<PAGE> 1
FINANCIAL BANCORP, INC.
42-25 QUEENS BOULEVARD
LONG ISLAND CITY, NEW YORK 11104
(718) 729-5002
December 23, 1996
Fellow Shareholders:
You are cordially invited to attend the annual meeting of shareholders
(the "Annual Meeting") of Financial Bancorp, Inc., (the "Company") the holding
company for Financial Federal Savings Bank (the "Bank"), Long Island City, New
York, which will be held on Wednesday, January 22, 1997, at 10:30 a.m., Eastern
Standard Time, at the La Guardia Marriott, 102-05 Ditmars Boulevard, East
Elmhurst, New York.
The attached Notice of the Annual Meeting and the Proxy Statement describe
the formal business to be transacted at the Annual Meeting. Directors and
officers of Financial Bancorp, Inc., as well as a representative of Radics &
Co., LLC, the Company's independent auditors, will be present at the Annual
Meeting to respond to any questions that our shareholders may have regarding the
business to be transacted.
The Board of Directors of Financial Bancorp, Inc. has determined that the
matters to be considered at the Annual Meeting are in the best interests of the
Company and its shareholders. For the reasons set forth in the Proxy Statement,
the Board unanimously recommends that you vote "FOR" each matter to be
considered.
PLEASE SIGN AND RETURN THE ENCLOSED PROXY CARD PROMPTLY. YOUR COOPERATION
IS APPRECIATED SINCE A MAJORITY OF THE COMMON STOCK MUST BE REPRESENTED, EITHER
IN PERSON OR BY PROXY, TO CONSTITUTE A QUORUM FOR THE CONDUCT OF BUSINESS.
On behalf of the Board of Directors and all of the employees of the
Company and the Bank, I thank you for your continued interest and support.
Sincerely yours,
Frank S. Latawiec
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE> 2
FINANCIAL BANCORP, INC.
42-25 QUEENS BOULEVARD
LONG ISLAND CITY, NEW YORK 11104
----------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 22, 1997
----------------------------------
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders (the
"Annual Meeting") of Financial Bancorp, Inc. will be held on Wednesday, January
22, 1997, at 10:30 a.m., Eastern Standard Time, at the La Guardia Marriott,
102-05 Ditmars Boulevard, East Elmhurst, New York.
The purpose of the Annual Meeting is to consider and vote upon the
following matters:
1. The election of one director to a three-year term of office;
2. The ratification of the appointment of Radics & Co., LLC as
independent auditors of the Company for the fiscal year ending
September 30, 1997; and
3. Such other matters as may properly come before the meeting and at
any adjournments thereof, including whether or not to adjourn the
meeting.
The Board of Directors has established December 3, 1996, as the record
date for the determination of shareholders entitled to receive notice of and to
vote at the Annual Meeting and at any adjournments thereof. Only record holders
of the common stock of the company as of the close of business on that date will
be entitled to vote at the Annual Meeting or any adjournments thereof. In the
event there are not sufficient votes for a quorum or to approve or ratify any of
the foregoing proposals at the time of the Annual Meeting, the Annual Meeting
may be adjourned in order to permit further solicitation of proxies by the
Company. A list of shareholders entitled to vote at the Annual Meeting will be
available at Financial Bancorp, Inc., 42-25 Queens Boulevard, Long Island City,
New York 11104, for a period of ten days prior to the Annual Meeting and will
also be available at the Annual Meeting itself.
By Order of the Board of Directors
Robert E. Adamec
SENIOR VICE PRESIDENT AND
CORPORATE SECRETARY
Long Island City, New York
December 23, 1996
<PAGE> 3
FINANCIAL BANCORP, INC.
-----------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
JANUARY 22, 1997
-----------------------
SOLICITATION AND VOTING OF PROXIES
This Proxy Statement is being furnished to shareholders of Financial
Bancorp, Inc. (the "Company") in connection with the solicitation by the Board
of Directors ("Board of Directors" or "Board") of proxies to be used at the
annual meeting of shareholders (the "Annual Meeting"), to be held on January 22,
1997, and at any adjournments thereof. The 1996 Annual Report to Shareholders,
including consolidated financial statements for the fiscal year ended September
30, 1996, accompanies this Proxy Statement, which is first being mailed to
record holders on or about December 23, 1996.
Regardless of the number of shares of common stock owned, it is important
that record holders of a majority of the shares be represented by proxy or in
person at the Annual Meeting. Shareholders are requested to vote by completing
the enclosed proxy card and returning it signed and dated in the enclosed
postage-paid envelope. Shareholders are urged to indicate their vote in the
spaces provided on the proxy card. PROXIES SOLICITED BY THE BOARD OF DIRECTORS
OF THE COMPANY WILL BE VOTED IN ACCORDANCE WITH THE DIRECTIONS GIVEN THEREIN.
WHERE NO INSTRUCTIONS ARE INDICATED, SIGNED PROXY CARDS WILL BE VOTED FOR THE
ELECTION OF THE NOMINEES FOR DIRECTOR NAMED IN THIS PROXY STATEMENT AND FOR THE
APPROVAL AND RATIFICATION OF EACH OF THE SPECIFIC PROPOSALS PRESENTED IN THIS
PROXY STATEMENT.
Other than the matters listed on the attached Notice of Annual Meeting of
Shareholders, the Board of Directors knows of no additional matters that will be
presented for consideration at the Annual Meeting. Execution of a proxy,
however, confers on the designated proxy holders discretionary authority to vote
the shares in accordance with their best judgment on such other business, if
any, that may properly come before the Annual Meeting and at any adjournments
thereof, including whether or not to adjourn the Annual Meeting.
A proxy may be revoked at any time prior to its exercise by filing a
written notice of revocation with the Corporate Secretary of the Company, by
delivering to the Company a duly executed proxy bearing a later date, or by
attending the Annual Meeting and voting in person. However, if you are a
shareholder whose shares are not registered in your own name, you will need
appropriate documentation from your record holder to vote personally at the
Annual Meeting.
The cost of solicitation of proxies on behalf of management will be borne
by the Company. In addition to the solicitation of proxies by mail, Kissel-Blake
& Co., a proxy solicitation firm, will assist the Company in soliciting proxies
for the Annual Meeting and will be paid a fee of $2,500, plus out-of-pocket
expenses. Proxies may also be solicited personally
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or by telephone by directors, officers and other employees of the Company and
its subsidiary, Financial Federal Savings Bank (the "Bank"), without additional
compensation therefor. The Company will also request persons, firms and
corporations holding shares in their names, or in the name of their nominees,
which are beneficially owned by others, to send proxy material to and obtain
proxies from such beneficial owners, and will reimburse such holders for their
reasonable expenses in doing so.
