asset Management, Inc. ("Southeastern"), a
registered investment advisor, Longleaf Partners Realty Fund ("Longleaf
Realty"), Longleaf Partners Small-Cap Fund ("Longleaf Small-Cap") and Mr.
O. Mason Hawkins, as of December 31, 1997 on Amendment No. 3 to a Schedule
13G filed with the Securities and Exchange Commission (the "SEC").
Longleaf Realty and Longleaf Small-Cap are series of Longleaf Partners
Funds Trust, an open-end management investment company ("LongLeaf Trust").
Southeastern serves as investment advisor for Longleaf Trust. Southeastern
reported sole voting power as to 218,500 shares, sole dispositive power as
to 250,900 shares and shared voting and dispositive power as to 1,604,500
shares. Longleaf Realty reported sole voting and dispositive power as to
no shares and shared voting and dispositive power as to 674,500 shares.
Longleaf Small-Cap reported sole voting and dispositive power as to no
shares and shared voting and dispositive power as to 930,000 shares. Mr.
Hawkins, the Chairman of the Board and Chief Executive Officer of
Southeastern, may also be deemed to beneficially own the 1,855,400 shares
beneficially owned by Southeastern. Mr. Hawkins disclaims beneficial
ownership of all such shares.
(2) Includes shares held directly, held in retirement accounts, held by
certain members of the named individuals' families, or held by trusts of
which the named individuals are trustees or substantial beneficiaries,
with respect to which shares the named individuals may be deemed to have
sole or shared voting or dispositive power. Includes for Messrs. Sondker,
Heaberlin, Flax, Buckley and Ayton, and all directors and executive
officers as a group, respectively, 168,000, 94,000, 61,800, 36,001, 12,200
and 635,001 shares, which are subject to options currently exercisable or
which will become exercisable within 60 days of March 31, 1998, granted
under one or more of the Company's 1995 Stock Option and Incentive Plan
(the "1995 Stock Option Plan"), Amended and Restated 1986 Stock Option and
Incentive Plan (the "1986 Stock Option Plan") and 1989 Non-Employee
Director Stock Option Plan (the "1989 Stock Option Plan"). Amount also
includes a total of 12,583 Stock Units representing deferred director fees
credited to the Stock Unit Accounts of non- employee directors established
under the Company's and the Bank's Stock In Lieu of Cash Compensation Plan
for Non-Employee Directors (the "Stock in Lieu of Cash Plan"). The Stock
Units credited to a director's Stock Unit Account will be settled upon the
director's termination of service as a director, for any reason, by
delivering to the director the number of shares of the Company's common
stock equal to the number of whole stock units then credited to the
director's Stock Unit Account. Until such time as the shares are delivered
to a director upon termination of service, such director has none of the
rights of shareholders generally, including the right to vote or dispose
of the shares represented by the Stock Units.
2
<PAGE>
PROPOSAL I--ELECTION OF DIRECTORS
The Company's Board of Directors is composed of ten members. Approximately
one-third of the directors are elected annually. Directors of the Company are
elected to serve for a three-year period or until their respective successors
shall have been elected and shall qualify.
The table below sets forth certain information regarding the members of the
Company's Board of Directors, including their terms of office. It is intended
that the proxies solicited on behalf of the Board of Directors (other than
proxies in which the vote is withheld as to one or more nominees) will be
voted at the Meeting for the election of the nominees identified below. If any
nominee is unable to serve, the shares represented by all such proxies will be
voted for the election of such substitute as the Board of Directors may
recommend. At this time, the Board of Directors knows of no reason why any of
the nominees might be unable to serve, if elected. There are no arrangements
or understandings between any director or nominee and any other person
pursuant to which such director or nominee was selected.
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
TERM BENEFICIALLY PERCENT
DIRECTOR TO OWNED AT OF
NAME AGE POSITION HELD SINCE(1) EXPIRE 3/31/98(2)(3) CLASS
---- --- ------------- -------- ------ ------------- -------
NOMINEES
--------
<S> <C> <C> <C> <C> <C> <C>
Robert M. Greber........ 60 Director 1996 2001 21,911 .11%
Edward H. Sondker....... 50 Director, President and Chief 1995 2001 182,904 .89
Executive Officer
W. Blake Winchell....... 45 Director 1996 2001 21,463 .11
<CAPTION>
DIRECTORS CONTINUING IN OFFICE
------------------------------
<S> <C> <C> <C> <C> <C> <C>
Roger K. Easley......... 61 Director 1984 1999 65,418 .32
George H. Krauss........ 56 Director 1998 1999 31,556 .16
John R. McKean.......... 67 Chairman of the Board 1984 1999 111,563 .55
Angelo J. Siracusa...... 68 Director 1996 1999 21,739 .11
Paula R. Collins........ 48 Director 1993 2000 44,047 .21
Thomas M. Foster........ 55 Director 1993 2000 50,270 .25
Stephen T. McLin........ 52 Director 1998 2000 34,412 .17
</TABLE>
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(1) Includes service as a director of the Bank.
(2) Includes shares held directly, held in retirement accounts, held by
certain members of the named individuals' families, or held by trusts of
which the named individual is a trustee or substantial beneficiary, with
respect to which shares the named individuals may be deemed to have sole
or shared voting or dispositive power. Includes for Directors Greber,
Sondker, Winchell, Easley, McKean, Siracusa, Collins and Foster,
respectively, 20,000, 168,000, 20,000, 52,000, 52,000, 20,000, 42,000 and
48,000 shares which are subject to stock options currently exercisable or
which will become exercisable within 60 days of March 31, 1998 granted
under one or more of the Company's 1995 Stock Option Plan, 1989 Stock
Option Plan and 1986 Stock Option Plan.
(3) Of the amounts listed for Directors Greber, Winchell, Easley, McKean,
Siracusa, Colllins and Foster, 1,911, 963, 1,590, 3,163, 1,639, 1,847 and
1,470 consist of Stock Units representing deferred director fees credited
to the respective Stock Unit Account of each director established under
the Stock in Lieu of Cash Plan.
The business experience of each of the above directors for at least the past
five years is as follows:
Mr. Greber is Chairman of the Board and Chief Executive Officer of the
Pacific Stock Exchange. Mr. Greber is also a director of Sonic Solutions,
Inc., Novato, California.
Mr. Sondker has served as President and Chief Executive Officer of the
Company and the Bank since August 1995. Prior thereto he was President and
Chief Executive Officer of Independence One Bank of California from October
1990 until June 1995. Mr. Sondker is a director of Sunstone Hotel Investors,
Inc., San Clemente, California.
3
<PAGE>
Mr. Winchell is Managing Director of Generation Ventures, LLC, a venture
investment group. In 1996, Mr. Winchell served as Chief Executive Officer of
Kleer-Vu Industries and prior thereto he was a General Partner of the Channel
Investment Group.
Mr. Easley is Chairman, President and Chief Executive Officer of Seven-Up
Bottling Company of San Francisco, California.
Mr. Krauss is an attorney and serves as of counsel to Kutak Rock, a national
law firm headquartered in Omaha, Nebraska. Mr. Krauss has practiced law with
Kutak Rock since 1972 and served as managing partner of the firm from 1983 to
1993. In 1996, Mr. Krauss became an independent business consultant to America
First Companies. Mr. Krauss also serves as a director of Gateway 2000, Inc., a
computer manufacturing firm, and of America First Mortgage Investments, Inc.
Mr. McKean has served as Chairman of the Board of the Company since January
1994. Mr. McKean is the President of John R. McKean & Co. (CPAs), San
Francisco, California.
Mr. Siracusa is the former President of the Bay Area Council, a non-profit
public policy organization, which he headed for 24 years. Mr. Siracusa serves
on the Board of Directors of Bridge Housing Corporation and on the Board of
Trustees of Golden Gate University.
Ms. Collins is a principal of The WDG Companies, San Francisco, California,
a real estate development firm she founded in 1982, and Chief Executive
Officer of WDG Ventures, Inc., a subsidiary of The WDG Companies.
Mr. Foster is an independent financial consultant with over 20 years of
banking and financial experience. Mr. Foster was the President of Aircraft
Technical Publishers, Brisbane, California, an aircraft maintenance library
services company, from February 1989 until August 1992.
Mr. McLin has been President and Chief Executive Officer of America First
Financial Corporation, San Francisco, California ("America First"), since
1987. America First offers merger and acquisition advice to the financial
services industry. Prior to joining America First, Mr. McLin was Executive
Vice President of BankAmerica Corporation and Bank of America NT&SA.
BOARD OF DIRECTORS MEETINGS, COMMITTEES AND COMPENSATION
Meetings. Meetings of the Company's Board of Directors are generally held
monthly. The Board of Directors of the Company held 11 meetings during the
fiscal year ended December 31, 1997. No incumbent director of the Company
attended fewer than 75% of the total number of meetings held by the Company's
Board of Directors and by all committees of the Board of Directors of the
Company on which he or she served during the year.
During the fiscal year ended December 31, 1997, the Board of Directors of
the Bank held ten meetings. No incumbent director of the Bank attended fewer
than 75% of the total number of meetings held by the Bank's Board of Directors
and by all committees of the Bank's Board of Directors on which he or she
served during the year.
Fees. Directors' fees are paid to non-employee directors of the Bank and the
Company in the amounts of $21,600 per annum, $1,000 per Board meeting attended
and $750 per committee meeting attended ($500 in the case of telephonic
meetings attended), plus an additional fee of $4,000 per annum for the
Chairman of the Audit Committee and $2,400 per annum for each chairman of
other Board committees. Only one fee for attendance at Board meetings of the
Bank and the Company is paid when the meetings are held on the same day.
The Chairman of the Board received compensation for 1997 as follows: a
Chairman fee of $60,000, a retainer of $21,600, and a fee of $36,000 for
attendance at Board and committee meetings.
4
<PAGE>
Stock Option Awards. On January 31, 1997, options to purchase 5,000 shares
of the Company's common stock at an exercise price of $51.00 per share
(adjusted to 10,000 shares and $25.50, respectively, for the two-for-one stock
split in the form of a 100% stock dividend paid on the Company's common stock
on June 2, 1997) were granted to each of Directors Collins, Easley, Foster and
McKean, and to former directors Richard J. Quinlan and Robert L. Witt (each of
whom ceased to be a director of the Company and the Bank in January 1998). The
options became exercisable in full on July 31, 1997.
Information regarding stock options granted to Director Sondker, the
President and Chief Executive Officer of the Company, is contained elsewhere
in this Proxy Statement under the caption "Option Grants in Last Fiscal Year."
