SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant |X|
Filed by a party other than the registrant |_|
Check the appropriate box:
|_| Preliminary proxy statement
|X| Definitive proxy statement
|_| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MERCHANTS NEW YORK BANCORP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Charter)
Karen L. Deitz, Corporate Secretary
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
|_| No fee required.
|_| Fee computed on the table below per Exchange Act Rules 14a-6(i)(1) 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:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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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:
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|_| 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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<PAGE>
March 24, 2000
To Our Shareholders:
On behalf of our Directors, I cordially invite you to attend the Annual
Meeting of Stockholders of Merchants New York Bancorp. This Annual Meeting will
be held at 12:00 o'clock, local time, on Tuesday, May 2, 2000, at The Harmonie
Club, 4 East 60th Street, New York, NY 10022. The formal notice of the meeting
is attached hereto.
The Proxy Statement describes matters that we expect will be acted upon
at the meeting. The shareholders who are present will have the opportunity to
ask questions.
Our Company has performed very well having shown record results for the
past twenty-nine consecutive quarters and six years in a row of record earnings.
Dividends paid to our stockholders have kept pace with our performance.
"The Good Old Bank" has paid 266 consecutive quarterly cash dividends since they
commenced in 1932. We also have increased our payout 47 times since 1950, most
recently in 1999. This is a record very few companies in America can match.
We are gratified by our shareholders' continued interest in the Company
and pleased that in the past so many of you have voted your shares in person or
by proxy. We hope you will continue to do so and urge you to return your proxy
card as soon as possible.
Cordially yours,
/s/ Spencer B. Witty
--------------------------
Spencer B. Witty
Chairman of the Board
<PAGE>
Merchants New York Bancorp
275 Madison Avenue
New York, New York 10016
(212) 973-6600
--------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 2, 2000
--------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of Merchants New York Bancorp, Inc. (the "Company"), the holding
company for The Merchants Bank of New York (the "Bank"), will be held on
Tuesday, May 2, 2000, at 12 o'clock Noon, local time.
The location of the Meeting will be The Harmonie Club, 4 East 60th Street,
New York, 10022. The Meeting will be held for the following purposes:
1. To elect thirteen directors to serve until the next Annual Meeting
of Stockholders and/or until their successors are elected and
qualified; and
2. To transact such other business as may properly come before the
Meeting or any adjournments or postponements thereof.
The Board of Directors has fixed March 24, 2000, as the record date for the
determination of the stockholders entitled to notice of, and to vote at, the
Meeting and any adjournments thereof. Only those stockholders of record of the
Company as of the close of business on that date will be entitled to vote at the
Meeting or any adjournments or postponements thereof.
By order of the Board of Directors
/s/ Spencer B. Witty
-------------------------------------
Spencer B. Witty
Chairman of the Board
/s/ James G. Lawrence
-------------------------------------
James G. Lawrence
President and Chief Executive Officer
/s/ Karen L. Deitz
-------------------------------------
Karen L. Deitz
Corporate Secretary
NEW YORK, NEW YORK
March 24, 2000
YOU ARE CORDIALLY INVITED TO ATTEND THIS MEETING. IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. IF YOU WILL BE
UNABLE TO BE PRESENT AT THE MEETING OR EVEN IF YOU ANTICIPATE THAT YOU WILL
ATTEND, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE
ACCOMPANYING ENVELOPE WITHOUT DELAY. YOU WILL BE MOST WELCOME AT THE MEETING AND
MAY THEN VOTE IN PERSON IF YOU SO DESIRE, EVEN THOUGH YOU MAY HAVE EXECUTED AND
RETURNED THE PROXY. ANY STOCKHOLDER WHO EXECUTES SUCH A PROXY MAY REVOKE IT AT
ANY TIME BEFORE IT IS EXERCISED. YOUR PROMPT RETURN OF YOUR PROXY WILL HELP
AVOID THE COST OF FURTHER SOLICITATIONS. FOR CERTAIN ADDITIONAL FINANCIAL
INFORMATION, AVAILABLE WITHOUT CHARGE, YOU MAY CONTACT KAREN l. DEITZ AT THE
COMPANY OR CALL (212) 973-6600.
<PAGE>
Merchants New York Bancorp
275 Madison Avenue
New York, New York 10016
(212) 973-6600
--------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 2, 2000
--------------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
General
This statement is furnished in connection with the solicitation by the
Board of Directors of Merchants New York Bancorp, Inc. (the "Company"), holding
company for The Merchants Bank of New York (the "Bank"), of proxies to be used
at the Annual Meeting of Stockholders (the "Meeting") of the Company on Tuesday,
May 2, 2000, and any adjournments or postponements thereof.
The location and time of the Meeting will be The Harmonie Club, 4 East
60th Street, New York, New York 10022, at 12 o'clock Noon, local time. The
Meeting will be held for the following purposes:
1. To elect thirteen directors to serve until the next Annual Meeting
of Stockholders and/or until their successors are elected and
qualified; and
2. To transact such other business as may properly come before the
Meeting or any adjournments thereof.
This proxy statement, the accompanying notice of annual meeting and proxy
and the Company's annual report to stockholders containing the Company's
financial statements for the year ended December 31, 1999 are being mailed to
stockholders on or about March 29, 2000.
Record Date and Principal Stockholders
Stockholders of record at the close of business on March 24, 1999 (the
"Record Date") are entitled to notice of, and to vote at, the Meeting and any
adjournments or postponements thereof. On the Record Date, the Company had
outstanding and entitled to vote 18,865,640 shares of common stock, par value
$.001 per share (the "Common Stock"). For information regarding security
ownership by management and certain other holders of the Company's Common Stock,
see "Security Ownership of Certain Beneficial Owners and Management."