VOTING SECURITIES
The securities which may be voted at the Annual Meeting consist of shares
of common stock of the Company ("Common Stock"), with each share entitling its
owner to one vote on all matters to be voted on at the Annual Meeting, except as
described below. There is no cumulative voting for the election of directors.
The close of business on December 3, 1996, has been fixed by the Board of
Directors as the record date (the "Record Date") for the determination of
shareholders of record entitled to notice of and to vote at the Annual Meeting
and at any adjournments thereof. The total number of shares of Common Stock
outstanding on the Record Date was 1,747,686 shares.
As provided in the Company's Certificate of Incorporation, record holders
of Common Stock who beneficially own in excess of 10% of the outstanding shares
of Common Stock (the "Limit") are not entitled to any vote in respect of the
shares held in excess of the Limit. A person or entity is deemed to beneficially
own shares owned by an affiliate of, as well as, by persons acting in concert
with, such person or entity. The Company's Certificate of Incorporation
authorizes the Board of Directors (i) to make all determinations necessary to
implement and apply the Limit, including determining whether persons or entities
are acting in concert, and (ii) to demand that any person who is reasonably
believed to beneficially own stock in excess of the Limit to supply information
to the Company to enable the Board of Directors to implement and apply the
Limit.
The presence, in person or by proxy, of the holders of at least a majority
of the total number of shares of Common Stock entitled to vote (after
subtracting any shares in excess of the Limit pursuant to the Company's
Certificate of Incorporation) is necessary to constitute a quorum at the Annual
Meeting. In the event that there are not sufficient votes for a quorum or to
approve or ratify any proposal at the time of the Annual Meeting, the Annual
Meeting may be adjourned in order to permit the further solicitation of proxies.
As to the election of a director, the proxy card being provided by the
Board of Directors enables a shareholder to vote "FOR" the election of the
nominee proposed by the Board of Directors, or to "WITHHOLD" authority to vote
for the nominee being proposed. Under Delaware law and the Company's Bylaws,
directors are elected by a plurality of votes cast, without regard to either (i)
broker non-votes, or (ii) proxies as to which authority to vote for the nominee
being proposed is withheld.
As to the ratification of Radics & Co., LLC as independent auditors of the
Company and all other matters that may properly come before the Annual Meeting,
by checking the appropriate box, you may: (i) vote "FOR" the item; (ii) vote
"AGAINST" the item; or (iii) "ABSTAIN" with
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<PAGE> 5
respect to the item. Under the Company's Bylaws, unless otherwise required by
law, all such matters shall be determined by a majority of the votes cast,
without regard to either (a) broker non-votes, or (b) proxies marked "ABSTAIN"
as to that matter.
Proxies solicited hereby will be returned to Registrar and Transfer
Company, and will be tabulated by inspectors of election designated by the Board
of Directors, who will not be employed by, or a director of, the Company or any
of its affiliates.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information as to those persons believed by
management to be beneficial owners of more than 5% of the Company's outstanding
shares of Common Stock on the Record Date or as disclosed in certain reports
regarding such ownership filed by such persons with the Company and with the
Securities and Exchange Commission ("SEC"), in accordance with Sections 13(d)
and 13(g) of the Securities Exchange Act of 1934, as amended ("Exchange Act").
Other than those persons listed below, the Company is not aware of any person,
as such term is defined in the Exchange Act, that owns more than 5% of the
Company's Common Stock as of the Record Date.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF
TITLE OF CLASS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
- -------------- ------------------------- --------------------- -----------
<S> <C> <C> <C>
Common Stock Financial Federal Savings and 152,983(1) 8.75%
Loan Association Employee Stock
Ownership Plan ("ESOP")
42-25 Queens Boulevard
Long Island City, New York 11104
Common Stock Kennedy Capital Management, Inc. 142,650(2) 8.16%
425 N. New Ballas Road, Suite 181
St. Louis, Missouri 63141-6821
Common Stock Heine Securities Corp. 191,000(3) 10.93%
and Michael F. Price
51 John F. Kennedy Parkway
Short Hills, New Jersey 07087
Common Stock BFS Bankorp, Inc. 91,500(4) 5.24%
110 William Street, 29th Floor
New York, New York 10038
- ------------------------------
(1)Shares of Common Stock were acquired by the ESOP in the Bank's conversion
from mutual to stock form (the "Conversion"). The Compensation Committee
administers the ESOP. First Bankers Trust Company, A National Association,
has been appointed as the corporate trustee for the ESOP ("ESOP Trustee").
The ESOP Trustee must vote all allocated shares held in the ESOP in
accordance with the instructions of the participants. At December 3, 1996,
27,062 shares had been allocated under the ESOP. Unallocated shares will be
voted by the ESOP Trustee in a manner calculated to most accurately reflect
the instructions received from participants regarding the allocated stock so
long as such vote is in accordance with the provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
(2)Based upon information filed in a Schedule 13G by Kennedy Capital Management
Inc. on February 8, 1996.
(3)Based on information contained in a Schedule 13G filed on February 12, 1996.
(4)Based upon information in the Schedule 13Ds filed by BFS Bankorp, Inc. on
July 22, 1996 and August 2, 1996. BFS Bankorp, Inc. claimed shared voting and
dispositive power over 1,500 of these 91,500 shares that were owned directly
and indirectly by a director of BFS Bankorp, Inc.
</TABLE>
3
<PAGE> 6
PROPOSALS TO BE VOTED ON AT THE MEETING
PROPOSAL 1. ELECTION OF DIRECTORS
Pursuant to its Bylaws, the number of directors of the Company may be
designated by the Board of Directors. During fiscal 1996, the Board increased
the number to six when Mr. Frank S. Latawiec was added as a director. Following
the resignation of Mr. Stuart G. Hoffer, Raymond M. Calamari was elected to the
Board of Directors. The Board of Directors has designated that the number of
directors will be set at five members following the Annual Meeting. Each of the
members of the Board of Directors of the Company also presently serve as
directors of the Bank. Directors are elected for staggered terms of three years
each, with the term of office of only one of the three classes of directors
expiring each year. Directors serve until their successors are elected and
qualified.
The one nominee proposed for election at this Annual Meeting is Peter S.
Russo.
In the event that the nominee is unable to serve or declines to serve for any
reason, it is intended that the proxies will be voted for the election of such
other person as may be designated by the present Board of Directors. The Board
of Directors has no reason to believe that the person named will be unable or
unwilling to serve. UNLESS AUTHORITY TO VOTE FOR THE NOMINEE IS WITHHELD, IT IS
INTENDED THAT THE SHARES REPRESENTED BY THE ENCLOSED PROXY CARD, IF EXECUTED AND
RETURNED, WILL BE VOTED FOR THE ELECTION OF THE NOMINEES PROPOSED BY THE BOARD
OF DIRECTORS.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF THE
NOMINEE NAMED IN THIS PROXY STATEMENT.