Stock in Lieu of Cash Compensation Plan. In 1996, the Company and the Bank
adopted the Stock in Lieu of Cash Compensation Plan for Non-Employee Directors
(the "Stock in Lieu of Cash Plan"). The Stock in Lieu of Cash Plan provides
for the deferral of compensation earned by non-employee directors of the Bank
in the form of Stock Units ("Stock Units") in a Stock Unit account ("Stock
Unit Account"). Pursuant to the Stock in Lieu of Cash Plan, at least 20% of
the fees paid to non-employee directors must be converted into Stock Units,
and non-employee directors may elect to have up to 100% of their fees
converted.
For dividends paid with respect to the Company's common stock, each non-
employee director has credited to his or her Stock Unit Account an additional
number of Stock Units in an amount determined under the Stock in Lieu of Cash
Plan. Each non-employee director's Stock Unit Account shall be settled by
delivering to the non-employee director (or his beneficiary) the number of
shares of Company common stock equal to the number of whole Stock Units then
credited to the non-employee director's Stock Unit Account, in either (i) a
lump sum or (ii) substantially equal annual installments over a period not to
exceed ten years.
Amended Outside Directors' Retirement Plan. The Bank maintains a retirement
plan for non-employee directors who retire from the Bank's Board of Directors
with at least three years of service on the Board at the date of retirement
and who were elected to the Bank's Board of Directors prior to 1996. Pursuant
to the Amended Outside Directors' Retirement Plan, the present value of the
vested accrued benefits as of May 23, 1996 of each then-current non-employee
director were contributed by the Bank in cash to a grantor trust administered
by a third party trustee. Only Directors Easley, McKean, Collins and Foster
and former directors Quinlan and Witt are eligible participants in the Amended
Outside Directors' Retirement Plan. Upon termination of a participant's
service as a director of the Bank prior to a change in control of the Company
or the Bank, the participant's benefit in the form of shares of the common
stock of the Company held by the grantor trust will be distributed in ten
installments, with the first installment generally being made within 30 days
after termination of service and each subsequent installment generally being
made annually thereafter. Upon a change in control of the Company or the Bank,
the undistributed shares in the grantor trust will be converted into cash by
the trustee and invested by the trustee in permitted investments with
installment distributions being made in cash. Following a change in control of
the Company or the Bank and the occurrence of a Trigger Event (as defined in
the grantor trust), a single lump-sum cash payment will be made to
participants in termination of the grantor trust and the Amended Outside
Directors' Retirement Plan.
1998 Non-Employee Director Stock Option and Incentive Plan. The Board of
Directors has approved, and is recommending that stockholders of the Company
adopt, the 1998 Non-Employee Director Stock Option and Incentive Plan. See
"Approval of the 1998 Non-Employee Director Stock Option and Incentive Plan."
Committees. Set forth below is information regarding the Audit, Compensation
and Benefits and Nominating Committees of the Company. The Board of Directors
of the Company also has a Stock Option Committee, the members of which are
Directors Collins, Greber and McKean.
5
<PAGE>
The Audit Committee reviews audit and regulatory reports and related matters
to ensure effective compliance by the Company and the Bank with regulatory and
internal policies and procedures. Directors McKean, Collins, Easley and
Winchell are members of this Committee. The Audit Committee held nine meetings
during 1997.
The Compensation and Benefits Committee is responsible for review and
recommendations for approval by the Board of senior officers' salaries, other
compensation and benefit programs and Board of Directors and committee fees.
The current members of the Compensation and Benefits Committee are Directors
Collins, Greber and McKean. The Committee held nine meetings during 1997.
The Nominating Committee of the Company is responsible for nominating
persons to serve on the Board of Directors of the Company and as Chairman of
the Board. Directors Easley, Foster, McKean, and Sondker are members of this
Committee. The Committee held one meeting during 1997. While the Nominating
Committee will consider nominees recommended by stockholders, the Committee
has not actively solicited such nominations. Pursuant to the Company's Bylaws,
nominations by stockholders must be delivered in writing to the Secretary of
the Company at least 60 days before the date of the annual meeting.
6
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information concerning the compensation for
services in all capacities to the Company for the years ended December 31,
1997, 1996 and 1995 of the Chief Executive Officer of the Company during 1997
and the other four most highly compensated executive officers of the Company
in 1997 (the "named officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------- --------------------- --------
RESTRICTED SHARES LTIP
STOCK UNDERLYING PAYOUTS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS AWARD(S) OPTIONS(2) ($) COMPENSATION
- --------------------------- ---- ------------------- ---------- ---------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Edward H. Sondker(1) 1997 $ 300,000 $ 150,000 -- 30,000 $702,881 $12,500(3)
President and Chief 1996 287,502 143,750 -- 80,000 -- 48,977(3)
Executive Officer 1995 114,585 -- -- 160,000 -- 13,180(3)
David A. Heaberlin(1) 1997 $ 230,833 $ 117,500 -- 30,000 $372,862 $ 7,438(4)
Executive Vice President 1996 205,002 82,001 -- 80,000 -- 2,719(4)
and Chief Financial
Officer 1995 33,334 -- -- 40,000 -- 10,086(4)
Robert J. Flax 1997 $ 165,006 $ 68,002 -- 7,500 $388,205 $ 9,673(5)
Executive Vice
President, 1996 158,724 63,490 -- 6,000 -- 18,028(5)
General Counsel and
Secretary 1995 157,590 15,750 -- 20,000 -- 15,339(5)
John N. Buckley 1997 $ 155,000 $ 64,000 -- 17,500 $199,755 $ 7,007(6)
Executive Vice President 1996 140,004 56,002 -- 10,000 -- 11,683(6)
1995 119,617 19,500 -- 20,000 -- 9,374(6)
Rupert N. Ayton(8) 1997 $ 117,504 $ 50,002 -- 20,000 -- $ 5,031(7)
Senior Vice President 1996 104,685 35,000 -- 10,000 -- 975(7)
1995 -- -- -- -- -- -- (7)
</TABLE>
- -------
(1) Mr. Sondker joined the Company on August 1, 1995 and Mr. Heaberlin joined
the Company on November 1, 1995.
(2) Options granted prior to June 2, 1997 have been adjusted for the two-for-
one stock split in the form of a 100% stock dividend paid on such date.
(3) 1997: matching contribution to Mr. Sondker's account in the Bank's 401(k)
Plan, $4,800; life insurance premium, $4,260, split dollar life insurance
premium, $3,440; 1996: matching contribution to Mr. Sondker's account in
the Bank's 401(k) Plan, $4,500; life insurance premium, $4,033; executive
physical, $880; closing costs related to the sale and purchase of Mr.
Sondker's homes, $17,689; reimbursement for miscellaneous moving expenses,
$21,875. 1995: life insurance premium, $397; moving expenses pursuant to
Mr. Sondker's hiring agreement, $12,783.
(4) 1997: matching contribution to Mr. Heaberlin's account in the Bank's
401(k) Plan, $4,800; life insurance premium, $73; split dollar life
insurance premium, $2,565; 1996: matching contribution to Mr. Heaberlin's
account in the Bank's 401(k) Plan, $1,050; life insurance premium, $73;
executive physical, $1,596. 1995: moving expenses pursuant to Mr.
Heaberlin's hiring agreement, $10,086.
(5) 1997: matching contribution to Mr. Flax's account in the Bank's 401(k)
Plan, $9,600; life insurance premium $73; 1996: matching contribution to
Mr. Flax's account in the Bank's 401(k) Plan, $9,800; life insurance
premium, $73; executive physical, $1,748, ESOP contribution $6,406. 1995:
401(k) Plan contribution, $9,000; life insurance premium, $73; ESOP
contribution, $6,266.
(6) 1997: matching contribution to Mr. Buckley's account in the Bank's 401(k)
Plan, $6,975; life insurance premium, $32; 1996: Matching contribution to
Mr. Buckley's account in the Bank's 401(k) Plan, $5,325; life insurance
premium, $32; ESOP contribution $6,325. 1995: 401(k) Plan contribution,
$3,588; life insurance premium, $32; ESOP contribution, $5,754.
(7) 1997: matching contribution to Mr. Ayton's account in the Bank's 401(k)
Plan, $3,525; life insurance premium, $1,506; 1996: life insurance
premium, $975.
(8) Mr. Ayton joined the Company on January 1, 1996 and resigned from the
Company effective March 31, 1998.
7
<PAGE>
The following table sets forth certain information concerning grants of
stock options pursuant to the 1995 Stock Option Plan to the named officers in
1997. No stock appreciation rights ("SARs") were granted in 1997.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF STOCK
PRICE APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
---------------------------------------------- -----------------------
NUMBER OF % OF TOTAL
SHARES OPTIONS
UNDERLYING GRANTED TO PER SHARE
OPTIONS EMPLOYEES EXERCISE EXPIRATION
GRANTED(1) IN FISCAL YEAR PRICE DATE 5% 10%
---------- -------------- --------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Edward H. Sondker....... 30,000(2) 3.84% $25.53 06/23/07 $ 481,670 $ 1,220,647
David A. Heaberlin...... 20,000(3) 2.56 28.44 02/27/07 357,715 906,521
10,000(2) 1.28 25.53 06/23/07 160,557 406,882
Robert J. Flax.......... 7,500(2) .96 25.53 06/23/07 120,418 305,163
John N. Buckley......... 10,000(3) 1.28 28.44 02/27/07 178,858 453,260
7,500(4) .96 34.41 12/11/07 162,302 411,305
Rupert N. Ayton......... 7,000(5) .90 25.50 01/22/07 116,660 295,639
7,000(3) .90 28.44 02/27/07 125,200 317,282
2,500(2) .32 25.53 06/23/07 40,139 101,721
3,500(4) .45 34.41 12/11/07 75,741 191,942
</TABLE>
- --------
(1) All options granted prior to the two-for-one stock split in the form of a
100% stock dividend paid on the Company's common stock on June 2, 1997
have been adjusted for such dividend.
(2) The vesting schedule of the option is as follows: 30% on June 23, 1998,
30% on June 23, 1999 and 40% on June 23, 2000.
(3) The vesting schedule of the option is as follows: 30% on February 27,
1998, 30% on February 27, 1999 and 40% on February 27, 2000.
(4) The vesting schedule of the option is as follows: 30% on December 11,
1998, 30% on December 11, 1999 and 40% on December 11, 2000.
(5) The vesting schedule of the option is as follows: 30% on January 22, 1998,
30% on January 22, 1999 and 40% on January 22, 2000.