<PAGE>
Revocability of Proxies
A proxy is enclosed for use at the Meeting. Each stockholder is urged to
complete and return the enclosed proxy immediately, even if attendance in person
at the Meeting is anticipated. The proxy may be revoked by the stockholder at
any time before it is voted by delivering to the Secretary of the Company a
notice of revocation or a duly executed proxy bearing a later date. Any proxy
may also be revoked by (i) the stockholder's attendance at the Meeting, and (ii)
voting in person. The presence of a stockholder at the Meeting will not
automatically revoke that stockholder's proxy.
Voting and Solicitation
Proxies properly executed and received in time to be duly presented at the
Meeting will be voted in accordance with the stockholder's directions. Properly
executed proxies not marked to indicate any desired vote will be voted FOR the
election of the nominees for directors named below. If any other matters are
properly brought before the Meeting, the persons named in the accompanying
proxies will vote the shares represented by such proxies on such matters as
instructed by the Board of Directors of the Company, who have instructed the
proxies to vote in accordance with the proxies' own best judgment in the absence
of express instruction from the Board.
The expense of preparing, printing, and mailing this proxy statement and
the proxies will be borne by the Company. In addition to the use of the mail,
proxies may be solicited by directors and officers of the Bank in person or by
telephone or telegram. The Company will also reimburse brokerage houses and
other custodians, nominees and fiduciaries for their expenses, in accordance
with Securities and Exchange Commission (the "SEC") regulations, in sending this
proxy statement and proxies to the beneficial owners of its Common Stock.
Quorum, Abstentions and Broker Non-Votes
The presence, in person or by proxy, of at least a majority of the total
number of outstanding shares of the Company's Common Stock is necessary to
constitute a quorum. Shares of Common Stock represented by a properly signed and
returned proxy will be counted as present at the Annual Meeting for purposes of
determining a quorum, without regard to whether the proxy is marked as casting a
vote or abstaining. Shares of Common Stock held by nominees that are voted on at
least one matter coming before the Annual Meeting will also be counted as
present for purposes of determining a quorum, even if the beneficial owner's
discretion has been withheld (a "broker non-vote") for voting on some or all
other matters.
Each share of Common Stock is entitled to one vote on all matters that
may properly come before the Annual Meeting other than the election of
directors. In the election of directors, each share is entitled to cast one vote
for each director to be elected. Directors of the Company shall be elected by a
plurality of votes cast at the Meeting. The holders of Common Stock may not vote
their shares cumulatively for election of directors. For purposes of the
election of directors, abstentions and broker non-votes are not considered to be
votes cast and do not affect the plurality vote required for the election of
directors. All other matters to come before the Annual Meeting require the
approval of a majority of the shares of Common Stock present, in person or by
proxy, at the Annual Meeting and entitled to vote. Therefore, abstentions will
have the same effect as votes against the proposals on such matters. Broker
non-votes, however, will be deemed shares not present to vote on such matters,
and therefore will not count as votes for or against the proposals, and will not
be included in calculating the number of votes necessary for approval of such
matters.
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<PAGE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Company's Board of Directors met on twelve occasions in 1999. The
Bank's Board of Directors generally meets monthly at the same time as the
Company's Board of Directors. Each Director of the Company attended at least 92%
of the aggregate of the total number of meetings of the Board and the total
number of meetings held by all committees on which each served. The Board of
Directors has standing executive, audit, compensation and option, planning and
nominating committees described below.
Executive Committee. The Executive Committee consists of the following
directors: Charles J. Baum (Chairman), Spencer B. Witty, Rudolf H. Hertz, James
G. Lawrence, William J. Cardew, Charles I. Silberman and Robinson Markel. The
Executive Committee is empowered to act for the full Board in intervals between
Board meetings, with the exception of certain matters that by law may not be
delegated. The Executive Committee meets as necessary, and all actions of the
Executive Committee are reported at the next Board of Directors meeting.
Nominating Committee. The Nominating Committee consists of the following
directors: Robinson Markel (Chairman), Spencer B. Witty and Rudolf H. Hertz. The
Nominating Committee meets annually to interview and recommend nominees for
election as Directors of the Company. The Nominating Committee will consider
nominees for the Board recommended by stockholders in accordance with the
Company's By-laws.
Audit Committee. The Audit Committee consists of the following directors:
Alan Mirken (Chairman), Charles J. Baum, Robinson Markel and Charles I.
Silberman. The Audit Committee recommends outside auditors, approves overall
audit scope, reviews adequacy of internal control systems, reviews annual
financial statements and audit reports thereon and directs special
investigations for the Board. The Audit Committee met eleven times during 1999.
Compensation and Option Committee. The Compensation and Option Committee
consists of Charles J. Baum, (Chairman), Robinson Markel, Paul Meyrowitz, Alan
Mirken, Mitchell J. Nelson, Leonard Schlussel, Charles I. Silberman and Marcia
Toledano. The Compensation and Option Committee reviews and determines the
compensation of the Bank's executive officers, and recommends the granting of
options on Company Common Stock to eligible employees pursuant to the Company's
Stock Option Plan. See "Compensation and Option Committee Report on Executive
Officer Compensation".
Planning Committee. The Planning Committee consists of the following
directors: Charles I. Silberman (Chairman), Charles J. Baum, Robinson Markel,
Paul Meyrowitz, Alan Mirken, Mitchell J. Nelson, Leonard Schlussel and Marcia
Toledano. The Planning Committee has been formed to address, with the assistance
of senior management as required, strategic planning issues for growth of the
Bank and expansion of its business opportunities.
In addition to executive and audit committees with the same members and
purposes as described above, the Board of Directors of the Bank has additional
standing committees, with the functions and membership described below:
Community Reinvestment Act Committee. The Community Reinvestment Act
Committee consists of the following directors: Leonard Schlussel (Chairman),
Spencer B. Witty, and William J. Cardew. The Community Reinvestment Act
Committee is responsible for monitoring the Bank's compliance with its Community
Reinvestment Act responsibilities.