INFORMATION WITH RESPECT TO THE NOMINEE AND CONTINUING DIRECTORS
The following table sets forth, as of the Record Date, the names of the
nominee and the continuing directors, their ages, a brief description of their
recent business experience, including present occupations and employment,
certain directorships held by each, the year in which each became a director,
the year in which their terms (or in the case of the nominees, their proposed
terms) as director of the Company expire. The table also sets forth the amount
of Common Stock and the percent thereof beneficially owned by each and all
directors and executive officers as a group as of the Record Date.
4
<PAGE> 7
<TABLE>
<CAPTION>
SHARES OF
NAME AND PRINCIPAL EXPIRATION COMMON STOCK PERCENT
OCCUPATION AT PRESENT DIRECTOR OF TERM AS BENEFICIALLY OF
AND FOR PAST FIVE YEARS AGE SINCE(1) DIRECTOR OWNED(2) CLASS
- ----------------------- --- -------- -------- -------- -----
<S> <C> <C> <C> <C> <C>
NOMINEE
Peter S. Russo 50 1987 2000 44,429(3)(4) 2.54%
Vice Chairman of the Board since
October 1996. General partner in Trio
Realty Co. and Quad Realty Co., owner
of various retail and commercial
properties. President of Ven-Rea Corp.,
a photo retailer.
CONTINUING DIRECTORS
Richard J. Hickey 58 1988 1999 16,429(3)(4) 0.94%
Partner in the firm of Girardi & Hickey,
certified public accountants. Prior to
that, Mr. Hickey was a partner in the
firm of Girardi, Hickey and Napolitano,
certified public accountants.
Raymond M. Calamari 65 1996 1999 4,000 0.23%
Manager for LCM Marketing, Inc.,
a financial services company.
Prior to that, Vice President for
Marketing for H.T.C. Inc., an industrial
products company, and President and
Chief Executive Officer of D.A.V.
Corp., an industrial products fabricator.
Former director of Hamilton Bancorp, Inc.
and Hamilton Federal Savings, F.A.
Dominick L. Segrete 56 1974 1998 68,157(3)(4) 3.90%
Chairman of the Board of the Company
and the Bank. President and Chief
Executive Officer of Tucci, Segrete and
Rosen Consultants Inc., an architectural
design firm.
Frank S. Latawiec 61 1996 1998 12,000(3) 0.69%
President and Chief Executive Officer of
the Company and the Bank since August 6,
1996. Prior to that, Vice President
for LCM Marketing, Inc., a financial
services company, and Senior Vice
President for Hamilton Federal Savings,
F.A.
NAMED EXECUTIVE OFFICER
Irene C. Greco 53 1993 -- 22,251(3)(5) 1.27%
Executive Vice President and Chief
Operating Officer of the Company and
the Bank. Prior to that, Senior Vice
President - Operations of the Bank.
President of the Bank's service
corporations. Director of the Company
and the Bank until January 1997.
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
SHARES OF
NAME AND PRINCIPAL EXPIRATION COMMON STOCK PERCENT
OCCUPATION AT PRESENT DIRECTOR OF TERM AS BENEFICIALLY OF
AND FOR PAST FIVE YEARS AGE SINCE(1) DIRECTOR OWNED(2) CLASS
- ----------------------- --- -------- --------- -------- ------
<S> <C> <C> <C> <C> <C>
Stock Ownership of all Directors -- -- -- 200,667(6) 11.48%
and Executive Officers as a Group (8
persons)
(1) Includes years of service as a director of the Company's predecessor, the
Bank.
(2) Each person effectively exercises sole (or shares with spouse or other
immediate family member) voting or dispositive power as to shares reported
herein (except as noted).
(3) Includes 5,000 and 8,390 shares held by Mr. Latawiec and Mrs. Greco,
respectively, under Part I of the Financial Federal Savings Bank Recognition
and Retention Plan ("RRP") and 1,000, 500, and 500 shares awarded to Messrs.
Segrete, Hickey and Russo, respectively, under Part II of the RRP. Mrs.
Greco's Award of 10,488 shares under the RRP vests in five equal
installments which commenced on January 26, 1996, the first anniversary date
of the effective date of the Award. Mr. Latawiec's Award of 5,000 shares
under the RRP will vest in five equal installments commencing on September
24, 1997, the first anniversary date of the effective date of the Award.
Effective September 24, 1996, Part II of the RRP was amended to provide that
Awards granted under Part II as of that date vest in five equal installments
commencing one year from the date the individual began serving as an Outside
Director. At September 30, 1996, the entire Awards granted to Messrs.
Segrete, Hickey, and Russo under Part II of the RRP were vested.
(4) Includes 10,925 shares subject to options held by Messrs. Segrete, Hickey
and Russo, respectively, under the Financial Bancorp, Inc. 1995 Stock Option
Plan for Outside Directors ("Directors' Option Plan"), which, following an
amendment to the Directors' Option Plan, became exercisable on September 24,
1996.
(5) Includes 2,272 shares subject to options held by Mrs. Greco under the
Financial Bancorp, Inc. 1995 Incentive Stock Option Plan ("Incentive Option
Plan"), which became exercisable on January 26, 1996, and 2,272 shares
subject to options held by Mrs. Greco under the Incentive Option Plan, which
will become exercisable on January 26, 1997. Does not include the remaining
6,818 shares subject to options granted to Mrs. Greco under the Incentive
Option Plan, which will continue to vest in equal annual installments on
January 26, 1998, 1999 and 2000, respectively.
(6) Includes 32,775 shares which may be acquired through the exercise of stock
options granted under the Directors' Option Plan, 9,702 shares with respect
to all executive officers which may be acquired through the exercise of
stock options under the Incentive Stock Option Plan, and 25,312 shares
awarded to executive officers and directors under the RRP.
</TABLE>
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company conducts its business through
meetings of the Board of Directors and through activities of its committees. The
Board of Directors of the Company generally meets on a monthly basis. During
fiscal 1996, the Board of Directors of the Company held one organizational
meeting, 12 regular meetings, and 2 special meetings. All of the directors of
the Company attended 100% of the total number of the Company's Board meetings
held and committee meetings on which such directors served during fiscal 1996.
The Board of Directors of the Company maintains committees, the nature and
composition of which are described below:
AUDIT COMMITTEE. The Audit Committee of the Company and the Bank consists
of Messrs. Hickey (Chairman) and Russo. This Committee meets as required, and is
responsible for reviewing the audit reports, of the Company and the Bank,
prepared by its internal auditor and independent auditors. The Committee is also
responsible for reviewing the fees and work product of the Company's independent
auditors. The Audit Committee of the Company met once in fiscal 1996 and the
Audit Committee of the Bank met 12 times in fiscal 1996.