8
<PAGE>
The following table sets forth certain information concerning the number and
value of unexercised stock options at December 31, 1997 held by the named
officers. None of the named officers held any SARs at December 31, 1997 or
exercised any stock options or SARs during 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND OPTION VALUES AT
DECEMBER 31, 1997
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END FY-END ($) (1)
------------------------- -------------------------
SHARES
ACQUIRED VALUE
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Edward H. Sondker....... -- $-- 144,000 126,000 $2,362,500 $2,429,061
David A. Heaberlin...... -- -- 64,000 86,000 1,412,500 1,418,437
Robert J. Flax.......... -- -- 81,800 11,700 2,161,525 161,240
John N. Buckley......... -- -- 33,000 24,500 788,375 226,703
Rupert N. Ayton......... -- -- 10,000 20,000 218,750 163,187
</TABLE>
- --------
(1) The difference between the aggregate option exercise price and the fair
market value of the underlying shares at December 31, 1997.
EMPLOYMENT CONTRACTS
The Company has employment agreements with each of Messrs. Sondker,
Heaberlin, Flax, Buckley and Ayton. Each agreement provides for an initial
term of one year with automatic renewal for an additional year on each
December 31 unless the Company or the executive gives prior written notice
that the agreement is not to be renewed. The agreements provide for the
payment of base salary as follows: Mr. Sondker $350,000 per annum; Mr.
Heaberlin $275,000 per annum; Mr. Flax $170,004 per annum; Mr. Buckley
$160,000 per annum; and Mr. Ayton $125,004 per annum. The agreements provide
for base salary review on July 1 of each year and further provide that salary
increases are not guaranteed or automatic. The contracts provide for
participation in an equitable manner in employee benefits applicable to
executive personnel.
In the event of termination by the Company without cause, Messrs. Sondker,
Heaberlin and Flax would be entitled to receive a lump sum severance payment
of 18 months salary, and Messrs. Buckley and Ayton would be entitled to a
severance payment of 12 months' salary. Upon a change in control of the
Company or Bank followed within 24 months by the involuntary termination of an
executive (including the executive's relocation or a reduction in benefits or
responsibilities) without cause, the executive would be entitled to a lump sum
severance payment of 200% of annual salary. As noted elsewhere in this Proxy
Statement, Mr. Ayton voluntarily terminated his employment effective March 31,
1998.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Benefits Committee of the Board of Directors has
furnished the following report on executive compensation:
Compensation Philosophy Regarding Executive Officers
The Compensation and Benefits Committee (the "Committee") of the Board of
Directors is responsible for supervising and recommending for full Board
approval the compensation and benefits of the executive officers of the
Company. The Committee has structured the compensation for
9
<PAGE>
executive officers of the Company around three components: (1) base salary;
(2) annual incentives; and (3) long-term incentives. The Committee's strategic
goal is to pay executives for performance by weighing the variable pay
components of compensation more heavily than base salary. Toward this end, the
Committee's goal is to set base salary for the respective executive position
based upon individual experience and performance and at levels that are
competitive but slightly below market average salary for the position. At the
same time, total compensation, including annual cash and long-term incentives,
is structured in a manner that allows executives to attain above-market total
pay if the Company and the individual are achieving stated goals; if goals are
not achieved, total pay would be below market. In 1997, the Committee retained
the services of Strategic Compensation Associates ("SCA"), an independent
compensation consulting firm, to competitively assess the Company's executive
compensation programs and make appropriate recommendations in accordance with
the Committee's pay-for-performance philosophy. SCA compiled a composite group
of peer institutions and analyzed peer group compensation data from proxy
statements, financial data, annual reports and published surveys; pay data was
appropriately adjusted to compare with the Company's size as adjusted to take
into account the pending acquisition of EurekaBank. SCA derived market
consensus levels of total compensation for each executive position based on
experience, responsibilities and scope of duties, and made recommendations as
to appropriate base salary and target annual and long-term incentive
compensation levels. The Committee updated its executive salary ranges based
on SCA's data and recommendations effective July 1997. Base salary ranges were
established in such a way that the midpoint of each range was approximately 5
to 15% below market consensus for each position. The Committee generally sets
the base salary of each executive officer at the midpoint of the recommended
salary range. The Committee determined not to adjust the base salaries of the
Chief Executive Officer and the Chief Financial Officer in July; rather, the
Committee waited to make such adjustments when the contemplated acquisition of
EurekaBank was completed in January 1998. Ranges for target long-term
compensation for each executive position were also established by the
Committee based on SCA's recommendations.
Incentive and bonus programs for executive officers have been utilized since
the Bank's conversion from a mutual to stock institution in 1986. Annual
incentive plans for the executive officers commenced in fiscal year 1987 under
a philosophy that was geared towards measuring performance based on the
creation of shareholder value as reflected in certain financial measurements.
Annual incentive compensation has also been based upon business unit and
individual performance as measured against goals and objectives which were
stated in the Company's business plan. The Company's annual incentive plans
for executive officers have required that certain thresholds of corporate
performance and regulatory ratings be met prior to an executive being entitled
to an incentive payment under any of the three categories of the annual plans:
corporate, business unit and individual performance.
The 1997 Annual Senior Management Incentive Plan (the "Senior Management
Incentive Plan") for the executive officers contained corporate, business unit
and individual goals. Certain thresholds of performance were required to be
met by the Company prior to any officer eligibility for a bonus in 1997. These
thresholds were net income, earnings per share and, for officers of the Bank
only, regulatory examination results, including satisfactory Community
Reinvestment Act ("CRA") rating. Because these performance thresholds were met
by the Company and the Bank, and all business unit and individual performance
measures were achieved, the named officers were entitled to payments under the
Senior Management Incentive Plan as follows: Edward Sondker, $150,000; David
Heaberlin, $117,500; Robert Flax, $68,002; John Buckley, $64,000; and Rupert
Ayton, $50,002. The bonus payments to the named officers for 1997 totaled
$449,504.
SCA developed and the Board adopted in 1993 a five year long-term incentive
plan for the executive officers (the "LTIP") based upon certain performance
criteria including shareholder return as measured by the increase in the value
of the Company's common stock. The Committee and the
10
<PAGE>
Board of Directors are satisfied that the LTIP is properly tied to a direct
increase in shareholder value and provides the executive officers with an
incentive to achieve goals that are expected to directly result in an increase
in the price of the Company's common stock. The awards were based on the
executive officer's base salary and a factor related to the relative value of
the executive's contribution to achieving the goals set forth in the LTIP. In
June 1996, the Committee amended certain of the performance criteria to
reflect changes in the strategy and direction of the Company since 1993. As of
December 31, 1996, three of the stated goals contained in the LTIP were
achieved, and 45% of the performance units vested in accordance with the terms
of the LTIP. No performance units were granted in 1997 to any of the named
individuals.
In March 1997, the Company entered into agreements with each of the Plan
participants whereby the participants agreed to fix the price of one-half of
their vested units (22.5% of the units granted) at a price of $28.625. The
remaining one-half of each participant's vested units were fixed at a share
price of $27.25 on July 1, 1997, also through agreements voluntarily executed
by the participants. The Committee considered the agreements to be in the best
interests of the Company because they served to fix the Company's liability
with respect to the vested performance units rather than having the liability
continue to rise with the Company's stock price. Toward this end, the
Committee also amended the LTIP to provide that the remaining 55% of unvested
performance units, if earned, would be fixed as of December 31, 1997 at a
price equal to the 30 day moving average share price for the month of December
1997. The amendment further provided that any performance units earned as of
December 31, 1997 would not vest immediately, but would vest in 12.5%
increments over eight consecutive quarters beginning March 31, 1998. As of
December 31, 1997, no additional performance objectives were attained, and all
unearned performance units were forfeited in accordance with the terms of the
Plan.
Payment of the balances representing the fixed portion of the vested
performance units as described above, plus interest, were made in 1997 to the
named officers in the following amounts: Edward Sondker, $702,880.55; David
Heaberlin, $372,861.94; Robert Flax, $388,204.79; and John Buckley,
$199,755.37. All amounts earned under the LTIP were paid in 1997 and all
unearned amounts were forfeited in accordance with the terms of the Plan. The
Plan ended effective December 31, 1997.
In January 1998, the Committee approved the Performance Stock Plan, which
was designed by SCA to complement the Company's existing stock option program
through awards which are contingent on the achievement of specific performance
measures as set forth in the Performance Stock Plan. The Committee believes
that the Performance Stock Plan's design will focus participants on
performance measures that will lead to the creation of value for the Company's
shareholders while providing the participants with the opportunity to earn
awards commensurate with performance and the creation of shareholder value.
The Performance Stock Plan will be submitted to stockholders for their
approval at the Meeting and is described in detail elsewhere in this Proxy
Statement under "Proposal II--Approval of the 1998-2000 Performance Stock
Plan."
The Committee considers the grant of stock options to executive officers to
be a component of long-term compensation. In 1997, options were granted to the
named officers as follows: Mr. Sondker, 30,000 shares; Mr. Heaberlin, 30,000
shares; Mr. Flax, 7,500 shares; Mr. Buckley, 17,500 shares; and Mr. Ayton,
20,000 shares. The grants were based on the Committee's recognition of the
exceptional performance of the named individuals, their leadership skills and
their ability to affect the results of the Company, and most importantly, the
importance of retaining the named individuals because of their impact on the
future success of the Company.
During 1997, the Company established split-dollar life insurance policies
for Messrs. Sondker and Heaberlin. The policies were funded by the tax-free
conversion of the cash surrender value of existing policies that no longer
served a valid purpose. The new policies are owned by the executives but
11
<PAGE>
provide for an assignment back to the Company of the amount contributed by the
Company. The assignment would be terminated upon a change in control of the
Company.
CEO Compensation
Edward H. Sondker commenced employment as the Company's President and Chief
Executive Officer on August 1, 1995. Mr. Sondker's initial base salary of
$275,000 per annum was set as part of the negotiation of his entire employment
package. His base salary was adjusted to $300,000 as of July 1, 1996. The
Committee took no action to increase Mr. Sondker's base salary in 1997;
effective January 1, 1998, Mr. Sondker's base salary was adjusted to $350,000
as a result of the recommendations made by SCA and in accordance with the
Committee's philosophy of setting base salary at slightly below peer market
average for a comparable position. Mr. Sondker's total compensation package
includes: (1) the aforementioned base salary; (2) annual incentive target
award of 50% of annual base salary based upon achievement of agreed-upon 1997
performance goals; (3) long-term compensation consisting of an option to
purchase 300,000 shares of Bay View common stock (representing cumulative
grants since his date of hire) vesting over three years and performance units
granted under the LTIP; (4) a split-dollar life insurance policy described
above; and (5) a one year employment contract. On January 1, 1998, the
Committee allowed Mr. Sondker's employment agreement (described elsewhere in
this Proxy Statement) to automatically renew for an additional one year term.