-3-
<PAGE>
Directors' Examining Committee. The Directors' Examining Committee
consists of the following directors: Leonard Schlussel, Alan Mirken and Charles
I. Silberman. The Directors' Examining Committee meets with the Bank's auditors
to discuss and review the condition of the Bank's loan portfolio and other
matters as required by the New York State Banking Department.
Conflict of Interest Committee. The Conflict of Interest Committee
consists of the following directors: Paul Meyrowitz (Chairman), Robinson Markel,
Rudolf H. Hertz, Charles J. Baum and Spencer B. Witty. The Conflict of Interest
Committee resolves actual or potential conflicts of interest between the
interests of the Bank's employees and those of the Bank.
Investment Committee. The Investment Committee consists of the following
directors: Spencer B. Witty (Chairman), Rudolf H. Hertz, James G. Lawrence,
William J. Cardew and Eric W. Gould. The Investment Committee formulates
investment strategies and programs for the Bank that are then presented to the
Board for approval.
Asset and Liability Committee. The Asset and Liability Committee consists
of the following directors: William J. Cardew (Chairman), Spencer B. Witty,
James G. Lawrence, Rudolf H. Hertz, Eric W. Gould and Charles I. Silberman
(alternate: Mitchell J. Nelson). The Asset and Liability Committee is
responsible for managing the interest rate risk between the Bank's assets and
liabilities to maximize income, as well as providing for adequate liquidity to
meet loan demand and deposit withdrawals.
Directors' Compensation
During 1999, the Company paid Directors' fees of $1,000 for each Board
meeting attended through March, and $2,000 per meeting attended during the rest
of the year, to each director. Outside directors serving on Board committees
received additional compensation for that service. Members of the Executive
Committee, the Audit Committee and the Community Reinvestment Act Committee each
received $2,000 per year; members of the Directors' Examining Committee and the
Compensation and Option Committee each received $1,000 per year, and members of
the Asset and Liability Committee each received $1,000 per meeting. In addition
to the foregoing fees each person who was an outside director at the end of 1999
and who attended a minimum of ten meetings of the Board in that year received a
stipend of $10,000. The outside directors of the Company include all directors
other than Messrs. Witty, Lawrence, Cardew and Gould. Each of the outside
directors received the stipend for 1999.
The Company has adopted a pension plan for members of the Board of
Directors (the "Directors' Plan"). Under the Directors' Plan, all Directors of
the Company are eligible to receive an annual benefit commencing upon
termination of service as a Director. The annual benefit is equal to 80% of the
average annual compensation the Director received from the Company over the two
complete years prior to retirement. The annual benefit will be payable
commencing at retirement and continuing for fifteen years or for the length of
time the Director had served on the Board prior to retirement, whichever is
less.
ELECTION OF DIRECTORS
The Directors are elected annually by the stockholders. At the Meeting,
thirteen directors are to be elected to serve until the next Annual Meeting of
Stockholders and/or until their successors are elected and qualified. Unless
otherwise directed, proxies will be voted FOR the nominees listed in this Proxy
-4-
<PAGE>
Statement; or, if any of the nominees should be unable or unwilling to serve as
a director, an event that is not anticipated, proxies will be voted FOR
substitute nominees designated by the Board of Directors.
Each nominee is presently a Director of the Company. For each nominee
there follows certain biographical information, including age as of the date of
this proxy statement and a brief listing of principal occupation or employment
of each during the past five years. For detailed information with respect to the
Common Stock ownership of each of the nominees, see the table in the section of
this Proxy Statement captioned "Security Ownership of Certain Beneficial Owners
and Management."
CHARLES J. BAUM
Age: 71
Mr. Baum has been a Director of the Bank since 1976 and a Director of the
Company since it became the Bank's holding company. He has been the President of
Baum Brothers Imports, Inc., importers of porcelain dinnerware, for
approximately 21 years, and President of Essex Manufacturing Co., Inc.,
manufacturers and importers of rainwear and umbrellas, since 1978. He has also
been the President of Azal Sales Corp., import agents of general merchandise,
since 1958.
WILLIAM J. CARDEW
Age: 73
Mr. Cardew has been the Vice Chairman of the Board of Directors of the
Company and the Bank since 1997, Chief Operating Officer of the Bank from 1985
to 1996 and Chief Operating Officer of the Company since it became the Bank's
holding company. He was also the Executive Vice President of the Bank from 1985
to 1996 and of the Company since it became the Bank's holding company.
ERIC W. GOULD
Age: 31
Mr. Gould has served as a director of the Company since 1997 and of the
Bank since the following year. He has been employed by the Bank since 1990. He
became Assistant Treasurer of the Bank in 1993, Treasurer of the Bank and the
holding company in 1996, Vice President in 1997, Senior Vice President in 1998,
and Executive Vice President in January 2000.
RUDOLF H. HERTZ
Age: 83
Mr. Hertz has served as the Vice Chairman of the Board of Directors of the
Company since it became the Bank's holding company. From 1962 until September
1998, and since September 1999, he has served as a Director of the Bank. From
1978 to 1985 he served as President and Chief Executive Officer, and from 1985
to April 1999 as Vice Chairman, of the Bank. Since May 1999 he has been a
consultant to the Bank.
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<PAGE>
JAMES G. LAWRENCE
Age: 57
Mr. Lawrence has been the President and Chief Executive Officer of the
Bank since 1985, a Director of the Bank since 1984 and a Director of the Company
since it became the Bank's holding company.
ROBINSON MARKEL
Age: 65
Mr. Markel has been a Director of the Bank since 1974 and of the Company
since it became the Bank's holding company. He is an attorney and has been a
member of the law firm of Rosenman & Colin LLP since February 1998. From May
1995 to February 1998 he was a member of the law firm of Piper & Marbury L.L.P.,
and for more than twenty-one years prior to that time he was a member of the law
firm of Milgrim Thomajan & Lee P.C. and its successor firms Varet Marcus & Fink
P.C. and Marcus Montgomery Wolfson P.C.