NOMINATING COMMITTEE. The Company's Nominating Committee for the 1997
Annual Meeting consists of Messrs. Segrete (Chairman) and Hickey. The committee
considers and recommends the nominees for director to stand for election at the
Company's annual meeting of
6
<PAGE> 9
shareholders. The Company's Certificate of Incorporation and Bylaws provide for
shareholder nominations of directors. These provisions require such nominations
to be made pursuant to timely notice in writing to the Secretary of the Company.
The shareholder's notice of nomination must contain all information relating to
the nominee which is required to be disclosed by the Company's Bylaws and by the
Exchange Act. The Nominating Committee met on September 24, 1996.
COMPENSATION COMMITTEE. The Compensation Committee of the Company consists
of Messrs. Segrete (Chairman), Russo and Hickey. The Compensation Committee of
the Company met three times in fiscal 1996. This committee meets to establish
compensation for the executive officers, and to review the incentive
compensation programs when necessary. The Compensation Committee is also
responsible for establishing certain guidelines and limits for compensation for
other salaried officers and employees of the Company and the Bank.
DIRECTORS' COMPENSATION
DIRECTORS' FEES. Directors of the Company do not receive any fees or
retainer for serving on the Company's Board of Directors. For the 1996 fiscal
year, outside directors of the Bank received an annual retainer of $18,000 and
the Chairman received an annual retainer of $21,600. All fees are paid to
outside directors on a monthly basis. Directors of the Bank receive no fee or
other compensation for participation on committees of the Board. Directors who
are also officers of the Bank or the Company receive no fee or other
compensation for their Board or Committee participation.
OUTSIDE DIRECTORS' CONSULTATION AND RETIREMENT PLAN. The Bank maintains
the Financial Federal Savings and Loan Association Outside Directors'
Consultation and Retirement Plan (the "Directors' Retirement Plan") to provide
benefits to outside directors and to ensure their continued service and
assistance in the conduct of the Bank's business in the future. Directors who
currently are not officers or employees of the Bank ("Outside Directors"), have
served as a director for at least seven years and who, within thirty days of
retirement, agree to provide consulting services to the Bank are eligible, upon
retirement, to receive an annual benefit, based on the Outside Director's annual
retainer fee determined at the date of termination, equal to the lesser of ten
years or one half of the number of months of such participant's credited
service. In addition, the Board of Directors, on September 24, 1996, amended the
Directors' Retirement Plan to provide that, upon occurrence of a change in
control of the Company or the Bank, each eligible outside director shall receive
payment of his or her retirement benefit in a single sum payment and any
obligation to provide consulting services shall cease upon the occurrence of a
change in control. As of September 30, 1996, the Director's Retirement Plan had
three eligible participants and one active participant.
OUTSIDE DIRECTORS' OPTION PLAN. The Company maintains the Directors'
Option Plan for all directors who are not also employees of the Company or the
Bank. The Directors' Option
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<PAGE> 10
Plan authorizes the granting of non-statutory options for a total of 65,550
shares of Common Stock to certain members of the Board of Directors of the
Company. Directors who were serving as directors on both the date of the
Company's initial public offering and the effective date of the Directors'
Option Plan and who were not also serving as employees of the Company or any of
its affiliates are eligible to participate in the Directors' Option Plan. Each
member of the Board of Directors who was not an officer of the Bank or the
Company received options to purchase a number of shares of Common Stock,
depending upon length of Board service, at an exercise price of 100% of the Fair
Market Value of the Common Stock of the Company on the date of grant. Each
outside director with years of service in excess of five (5) years was granted
non-statutory options to purchase 10,925 shares of Common Stock. Each outside
director with less than five (5) years of service was granted non-statutory
options to purchase 5,000 shares of Common Stock. The Directors' Option Plan was
amended as of September 24, 1996 so that options granted under the Directors'
Option Plan are exercisable in the amount of twenty percent (20%) per year
commencing one year from the date the individual began serving as an Outside
Director, including service prior to the adoption of the Directors' Option Plan.
Options granted after September 24, 1996 shall become exercisable in the amount
of twenty percent (20%) per year commencing one year from the date of grant. At
September 30, 1996, all options granted under the Directors' Option Plan were
exercisable.
RECOGNITION AND RETENTION PLAN FOR OUTSIDE DIRECTORS. The Company
maintains the Recognition and Retention Plan for Outside Directors ("RRP") which
grants awards to directors who are not also employees of the Company or the
Bank. The RRP authorizes the granting of plan share awards ("Plan Share Awards")
in the form of up to 65,550 shares of Common Stock. Under Part II of the RRP,
outside directors serving in such capacity as of the effective date of the RRP
were awarded Plan Share Awards based upon length of Board service. Each outside
director with years of service in excess of twenty (20) years was granted an
award of 1,500 shares of Common Stock. Each outside director with between ten
(10) and twenty (20) years of service was granted an award of 1,000 shares of
Common Stock. Each outside director with between five (5) and ten (10) years of
service was granted an award of 500 shares of Common Stock. Plan Share Awards
are nontransferable and nonassignable. Recipients of the Plan Share Awards will
earn (i.e., become vested in) the shares of Common Stock covered by the Plan
Share Awards over a period of time. The RRP was amended as of September 24, 1996
so that Plan Share Awards granted to individuals serving as Outside Directors on
that date vest at the rate of twenty percent (20%) annually commencing one year
from the date the individual began serving as an Outside Director, including
service prior to the adoption of the RRP. Subsequent Outside Directors shall
earn Plan Share Awards at the rate of twenty percent (20%) annually commencing
one year from the date of grant. At September 30, 1996, all Plan Share Awards
granted to Outside Directors were vested.
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<PAGE> 11
EXECUTIVE COMPENSATION
THE REPORT OF THE COMPENSATION COMMITTEE AND THE STOCK PERFORMANCE GRAPH
SHALL NOT BE DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT
INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO ANY FILING UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE EXCHANGE ACT,
EXCEPT AS TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS
INFORMATION BY REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH
ACTS.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION. Under rules
established by the Securities and Exchange Commission ("SEC"), the Company is
required to provide certain data and information in regard to the compensation
and benefits provided to the Company's Chief Executive Officer and other
executive officers of the Company. The disclosure requirements for the Chief
Executive Officer and other executive officers include the use of tables and a
report explaining the rationale and considerations that led to fundamental
compensation decisions affecting those individuals. In fulfillment of this
requirement, the executive compensation committee of the Bank at the direction
of the Board of Directors has prepared the following report for inclusion in
this proxy statement.