Mr. Sondker received an annual incentive award in the amount of $150,000,
which represented 50% of his 1997 annual base salary, for achieving corporate
and individual performance goals in accordance with the terms of the Senior
Management Incentive Plan. The Committee is satisfied that Mr. Sondker's total
compensation package is reasonable and will continue to achieve the
aforementioned goals of the Committee regarding executive compensation.
Employment Contracts
A more detailed description of the employment contracts with the named
officers is contained elsewhere in this Proxy Statement.
Deductibility of Executive Compensation
The federal income tax laws limit the deduction a publicly-held company is
allowed for compensation paid to its chief executive officer and its four most
highly compensated executive officers. Generally, amounts in excess of $1
million (other than performance-based compensation) paid in any tax year to a
covered executive cannot be deducted. The Committee will consider ways to
maximize the deductibility of executive compensation, while retaining the
discretion the Committee deems necessary to compensate executive officers in a
manner commensurate with performance and the competitive environment for
executive talent.
The foregoing report is furnished by Ms. Collins (Chairperson) and Messrs.
McKean and Greber.
12
<PAGE>
STOCKHOLDER RETURN PERFORMANCE PRESENTATION
The line graph below compares the cumulative total stockholder return on the
Company's common stock to the cumulative total return of the Dow Jones Global-
U.S. Index and Dow Jones Savings and Loan Index for the period December 31,
1992 through December 31, 1997. The graph assumes that $100 was invested on
December 31, 1992 and that all dividends were reinvested.
CUMULATIVE TOTAL RETURN
BAY VIEW CAPITAL CORPORATION, DOW JONES GLOBAL-U.S.
INDEX AND SAVINGS AND LOAN INDUSTRY INDEX
[LINE GRAPH APPEARS HERE]
12/31/92 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
Bay View 100 107.32 99.13 152.59 231.12 401.71
Dow Jones 100 109.95 110.76 152.49 187.63 251.34
S&L Index 100 104.81 91.16 151.34 188.96 328.90
RETIREMENT PLAN
The Bank terminated its non-qualified defined benefit supplemental executive
retirement plan (the "Retirement Plan") as of December 31, 1995. The Bank has
no continuing liabilities in connection with the Retirement Plan to any
executive officers other than to Robert J. Flax, who will be entitled at
normal retirement age (65) to an annual benefit, to be paid for 15 years,
equal to 50% of his average base salary over the three calendar years
preceding retirement, provided that such average base salary shall not exceed
the amount of his base salary as of December 31, 1995. The Bank has continuing
liabilities, which have been fully accrued, to former executive officers who
retired from or are no longer employed by the Bank.
CERTAIN TRANSACTIONS
Prior to the enactment on August 9, 1989 of the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 ("FIRREA"), the Bank, like many
savings associations, followed a policy of granting loans to eligible
officers, directors and employees, generally for the financing of real estate
and for consumer purposes. Under the Bank's policy, which was consistent with
Federal Home Loan Bank Board regulations governing transactions with the
Bank's affiliated persons, real estate loans were permitted to be made at
rates 1.0 percentage point above the applicable adjustable mortgage loan
index, which was generally the Eleventh District Federal Home Loan Bank cost
of funds index, and consumer loans were permitted to be made at .75 to 1.0
percentage point below market rates. These loans were made in the ordinary
course of business on substantially the same terms and collateral, except for
interest rates and, in the case of real estate secured loans, waiver of loan
13
<PAGE>
origination fees, as those of comparable transactions prevailing at the time,
and did not involve more than the normal risk of collectibility or present
other unfavorable features.
FIRREA added a requirement that all loans and extensions of credit to the
executive officers and directors of the Bank and their related entities be on
substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons.
In connection therewith, the Bank adopted a policy that directors and officers
at or above the level of Vice President are not eligible for Bank loans. Loans
approved prior to August 9, 1989 were not affected. In addition, all loans and
other transactions between the Company and its affiliates are subject to
approval by a majority of the directors of the Company, including a majority
of its disinterested directors.
Set forth below is certain information as of December 31, 1997 as to loans
made by the Bank to any director or executive officer of the Company or the
Bank whose aggregate indebtedness to the Bank exceeded $60,000 at any time
since December 31, 1996.
<TABLE>
<CAPTION>
LARGEST
AGGREGATE
AMOUNT LOAN
OUTSTANDING BALANCE INTEREST
SINCE AS OF RATE AS OF
NAME DATE OF LOAN 12/31/96 12/31/97 12/31/97
- ---- ------------ ----------- -------- ----------
<S> <C> <C> <C> <C>
Robert J. Flax..................... 08/26/86 $247,395 $240,534 5.86%
03/15/88 28,571 24,764 6.68
</TABLE>
As required by the regulations of the SEC, the following information is
provided with respect to certain proceedings: Ms. Paula R. Collins became one
of the founders of The WDG Companies ("WDG") in 1982. Ms. Collins and WDG have
been involved in numerous real estate development projects and investments,
virtually all of which have been successful. The two exceptions are
acquisitions of existing buildings in individual transactions structured as
separate limited partnerships. In September 1989, a limited partnership of
which Ms. Collins was a General Partner transferred its assets to a lender for
a deed in lieu of foreclosure (WDG-I Creekside Oaks, a California limited
partnership). In May 1993, a real estate limited partnership (the "Limited
Partnership") of which Ms. Collins is a partner of a general partnership,
which is a general partnership of the Limited Partnership, filed a petition
under the Bankruptcy Code. The Limited Partnership has been reorganized under
Chapter 11 of the Bankruptcy Code and the reorganization plan has been
confirmed by the courts.
PROPOSAL II--APPROVAL OF THE 1998-2000 PERFORMANCE STOCK PLAN
GENERAL
The Performance Stock Plan has been adopted by the Board of Directors of the
Company subject to approval by the stockholders of Bay View at the Meeting.
The complete text of the Performance Plan is attached to this Proxy Statement
as Appendix I and is incorporated herein by reference. The principal features
of the Performance Plan are summarized below.
The Board of Directors believes that it is appropriate for the Company to
adopt a performance stock plan which permits selected employees to earn
rewards commensurate with the creation of value for the Company and its
shareholders, thereby aligning the interests of those employees more closely
with the interests of the Company and its stockholders while also providing a
financial incentive that will help the Company attract and retain employees of
outstanding competence.
PRINCIPAL FEATURES OF THE PERFORMANCE PLAN
Eligibility and Participation. Employees of the Company or the Bank who are
at the level of senior vice president or above and employees of any other
subsidiary of the Company or the Bank at the level of executive vice president
or above (there are currently 17 such employees) and who are selected by a
committee of non-employee directors are eligible to participate in the
Performance Plan.
14
<PAGE>
Awards. The Performance Plan provides for the granting of non-qualified
stock options and phantom stock units.
Shares Available; Non-Transferability of Rights. Pursuant to the Performance
Plan, 400,000 shares of the Company's common stock are reserved for issuance.
Shares may be either authorized but unissued shares or reacquired shares held
by the Company in its treasury. Any shares subject to an award which expires
or is terminated unexercised will again be available for issuance under the
Performance Plan. No right or interest in the Performance Plan is assignable
or transferable except in the event of the death of the participant.
Administration. The Performance Plan is administered by a committee (the
"Performance Plan Committee") of two or more non-employee directors selected
by the Board of Directors of the Company.
Performance Targets. Awards under the Performance Plan are made only with
respect to a quarter in which the Company achieves one or more of the
performance targets set forth therein. If the Performance Plan had been in
effect during fiscal 1997, none of the performance targets would have been
met.
Stock Options. Stock options issued under the Performance Plan ("Performance
Options") shall be exercisable for a term of four and one-half years beginning
six months from the date of the grant. The exercise price of Performance
Options shall be equal to the market value per share on the date the options
are granted. The exercise price must be paid in full in cash or, if permitted
by the Performance Plan Committee, shares of Company common stock, or a
combination of both. Performance Options are not intended to qualify under
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
Phantom Stock Units. A phantom stock unit issued under the Performance Plan
(a "Performance Unit") evidences the right of a participant to receive a cash
payment (which the participant may choose to defer) within 45 days following
the end of the quarter in which the Performance Unit is awarded. The amount of
such payment is equal to the excess of the market value of one share of
Company common stock on the last day of the quarter with respect to which the
Performance Unit is issued over $36.25; provided, however, that no such
payment may exceed $36.25 except in connection with a change in control.
Effect of Merger and Other Adjustments. Shares as to which Performance
Options have been granted or may thereafter be granted and the corresponding
exercise prices thereof, and the number of shares underlying a Performance
Unit and the calculation of the cash payment with respect thereto, shall be
appropriately adjusted by the Performance Plan Committee in the event of any
change in the number of shares outstanding by reason of any merger,
reorganization, stock split or other change in the corporate structure of the
Company.
Amendment and Termination. The Performance Plan Committee may at any time
amend, suspend or terminate the Performance Plan, provided however that no
such modification may impair the rights of any participant in a previously
earned award, and further provided that no such modification shall be made
without determining the necessity or desirability of shareholder approval.
FEDERAL INCOME TAX CONSEQUENCES
Under present federal income tax laws, awards under the Performance Plan
will have the following tax consequences:
(1) The grant of a Performance Option will neither, by itself, result in
the recognition of taxable income to the participant nor entitle the
Company to a deduction at the time of such grant.
15
<PAGE>
(2) The exercise of a Performance Option will result in the recognition
of ordinary income by the participant on the date of exercise in an amount
equal to the difference between the exercise price and the fair market
value on the date of exercise of the shares acquired pursuant to the
Performance Option.
(3) The receipt of a cash payment pursuant to a Performance Unit will
result in the recognition of ordinary income by the participant on the date
of payment in an amount equal to the payment.
(4) The Company will be allowed a deduction at the time, and in the
amount of, any ordinary income recognized by the participant under the
circumstances described above, provided that the Company meets its federal
reporting obligations.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE ADOPTION
OF THE 1998-2000 PERFORMANCE STOCK PLAN.
PROPOSAL III--APPROVAL OF THE 1998 NON-EMPLOYEE DIRECTOR
STOCK OPTION AND INCENTIVE PLAN
GENERAL
The 1998 Non-Employee Director Stock Option and Incentive Plan (the "Non-
Employee Director Plan") has been adopted by the Board of Directors of the
Company subject to approval by the stockholders of Bay View at the Meeting.
The complete text of the Non-Employee Director Plan is attached to this Proxy
Statement as Appendix II and is incorporated herein by reference. The
principal features of the Non-Employee Director Plan are summarized below.