PAUL MEYROWITZ
Age: 83
Mr. Meyrowitz has been a Director of the Bank since 1981 and of the
Company since it became the Bank's holding company. He is an attorney and has
been a senior partner of the law firm Simon, Meyrowitz and Meyrowitz LLP and its
predecessor firm for over fifty years and has been counsel to the Bank since
1961.
ALAN MIRKEN
Age: 70
Mr. Mirken has been a Director of the Bank since 1984 and of the Company
since it became the Bank's holding company. From 1979 until 1988, Mr. Mirken was
the President of Crown Publishing Group. From October 1988 until January 1990,
he was the Vice Chairman of Random House Inc., and from March 1990 to December
1994 he was the Executive Vice President--Associate Publisher for Abbeville
Press. Since January 1995, Mr. Mirken has been President of Aaron Publishing
Group, Inc.
MITCHELL J. NELSON
Age: 52
Mr. Nelson has been a Director of the Bank since 1992 and of the Company
since it became the Bank's holding company. He is an attorney presently of
counsel to the law firm of Salans, Hertzfeld, Heilbrunn, Christy & Viener having
formerly been of counsel to Proskauer Rose Goetz & Mendelsohn from May 1992 to
June 1994, and previously a partner with the law firm of Wien, Malkin & Bettex
for more than ten years. He is also a principal in Atlas Partners, L.P., a real
estate consulting firm, and President of Atlas Real Estate Funds, Inc., a
private investment firm.
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<PAGE>
LEONARD SCHLUSSEL
Age: 70
Mr. Schlussel has been a Director of the Bank since 1981 and of the
Company since it became the Bank's holding company. He has been President of
Wellbilt Equipment Corp., builders of restaurants, since 1990, and its Secretary
for over twenty years. Mr. Schlussel is also a partner in several real estate
ventures and has been a partner in Keybro Enterprises, a financial enterprise,
for over thirty years.
CHARLES I. SILBERMAN
Age: 51
Mr. Silberman has been a Director of the Bank since 1989 and of the
Company since it became the Bank's holding company. He has also served as Vice
Chairman of the Company since May 1995. He has been the President and Chairman
of the Board of S. Parker Hardware Manufacturing Corp., importer and
manufacturer of builders' hardware, since June 1989.
MARCIA TOLEDANO
Age: 50
Ms. Toledano has served as a Director of the Company and the Bank since
1999. She is a Senior Vice President of both 990 G.P. Corp., a realty firm, and
Bermaha Textile Co., a textile exporter, for more than five years. She also
serves as chief executive and financial administrator of a family medical
practice.
SPENCER B. WITTY
Age: 85
Mr. Witty has been the Chairman of the Board of Directors of the Bank
since 1976, a Director of the Bank since 1967 and the Chairman of the Board of
Directors and a Director of the Company since it became the Bank's holding
company.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information regarding the ownership of the Company's outstanding Common
Stock as of February 1, 2000 by the Company's directors, and by all directors
and executive officers of the Company as a group, is shown in the following
table. The Company's management is not aware that any person or group not
connected with management beneficially owns more than 5% of the Company's Common
Stock.
<TABLE>
<CAPTION>
Number of Shares which Percentage of
Number of Shares owned may be acquired outstanding
Name(1) as of February 1, 2000(2) within 60 days(3) Shares(4)
------- ------------------------- ----------------- ---------
<S> <C> <C> <C>
Charles J. Baum 124,368(5) 0 *
William J. Cardew 117,640(6) 0 *
Eric W. Gould 372,940(7) 2,000 1.98
Rudolf H. Hertz 410,416(8) 0 2.17
James G. Lawrence 301,756(9) 8,500 1.64
Robinson Markel 419,110(10) 0 2.21
Paul Meyrowitz 42,100(11) 0 *
Alan Mirken 122,912(12) 0 *
Mitchell J. Nelson 256,656(13) 0 1.35
Leonard Schlussel 426,816(14) 0 2.25
Charles I. Silberman 520,000(15) 0 2.74
Marcia Toledano 523,576(16) 0 2.76
Spencer B. Witty 1,682,210(17) 38,000 9.06
All Directors and Executive Officers
as a Group (13 persons) 4,474,376(18) 48,500 23.80
</TABLE>
- ----------
* Less than 1%.
(1) The address of each beneficial owner is c/o The Merchants Bank of New
York, 275 Madison Avenue, New York, New York 10016.
(2) Share totals in each line of this column reflect all shares identified in
the relevant footnote.
(3) Represents shares subject to options granted under the Company Option
Plan.
(4) Percentage computations are made as follows: The sum of each nominee's
shares shown in the second column plus shares shown in the third column
(if any) is divided by the sum of (i) the 18,956,504 shares (excluding
treasury shares) outstanding on February 1, 2000 plus (ii) shares shown in
the third column for that nominee (if any). Except as otherwise noted
below, each nominee has sole voting and investment power over the shares
listed opposite his or her name.
(5) Includes (i) 51,400 shares owned directly and beneficially by Mr. Baum,
(ii) 23,088 shares owned by Azal Sales Corp., of which Mr. Baum is the
sole shareholder, (iii) 44,544 shares owned by Azal Sales Corp.'s
Retirement Pension Plan, of which Mr. Baum is a trustee, and (iv) 5,336
shares owned by Mr. Baum's spouse. Mr. Baum disclaims beneficial ownership
of the shares owned by his spouse.
(6) Includes 83,496 shares owned directly and beneficially by Mr. Cardew and
34,144 shares owned by Mr. Cardew's spouse. Mr. Cardew disclaims
beneficial ownership of the shares owned by his spouse.