This report is submitted by the Compensation Committee of the Boards of
Directors of the Company and Bank (the "Compensation Committee") and summarizes
its involvement in the compensation decisions, policies and programs adopted by
the Bank and Company for executive officers, including the Chief Executive
Officer ("CEO"), during the fiscal year ended September 30, 1996. The members of
the Compensation Committee include Messrs. Segrete, Russo and Hickey, all of
whom are outside directors.
GENERAL POLICY. The stated purpose of the Compensation Committee and its
corresponding practices are designed to reward and provide incentives for
executives, based upon the Company's financial performance and the individual's
performance. One of the primary objectives of the executive compensation program
is to retain skilled and motivated executive officers, along with promoting
growth and profitability for the Company. Compensation levels are established
subsequent to a review of certain quantitative and qualitative factors,
including, but not limited to, financial performance, the individual's
commitment, leadership and level of responsibilities.
The Compensation Committee is responsible for conducting periodic reviews
of compensation for senior executives, including the CEO. The Compensation
Committee determines salary levels for senior executives, other officers and
employees, and cash performance awards, if and as deemed appropriate, in
addition to grants under the Bank and Company's stockbased benefit plans.
COMPONENTS OF COMPENSATION. In evaluating executive compensation, the
Compensation Committee reviews and analyzes three fundamental components, which
include salary, short-term incentive awards (performance awards) and long-term
incentive compensation.
9
<PAGE> 12
Salary. Salary levels for senior executives and other officers are
------
reviewed by the Compensation Committee on an annual basis, and any increase in
compensation is to take effect on January 1 of each year. Evaluations of the
executive officers and their specific cash compensation levels are based upon
the Company's financial performance for the said fiscal year, in addition to
certain discretionary criteria; however, no specific formula was used to
determine annual cash compensation levels for executive officers. Salary levels
are designed to be commensurate with the individual's responsibilities,
experience and marketplace conditions. In making such determination, the
Compensation Committee reviewed the "1995 Bank Executive and Director
Compensation Survey" published by Sheshunoff, in order to determine salary
adjustments effective January 1, 1996. The institutions reviewed by the
compensation committee in the survey are not necessarily comprised of the same
group of institutions used in the peer group of the Stock Performance Graph. For
purposes of determining compensation, the Bank generally considers its peer
group to consist of thrift institutions and banks with deposits between $100
million and $250 million, operating in the Mid-Atlantic region, with particular
emphasis on the New York City Metropolitan Area.
Short-term Incentive Compensation (Performance Awards). The Board of
----------------------------------------------------------
Directors adopted, as part of its Executive Compensation Policy, a program for
annual performance awards. Historically, the short-term incentive component of
executive compensation has been granted based upon the Bank's annual
profitability. The short-term incentives are in the form of cash distributions
to executives based upon financial performance, as well as individual
achievements. The financial performance component consists of certain factors,
including, but not limited to, earnings per share, return on average assets and
return on average equity. Although the Compensation Committee analyzes these
individual factors, no specific weightings of the factors are used to calculate
the performance awards. However, the Compensation Committee makes these
performance measures as quantitative and objective as possible.
The Compensation Committee has the authority and discretion to make
adjustments to the short-term incentive plan as deemed prudent and appropriate.
The Compensation Committee determined that short-term incentive awards for
executive officers were not payable in fiscal 1996, based upon performance
during fiscal 1995.
Long-term Incentive Compensation. The long-term incentive compensation
---------------------------------
portion of the Bank and Company's compensation program consists of the ESOP, the
RRP and the Incentive Option Plan. After the Company's first Annual Meeting of
Shareholders held on January 26, 1995, the Committee granted stock options and
restricted stock awards, which vest over a five year period. These stock-based
benefit plans are designed as an incentive for the executive officers and key
employees of the Bank to encourage longer-term performance, and to align the
financial interests of such individuals with those of the Company's
shareholders.
All stock options granted under the Incentive Option Plan have an exercise
price equal to the fair market value of the common stock on the date of grant.
Under the RRP, the awards
10
<PAGE> 13
are granted in the form of shares of the Company's Common Stock, which are held
in trust until the share award vests. The Compensation Committee may grant
awards at its discretion under the plan at any time. At this time, the
Compensation Committee does not plan to make any additional awards under the
stock-based benefit plans to the current group of senior executive officers
beyond those already in place. Although there is no specific formula, the
factors utilized in determining an individual's eligibility in the plans are
commensurate with the executive officer's position, responsibilities and
contributions to the Company.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. In assessing the appropriate
level of compensation for the CEO, the Compensation Committee reviews corporate
performance, individual performance, and a published compensation survey.
Effective January 1, 1996 the CEO was not granted an increase and the annual
base salary remains at $120,016. A short-term incentive award will not be
granted in 1996, based upon performance for fiscal 1995.
The Compensation Committee recognizes the CEO's contributions to the
Company's operations and attempts to ensure that the CEO's compensation is
commensurate with the Company's peer group. Subsequent to a review of the "1995
Bank Executive and Director Compensation Survey" published by Sheshunoff, the
Compensation Committee determined that the CEO's cash compensation is below the
average disclosed in the compensation survey.
Effective August 6, 1996, Stuart G. Hoffer resigned his position as
President and CEO of the Company and Bank. Subsequent to Mr. Hoffer's
resignation, the Board of Directors appointed Frank S. Latawiec President and
CEO of the Company and Bank. The Compensation Committee set the CEO's base
salary at $120,016, the same level of compensation paid to the outgoing
President and CEO. The Committee believes that this base salary reflects the
importance of the CEO's position to the prosperity of the Company. In addition,
the Compensation Committee awarded Mr. Latawiec 5,000 RRP shares in order to
attract and maintain the CEO in a key personnel position and to further provide
him with a proprietary interest in the Company, which, in turn will create
further incentive to contribute to the success of the Company.
Although certain quantitative and qualitative factors were reviewed to
determined the CEO's compensation, no specific formula was utilized in the
Compensation Committee's decisions nor did the Committee set a specified salary
level based upon the corporate performance.
The Compensation Committee
--------------------------
Dominick L. Segrete
Richard J. Hickey
Peter S. Russo
11
<PAGE> 14
STOCK PERFORMANCE GRAPH. The following graph shows a comparison of total
shareholder return on the Company's Common Stock, based on the market price of
the Common Stock with the cumulative total return of companies in The Nasdaq
Stock Market and The Nasdaq Stock Market Bank Stock Index for the period
beginning on August 17, 1994, the day the Company's Common Stock began trading,
through September 30, 1996. The data was supplied by the Center for Research in
Security Prices ("CRSP").
Financial Bancorp, Inc.