The Board of Directors believes that it is appropriate for the Company to
adopt a stock option and incentive plan which permits the grant of stock
options as a mean of aligning the interests of the directors more closely with
the interests of the other stockholders of the Company while also providing a
financial incentive that will help the Company attract and retain directors of
outstanding competence.
PRINCIPAL FEATURES OF THE NON-EMPLOYEE DIRECTOR PLAN
Eligibility and Participation. Non-employee directors of the Company or any
affiliate thereof who are selected by the Board of Directors are eligible to
participate in the Non-Employee Director Plan. There are currently nine non-
employee directors.
Awards. The Non-Employee Director Plan provides for the granting of non-
qualified stock options.
Shares Available; Non-Transferability of Rights. Pursuant to the Non-
Employee Director Plan, 200,000 shares of the Company's common stock are
reserved for issuance. Participants are eligible to receive annually options
with respect to up to 5,000 shares of Company common stock at the discretion
of the Board of Directors. Shares may be either authorized but unissued shares
or reacquired shares held by the Company in its treasury. Any shares subject
to an award which expires or is terminated unexercised will again be available
for issuance under the Non-Employee Director Plan. No right or interest in the
Non-Employee Director Plan is assignable or transferable except in the event
of the death of the participant or pursuant to a qualified domestic relations
order.
Administration. The Non-Employee Director Plan is administered by the Board
of Directors of the Company.
16
<PAGE>
Stock Options. Stock options issued under the Non-Employee Director Plan
("Director Options") shall be exercisable for a term of not more than ten
years from the date of the grant. Director Options are not intended to qualify
under Section 422 of the Code. The exercise price of Director Options shall
not be less than the market value per share on the date the options are
granted. The exercise price must be paid in full in cash or shares of Company
common stock, or a combination of both.
Effect of Merger and Other Adjustments. Shares as to which Director Options
have been granted or may thereafter be granted and the corresponding exercise
prices thereof, shall be appropriately adjusted by the Board of Directors in
the event of any change in the number of shares outstanding by reason of any
merger, reorganization, stock split or other change in the corporate structure
of the Company.
Amendment and Termination. The Board of Directors may at any time amend,
suspend or terminate the Non-Employee Director Plan, provided however that no
such modification may impair the rights of any participant in a previously
earned award, and further provided that no such modification shall be made
without determining the necessity or desirability of shareholder approval.
FEDERAL INCOME TAX CONSEQUENCES
Under present federal income tax laws, awards under the Non-Employee
Director Plan will have the following tax consequences:
(1) The grant of a Director Option will neither, by itself, result in the
recognition of taxable income to the participant nor entitle the Company to
a deduction at the time of such grant.
(2) The exercise of a Director Option will result in the recognition of
self-employment income by the participant on the date of exercise in an
amount equal to the difference between the exercise price and the fair
market value on the date of exercise of the shares acquired pursuant to the
Director Option.
(3) The Company will be allowed a deduction at the time, and in the
amount of, any self-employment income recognized by the participant under
the circumstances described above, provided that the Company meets its
federal reporting obligations.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" ADOPTION OF
THE NON-EMPLOYEE DIRECTOR PLAN.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers, and
persons who own more than 10% of a registered class of the Company's equity
securities, to file with the SEC reports of ownership and reports of changes
in ownership of common stock and other equity securities of the Company.
Officers, directors and greater than 10% stockholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1997, all
Section 16(a) filing requirements applicable to the Company's officers,
directors and greater than 10% beneficial owners were met, except for the
inadvertent late filing of a Form 4 by former Director Robert L. Witt.
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AUDITORS
The Board of Directors of the Company is reviewing which independent
accountants are to be appointed the Company's auditors for the fiscal year
ending December 31, 1998. Deloitte & Touche LLP served as the Company's
independent auditors for the fiscal year ended December 31, 1997.
Representatives of Deloitte & Touche LLP are expected to attend the Meeting to
respond to appropriate questions and to make a statement if they so desire.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials for
next year's Annual Meeting of Stockholders, any stockholder proposal to take
action at such meeting must be received at the main office of the Company,
1840 Gateway Drive, San Mateo, California 94404, no later than December 21,
1998. Any such proposals shall be subject to the requirements of the proxy
rules adopted under the Exchange Act.
OTHER MATTERS
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy
materials to the beneficial owners of common stock. In addition to
solicitation by mail, directors and officers of the Company and regular
employees of the Bank may solicit proxies personally or by telegraph or
telephone, without additional compensation. The Company has retained Kissel-
Blake, Inc. to assist in the solicitation of proxies, for a fee estimated to
be approximately $6,500 plus reasonable out-of-pocket expenses.
By Order of the Board of Directors
/s/ Robert J. Flax
Robert J. Flax
Secretary
San Mateo, California
April 20, 1998
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APPENDIX I
BAY VIEW CAPITAL CORPORATION
1998-2000 PERFORMANCE STOCK PLAN
1. Plan Purpose. The purpose of the Plan is to focus Participants on
measures that will lead to the creation of value for the Corporation and its
shareholders and to provide the Participants with the opportunity to earn
significant rewards commensurate with performance and shareholder value
creation. It is intended that Options granted pursuant to the provisions of
this Plan will be Non-Qualified Stock Options.
2. Definitions. The following definitions are applicable to the Plan:
"Affiliate"--means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in section 425(e) and (f),
respectively, of the Code.
"Agreement"--means the written agreement entered into between the
Corporation and a Participant to carry out the Plan with respect to the rights
and entitlements of a Participant to earn Awards in accordance with the Plan's
terms and conditions.
"Award"--means the grant by the Committee of a Phantom Stock Unit, an
Option, or both, as provided in the Plan.
"Change in Control"--means any of the events specified in the following
clauses (i) through (iii): (i) any third person, including a "group" as
defined in section 13(d) (3) of the Securities Exchange Act of 1934, shall
become the beneficial owner of shares of the Corporation with respect to which
25% or more of the total number of votes for the election of the Board of
Directors of the Corporation may be cast, (ii) as a result of, or in
connection with, any cash tender offer, merger or other business combination,
sale of assets or contested election, or combination of the foregoing, the
persons who were directors of the Corporation shall cease to constitute a
majority of the Board of Directors of the Corporation, or (iii) the
stockholders of the Corporation shall approve an agreement providing either
for a transaction in which the Corporation will cease to be an independent
publicly-owned corporation or for a sale or other disposition of all or
substantially all the assets of the Corporation.
"Code"--means the Internal Revenue Code of 1986, as amended.
"Committee"--means the Committee referred to in section 3 hereof.
"Continuous Service"--means the absence of any interruption or termination
of service as an Employee. Service shall not be considered interrupted in the
case of sick leave, military leave or any other leave of absence approved by
the Corporation or in the case of transfers between payroll locations of the
Corporation or between the Corporation, its Affiliates or any successor.
"Corporation"--means Bay View Capital Corporation, a Delaware corporation,
and any successor thereto.
"Effective Date"--means January 1, 1998.
"Employee"--means an officer who is employed either (i) by the Corporation
or Bay View Bank at the level of senior vice president or above, or (ii) by an
Affiliate (other than Bay View Bank) at the level of executive vice president
or above.
"Exercise Price"--means, in the case of an Option, the price per Share at
which the Shares subject to such Option may be purchased upon exercise of such
Option, which price is the Market Value per Share on the Grant Date.
"Grant Date"--means the last day of the Quarter in which an Award is earned.
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"Market Value"--means the average of the high and low quoted sales price on
the date in question (or, if there is no reported sale on such date, on the
last preceding date on which any reported sale occurred) of a Share on the
Composite Tape for the New York Stock Exchange-Listed Stocks, or, if on such
date the Shares are not quoted on the Composite Tape, on the New York Stock
Exchange, or if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934 on which the Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted to trading on any
such exchange, the mean between the closing high bid and low asked quotations
with respect to a Share on such date on the Nasdaq Stock Market, or any
similar system then in use, or, if no such quotations are available, the fair
market value on such date of a Share as the Committee shall determine.
"Net Interest Margin"--means net interest spread after including a factor
for the excess of interest-earning assets over interest-bearing liabilities
for the three month period ending on the last day of a Quarter. Net interest
spread represents the difference between the yield on interest-earning assets
and cost of interest-bearing liabilities adjusted for income derived from
noninterest-earning assets which are funded by interest-bearing liabilities.
"Non-Employee Director"--means a director who a) is not currently an officer
or employee of the Corporation or any Affiliate; b) is not a former employee
of the Corporation who receives compensation for prior services (other than
form a tax-qualified retirement plan); c) has not been an officer of the
Corporation; d) does not receive remuneration, directly or indirectly, from
the Corporation in any capacity other than as a director; and e) does not
possess an interest in any other transactions or is not engaged in a business
relationship for which disclosure would be required under Item 404(a) or (b)
of Regulation S-K.
"Non-Qualified Stock Option"--means an option to purchase Shares granted by
the Committee pursuant to section 6 hereof, which option is not intended to
qualify under section 422(b) of the Code.
"Option"--means a Non-Qualified Stock Option.
"Participant"--means an Employee who is selected by the Committee to
participate in the Plan and with whom the Corporation enters into an
Agreement.
"Performance Target"--means the performance criteria and the achievement
goals established pursuant to section 5 hereof for the granting of Awards
pursuant to section 6 hereof.
"Phantom Stock Unit"--means the right to receive on the Grant Date the Per
Unit Value multiplied by the number of hypothetical Shares earned.
"Per Unit Value"--means the excess of the Market Value of a Share on the
last day of the Quarter in which the Phantom Stock Unit is earned over $36.25,
but such Market Value shall be limited to $72.50 prior to the earlier of a
Change in Control or the Board of Directors of the Corporation approving a
proposal or transaction that could result in a Change in Control.
"Plan"--means the 1998-2000 Performance Stock Plan of the Corporation.
"Quarter"--means the three-month period ending on March 31, June 30,
September 30 or December 31 of each year, commencing on the Effective Date and
ending on the date that the Plan expires in accordance with Section 17(b)
hereof.
"Share"--means a share of the common stock of the Corporation.
"Tangible ROE"--means the consolidated after-tax net income of the
Corporation (including nonrecurring and extraordinary items) determined in
accordance with generally accepted accounting principles for the twelve month
period ending on the last day of a Quarter, divided by the average tangible
equity of the Corporation for such period.
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"Transaction Account Mix"--means transaction accounts as a percentage of
total retail deposits on the last day of a Quarter. Transaction accounts
represent savings, checking and money market accounts including other deposit
accounts which have similar interest rate risks.