(7) Includes (i) 400 shares owned directly and beneficially by Mr. Gould, (ii)
400 shares owned by him as custodian for his minor child, (iii) 268,428
shares owned by trusts for which Mr. Gould is a co-trustee with Mr. Witty,
(iv) 70,352 shares owned by the Employees' Retirement Plan of the Bank for
which Mr. Gould is a co-trustee with Messrs. Witty and Hertz, and (v)
33,360 shares owned by Mr. Gould's mother which Mr. Gould has power to
vote pursuant to a power of
-8-
<PAGE>
attorney. Mr. Gould has shared voting and investment power over the shares
owned by the trusts for which he is a co-trustee and the shares owned by
the Employees' Retirement Plan. Mr. Gould disclaims beneficial ownership
of the shares owned by the trusts of which he is a co-trustee, the shares
held by the Employees' Retirement Plan (other than those that may be
attributable to him as a result of his interest in the Plan), and the
shares owned by his mother.
(8) Includes (i) 71,420 shares owned directly and beneficially by Mr. Hertz,
(ii) 288 shares owned by Mr. Hertz jointly with his spouse, (iii) 14,944
shares owned by Mr. Hertz's spouse, (iv) 57,476 shares owned by trusts for
which Mr. Hertz, but no other person who is an officer or director of the
Company, is trustee, (v) 195,936 shares owned by trusts for which Mr.
Hertz is a co-trustee with Mr. Witty, and (vi) 70,352 shares owned by the
Employees' Retirement Plan of the Bank for which Mr. Hertz is a co-trustee
with Messrs. Witty and Gould. Mr. Hertz has shared voting and investment
power over the shares owned by the trusts for which he is a co-trustee and
the shares held by the Employees' Retirement Plan. Mr. Hertz disclaims
beneficial ownership of the shares owned by his spouse, the shares owned
by the trusts of which he is a co-trustee, and the shares held by the
Employees' Retirement Plan (other than those that may be attributable to
him as a result of his interest in the Plan).
(9) Includes (i) 188,132 shares owned directly and beneficially by Mr.
Lawrence, (ii) 12,000 shares owned by his spouse, (iii) 72,224 shares
owned by family members which Mr. Lawrence has the power to vote pursuant
to a proxy, and (iv) 29,400 shares owned by an estate which Mr. Lawrence
has sole voting and investment power over as executor of the estate. Mr.
Lawrence disclaims beneficial ownership of the shares owned by his spouse
and by the estate.
(10) Includes (i) 68,296 shares owned directly and beneficially by Mr. Markel,
(ii) 11,126 shares owned by Mr. Markel's spouse (3,480 directly by her and
7,646 as custodian for their minor child), (iii) 58,888 shares held by Mr.
Markel's Individual Retirement Account, and (iv) 280,800 shares owned by
his sister which Mr. Markel has power to vote pursuant to a power of
attorney. Mr. Markel disclaims beneficial ownership of the shares owned by
his spouse and his sister.
(11) Includes 27,900 shares owned directly and beneficially by Mr. Meyrowitz
and 14,200 shares owned by Mr. Meyrowitz's spouse. Mr. Meyrowitz disclaims
beneficial ownership of the shares owned by his spouse.
(12) Includes 116,240 shares owned directly and beneficially by Mr. Mirken and
6,672 shares owned by Mr. Mirken's spouse. Mr. Mirken disclaims beneficial
ownership of the shares owned by his spouse.
(13) Includes 15,600 shares owned directly and beneficially by Mr. Nelson and
241,056 shares owned by an estate of which he, Ms. Toledano and three
other persons are executors. Mr. Nelson disclaims beneficial ownership of
the shares owned by the estate.
(14) Includes (i) 148,400 shares owned directly and beneficially by Mr.
Schlussel, (ii) 226,842 shares owned by Mr. Schlussel jointly with his
brother, (iii) 6,704 shares owned by Mr. Schlussel jointly with his spouse
and (iv) 44,870 shares owned by a limited liability company. Mr. Schlussel
has sole voting and investment power over all of these shares.
(15) Includes (i) 409,192 shares owned directly and beneficially by Mr.
Silberman, (ii) 99,776 shares owned by Mr. Silberman's spouse, and (iii)
11,032 shares held in custodial accounts for which Mr. Silberman is the
custodian. Mr. Silberman disclaims beneficial ownership of the shares
owned by his spouse.
(16) Includes (i) 8,400 shares owned directly and beneficially by Ms. Toledano,
(ii) 16,408 shares owned by her minor child as to which Ms. Toledano
disclaims beneficial ownership, (iii) 241,056 shares owned by an estate of
which Ms. Toledano and Mr. Nelson are executors, as to which she disclaims
beneficial ownership except to the extent that she is a beneficiary of the
estate, and (iv) 257,712 shares owned by Ms. Toledano's mother which Ms.
Toledano has the power to vote pursuant to a power of attorney, in which
shares she disclaims beneficial ownership. Ms. Toledano has sole voting
and investment power over the shares she owns directly, and shares such
power with Mr. Nelson and the other co-executors as to the estate shares
and with her brother and sister as to the shares owned by her mother.
(17) Includes (i) 615,932 shares owned directly and beneficially by Mr. Witty,
(ii) 6,984 shares owned by Mr. Witty's spouse, (iii) 524,578 shares owned
by trusts for which Mr. Witty, but no other person who is an officer or
director of the Company, is trustee, (iv) 70,352 shares held by the
Employees' Retirement Plan of the Bank for which Mr. Witty is a co-trustee
with Messrs. Hertz and Gould, and (v) 464,364 shares owned by trusts for
which Mr. Witty is co-trustee with Mr. Gould or Mr. Hertz. Mr. Witty has
sole voting and investing power over the shares owned by the trusts for
which he is the sole trustee, and shared voting and investment power over
the shares owned by the trusts for which he is a co-trustee and the shares
owned by the Employees' Retirement Plan. Mr. Witty disclaims beneficial
ownership of the shares owned by his spouse, the shares owned by the
trusts, and the shares owned by the Employees' Retirement Plan (other than
those that may be attributable to him as a result of his interest in the
Plan).