Stock Performance Graph
[GRAPH APPEARS HERE]
The data points depicted on the graph are as follows:
<TABLE>
<CAPTION>
SUMMARY
8/17/94 9/30/94 3/31/95 9/29/95 3/29/96
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Financial Bancorp, Inc. 100.00 92.222 93.821 127.253 114.831
CRSP Nasdaq Market Index 100.00 102.881 110.878 142.101 150.555
CRSP Nasdaq Bank Stock Index 100.00 98.582 99.740 124.303 141.067
9/30/96
-------
Financial Bancorp, Inc. 142.529
CRSP Nasdaq Market Index 168.528
CRSP Nasdaq Bank Stock Index 158.806
A. The lines represent semi-annual index levels derived from compounded
daily returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on
the previous trading day.
C. If the semi-annual interval, based on the fiscal year-end, is not a
trading day, the preceding trading day is used.
D. The index level for all series was set to $100.00 on 8/17/94.
</TABLE>
12
<PAGE> 15
SUMMARY COMPENSATION TABLE. The following table shows, for the years ended
September 30, 1996, 1995 and 1994, the cash compensation paid by the Bank, as
well as certain other compensation paid or accrued for those years, to each
person serving as chief executive officer during fiscal year 1996 and an
executive officer of the Company and the Bank who received salary and bonus in
excess of $100,000 in fiscal year 1996 ("Named Executive Officers"). No other
executive officer of the Company and the Bank received salary and bonus in
excess of $100,000 in fiscal year 1996. The Company does not pay any cash
compensation.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
---------------------------- -----------------------------------
AWARDS PAYOUTS
-------------------------- -------
SECURITIES
OTHER ANNUAL RESTRICTED UNDERLYING LTIP
NAME AND SALARY BONUS COMPENSATION STOCK AWARDS OPTINS/SARS PAYOUTS ALL OTHER
PRINCIPAL OFFICE YEAR ($)(1) ($) ($)(2) ($)(3) (#)(4) (5) COMPENSATION
- ----------------- ---- ------- ------ ------------ ------------ ----------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stuart G. Hoffer 1996 $103,275 $ -- -- $ -- -- None $368,960(7)
President and Chief 1995 118,027 -- -- 125,807 17,043 None 9,644
Executive Officer of 1994 114,882 15,000 -- -- -- None 1,627
the Company and the
Bank until August 6,
1996.(6)
Frank S. Latawiec 1996 $ 17,541 $ -- -- $ 76,250 -- None $ 10,500(8)
President and Chief 1995 -- -- -- -- -- None --
Executive Officer of 1994 -- -- -- -- -- None --
the Company and the
Bank since August 6,
1996.(6)
Irene C. Greco 1996 $102,128 $4,000(9) -- $ -- -- None $ 21,049(10)
Executive Vice 1995 100,906 -- -- 99,007 11,362 None 7,726
President and Chief 1994 97,794 8,000 -- -- -- None 960
Operating Officer of
the Company and the
Bank.
(1) Salary includes compensation deferred at the election of the Named
Executive Officers through the Bank's 401(k) Plan.
(2) There were no (a) perquisites over the lesser of $50,000 or 10% of either
of the Named Executive Officer's total salary and bonus for the year; (b)
payments of above-market preferential earnings on deferred compensation;
(c) payments of earnings with respect to long-term incentive plans prior to
settlement or maturation; (d) tax payment reimbursements; or (e)
preferential discounts on stock.
(3) Pursuant to the RRP, Mr. Hoffer and Mrs. Greco were granted an aggregate of
13,327 and 10,488 shares of Common Stock, respectively, which had a market
value of $9.44 per share on the date of grant, January 26, 1995. As of
August 6, 1996, the date of Mr. Hoffer's resignation from the Company and
the Bank, 2,665 of the shares awarded to Mr. Hoffer under the RRP had
vested, and the remaining 10,662 shares were forfeited. Awards to Mrs.
Greco will vest in five equal annual installments which commenced on
January 26, 1996, the first anniversary date of the effective date of the
award. Mr. Latawiec held an aggregate of 5,000 shares of Common Stock,
which had a market value of $15.25 per share on the date of grant,
September 24, 1996. Awards to Mr. Latawiec will vest in five equal annual
installments commencing on September 24, 1997, the first anniversary date
of the effective date of the award. When shares become vested and are
distributed, the recipient will also receive an amount equal to accumulated
dividends and earnings thereon (if any). All awards vest immediately upon
termination of employment due to death, disability or change in control. As
of September 30, 1996, the market value of the 8,390 and 5,000 shares held
by Mrs. Greco and Mr. Latawiec was $130,045, and $77,500, respectively.
(4) Includes options awarded under the Incentive Option Plan. As of August 6,
1996, the date of Mr. Hoffer's resignation from the Company and the Bank,
3,409 of the options granted to Mr. Hoffer were exercisable and the
remaining options were forfeited. Options granted to Mrs. Greco become
exercisable in five equal annual installments, the first of which became
exercisable on January 26, 1996, the first anniversary date of the grant.
To the extent not already exercisable, the options become exercisable upon
death, disability or a change in control. See "Incentive Stock Option
Plan."
(5) For fiscal years 1996, 1995 and 1994, the Bank had no long-term incentive
plans in existence, and therefore made no payouts or awards under such
plans.
(6) Effective August 6, 1996, Mr. Hoffer resigned as President, Chief Executive
Officer and Director of the Company and the Bank, and the Board of
Directors subsequently appointed Mr. Latawiec to the position of President
and Chief Executive Officer of the Company and the Bank.
(Footnotes continued of following page)
13
<PAGE> 16
(7) Represents the amount payable to Mr. Hoffer pursuant to an agreement
executed with the Company upon his resignation. Payment will be made over
approximately a three year period beginning August 6, 1996.
(8) Represents directors' fees paid to Mr. Latawiec during fiscal 1996.
(9) Bonuses are earned on a fiscal year basis and are paid during the first
quarter of the subsequent fiscal year. No bonuses will be paid to Mr.
Hoffer or Mr. Latawiec for fiscal 1996. Mrs. Greco was awarded a $4,000
bonus for fiscal 1996, payable during the first quarter of fiscal 1997.
(10) Represents shares of Common Stock granted pursuant to the ESOP. For fiscal
year 1996, Mrs. Greco was allocated 1,358 shares of Common Stock. Dollar
amounts reflect market value ($15.50) as of September 30, 1996. No
discretionary contributions were made to the 401(k) for fiscal 1996.
</TABLE>
EMPLOYMENT AGREEMENTS. The Bank and the Company have entered into a salary
continuation agreement (the "Salary Agreement") with Mr. Latawiec (the "CEO").
In addition, the Company and the Bank entered into employment agreements
(collectively, the "Employment Agreements") with Mrs. Greco (the "Named
Executive"), as well as Messrs. O'Gorman and Adamec, who are not Named Executive
Officers (the "Executives").