3. Administration. The Plan shall be administered by a Committee consisting
of two or more individuals, each of whom shall be a Non-Employee Director. The
members of the Committee shall be appointed, removed and/or substituted from
time to time by the Board of Directors of the Corporation. Except as limited
by the express provisions of the Plan, the Committee shall have sole and
complete authority and discretion to (i) select Participants and grant Awards;
(ii) determine the number of Shares to be subject to types of Awards
generally, as well as to individual Awards granted under the Plan; (iii)
determine the terms and conditions upon which Awards shall be granted under
the Plan; (iv) prescribe the form and terms of the Agreements; and (v)
establish from time to time regulations for the administration of the Plan,
interpret the Plan, and make all determinations deemed necessary or advisable
for the administration of the Plan. A majority of the Committee shall
constitute a quorum, and the acts of a majority of the members present at any
meeting at which a quorum is present, or acts approved in writing by a
majority of the Committee without a meeting, shall be acts of the Committee.
4. Participation. The Committee may select Employees from time to time to
become Participants in the Plan. As a condition of participation, the
Corporation and the Employee shall enter into an Agreement relating to the
entitlement of such Participant to earn Awards under this Plan. Employees
approved for participation will be notified of their selection as soon after
approval as practicable.
5. Performance Targets. As soon as practicable after the end of each Quarter
(but in the case of any required or requested stockholder approval of the
Plan, then ending after the adoption of the Plan by the stockholders of the
Corporation), the Committee shall, based upon its review of the Corporation's
financial statements for such Quarter, determine whether one or more
Performance Targets were achieved during such Quarter. The Committee shall
certify in writing whether a Performance Target was achieved during such
Quarter based upon the actual performance results for such Quarter. There are
three separate Performance Targets that may be achieved under this Plan. Each
of the three Performance Targets may be achieved by the Corporation's
attainment during any Quarter of a minimum level of performance in each of
three applicable criteria--Net Interest Margin, Tangible ROE and Transaction
Account Mix--as follows:
<TABLE>
<CAPTION>
TRANSACTION
PERFORMANCE NET INTEREST ACCOUNT
TARGET MARGIN TANGIBLE ROE MIX
------------ ------------ ------------ -----------
<S> <C> <C> <C>
First................................. 3.3% 15.0% 40%
Second................................ 3.7% 16.0% 45%
Third................................. 4.0% 18.0% 50%
</TABLE>
6. Grant of Awards.
(a) Immediately upon the Committee's certification in writing of the
satisfaction of a Performance Target during a Quarter (but in no event prior
to the adoption of the Plan by the stockholders of the Corporation if such
approval is required or requested), each Employee who was a Participant in the
Plan on the last day of such Quarter shall be granted an Award of a number of
Phantom Stock Units and Options in accordance with the terms of his or her
Agreement.
(b) In the event that one or more of the Performance Targets is not achieved
on or before December 31, 2000, each Participant who is an Employee on
December 31, 2000, shall be entitled to an Award of Phantom Stock Units and
Options hereunder equal to the number of Phantom Stock Units and Options that
would have been granted to such Participant if the next Performance Target had
been satisfied, multiplied by a fraction, the numerator of which is the level
of performance of the lowest performing of the three applicable criteria--Net
Interest Margin, Tangible ROE or Transaction Account
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Mix--on December 31, 2000, and the denominator of which is the minimum level
of performance of the same criteria that would have been required in order to
satisfy the next Performance Target.
(c) In the event that a Participant ceases Continuous Service for any
reason, except as otherwise provided herein, all unvested Options shall be
forfeited and such Participant's right of participation in this Plan shall
thereupon cease and terminate.
7. Terms and Conditions of Phantom Stock Units. A Phantom Stock Unit, when
granted, shall evidence the right of a Participant to receive in cash the Per
Unit Value, multiplied by the number of hypothetical Shares earned thereby.
8. Terms and Conditions of Options. Subject to adjustment by the operation
of section 11 hereof, the maximum number of Shares with respect to which
Options may be granted under the Plan is 400,000 Shares. The Shares with
respect to which Options may be granted under the Plan may be either
authorized and unissued Shares or issued Shares heretofore or hereafter
reacquired and held as treasury stock. An Award shall not be considered to
have been made under the Plan with respect to any Option which is forfeited,
and new Awards may be granted under the Plan with respect to the number of
Shares as to which such termination or forfeiture has occurred. All Options
awarded hereunder are intended to be Non-Qualified Stock Options and shall be
granted pursuant to an Agreement. An Option shall, upon its exercise, entitle
the Participant to whom such Option is granted to purchase a number of Shares
at the Exercise Price. Such Option shall be exercisable for a term of four and
one-half years, beginning six months after the Grant Date and ending five
years after the Grant Date; provided, if a Participant ceases Continuous
Service during the six month period after the Grant Date for any reason other
than death, then the Option granted on such Grant Date shall terminate and be
forfeited. Notwithstanding the foregoing, however, the six-month vesting
provision contained in the previous sentence shall not apply in the event of a
Change in Control, as provided in Section 10 hereof.
9. Exercise of Awards.
(a) The Per Unit Value shall be paid in cash within 45 days following the
end of the Quarter in which the Phantom Stock Unit is awarded, unless (1) the
Participant elects to defer receipt of such cash payment pursuant to
subsection (b) hereof, or (2) the Committee, in its discretion, elects to
delay the payment of all or a portion thereof until such time as the amount
payable would be deductible to the Corporation or its Affiliate as
contemplated by section 162(m) of the Code.
(b) Participants who are eligible to participate in the Bay View Capital
Corporation Deferred Compensation Plan (the "BVCC Deferred Compensation Plan")
may elect to defer their receipt of cash payment for their Per Unit Value
pursuant to the Plan by their voluntary election to participate in the BVCC
Deferred Compensation Plan. Based upon the terms and provisions of the BVCC
Deferred Compensation Plan, certain Participants may irrevocably elect to
defer the receipt of all or a portion of their Per Unit Value to a specified
future date as permitted in the BVCC Deferred Compensation Plan. The election
to defer the Per Unit Value pursuant to the BVCC Deferred Compensation Plan
must be in writing and submitted to the Company's Human Resources Department
within the time period required for deferral under the BVCC Deferred
Compensation Plan.
(c) To exercise an Option under the Plan with respect to any portion or all
of the Shares represented by such Option, the Participant to whom such Option
was granted shall give written notice to the Corporation in form satisfactory
to the Committee, together with full payment of the Exercise Price. The date
of exercise shall be the date on which such notice is received by the
Corporation. Payment shall be made either (i) in cash (including check, bank
draft or money order) or (ii) if permitted by the Committee, by delivering (A)
Shares already owned by the Participant and having a Market Value equal to the
applicable Exercise Price, or (B) a combination of cash and such Shares.
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(d) An Option granted under the Plan shall be exercisable during the
lifetime of the Participant to whom such Option was granted only by such
Participant, and no such Option may be exercised unless at the time such
Participant exercises such Option such Participant has maintained Continuous
Service since the date of grant of such Option.
10. Effect of Change in Control. In the event of a Change in Control, each
Participant, as soon as practicable following the effective time of such
Change in Control, shall receive a cash award in lieu of the Phantom Stock
Units and Options that such Participant could have earned in the future under
the Plan. The amount of such cash award shall be equal to the following:
A) The total number of Phantom Stock Units that the Participant is
eligible to earn upon the achievement of all three Performance Targets,
multiplied by a fraction, the numerator of which is the number of days from
the Effective Date until the effective time of such Change in Control, and
the denominator of which is 1096; multiplied by
B) The Market Value of a Share at the effective time of the Change in
Control, minus $36.25; minus
C) The value under section 7 hereof of all Phantom Stock Units previously
awarded to the Participant, together with the Market Value at the effective
time of the Change in Control of all Shares represented by each Option
previously granted to the Participant under the Plan minus the Market Value
of such Shares on the date of grant of such Option.
In addition, in the event of a Change in Control, each Option, to the extent
that it has not previously been exercised, shall be immediately exercisable in
full at and after the effective time of such Change in Control.
11. Adjustments Upon Changes in Capitalization. In the event of any change
in the outstanding Shares subsequent to the Effective Date of the Plan by
reason of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in the
corporate structure or Shares of the Corporation, the number and class of
Shares as to which Options have been theretofore granted or may thereafter be
granted under the Plan and the corresponding Exercise Prices thereof, and the
number of Shares underlying a Phantom Stock Unit that may thereafter be
granted under the Plan, and the calculation of the Per Unit Value, shall be
appropriately adjusted by the Committee, whose determination shall be
conclusive.
12. Assignments and Transfers. No right or interest of any Participant in
this Plan will be assignable or transferable or subject to any lien or
encumbrance, whether directly or indirectly, by operation of law or otherwise,
including, without limitation, execution, levy, garnishment, attachment,
pledge, or bankruptcy except, in the event of the death of a Participant, by
will or the laws of descent and distribution.
13. Employee Rights Under the Plan. No Employee shall have a right to be
selected as a Participant, and no Employee or other person shall have any
claim or right to be granted an Award under the Plan or under any other
incentive or similar plan of the Corporation or any Affiliate. Neither the
Plan nor any action taken hereunder shall be construed as giving any Employee
any right to be retained in the employ of the Corporation or any Affiliate.
14. Delivery and Registration of Stock. The Corporation's obligation to
deliver Shares with respect to the exercise of an Option shall, if the
Committee so requests, be conditioned upon the receipt of a representation as
to the investment intention of the Participant to whom such Shares are to be
delivered, in such form as the Committee shall determine to be necessary or
advisable to comply with the provision of the Securities Act of 1933 or any
other federal, state or local securities legislation.
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It may be provided that any representation requirement shall become
inoperative upon a registration of the Shares or other action eliminating the
necessity of such representation under such Securities Act or other securities
legislation. The Corporation shall not be required to deliver any Shares under
the Plan prior to (i) the admission of such Shares to listing on any stock
exchange on which Shares may then be listed, and (ii) the completion of such
registration or other qualification of such Shares under any state or federal
law, rule or regulation, as the Committee shall determine to be necessary or
advisable.
15. Withholding Tax. The Corporation shall have the right to deduct from all
amounts paid in cash with respect to the Per Unit Value under the Plan any
taxes required by law to be withheld with respect to such cash payments. Where
a Participant or other person is entitled to receive Shares pursuant to the
exercise of an Option pursuant to the Plan, the Corporation shall have the
right to require the Participant or such other person to pay the Corporation
the amount of any taxes which the Corporation is required to withhold with
respect to such Shares, or, in lieu thereof, to retain, or sell without
notice, a number of such Shares sufficient to cover the amount required to be
withheld.