(18) Includes shares subject to stock options as described in the preceding
footnotes.
-9-
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The Summary Compensation Table shows the compensation for the past three
years of each of the Company's five most highly compensated executive officers,
including the Chief Executive Officer (the "named executive officers"). The
named executive officers have received no compensation for their services to the
Company; in each case the reported compensation has been paid by, and with
respect to the services provided to, the Bank.
Annual Compensation
-------------------------------
Name and Principal Position Year Salary Bonus(1)
- --------------------------- ---- ------ --------
James G. Lawrence .......................... 1999 351,538 149,659
President and 1998 310,000 121,932
Chief Executive Officer 1997 310,000 121,932
Spencer B. Witty ........................... 1999 324,760 145,284
Chairman of the Board 1998 275,000 117,557
1997 275,000 119,245
William J. Cardew .......................... 1999 262,673 139,034
Vice Chairman of the Board 1998 225,000 111,307
and Chief Operating Officer 1997 225,000 113,117
-10-
<PAGE>
Rudolf H. Hertz ............................ 1999 95,385 87,273
Vice Chairman of the Board 1998 160,000 70,455
1997 160,000 72,183
Stephen A. Barrow(2) ....................... 1999 160,260 48,711
Executive Vice President 1998 149,692 47,778
and Chief Credit Officer 1997 143,717 44,500
- ----------
(1) Includes (i) bonuses under the incentive compensation bonus plan for
senior executives in 1999 and (ii) regular bonus of approximately 12.5% of
salary. The regular bonus is paid to all officers of the Bank
(approximately 80 persons in 1999) and historically has been a part of
management compensation. The incentive compensation bonus for each of the
named executive officers in 1999 was as follows: Mr. Lawrence - $110,909;
Mr. Witty - $110,909; Mr. Cardew - $110,909; Mr. Hertz - $67,273; and Mr.
Barrow $30,000. See "Compensation and Option Committee Report on Executive
Officer Compensation."
(2) Mr. Barrow is not an executive officer but is included in the Summary
Compensation Table as one of the Company's most highly compensated
non-executive officers pursuant to the rules of the Commission.
Pension Plans
Employees' Retirement Plan. The Bank maintains a non-contributory, defined
benefit Retirement Plan administered by the Bank for employees. The estimated
annual pension benefits payable upon retirement at a normal retirement age (65)
for the named executive officers are as follows:
James G. Lawrence ...................................... $ 74,868
Spencer B. Witty ....................................... 62,070
Rudolf H. Hertz ........................................ 129,291
William J. Cardew ...................................... 45,190
Stephen A. Barrow ...................................... 28,936
Under the Retirement Plan, the normal annual benefit payable to qualifying
employees upon their retirement is based upon a formula of 1.8% of the initial
$160,000 of a participant's annual compensation for each year of participation.
Normal retirement age under the Retirement Plan is 65. The Retirement Plan also
provides for reduced benefit payments for early retirement following age 55.
Covered remuneration under the Retirement Plan is an employee's salaries, wages,
or other regular payments from the Bank, including commissions, overtime pay,
bonuses and any other taxable compensation.
The estimated annual pension benefits for the Bank's executive officers
are based upon continuation of employment from December 31, 1999, at the salary
then in effect, to retirement date. In addition, Non-Retirement Plan benefits
are payable to Messrs. Witty and Hertz (under Board resolutions of November 17,
1981, March 24, 1987 and April 28, 1988, which specified respective base dollar
amounts to be increased annually by 9%) in the amount of $137,024 and $33,427,
respectively, and Non-Retirement Plan benefits are payable to James G. Lawrence
and William J. Cardew in the amount of
-11-
<PAGE>
$100,000 each per year, and to Spencer B. Witty in the amount of $50,000 per
year, for 15 years guaranteed after retirement. Further, each of Messrs. Witty,
Hertz and Cardew would receive an annual benefit of $13,200, and Mr. Lawrence an
annual benefit of $14,000, under the Directors' Plan, upon termination of their
service as a Director.
Stock Option Grants. The Company maintains an incentive and non-qualified
Employees' Stock Option Plan within the meaning of the Internal Revenue Code of
1986, as amended (the "Company Option Plan"). No options were granted to the
named executive officers in 1999.
Option Value Table. The following table shows information concerning (i)
options exercised during 1999 and (i) the value at December 31, 1999 of
unexercised stock options granted to the named executive officers.
Aggregated Option Exercises in Last Fiscal Year
and December 31, 1999 Option Values
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options at In-the-Money Options at
December 31, 1999 December 31, 1999 (1)
--------------------------- ---------------------------
Shares
Acquired Value
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
James G. Lawrence........ 12,000 $144,000 17,000 0 $207,145 0
Spencer B. Witty......... 10,000 124,620 38,000 0 463,030 0
William J. Cardew........ 0 0 0 0 0 0
Rudolf H. Hertz.......... 11,456 140,659 0 0 0 0
Stephen A. Barrow........ 10,000 122,100 12,000 0 140,220 0
</TABLE>
- -------------
(1) Computed by deducting option exercise price from the $17.125 closing
market price of the Common Stock at December 31, 1999. Except for the
options owned by Mr. Barrow which have an exercise price of $5.44 per
share, all of the options in the table have an exercise price of $4.94 per
share.