The Bank's and the Company's Employment Agreements are substantially
similar. The Employment Agreements provide for initial three year terms. The
Company's employment agreement provides for daily extensions such that the term
of the contract will always be three years unless written notice is provided by
either party. On July 23, 1996, the Company provided written notice to the Named
Executive and the Executives that effective on that date the extension
provisions of each employment agreement were no longer applicable, and that each
respective employment agreement would expire on the third anniversary of that
date. The Bank's employment agreement may be renewed annually following review
by the disinterested members of the Board of Directors. On September 24, 1996,
the Compensation Committee of the Board of Directors declined to renew the
Bank's employment agreements with the Named Executive and the Executives for
additional one year terms. Therefore, the expiration date for the Named
Executive's and Executives' effective employment agreements with the Bank is
November 15, 1998. The Employment Agreements also provide for a base salary
which will be reviewed annually. In this regard, the base salary of Mrs. Greco
is $102,128. In addition to base salary, the employment agreements provide for,
among other things, medical insurance coverage and participation in stock
benefit plans and other fringe benefits. The Employment Agreements provide for
termination of the Named Executive or the Executives by the Bank or the Company
for cause at any time. In the event the Bank or the Company chooses to terminate
the Named Executive's or the Executive's employment for reasons other than for
cause or disability, or in the event of the Named Executive's or the Executive's
resignation from the Bank and the Company upon (i) failure to re-elect the Named
Executive or the Executives to their current offices or, if applicable,
renominate the Named Executive or the Executives for election to the Board, (ii)
a material adverse change in the their functions, duties or responsibilities,
(iii) a relocation of the their principal place of employment or a material
reduction of benefits and perquisites, (iv) liquidation or dissolution of the
Bank or the Company, or (v) a breach of the Agreement by the Bank or the
Company, the Named Executive or the Executives, or in the event of death
following such termination, their beneficiaries, would be entitled to severance
pay in an amount equal to the remaining salary payments under the Employment
Agreement.
14
<PAGE> 17
If the Named Executive or Executives are terminated for reasons other than
cause, following a change in control of the Bank or the Company, as defined in
the Employment Agreements, the Named Executive or Executives or, in the event of
death following such termination, their beneficiaries, would be entitled to a
payment equal to the greater of (i) the payments due under the remaining term of
the Employment Agreements or (ii) three times their average annual compensation
over the five years preceding their termination of employment. In addition, the
Named Executive or Executives would be entitled to continued life, health,
dental and disability coverage for the thirty-six month period following their
termination upon a change in control. Payments to the Named Executive and
Executives under the Bank's employment agreement are guaranteed by the Company
in the event that payments or benefits are not paid by the Bank.
Payments under the Employment Agreements in the event of a change in
control may constitute some portion of an excess parachute payment under Section
280G of the Internal Revenue Code (the "Code") for executive officers, resulting
in the imposition of an excise tax on the recipient and denial of the deduction
for such excess amounts to the Company and the Bank.
Pursuant to the Salary Agreement, in the event a change in control, as
defined in such agreement, of either the Company or the Bank occurs before
September 24, 1998, the CEO shall receive payment of his then current base
salary through September 24, 1998. The payment shall be made in a single sum
from the Bank's general funds on the date of the change in control. The Company
guarantees payment by the Bank. Also, the Bank and the Company shall continue to
provide the CEO with life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank or Company immediately prior to
the change in control through September 24, 1998. In no event shall the
aggregate dollar amount of the payments and continuation of benefits under the
Salary Agreement constituting parachute payments under the Code exceed three
times the CEO's average annual total compensation for the last five consecutive
calendar years ending prior to his termination of employment with the Bank (or
his entire period of employment with the Bank if less than five years).
In the event of a change in control based upon the past fiscal year's
salary and bonus, Mr. Latawiec and Mrs. Greco would receive approximately
$237,724 and $306,384, respectively, before any federal, state or local taxes,
in severance payments in addition to other cash and non-cash benefits provided
for under the Employment Agreements.
INCENTIVE STOCK OPTION PLAN
The Company maintains the Incentive Stock Option Plan, which provides
discretionary awards to officers and key employees as determined by a committee
of disinterested directors who administer the plan. No options or stock
appreciation rights were granted to the Named Executive Officers during fiscal
year 1996.
The following table provides certain information with respect to the
number of shares of Common Stock represented by outstanding options held by the
Named Executive Officers as of September 30, 1996. Also reported are the value
for "in-the-money" options which represent the positive spread between the
exercise price of any such existing stock options and the year-end price of the
Common Stock.
15
<PAGE> 18
FISCAL YEAR END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Securities Underlying Number Value of Unexercised In-the-
of Unexercised Options/SARs Money Options/SARs at
at Fiscal Year End (#) Fiscal Year End ($)(1)
---------------------------- ------------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ------------- ---------------
<S> <C> <C> <C> <C>
Stuart G. Hoffer.......... 3,409 0 $20,659 $ -
Frank S. Latawiec......... 0 0 - -
Irene C. Greco............ 2,272 9,090 13,768 55,085
(1) Market value of underlying securities at fiscal year end ($15.50) minus the
exercise or base price ($9.44) per share. Options vest at an annual rate of
20% of the original amount granted beginning on January 26, 1996.
</TABLE>
RETIREMENT PLAN. The Bank maintains the Financial Federal Savings and Loan
Association Retirement Income Plan ("Retirement Plan"), a non-contributory
defined benefit plan. The following table indicates the annual retirement
benefit that would be payable under the plan upon retirement at age 65, or at
age 60 with 30 years of service, to a participant electing to receive his
retirement benefit in the standard form of benefit, assuming various specified
levels of plan compensation and various specified years of credited service. The
benefits listed in the retirement benefit table are based upon salary and bonus
and are subject to any Social Security amounts.
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
------------------------------------
FINAL AVERAGE
EARNINGS 15 20 25 30
-------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
$ 25,000 $ 5,063 $ 6,750 $ 8,438 $10,125
50,000 12,311 16,415 20,519 24,623
75,000 19,811 26,415 33,019 39,623
100,000 27,311 36,415 45,519 54,623
150,000 42,311 56,415 70,519 84,623
Over 150,000(1) 42,311 56,415 70,519 84,623
(1) The maximum compensation permitted in the calculation of benefits under
Section 401(a)(17) of the Code was $150,000 for the 1996 calendar year.
</TABLE>
16
<PAGE> 19
The following table sets forth the years of credited service (i.e.,
benefit service) as of September 30, 1996 for each executive officer.