16. Amendment or Termination. The Committee, in its sole and absolute
discretion, may modify or amend any or all of the provisions of this Plan at
any time and from time to time, without notice, and may suspend or terminate
it entirely. However, no such modification, amendment, suspension, or
termination will be made prior to the Committee determining whether the
approval of the stockholders of the Corporation is required or desirable
pursuant to applicable law or regulation; provided, further, that no such
amendment, suspension or termination shall impair the rights of any
Participant, without his consent, in any Award theretofore earned pursuant to
the Plan.
17. Effective Date and Term of Plan.
(a) The Plan shall become effective upon its adoption by the Board of
Directors of the Corporation, effective as of January 1, 1998, provided, if
stockholder approval is required or requested, the Plan is duly approved by
the holders of a majority of the shares of common stock present, or
represented, and entitled to vote at the 1998 annual meeting of stockholders
of the Corporation. If the Plan is not approved by the stockholders, the Plan
shall terminate and all actions taken hereunder shall be null and void.
(b) Unless sooner terminated under section 16 hereof, the Plan shall expire
as soon as practicable after the earliest to occur of the dates specified
below and the satisfaction of all of the Corporation's responsibilities and
obligations with respect to all Awards earned through such date:
(1) The date on which all three Performance Targets have been achieved.
(2) December 31, 2000.
(3) The effective time of a Change in Control.
18. Beneficiary Designation. Each Participant under the Plan may, from time
to time, name any beneficiary or beneficiaries (who may be named contingently
or successively) to whom any Award under the Plan is to be paid in case of his
death before he receives any or all of such Award. Each designation will
revoke all prior designations by the same Participant, will be in a form
prescribed by the Committee, and will be effective only when filed by the
Participant in writing with the Committee during his lifetime. In the absence
of any such designation, benefits remaining unpaid at the Participant's death
will be paid to the Participant's estate.
19. No Funding. Nothing contained in this Plan and no action taken hereunder
will create or be construed to create a trust of any kind, or a fiduciary
relationship between the Corporation and any Participant or beneficiary or any
other person. Amounts due under this Plan at any time and from time to time
will be paid from the general funds of the Corporation. To the extent that any
person acquires a right to receive payments hereunder, such right shall be
that of an unsecured general creditor of the Corporation.
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20. Indemnification of Committee. No member of the Committee shall be liable
for any act, omission, or determination taken or made in good faith with
respect to the Plan or any Awards made hereunder; and the members of the
Committee shall be entitled to indemnification and reimbursement by the
Corporation in respect of any claim, loss, damage, or expenses (including
counsel fees) arising therefrom to the full extent permitted by law and under
any directors' and officers' liability or similar insurance coverage that may
be in effect from time to time.
21. Binding Effect. The Plan shall inure to the benefit of the Participants
hereunder and their respective heirs, devisees and legal representatives, and
it shall be binding on the successors of the Corporation and its Affiliates.
22. Expenses of the Plan. The expenses of administering the Plan will be
borne by the Corporation.
23. Governing Law. The Plan will be construed in accordance with and
governed by the laws of the State of California, except to the extent that
such laws are preempted by Federal law.
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APPENDIX II
BAY VIEW CAPITAL CORPORATION
1998 NON-EMPLOYEE DIRECTOR STOCK OPTION AND INCENTIVE PLAN
1. Plan Purpose. The purpose of the Plan is to promote the interests of the
Corporation and its stockholders by providing an inducement to attract and
retain qualified Non-Employee Directors of the Corporation and its Affiliates.
It is intended that Options granted pursuant to the provisions of this Plan
will be Non-Qualified Stock Options.
2. Definitions. The following definitions are applicable to the Plan:
"Affiliate"--means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in Section 424(e) and (f),
respectively, of the Code.
"Award"--means the grant of a Non-Qualified Stock Option, as provided in the
Plan.
"Board"--means the Board of Directors of the Corporation.
"Code"--means the Internal Revenue Code of 1986, as amended.
"Continuous Service"--means the absence of any interruption or termination
of service as a Non-Employee Director of the Corporation or an Affiliate.
Service shall not be considered interrupted in the case of sick leave,
military leave or any other leave of absence approved by the Corporation or in
the case of transfers between the Corporation, its parent, its subsidiaries or
its successor. With respect to any advisory director or director emeritus,
continuous service shall mean availability to perform such functions as may be
required of such persons.
"Corporation"--means Bay View Capital Corporation, a Delaware corporation,
or any successor.
"ERISA"--means the Employee Retirement Income Security Act of 1974, as
amended.
"Exercise Price"--means the price per Share at which the Shares subject to
an Option may be purchased upon exercise of such Option.
"Market Value"--means the average of the high and low quoted sales price on
the date in question (or, if there is no reported sale on such date, on the
last preceding date on which any reported sale occurred) of a Share on the
Composite Tape for the New York Stock Exchange-Listed Stocks, or, if on such
date the Shares are not quoted on the Composite Tape, on the New York Stock
Exchange, or, if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934 on which the Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted to trading on any
such exchange, the mean between the closing high bid and low asked quotations
with respect to a Share on such date on the Nasdaq Stock Market, or any
similar system then in use, or, if no such quotations are available, the fair
market value on such date of a Share as the Board shall determine.
"Non-Employee Director"--means a director, advisory director or director
emeritus who is not currently an officer or employee of the Corporation or any
Affiliate.
"Non-Qualified Stock Option"--means an option to purchase Shares granted by
the Board pursuant to Section 6 hereof which is not intended to qualify under
Section 422(b) of the Code.
"Option"--means a Non-Qualified Stock Option.
"Participant"--means any Non-Employee Director of the Corporation or any
Affiliate who is selected by the Board to receive an Award or who is granted
an Award pursuant to Section 6 hereof.
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"Plan"--means the 1998 Non-Employee Director Stock Option and Incentive Plan
of the Corporation.
"Shares"--means the shares of common stock of the Corporation.
3. Administration. The Plan shall be administered by the Board. Except as
limited by the express provisions of the Plan, the Board shall have sole and
complete authority and discretion to (i) select Participants and grant Awards;
(ii) determine the number of Shares to be subject to types of Awards
generally, as well as to individual Awards granted under the Plan; (iii)
determine the terms and conditions upon which Awards shall be granted under
the Plan; (iv) prescribe the form and terms of instruments evidencing such
grants; and (v) establish from time to time regulations for the administration
of the Plan, interpretation of the Plan, and determination of all matters
deemed necessary or advisable for the administration of the Plan.
4. Participation in Board Awards. The Board may select from time to time
Participants in the Plan from those Non-Employee Directors of the Corporation
or its Affiliates who, in the opinion of the Board, have the capacity for
contributing to the successful performance of the Corporation or its
Affiliates.
5. Shares Subject to Plan. Subject to adjustment by the operation of Section
8 hereof, the maximum aggregate number of Shares with respect to which Awards
may be made under the Plan is 200,000. Subject to adjustment by the operation
of Section 8 hereof, the maximum number of Shares with respect to which Awards
may be made to any Participant in any calendar year during the term hereof is
5,000 Shares. The Shares with respect to which Awards may be made under the
Plan may be either authorized and unissued Shares or issued Shares heretofore
or hereafter reacquired and held as treasury Shares. An Award shall not be
considered to have been made under the Plan with respect to any Option which
terminates, and new Awards may be granted under the Plan with respect to the
number of Shares as to which such termination has occurred.
6. General Terms and Conditions of Options. The Board shall have full and
complete authority and discretion, except as expressly limited by the Plan, to
grant Options and to provide the terms and conditions of such Options and the
criteria upon which such Options are granted (which terms, conditions and
criteria need not be identical among Participants). In particular, the Board
may grant Awards to any Participant based upon such criteria as the Board may
establish from time to time, and it shall also prescribe the following terms
and conditions: (i) the Exercise Price of any Option, which shall not be less
than the Market Value per Share at the date of grant of such Option, (ii) the
number of Shares subject to, and the expiration date of, any Option, which
expiration date shall not exceed ten years from the date of grant, (iii) the
manner, time and rate (cumulative or otherwise) of exercise of such Option,
and (iv) the restrictions, if any, to be placed upon such Option or upon
Shares which may be issued upon exercise of such Option.
Any Award made pursuant to this Plan may, in the sole discretion of the
Board, vest in installments.
At the time of any Award, the Participant shall enter into an agreement with
the Corporation in a form specified by the Board, agreeing to the terms and
conditions of the Award and such other matters as the Board, in its sole
discretion, shall determine (the "Option Agreement").
7. Exercise of Option.
(a) Except as provided herein, an Option granted under the Plan shall be
exercisable during the lifetime of the Participant to whom such Option was
granted only by such Participant and, except as provided in paragraphs (c) and
(d) of this Section 7, no such Option may be exercised
II-2
<PAGE>
unless at the time such Participant exercises such Option, such Participant
has maintained Continuous Service since the date of grant of such Option.
(b) To exercise an Option under the Plan, the Participant to whom such
Option was granted shall give written notice to the Corporation in form
satisfactory to the Board, specifying the number of Shares with respect to
which such Participant elects to exercise such Option, together with full
payment of the Exercise Price. The date of exercise shall be the date on which
such notice is received by the Corporation. Payment shall be made either (i)
in cash (including check, bank draft or money order), or (ii) by delivering
(A) Shares already owned by the Participant and having a Market Value equal to
the applicable Exercise Price, or (B) a combination of cash and such Shares.
(c) If a Participant to whom an Option was granted shall cease to maintain
Continuous Service for any reason (excluding death, disability, retirement
after reaching the age of 55 and termination of employment by the Corporation
or any Affiliate for cause), such Participant may, but only within the period
of one year immediately succeeding such cessation of Continuous Service and in
no event after the expiration date of such Option, exercise such Option to the
extent that such Participant was entitled to exercise such Option at the time
of such cessation. If a Participant to whom an Option was granted shall cease
to maintain Continuous Service by reason of death or disability, then all
Options granted and not fully exercisable shall become exercisable in full
upon the happening of such event and shall remain so exercisable (i) in the
event of death for the period described in paragraph (d) of this Section 7 and
(ii) in the event of disability for a period of one year following such date.
If a Participant to whom an Option was granted shall cease to maintain
Continuous Service after having reached the age of 55 and after having served
on the Board for at least three years, such Participant may, but only within
the period of two years immediately succeeding such cessation of Continuous
Service and in no event after the expiration date of such Option, exercise
such Option to the extent that such Participant was entitled to exercise such
Option at the time of such cessation; provided, however, if a Participant to
whom an Option was granted shall cease to maintain Continuous Service after
having reached the age of 55 and after having served on the Board for at least
six years, such Participant may, but only within the period of three years
immediately succeeding such cessation of Continuous Service and in no event
after the expiration date of such Option, exercise such Option to the extent
that such Participant was entitled to exercise such Option at the time of such
cessation. If the Continuous Service of a Participant to whom an Option was
granted by the Corporation is terminated for cause, all rights under any
Option of such Participant shall expire immediately upon the effective date of
such termination.