-12-
<PAGE>
COMPENSATION AND OPTION COMMITTEE REPORT ON EXECUTIVE OFFICER COMPENSATION
Objectives
The Bank's compensation policies and procedures have historically been
aligned with the Bank's conservative traditions. The Bank seeks to compensate
its executive officers (including the named executive officers) in a manner
which is:
(i) consistent with the Bank's conservative traditions and cost
structure;
(ii) sufficient to attract and retain key executives critical to the
success of the Bank;
(iii) reflective of current performance of both the individual officer and
the Bank; and
(iv) remuneration of successful long-term strategic management and
enhancement of shareholder values.
Components of Compensation
The Compensation and Option Committee (the "Committee") approves the
design of, assesses the effectiveness of, and administers the executive
compensation programs of the Bank in support of stockholder interests. The key
elements of the Bank's executive compensation program are base salary, annual
incentives and long-term incentive compensation. These key elements are
addressed separately below. In determining each component of compensation, the
Committee considers all elements of an executive's total compensation package.
Base Salary
The Committee regularly reviews each executive's base salary. Base
salaries are not necessarily compared to other institutions, although market
rates for comparable executives with comparable responsibilities are considered
in some cases. Base salaries are adjusted by the Committee to recognize varying
levels of responsibility, experience, breadth of knowledge, internal equity
issues, as well as external pay practices. Increases to base salaries are driven
primarily by individual performance. Individual performance is evaluated based
on sustained levels of individual contribution to the Bank.
Mr. Lawrence, Chief Executive Officer of the Bank, received an increase in
base salary of $50,000, to a total of $360,000, during 1999.
Annual Incentives
The annual incentive program promotes the Bank's pay-for-performance
philosophy by providing the Chief Executive Officer and other executive officers
with direct financial incentives in the form of annual cash bonuses to achieve
corporate and, in some cases, individual performance goals. Annual bonus
opportunities allow the Bank to communicate specific goals that are of primary
importance during the coming year and motivate executives to achieve these
goals.
A bonus in the amount of 12.5% of annual average salary was paid to all
officers of the Bank (a total of 80 persons) in 1999. This percentage has
remained the same for many years. In addition, the Bank
-13-
<PAGE>
has an incentive compensation bonus plan for the named executive officers which
provides additional compensation at pre-determined levels if the Bank's pre-tax
earnings (excluding securities gains) exceed certain targets. At the beginning
of 1999, the Committee established specific corporate goals relating to the
Bank's pre-tax earnings (excluding securities gains). Eligible executives were
assigned threshold, target and maximum bonus levels based on a percentage of
base salary. The incentive compensation bonus for each of the named officers is
shown in under "EXECUTIVE COMPENSATION - Summary Compensation Table - Annual
Compensation - Bonus" above.
Long-Term Incentives
In keeping with the Bank's commitment to provide a total compensation
package which includes at-risk components of pay, long-term incentive
compensation comprises a significant portion of the value of an executive's
total compensation package. When awarding long-term grants, the Committee
considers an executive's level of responsibility, prior compensation experience,
historical award data, and individual performance criteria. Long-term incentives
are in the form of stock options awards under the Bank's Option Plan.
Stock options are granted at an option price which is the fair market
value of the Common Stock on the date of grant. Accordingly, stock options have
value only if the stock price appreciates. This design focuses executives on the
creation of stockholder value over the long term. The size of stock option
grants is based on competitive practice, individual performance factors and
historical award data. No stock option grants were made to the named executive
officers in fiscal 1999.
Conclusion
The Committee believes these executive compensation policies and programs
serve the interests of the Bank and its stockholders effectively. The various
compensation vehicles offered are appropriately balanced to provide increased
motivation for executives to contribute to the Bank's overall future success,
thereby enhancing the value of the Bank for the stockholders' benefit.
We will continue to monitor the effectiveness of the Bank's total
compensation program to meet the current and future needs of the Bank.
Members of the Compensation and Option Committee:
Charles J. Baum, (Chairman)
Robinson Markel,
Paul Meyrowitz, Alan Mirken, Mitchell J. Nelson,
Leonard Schlussel, Charles I. Silberman and Marcia Toledano
-14-
<PAGE>
STOCK PERFORMANCE GRAPH
The chart below compares cumulative total returns over the last five years
for the Company's Common Stock and stocks in the NASDAQ Stock Market Index (U.S.
Companies), the SNL $1--$5 billion Banks Index and the NASDAQ Bank Stocks Index.
Comparisons assume reinvestment of dividends and are adjusted for stock splits.
The SNL index is included for the first time because the Company proposes to use
it instead of the NASDAQ Bank Stocks Index in the future. The Company believes
the SNL index provides a better comparison because it consists entirely of banks
whose total assets are comparable to those of the Bank, while the NASDAQ Banks
Stocks Index includes banks having both substantially larger and substantially
smaller total assets.
Comparison of Five Year Cumulative Total Returns
Merchants New York Bancorp, Inc.
NASDAQ Stock Market, SNL $1--$5 billion Banks and NASDAQ Bank Stocks
[The following information was depicted as a line chart in the printed material]
- --------------------------------------------------------------------------------
Legend
<TABLE>
<CAPTION>
Symbol Index Description: 12/30/94 12/29/95 12/31/96 12/31/97 12/31/98 12/31/99
- ------ ------------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
MERCHANTS NEW YORK BANCORP 100.0 128.4 138.1 368.6 324.7 315.4
Nasdaq Stock Market (US Companies) 100.0 141.3 173.9 213.1 300.2 542.4
Nasdaq Bank Stocks 100.0 149.0 196.7 329.4 327.1 314.4
SIC 6020-6029, 6710-6719 US & Foreign
SNL $1--$5 billion Banks 100.0 134.5 174.3 290.7 290.1 266.6
</TABLE>
A. The lines represent 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 monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading days is used.
D. The index level for all series was set to $100.00 on 12/30/94.
- --------------------------------------------------------------------------------
-15-
<PAGE>
There can be no assurance as to future trends in the cumulative total
return of the Company's Common stock or of the foregoing indices. The Company
does not make or endorse any predictions as to future stock performance.
From the inception of the Company's share repurchase program in August,
1996 through December 31, 1999, a total of 1,351,146 shares of Common Stock had
been repurchased under the program, at a total cost of approximately
$18,653,000. Of these, 494,986 shares were reissued upon exercise of employee
stock options, and the Company received a total of approximately $6,082,000 in
payment of option exercise prices. Under the program, the Company is authorized
to repurchase up to approximately 2,000,000 shares of Common Stock. Unless
reissued, repurchased shares are held in the Company's treasury and appear on
the Company's financial statements as a reduction of stockholder equity.
Treasury shares do not receive any dividends and are not voted at meetings of
stockholders.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Any directors, officers or their associates or business affiliates who
have loans outstanding with the Bank have these extensions of credit in the
ordinary course of the Bank's business and on substantially the same terms as
those prevailing at the time for comparable transactions with members of the
general public, including interest rates and collateral. Such loans did not
involve more than the normal risk of collectibility or present other unfavorable
features.
Robinson Markel, a director of the Company, is a partner in Rosenman &
Colin LLP, which rendered legal services to the Company. Paul Meyrowitz, a
director of the Company, is a partner in Simon, Meyrowitz and Meyrowitz LLP,
which rendered legal services to the Company. Fees paid by the Company for these
services did not exceed five percent of either firm's gross income.
There are no family relationships among the nominees for directors, except
that Messrs. Witty and Gould are grandfather and grandson.
OTHER MATTERS
The Board of Directors of the Company does not know of any matters other
than those described in this proxy statement that will be presented for action
at the meeting. If any other matters are properly brought before the Meeting,
the persons named in the accompanying proxies will vote the shares represented
by such proxies on such matters as instructed by the Board of Directors of the
Company, who have instructed the proxies to vote in accordance with the proxies'
own best judgment in the absence of express instruction from the Board.
Independent Auditors and Accountants of the Company
KPMG LLP are the Company's independent auditors and have been the Bank's
auditors since 1982. Freeman & Davis LLP prepares the Bank's and the Company's
corporate income tax returns and have been with the Bank since 1975. It is the
Company's intent to continue the services of both accounting firms for 2000.
Representatives of both accounting firms will be present at the Meeting and will
have the opportunity to make a statement, if they wish, and to respond to
appropriate questions from stockholders.
-16-
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934, as
amended.
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers and directors, and persons who beneficially own 10% of
the Company's Common Stock (the "Reporting Persons"), to file reports regarding
their Company Common Stock ownership and changes in ownership with the SEC.
Based solely on a review of the copies of such forms furnished to the Company
and written representations from certain of the Reporting Persons, the Company
believes that during 1999, the Reporting Persons complied with all Section 16(a)
reporting requirements applicable to them.
Stockholder Proposals
Any stockholder who wishes to submit a proposal for the 2001 Annual
Meeting of Stockholders of the Company should submit the proposal to the Company
by November 24, 2000.
By the order of the Board of Directors
/s/ Spencer B. Witty
-----------------------------------------
Spencer B. Witty
Chairman of the Board
/s/ James G. Lawrence
-----------------------------------------
James G. Lawrence
President and Chief Executive Officer
NEW YORK, NEW YORK
March 24, 2000
-17-
<PAGE>
PROXY MERCHANTS NEW YORK BANCORP PROXY
ANNUAL METING OF STOCKHOLDERS -- MAY 2, 2000
This proxy is solicited on behalf of the Board of Directors. The undersigned
hereby appoints Harold N. London and David H. Meyrowitz, or either of them,
attorneys and proxies with full power of substitution in each of them, in the
name, place and stead of the undersigned to vote as proxy all the stock of the
undersigned in Merchants New York Bancorp, Inc. (the "Company") at the Annual
Meeting of Stockholders or any adjournment thereof, as instucted below.
Proposal One: Election of Directors
Nominees
Charles J. Baum, William J. Cardew, Eric W. Gould, Rudolf H. Hertz, James G.
Lawrence, Robinson Markel, Paul Meyrowitz, Alan Mirken, Mitchell J. Nelson,
Leonard Schlussel, Charles I. Silberman, Marcia Toledano and Spencer B. Witty.
Instructions: Mark one of the boxes below. If withholding authority to vote for
any individual nominee, place an "x" in the appropriate box and place a line
through the relevant nominee's name above.
[ ] FOR ALL NOMINEES
[ ] TO WITHHOLD ALL NOMINEES
[ ] FOR ALL NOMINEES, EXCEPT AS NOTED
<PAGE>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES AND
AS THE PROXIES DEEM ADVISABLE ON OTHER MATTERS THAT MAY COME BEFORE THE MEETING
IF NO INSTRUCTION TO THE CONTRARY IS INDICATED OR IF NO INSTRUCTION IS GIVEN.
THE UNDERSIGNED ACKNOWLEDGES RECEIPT OF THE NOTICE OF MEETING AND PROXY
STATEMENT, EACH DATED MARCH 24, 2000.
PLEASE DATE, SIGN AND RETURN THIS PROXY IN THE
ENCLOSED ENVELOPE.
DATED_____________________________________, 2000
____________________________________________L.S.
____________________________________________L.S.
(NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
HEREON. EXECUTORS, ADMINISTRATORS, TRUSTEES,
ETC.SHOULD SO INDICATE WHEN SIGNING, GIVING FULL
TITLE AS SUCH. IF SIGNER IS A CORPORATION,
EXECUTE IN FULL CORPORATE NAME BY AUTHORIZED
OFFICER. IF SHARES ARE HELD IN THE NAME OF TWO
OR MORE PERSONS, ALL SHOULD SIGN.)