<TABLE>
<CAPTION>
CREDITED SERVICE
------------------------------------
YEARS MONTHS
----- ------
<S> <C> <C>
Frank S. Latawiec....... 0 2
Stuart G. Hoffer........ 22 11
Irene C. Greco.......... 23 8
</TABLE>
TRANSACTIONS WITH CERTAIN RELATED PERSONS
The Bank's current policy provides that all loans made by the Bank to its
directors and senior executive officers are made on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with other persons and do not involve more than the
normal risk of collectibility or present other unfavorable features. Prior to
the FIRREA, the Bank made loans to officers with discounted interest rates and
loan origination fees.
Set forth below is certain information as of September 30, 1996, with
respect to loans made by the Bank on preferential terms to executive officers
whose aggregate indebtedness to the Bank exceeded $60,000 at any time since
October 1, 1994.
<TABLE>
<CAPTION>
LARGEST AMOUNT BALANCE INTEREST
MATURITY OUTSTANDING AS OF RATE AS OF
DATE DATE SINCE SEPTEMBER SEPTEMBER TYPE OF
NAME AND POSITION OF LOAN OF LOAN OCTOBER 1, 1994 30, 1996 30, 1996 LOAN
- ----------------- ------- ------- ---------------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Irene C. Greco 08/11/86 08/01/16 $94,470 $90,796 7.5% Mortgage
Executive Vice
President and Chief
Operating Officer
</TABLE>
17
<PAGE> 20
PROPOSAL 2. RATIFICATION OF APPOINTMENT
OF INDEPENDENT AUDITORS
The Company's independent auditors for the fiscal year ended September 30,
1996 were Radics & Co., LLC. The Company's Board of Directors has reappointed
Radics & Co., LLC to continue as independent auditors for the Bank and the
Company for the year ending September 30, 1997, subject to ratification of such
appointment by the shareholders.
Representatives of Radics & Co., LLC will be present at the Annual
Meeting. They will be given an opportunity to make a statement if they desire to
do so and will be available to respond to appropriate questions from
shareholders present at the Annual Meeting.
UNLESS MARKED TO THE CONTRARY, THE SHARES REPRESENTED BY THE ENCLOSED
PROXY CARD WILL BE VOTED FOR RATIFICATION OF THE APPOINTMENT OF RADICS & CO.,
LLC AS THE INDEPENDENT AUDITORS OF THE COMPANY.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR RATIFICATION OF THE
APPOINTMENT OF RADICS & CO., LLC AS THE INDEPENDENT AUDITORS OF THE COMPANY.
ADDITIONAL INFORMATION
SHAREHOLDER PROPOSALS
To be considered for inclusion in the Company's proxy statement and form
of proxy relating to the 1998 Annual Meeting of Shareholders, a shareholder
proposal must be received by the Secretary of the Company at the address set
forth on the first page of this Proxy Statement not later than August 25, 1997.
Any such proposal will be subject to 17 C.F.R. ss. 240.14a-8 of the Rules and
Regulations under the Securities Exchange Act of 1934, as amended.
NOTICE OF BUSINESS TO BE CONDUCTED AT AN ANNUAL MEETING
The Bylaws of the Company provide an advance notice procedure for a
shareholder to properly bring business before an Annual Meeting. The shareholder
must give written advance notice to the Secretary of the Company not less than
ninety (90) days before the date originally fixed for such meeting, provided,
however, that in the event that less than one hundred (100) days notice or prior
public disclosure of the date of the meeting is given or made to shareholders,
notice by the shareholder to be timely must be received not later than the close
of business on the tenth day following the date on which the Company's notice to
shareholders of the annual meeting date was mailed or such public disclosure was
made. The advance notice by shareholders must include the shareholder's name and
address, as they appear on the Company's record of shareholders, a brief
description of the proposed business, the reason for conducting such business at
the Annual Meeting, the class and number of shares of the Company's capital
stock that are beneficially owned by such shareholder and any material interest
of such shareholder in the proposed business. In the case of nominations to the
Board of Directors,
18
<PAGE> 21
certain information regarding the nominee must be provided. Nothing in this
paragraph shall be deemed to require the Company to include in its proxy
statement or the proxy relating to an annual meeting any shareholder proposal
which does not meet all of the requirements for inclusion established by the SEC
in effect at the time such proposal is received.
OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING
The Board of Directors knows of no business which will be presented for
consideration at the Meeting other than as stated in the Notice of Annual
Meeting of Shareholders. If, however, other matters are properly brought before
the Annual Meeting, it is the intention of the persons named in the accompanying
proxy to vote the shares represented thereby on such matters in accordance with
their best judgment.
Whether or not you intend to be present at the Annual Meeting, you are
urged to return your proxy card promptly. If you are then present at the Annual
Meeting and wish to vote your shares in person, your original proxy may be
revoked by voting at the Annual Meeting.
By Order of the Board of Directors
Robert E. Adamec
SENIOR VICE PRESIDENT AND
CORPORATE SECRETARY
Long Island City, New York
December 23, 1996
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE
REQUESTED TO SIGN, DATE AND PROMPTLY RETURN THE
ACCOMPANYING PROXY CARD IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
19
<PAGE> 22
[FRONT SIDE]
REVOCABLE PROXY
FINANCIAL BANCORP, INC.
ANNUAL MEETING OF SHAREHOLDERS
January 22, 1997
10:30 a.m. Eastern Standard Time
-------------------------------
The undersigned hereby appoints the official proxy committee of the Board
of Directors of Financial Bancorp, Inc. (the "Company"), each with full power of
substitution, to act as attorneys and proxies for the undersigned, and to vote
all shares of Common Stock of the Company which the undersigned is entitled to
vote only at the Annual Meeting of Shareholders, to be held on January 22, 1997,
at 10:30 a.m. Eastern Standard Time, at the La Guardia Marriott, 102-05 Ditmars
Boulevard, East Elmhurst, New York, and at any and all adjournments thereof, as
follows:
1. The election as director of the nominee listed.
Peter S. Russo
FOR VOTE WITHHELD
--- -------------
|_| |_|
2. The ratification of the appointment of Radics & Co., LLC as
independent auditors of Financial Bancorp, Inc. for the fiscal year
ending September 30, 1997.
FOR AGAINST ABSTAIN
--- ------- -------
|_| |_| |_|
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED
PROPOSALS.
<PAGE> 23
[BACK SIDE]
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
THIS PROXY IS REVOCABLE AND WILL BE VOTED AS DIRECTED, BUT IF NO
INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE PROPOSALS
LISTED. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL MEETING, INCLUDING
WHETHER OR NOT TO ADJOURN 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 ANNUAL MEETING.
The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Annual Meeting of Shareholders and of a
Proxy Statement dated December 23, 1996 and of the Annual Report to
Shareholders.
Please sign exactly as your name appears on this card. When signing
as attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder may sign but only one signature
is required.
Dated:___________________________
--------------------------------
SIGNATURE OF SHAREHOLDER
--------------------------------
SIGNATURE OF SHAREHOLDER
-----------------------------
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