(d) In the event of the death of a Participant while in the Continuous
Service of the Corporation or an Affiliate or within the one- or two-year
periods referred to in paragraph (c) of this Section 7, the person to whom any
Option held by the Participant at the time of his death is transferred by will
or the laws of descent and distribution, or pursuant to a qualified domestic
relations order, as defined in the Code or Title I of ERISA or the rules
thereunder may, but only to the extent such Participant was entitled to
exercise such Option upon his death as provided in paragraph (c) above,
exercise such Option at any time within a period of one year succeeding the
date of death of such Participant, but in no event after the expiration date
of such Option. Following the death of any Participant to whom an Option was
granted under the Plan, the Board may, as an alternative means of settlement
of such Option, elect to pay to the person to whom such Option is transferred
by will or by the laws of descent and distribution, or pursuant to a qualified
domestic relations order, as defined in the Code or Title I of ERISA or the
rules thereunder, the amount by which the Market Value per Share on the date
of exercise of such Option shall exceed the Exercise Price of such Option,
multiplied by the number of Shares with respect to which such Option is
properly exercised. Any such settlement of an Option shall be considered an
exercise of such Option for all purposes of the Plan.
8. Adjustments Upon Changes in Capitalization. In the event of any change in
the outstanding Shares subsequent to the effective date of the Plan by reason
of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in
II-3
<PAGE>
the corporate structure or Shares of the Corporation, the maximum aggregate
number and class of Shares as to which Awards may be granted under the Plan,
the maximum number and class of Shares as to which Awards may be granted to
any Participant on an annual basis under the Plan and the number, class and
exercise price of Shares with respect to which Awards theretofore have been
granted under the Plan shall be appropriately adjusted by the Board, whose
determination shall be conclusive.
9. Effect of Merger. In the event of any merger, consolidation or
combination of the Corporation (other than a merger, consolidation or
combination in which the Corporation is the continuing entity and which does
not result in the outstanding Shares being converted into or exchanged for
different securities, cash or other property, or any combination thereof)
pursuant to a plan or agreement the terms of which are binding upon all
stockholders of the Corporation (except to the extent that dissenting
stockholders may be entitled, under statutory provisions or provisions
contained in the certificate or articles of incorporation, to receive the
appraised or fair value of their holdings), any Participant's Options granted
and not fully exercisable shall become exercisable in full immediately prior
to the termination of Continuous Service of the Participant upon or after any
such merger, consolidation or combination and any Participant to whom an
Option has been granted shall have the right (subject to any limitation or
vesting period applicable to such Option), thereafter and during the term of
each such Option, to receive upon exercise of any such Option an amount equal
to the excess of the fair market value on the date of such exercise of the
securities, cash or other property, or combination thereof, receivable upon
such merger, consolidation or combination in respect of a Share over the
Exercise Price of such Option, multiplied by the number of Shares with respect
to which such Option shall have been exercised. Such amount shall be payable
fully in cash.
10. Assignments and Transfers. No Award nor any right or interest of a
Participant under the Plan in any instrument evidencing any Award under the
Plan may be assigned, encumbered or transferred except, in the event of the
death of a Participant, by will or the laws of descent and distribution, or
pursuant to a qualified domestic relations order, as defined in the Code or
Title I of ERISA or the rules thereunder.
11. Employee Rights Under the Plan. No director shall have a right to be
selected as a Participant nor, having been so selected, to be selected again
as a Participant, and no director shall have any claim or right to be granted
an Award under the Plan or under any other incentive or similar plan of the
Corporation or any Affiliate. Neither the Plan nor any action taken thereunder
shall be construed as giving any director any right to be retained as a
director of the Corporation or any Affiliate.
12. Delivery and Registration of Stock. The Corporation's obligation to
deliver Shares with respect to an Award shall, if the Board so requests, be
conditioned upon the receipt of a representation as to the investment
intention of the Participant to whom such Shares are to be delivered, in such
form as the Board shall determine to be necessary or advisable to comply with
the provisions of the Securities Act of 1933 or any other Federal, state or
local securities legislation or regulation. It may be provided that any
representation requirement shall become inoperative upon a registration of the
Shares or other action eliminating the necessity of such representation under
such Securities Act or other securities legislation. The Corporation shall not
be required to deliver any Shares under the Plan prior to (i) the admission of
such Shares to listing on any stock exchange or other system on which Shares
may then be listed, and (ii) the completion of such registration or other
qualification of such Shares under any state or Federal law, rule or
regulation, as the Board shall determine to be necessary or advisable.
13. Withholding Tax. Where a Participant or other person is entitled to
receive Shares pursuant to the exercise of an Option pursuant to the Plan, the
Corporation shall have the right to require the Participant or such other
person to pay the Corporation the amount of any taxes which the Corporation
II-4
<PAGE>
is required to withhold with respect to such Shares, and may, in its sole
discretion, withhold sufficient Shares to cover the amount of taxes which the
Corporation is required to withhold.
14. Amendment or Termination. The Board of Directors of the Corporation may
amend, suspend or terminate the Plan or any portion thereof at any time, but
(except as provided in Section 8 hereof) no amendment, suspension or
termination shall be made prior to the Board determining whether the approval
of the stockholders of the Corporation is required or desirable pursuant to
applicable law or regulation; provided, further, that no such amendment,
suspension or termination shall impair the rights of any Participant, without
his consent, in any Award theretofore made pursuant to the Plan.
15. Effective Date and Term of Plan. The Plan shall become effective upon
its ratification by stockholders of the Corporation. It shall continue in
effect for a term of ten years unless sooner terminated under Section 14
hereof.
II-5
<PAGE>
BAY VIEW CAPITAL CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
MAY 28, 1998
The undersigned hereby appoints the Board of Directors of Bay View Capital
Corporation (the "Company"), with full powers of substitution, to act as
attorneys and proxies for the undersigned to vote all shares of capital stock
of the Company which the undersigned is entitled to vote at the Annual Meeting
of Stockholders (the "Meeting") to be held at Bay View's main offices located
at 1840 Gateway Drive, San Mateo, California, on May 28, 1998 at 1:00 p.m.,
local time, and at any and all adjournments and postponements thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
This proxy may be revoked at any time before it is voted by: (i) filing with
the Secretary of the Company at or before the Meeting a written notice of
revocation bearing a later date than the proxy; (ii) duly executing a
subsequent proxy relating to the same shares and delivering it to the
Secretary of the Company at or before the Meeting; or (iii) attending the
Meeting and voting in person (although attendance at the Meeting will not in
and of itself constitute revocation of this proxy). If this proxy is properly
revoked as described above, then the power of such attorneys or proxies shall
be deemed terminated and of no further force and effect.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
- -------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
Please mark
[X] your votes
as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES AND
"FOR" THE PROPOSALS LISTED BELOW.
VOTE
FOR WITHHELD
I. The election as directors of all nominees listed
below (except as marked to the contrary) [_] [_]
INSTRUCTION: To withhold your vote for any individual
nominee, strike a line in that nominee's name below.
ROBERT M. GREBER EDWARD H. SONDKER W. BLAKE WINCHELL
FOR AGAINST ABSTAIN
II. The approval and adoption of the Company's
1998-2000 Performance Stock Plan [_] [_] [_]
FOR AGAINST ABSTAIN
III. The approval and adoption of the Company's
1998 Non-Employee Director Stock Option and [_] [_] [_]
Incentive Plan
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES AND PROPOSALS LISTED ABOVE.
IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY
THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE
BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
In their discretion, the proxies are authorized to vote on any other business
that may properly come before the Meeting or any adjournment or postponement
thereof.
The undersigned acknowledges receipt from the Company, prior to the execution
of this proxy, of notice of the Meeting, a Proxy Statement and an Annual Re-
port to Stockholders.
Dated: , 1998
------------------------------------------------------------------
Signature of Stockholder
------------------------------------------------------
Signature of Stockholder
------------------------------------------------------
Please sign exactly as your name(s) appear(s) to the left. When signing as
attor ney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
FOLD AND DETACH HERE
<PAGE>
BAY VIEW CAPITAL CORPORATION
ANNUAL MEETING OF STOCKHOLDERS--MAY 28, 1998
The undersigned hereby appoints the Board of Directors of Bay View Capital
Corporation (the "Company"), with full powers of substitution, to act as
attorneys and proxies for the undersigned to vote all shares of capital stock
of the Company which the undersigned is entitled to vote at the Annual Meeting
of Stockholders (the "Meeting") to be held at Bay View's main offices located
at 1840 Gateway Drive, San Mateo, California, on May 28, 1998 at 1:00 p.m.,
local time, and at any and all adjournments and postponements thereof.
I.The election as directors of all nominees listed below (except as marked to
the contrary)
[_] FOR [_] VOTE WITHHELD
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE IN
THE NOMINEE'S NAME BELOW.
ROBERT M. GREBER EDWARD H. SONDKER W. BLAKE WINCHELL
II. The approval and adoption of the Company's 1998-2000 Performance Stock Plan
[_] FOR [_] AGAINST [_] ABSTAIN
III. The approval and adoption of the Company's 1998 Non-Employee Director
Stock Option and Incentive Plan
[_] FOR [_] AGAINST [_] ABSTAIN
In their discretion, the proxies are authorized to vote on any other business
that may properly come before the Meeting or any adjournment or postponement
thereof.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES AND PROPOSALS LISTED ABOVE.
IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY
THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE
BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES AND
"FOR" THE PROPOSALS LISTED ABOVE.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
This proxy may be revoked at any time before it is voted by: (i) filing with
the Secretary of the Company at or before the Meeting a written notice of
revocation bearing a later date than the proxy; (ii) duly executing a
subsequent proxy relating to the same shares and delivering it to the Secretary
of the Company at or before the Meeting; or (iii) attending the Meeting and
voting in person (although attendance at the Meeting will not in and of itself
constitute revocation of a proxy). If this proxy is properly revoked as
described above, then the power of such attorneys or proxies shall be deemed
terminated and of no further force and effect.
The undersigned acknowledges receipt from the Company, prior to the execution
of this proxy, of notice of the Meeting, a Proxy Statement and an Annual Report
to Stockholders.
Dated: ____________________ , 1998
----------------------------------
Signature of Stockholder
----------------------------------
Signature of Stockholder
Please sign exactly as your
name(s) appear(s) to the left.
When signing as attorney,
executor, administrator, trustee
or guardian, please give your
full title. If shares are held
jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE
