SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
BANK UNITED CORP.
(Name of Registrant as Specified in its Charter)
_____________________________________________________________________
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
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:
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
2. Form, Schedule or Registration Statement No.:
3. Filing Party:
4. Date Filed:
<PAGE>
BANK UNITED CORP.
3200 SOUTHWEST FREEWAY
SUITE 2000
HOUSTON, TEXAS 77251-1370
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
------------------------
To the Stockholders of Bank United Corp.:
The Annual Meeting of Stockholders (the "Meeting") of Bank
United Corp., a Delaware corporation (the "Company"), will be held
on March 18, 1999, at 10:00 a.m., at The Houston City Club, One City
Club Drive, Nine Greenway Plaza, Houston, Texas for the following
purposes:
(1) To elect four members to the Board of Directors to serve for
a three-year term as Class III Directors; and
(2) To transact such other business as may properly come before
the Meeting and any adjournment thereof.
Stockholders entitled to notice of and to vote at the Meeting
were determined as of the close of business on January 27, 1999, the
record date fixed by the Board of Directors for such purpose. A list
of stockholders entitled to vote at the Meeting will be available to
any stockholder, for any purpose relevant to the Meeting, for ten days
before the Meeting, from 8:30 a.m. to 5:00 p.m. at the Company's
Houston offices at 3200 Southwest Freeway, Suite 1600, Houston, Texas.
By Order of the Board of
Directors
/s/ RANDOLPH C. HENSON
Randolph C. Henson
SECRETARY
February 10, 1999
YOUR VOTE IS IMPORTANT. STOCKHOLDERS ARE REQUESTED TO COM- PLETE,
SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING STAMPED ENVELOPE
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
<PAGE>
BANK UNITED CORP.
3200 SOUTHWEST FREEWAY
SUITE 2000
HOUSTON, TEXAS 77251-1370
------------------------
PROXY STATEMENT
------------------------
February 10, 1999
The accompanying proxy is solicited by the Board of Directors of Bank
United Corp., a Delaware corporation (the "Company"), for use at the Annual
Meeting of Stockholders to be held on March 18, 1999, at 10:00 a.m. at The
Houston City Club, One City Club Drive, Nine Greenway Plaza, Houston, Texas, and
at any adjournments thereof (the "Meeting"). This Proxy Statement and the
accompanying proxy are first being mailed to stockholders on or about February
10, 1999.
Only holders of record of the Company's Class A Common Stock, par value
$.01 per share (the "Class A Common Stock"), as of the close of business on
January 27, 1999 are entitled to notice of and to vote at the Meeting. As of
that date, 28,321,576 shares of Class A Common Stock were issued and
outstanding. The shares of Class A Common Stock are the only outstanding voting
securities of the Company. Each share of Class A Common Stock outstanding as of
the record date will be entitled to one vote on each matter to properly come
before the Meeting, and stockholders may vote in person or by proxy. Execution
of a proxy will not in any way affect a stockholder's right to attend the
Meeting and vote in person. Any stockholder giving a proxy has the right to
revoke it by written notice to the Secretary of the Company at any time before
it is exercised or, if a stockholder is present at the Meeting, he or she may
revoke his or her proxy by voting his or her shares personally at the Meeting.
The persons named as attorneys in the proxy are officers of the Company.
All properly executed proxies received by the Company prior to or at the Meeting
will be voted in accordance with the specifications made thereon. Proxies on
which no specification has been made will be voted FOR the election to the Board
of Directors of the nominees named herein.
The Board of Directors knows of no other matters to be presented at the
Meeting. If any other matter should be presented at the Meeting upon which a
vote may properly be taken, shares represented by all proxies received by the
Board of Directors may be voted with respect thereto in accordance with the
judgment of the persons named therein. The proxy also confers on persons named
therein discretionary authority to vote with respect to any matter presented at
the Meeting for which advance notice was not received by the Company in
accordance with the Company's Bylaws.
The presence in person or by proxy of the holders of a majority of the
shares of Class A Common Stock outstanding as of the record date will constitute
a quorum. Directors will be elected by plurality. Any stockholder giving a proxy
has the right to withhold authority to vote for any individual nominee to the
Board of Directors by writing that nominee's name in the space provided on the
proxy or to withhold authority with respect to any other matters submitted to a
vote of the stockholders. Votes that are withheld will be excluded entirely from
the vote and will have no effect. Abstentions may be specified on all proposals
and will be counted as present for purposes of determining a quorum regarding
the item on which the abstention is voted. Under the rules of the National
Association of Securities Dealers, Inc., brokers who hold shares in street name
have the authority to vote on certain items when they have not received
instructions from beneficial owners. However, brokers that do not receive
instructions are entitled to vote on the election of directors. With respect to
any other proposals, no broker may vote shares held for customers without
specific instructions from such customers. Under applicable Delaware law, a
broker non-vote will not count as a vote 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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An Annual Report to Stockholders, containing consolidated financial
statements for the fiscal year ended September 30, 1998, is being mailed
contemporaneously with this Proxy Statement to all stockholders as of the record
date.
The cost of soliciting proxies will be borne by the Company. The Company
has engaged Corporate Investors Communications to assist in the solicitation of
proxies, and will pay that firm a fee for such services estimated to be
approximately $3,500. In addition to soliciting stockholders by mail, the
Company may request banks and brokers to solicit their customers who have stock
of the Company registered in the name of the nominee and, if so, will reimburse
such banks and brokers for their reasonable out-of-pocket expenses.
ELECTION OF DIRECTORS
DIRECTORS
The Board of Directors of the Company consists of 12 members and is divided
into three classes. The members of each class are elected for a term of three
years with one class being elected annually. Each director of the Company is
also a director of Bank United, a federally chartered savings bank (the
"Bank"). The following table sets forth certain information with respect to
the directors of the Company, including information regarding their ages and
when they became directors.
<TABLE>
<CAPTION>
DIRECTOR OF DIRECTOR OF
THE COMPANY THE BANK TERM
NAME AGE SINCE SINCE EXPIRES
- ------------------------------------- --- ----------- ------------ --------
<S> <C> <C> <C> <C>
Lewis S. Ranieri, Chairman........... 52 1988 1988 2000
Barry C. Burkholder.................. 58 1996 1991 2000
Lawrence Chimerine................... 58 1996 1990 2000
David M. Golush...................... 54 1996 1988 2001
Paul M. Horvitz...................... 63 1996 1990 1999
Alan E. Master....................... 59 1996 1995 2000
Anthony J. Nocella................... 57 1996 1990 2001
Salvatore A. Ranieri................. 50 1988 1988 2001
Scott A. Shay........................ 41 1988 1988 1999
Patricia A. Sloan.................... 55 1996 1988 1999
Michael S. Stevens................... 49 1996 1996 1999
Kendrick R. Wilson III............... 52 1996 1988 2001
</TABLE>
During fiscal 1998, the Board of Directors of the Company held 9 meetings.
Each of the Directors attended at least 75% of the meetings of the Board of
Directors and each Committee on which he or she serves.
COMMITTEES OF THE BOARD OF DIRECTORS
The Company's Board of Directors has established two standing committees:
an Audit Committee and a Compensation Committee. The Board of Directors does not
currently have a standing nominating committee. The following is a brief
description of the committees of the Board of Directors:
AUDIT COMMITTEE. The Audit Committee meets with management to consider the
adequacy of the internal controls and the objectivity of financial reporting.
The Audit Committee also meets with the independent auditors and with
appropriate financial personnel and internal auditors of the Company regarding
these matters. The Audit Committee recommends to the Board the appointment of
the independent auditors, subject to ratification by the stockholders at the
annual meeting. Both the internal auditors and the independent auditors
periodically meet alone with the Audit Committee and have unrestricted access to
the Audit Committee. The Audit Committee consists of Messrs. Master and
Chimerine and Dr. Horvitz, none of whom is an employee of the Company, with Dr.
Horvitz serving as Chair. The Audit Committee held 6 meetings during fiscal
1998.
COMPENSATION COMMITTEE. The Compensation Committee's functions include
administering management incentive compensation plans and making recommendations
to the Board with respect to the compensation of directors and officers of the
Company. The Compensation Committee also supervises the Company's employee
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<PAGE>
benefit plans. The Compensation Committee consists of all directors except Mr.
Burkholder and Mr. Nocella, with Mr. Lewis Ranieri serving as Chair. The
Compensation Committee held 3 meetings during fiscal 1998.
To the extent that any permitted action taken by the Company Board
conflicts with action taken by the Compensation Committee, the action taken by
the Company Board shall control. Mr. Burkholder and Mr. Nocella have recused
themselves from Board deliberations regarding their compensation and it is
anticipated that this practice will continue.
COMPENSATION OF DIRECTORS
Each director, except Mr. Burkholder and Mr. Nocella, who are employees of
the Bank, receives a single annual retainer ("Annual Retainer") of $25,000 for
service on the boards of directors of Company and the Bank. All non-employee
directors also receive a fee of $1,000 for each in person meeting of the Board
of Directors of the Company that they attend and a fee of $500 for each
telephonic meeting of the Board and each meeting of any Committee of the Board
that they attend. The chair of the Audit Committee receives an additional annual
retainer of $2,000. Non-employee directors are also eligible to participate in
the Director Stock Compensation Plan and the Directors Supplemental Savings
Plan. Directors who are employees of the Company or any subsidiary do not
receive additional compensation for service as directors, and are not eligible
to participate in the Director Stock Plan or the Directors Supplemental Savings
Plan. See also "Executive Officer Compensation -- The Director Stock
Compensation Plan", " -- Directors Supplemental Savings Plan" and "Security
Ownership of Certain Beneficial Owners and Management -- Certain Relationships
and Related Transactions".
DIRECTORS TO BE ELECTED AT THE MEETING
The four nominees for Class III director, Messrs. Horvitz, Shay, Stevens
and Ms. Sloan are presently serving as directors of the Company. Each of the
nominees for director has consented to serve for a new term if elected. In the
event that any nominee for any reason should become unavailable for election,
proxies will be voted for a nominee or nominees designated by the Board of
Directors.
PAUL M. HORVITZ, PH.D. Dr. Horvitz has been on the faculty of the
University of Houston since 1977. From 1967 to 1977, Dr. Horvitz held positions
as Assistant Director of Research, Director of Research and Deputy to the
Chairman at the Federal Deposit Insurance Corporation ("FDIC"). Prior to
joining the FDIC he was an economist at the Federal Reserve Bank of Boston and
the Office of Comptroller of the Currency. From 1983 to 1990, Dr. Horvitz was a
member of the Board of Directors of the Federal Home Loan Bank ("FHLB") of
Dallas, and in 1986 and 1987 he was a member of the Federal Savings and Loan
Advisory Council. He is currently a member of the Shadow Financial Regulatory
Committee. Dr. Horvitz received a B.A. from the University of Chicago, an M.B.A.
from Boston University, and a Ph.D. from Massachusetts Institute of Technology.
SCOTT A. SHAY. Mr. Shay has been a Managing Director of Ranieri & Co.,
Inc. ("Ranieri & Co.") since its formation in 1988. He was also a Vice
President of the Company from 1988 until July 15, 1996. Mr. Shay is currently a
director of Hyperion Capital Management, Inc., a registered investment advisor
("Hyperion Capital"), Homeshark, Inc., and Transworld Home Healthcare, Inc.,
as well as an officer or director of other direct and indirect subsidiaries of
Hyperion Partners L.P., a Delaware limited partnership ("Hyperion Partners")
and Hyperion Partners II L.P., a Delaware limited partnership ("Hyperion
Partners II"). Mr. Shay is also a director of the general partner of Cardholder
Management Services, L.P., a credit card servicer, and of Capital Lease Funding,
L.P., a specialized commercial mortgage bank. Additionally, he is a director of
Bank Hapoalim B.M. in Tel Aviv, Israel. Along with Lewis S. Ranieri and
Salvatore A. Ranieri, Mr. Shay controls the general partner of Hyperion
Partners. Along with Mr. Lewis S. Ranieri, Mr. Shay controls the general partner
of Hyperion Partners II. Prior to joining Ranieri & Co., Mr. Shay was a director
at Salomon Brothers Inc. ("Salomon") where he was employed from 1980 to 1988.
Mr. Shay was involved with Salomon's thrift mergers and acquisitions practice
and with mortgage banking financing and mergers and acquisitions. Mr. Shay
graduated Phi Beta Kappa from Northwestern University with a B.A. degree in
economics and received a Master of Management degree with distinction from
Northwestern's Kellogg Graduate School of Management. Mr. Shay serves as Vice
President and Treasurer of the Jewish Youth Connection, Inc., a non-profit
organization.
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PATRICIA A. SLOAN. Ms. Sloan is a Managing Director of Ranieri & Co. and
has an economic interest in Hyperion Partners and Hyperion Partners II. She is
also a director of certain funds managed by Hyperion Capital Management,
including Hyperion 1999 Term Trust, Inc., Hyperion 2002 Term Trust, Inc.,
Hyperion Investment Grade Opportunity Term Trust, Inc., and the Hyperion Total
Return Fund, Inc. Prior to joining Ranieri & Co. in 1988, Ms. Sloan was employed
at Salomon from 1972 to 1988, where she served as director of Salomon's
Financial Institutions Group. Prior to joining Salomon, Ms. Sloan was employed
at Bache & Co., Inc. from 1965 to 1972. Ms. Sloan received a B.A. from Radcliffe
College and an M.B.A. from Northwestern University.
MICHAEL S. STEVENS. Mr. Stevens has been a Director of the Company since
August 1996, and a Director of the Bank since October 1996. Mr. Stevens is
Chairman of Michael Stevens Interests, Inc., a real estate development and
management company, which he founded in 1981. Since its inception, the company
has developed, acquired and managed over 70 real estate projects valued at over
$300 million and representing over 8.5 million square feet of building area and
8,000 apartment units. Currently Mr. Stevens serves as chairman of the Finance
Committee of the Board of the Harris County-Houston Sports Authority, and has
led the negotiating team responsible for the Houston Astros new downtown
baseball stadium, as well as the proposed new NFL stadium. Mr. Stevens serves on
the Urban Center Advisory Board of the Brookings Institution and is presently a
member of the Steering Committee of the Houston Metropolitan Study Group. From
1995 through 1997, in addition to having served as Assistant to the Mayor for
Housing and Inner-City Revitalization, Mr. Stevens served as chairman of the
Houston Housing Finance Corporation and the Houston Redevelopment Authority, and
was responsible under then Mayor Bob Lanier for the Homes for Houston program as
well as the major downtown revitalization currently underway. He was also
1996-97 chairman of the Fannie Mae National Advisory Council. Among his other
volunteer positions, Mr. Stevens serves as a deacon at Second Baptist Church and
is chairman of the Church's Centurion Foundation. He graduated from the
University of Houston in 1973 with a Bachelors in Business Administration.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES FOR
DIRECTOR.
DIRECTORS WHOSE TERMS EXTEND BEYOND THE MEETING
LEWIS S. RANIERI. Mr. Ranieri is the Chairman of the Company. He was also
the President and Chief Executive Officer ("CEO") of the Company and Chairman
of the Bank from 1988 until July 15, 1996. Mr. Ranieri is the Chairman and CEO
of Ranieri & Co., positions he has held since founding Ranieri & Co. in 1988.
Mr. Ranieri is a founder of Hyperion Partners and of Hyperion Partners II. He is
also Chairman of Hyperion Capital and The Hyperion Total Return Fund, Inc. He is
director of Transworld Home Healthcare, Inc., the Hyperion 1999 Term Trust,
Inc., the Hyperion 2002 Term Trust, Inc. and Hyperion 2005 Investment Grade
Opportunity Trust, Inc. Mr. Ranieri is also Chairman and President of various
other indirect subsidiaries of Hyperion Partners and Hyperion Partners II. Along
with his brother, Salvatore A. Ranieri, and Scott A. Shay, Mr. Ranieri controls
the general partner of Hyperion Partners. Along with Mr. Shay, Mr. Ranieri
controls the general partner of Hyperion Partners II, an investment partnership
formed to make investments primarily in the financial and real estate sectors of
the economy. He is a director of Delphi Financial Group, Inc. and of the Board
and a director of American Marine.
Mr. Ranieri is a former Vice Chairman of Salomon, where he was employed
from 1968 to 1987, and was one of the principal developers of the secondary
mortgage market. While at Salomon, Mr. Ranieri helped to develop the capital
markets as a source of funds for housing and commercial real estate and to
establish Salomon's then leading position in the mortgage-backed securities
area. He is a member of the National Association of Home Builders Mortgage
Roundtable.
Mr. Ranieri is a Trustee for the Parish of Our Lady of the Rosary/Shrine of
St. Elizabeth Ann Seton and the Environmental Defense Fund. Mr. Ranieri is also
a director of the Peninsula Hospital Center in Queens, New York. Mr. Ranieri
received his Bachelor of Arts degree from St. John's University.
BARRY C. BURKHOLDER. Mr. Burkholder has been the President and CEO of the
Company since July 15, 1996, and has held similar positions with the Bank since
joining it on April 10, 1991. Since July 15, 1996, Mr. Burkholder has also been
Chairman of the Bank. Prior to joining the Bank, Mr. Burkholder was employed at
Citicorp/Citibank for 15 years. Mr. Burkholder became associated with Citicorp
through its then newly formed
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<PAGE>
Consumer Services Group in 1976, and then became a member of its International
Staff. Mr. Burkholder moved to Citibank Savings in London where he was named
Chairman and Managing Director in 1977. Mr. Burkholder returned to the United
States in 1981 to become President of Citicorp Person-to-Person, now part of
Citicorp Mortgage, Inc., a nationwide mortgage lending business with related
mortgage banking, servicing, and insurance activities. In 1984, he was named
Chairman and CEO of Citibank Illinois, and two years later became Central
Division Executive for the U.S. Consumer Bank. As Central Division Executive,
Mr. Burkholder was responsible for Citicorp's consumer banking activities in the
Midwest and Southeast. Mr. Burkholder began his career at Ford Motor Company in
the financial planning area and moved to Certain-teed Corporation where his last
position prior to joining Citicorp was as President of its real estate
development subsidiary. Mr. Burkholder received a B.S. and an M.B.A. from Drexel
University. He is President of the Houston Symphony and serves on the Board of
Trustees of the Texas Gulf Coast United Way and the Board of Directors of the
Greater Houston Partnership. He is also a trustee of Drexel University.
LAWRENCE CHIMERINE, PH.D. Dr. Chimerine has served as President of his own
economic consulting firm, Radnor Consulting Services, since 1990. He is
currently also the Managing Director and Chief Economist of the Economic
Strategy Institute in Washington, D.C. Dr. Chimerine served as Chairman and
Chief Executive Officer of the WEFA Group from 1987 to 1990 and of Chase
Econometrics from 1979 to 1987, both of which provide economic consulting
services. He was manager of economic research for the IBM Corporation from 1965
to 1979. Dr. Chimerine received a B.S. from Brooklyn College and a Ph.D. from
Brown University.
DAVID M. GOLUSH. Mr. Golush is a Managing Director of Ranieri & Co., with
which he has been associated since the firm's founding in 1988. He is an officer
of direct and indirect subsidiaries of Hyperion Partners, and Hyperion Partners
II. Mr. Golush was employed by Salomon from 1972 to 1987 and was a Vice
President from 1975. From 1984 to 1987, he was Chief Administrative Officer of
Salomon's Mortgage and Real Estate Department. From 1966 to 1972, he held
positions in public accounting and private industry. He has been a certified
public accountant in New York since 1972. Mr. Golush received a B.B.A. from the
University of Cincinnati. He is Treasurer of the New York Police & Fire Widows'
& Children's Benefit Fund, Inc. and a member of the board of the Jewish
Federation of Central New Jersey.
ALAN E. MASTER. Mr. Master began his career with Chemical Bank in 1961 as
a commercial lending officer, became a Branch Office Head, and worked on
start-ups or clean-ups of banks in Miami, Florida. In 1973, he joined Barnett
Banks of Florida ("Barnett") and led a unit of Barnett formed from the
reorganization and merger of five subsidiaries of Barnett. In 1977, he became
President, CEO, and Chief Financial Officer, and in 1978 was elected Vice
Chairman, of United Americas Bank of New York. Mr. Master joined The Merchants
Bank of New York in 1979 as Executive Vice President and was elected a director
in 1980. In 1983, Mr. Master joined Ensign Bank FSB in New York City as
President and CEO. In 1991, Mr. Master established a consulting practice
specializing in the financial services and banking sectors. In 1996, he joined
PaineWebber, Inc. as an Investment Executive. Mr. Master is a director of
Thunder Wave, Inc., has served on the Board of Trustees of the Hyperion
Government Mortgage Trust II, has participated in meetings of the Advisory Board
of Hyperion Partners and Hyperion Partners II and is a past member of the
Advisory Board of the Johnson Graduate School of Management of Cornell
University. In August 1998, Mr. Master joined Bank Hapoalim, New York City, as
the Director of Private Banking USA. Mr. Master received a B.A. from Cornell
University and has completed course work in finance and accounting at the New
York University Graduate School of Business Administration.
ANTHONY J. NOCELLA. Mr. Nocella has been the Vice Chairman and the Chief
Financial Officer of the Company and the Bank since July 27, 1997. Mr. Nocella
was the Executive Vice President and Chief Financial Officer of the Company
since June 27, 1996, and has held those same positions with the Bank since
joining it in July 1990. He manages the Financial Markets and Commercial Banking
Groups of the Bank. From 1988 to 1990, Mr. Nocella provided consulting services
to the Bank as President of Nocella Management Company, a firm that specialized
in asset and liability management consulting for financial institutions. From
1981 to 1987, Mr. Nocella served as Executive Vice President and Chief Financial
Officer of Meritor Financial Group, as well as President of the Company's
commercial banking/financial markets arm, Meritor Financial Markets
("Meritor"). During his 13 years at Meritor (1974-1987), he also served as
President of PSFS Management Company, Inc., the holding company of The
Philadelphia Saving Fund Society, the nation's largest savings institution at
the
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time. Mr. Nocella's other positions have included Controller and Director of
Financial Services for American Medicorp (now Humana), Senior Managing Auditor
and Consultant for KPMG Peat Marwick and adjunct professor of finance at St.
Joseph's University and Drexel University. Mr. Nocella, a Certified Public
Accountant, received an undergraduate degree in accounting from LaSalle
University and an M.B.A. in computer science and finance from Temple University.
He also completed the graduate Bank Financial Management Program of the Wharton
School at the University of Pennsylvania. Mr. Nocella is the President and a
director of the Community Bankers Association of Southeast Texas, a delegate and
member of the Mortgage Finance and Accounting Committees of the America's
Community Bankers, is Chairman-elect and a director of the Texas Community
Bankers Association, and delegate and past President of the Financial Executives
Institute.
SALVATORE A. RANIERI. Mr. Ranieri is the General Counsel and a Managing
Director of Ranieri & Co. He was also the Vice President, Secretary and General
Counsel of the Company from 1988 until July 15, 1996. He is a director of
Hyperion Capital, as well as of various other direct and indirect subsidiaries
of Hyperion Partners. Along with his brother, Lewis S. Ranieri, and Scott A.
Shay, Mr. Ranieri controls the general partner of Hyperion Partners. He is also
a director of American Marine Holdings, Inc. ("American Marine"). Mr. Ranieri
was one of the original founders of Ranieri & Co. and of Hyperion Partners.
Prior to joining Ranieri & Co., he had been President of Livia Enterprises,
Inc., a private venture capital and real estate investment company that oversaw
investments in the real estate, construction, and manufacturing sectors. In
addition to his business experience, Mr. Ranieri is also a lawyer. During his
career, his practice has included corporate, litigation, real estate and
regulatory matters. Until 1984, he had been a member of a law firm in New York
City. He is admitted to practice law in New York and various federal courts. He
received his Bachelor of Arts degree from New York University and his Juris
Doctor degree from Columbia Law School.
KENDRICK R. WILSON III. Mr. Wilson currently is a Managing Director at
Goldman Sachs & Co., a New York-based investment banking firm. Prior to his
joining Goldman Sachs & Co. in March 1998, Mr. Wilson served as Vice Chairman of
Lazard Freres & Co. LLC from 1990 to March 1998, as President of Ranieri & Co.
from March 1988 to December 1989, and Senior Executive Vice President for E.F.
Hutton from April 1987 to February 1988. Mr. Wilson was also employed at Salomon
from June 1978 to April 1987, where he became a Managing Director. Mr. Wilson
has an economic interest in Hyperion Partners. He is a director of ITT
Corporation, Black Rock Asset Investors, American Marine, American Buildings
Company, Inc., and Meigher Communications, Inc. Mr. Wilson received a B.A. from
Dartmouth College and an M.B.A. from Harvard Business School.
Mr. Lewis Ranieri and Mr. Salvatore Ranieri are brothers. No other director
or executive officer is related to any other director or executive officer by
blood, marriage, or adoption. There are no existing arrangements or
understandings between a director and any other person pursuant to which such
person was elected a director.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), requires the Company's directors and executive officers, and
persons who own more than ten percent of a registered class of the Company's
equity securities, to file with the Securities and Exchange Commission
("Commission") initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company. Officers,
directors and greater than ten percent stockholders are required by the
Commission's regulations to furnish the Company with copies of all Section 16(a)
forms they file.
Based solely on its review of the forms received by it and written
representations from certain reporting persons that they were not required to
file Forms 5 for the fiscal year ended September 30, 1998, the Company believes
that during the year ended September 30, 1998, all filing requirements
applicable to the Company's officers, directors and greater than 10%
stockholders were met.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of the record date, the outstanding capital stock of the Company
consisted of 28,321,576 shares of Class A Common Stock, which entitles the
holder thereof to one vote per share on each matter on which the stockholders of
the Company are entitled to vote, and 3,241,320 shares of Class B Common Stock,
par value $0.01 per share ("Class B Common Stock"), which have no voting
rights. Shares of Class B Common Stock are convertible, at any time at the
election of the holder thereof, into shares of Class A Common Stock, subject to
certain restrictions set forth in the Certificate and the Letter Agreements (as
defined herein). See "-- Stockholder Letter Agreements." Conversion of such
shares of Class B Common Stock by a holder thereof to shares of Class A Common
Stock has the effect of diluting the voting power of the existing holders of
Class A Common Stock and increasing the voting power of such holder
commensurately.
The following table sets forth information, as of the record date, about
certain persons who own beneficially more than 5% of the Company's voting stock.
The Restated Certificate of Incorporation of the Company (the "Certificate"),
the Letter Agreements and certain management stock grant agreements relating to
options granted with respect to shares of Class B Common Stock impose certain
restrictions on the ability of holders to convert their shares of Class B Common
Stock into Class A Common Stock and generally prohibit any holder, other than
the holders of the currently outstanding shares of Class A Common Stock, from
converting shares of Class B Common Stock into Class A Common Stock if after
giving effect to such conversion such holder would become the beneficial owner
of more than 9.9% of the then outstanding shares of Class A Common Stock. In
addition, under the terms of the Certificate and the Letter Agreements, the
shares of Class B Common Stock owned by The Equitable Life Assurance Society of
the United States, Equitable Variable Life Insurance Company and The Prudential
Insurance Company of America are subject to additional conversion restrictions.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER TITLE OF CLASS OWNERSHIP CLASS
- ---------------------------------------- --------------------- ----------------- ------------
<S> <C> <C>
The Prudential Insurance Company
of America............................ Class B Common Stock* 2,441,137 7.7
c/o The Prudential Capital Group
100 Mulberry Street
Five Gateway Center Four
Newark, NJ 07102
LW-SP1, L.P. and LW-SP2, L.P............ Class A Common Stock 2,146,748 6.8
1201 Elm Street, Suite 5400
Dallas, TX 75270
</TABLE>
- ------------
* Subject to certain restrictions set forth in the Letter Agreement, each share
of Class B Common Stock is convertible, at any time at the option of the
holder, into one share of Class A Common Stock.
Under the terms of the Letter Agreements, the restrictions on the right of
The Prudential Insurance Company of America to sell its shares of Common Stock
expire August 14, 1999. The restrictions in the Letter Agreements on the right
of LW-SP1, L.P. and LW-SP2, L.P. to sell their shares expired, as to a portion
of their shares on August 8, 1998 and as to the balance on August 14, 1999.
7
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information, as of the date hereof,
regarding the shares of Class A Common Stock beneficially owned by each
director, each executive officer of the Company set forth in the Summary
Compensation Table below, and all of the directors and executive officers of the
Company as a group.
MANAGEMENT OWNERSHIP OF CLASS A COMMON STOCK
NUMBER OF SHARES
AND NATURE OF PERCENT
NAME BENEFICIAL OWNERSHIP(1) OF CLASS
- ------------------------------------- ----------------------- --------
Lewis S. Ranieri, Chairman........... 1,212,583(2) 4.28%
Barry C. Burkholder.................. 94,674 *
Lawrence Chimerine................... 6,138 *
David M. Golush...................... 164,000(3) *
Paul M. Horvitz...................... 4,138 *
Alan E. Master....................... 1,530(4) *
Anthony J. Nocella................... 43,614 *
Salvatore A. Ranieri................. 414,000(5) 1.46
Scott A. Shay........................ 335,367(6) 1.18
Patricia A. Sloan.................... 80,000 *
Michael S. Stevens................... -- *
Kendrick R. Wilson III............... 113,655(7) *
Ronald D. Coben...................... 9,038 *
Jonathon K. Heffron.................. 20,826 *
Sonny B. Lyles....................... 7,241 *
Directors and executive officers as a
group (17 persons)................. 2,512,269 8.87%
- ------------
* Percentages do not exceed 1% of the issued and outstanding shares.
(1) Calculated in accordance with Rule 13d-3 under the Exchange Act. Nature of
beneficial ownership is direct unless indicated otherwise by footnote.
Beneficial ownership of shares owned indirectly arises from shared voting
and investment power, unless otherwise indicated.
(2) Includes 1,210,933 shares held by LSR Hyperion Corp., a corporation that is
wholly owned by Mr. Lewis Ranieri.
(3) Includes 14,000 shares held by Mr. Golush's wife.
(4) Includes 1,380 shares held by Mr. Master's wife.
(5) All shares are held by SAR Hyperion Corp., a corporation that is wholly
owned by Mr. Salvatore Ranieri.
(6) Includes 430,000 shares held by SAS Hyperion Corp., a corporation that is
wholly owned by Mr. Shay. Excludes 4,058 shares held in trust for minor
children, as to which Mr. Shay disclaims beneficial ownership.
(7) All shares are held by KRW Hyperion Corp., a corporation that is wholly
owned by Mr. Wilson.
8
<PAGE>
MANAGEMENT OWNERSHIP OF BANK PREFERRED STOCK
The following table sets forth with respect to the Bank's Preferred Stock,
Series A and Series B, as of the date hereof: (i) shares beneficially owned by
all directors of the Company; (ii) each of the executive officers named in the
Summary Compensation Table set forth herein; and (iii) shares beneficially owned
by all directors and executive officers of the Company as a group.
MANAGEMENT OWNERSHIP OF BANK PREFERRED STOCK
<TABLE>
<CAPTION>
SERIES A SERIES B
------------------------------------ ------------------------------------
NUMBER OF SHARES NUMBER OF SHARES
AND NATURE OF PERCENT AND NATURE OF PERCENT
NAME BENEFICIAL OWNERSHIP(1) OF CLASS BENEFICIAL OWNERSHIP(1) OF CLASS
- ------------------------------------- ----------------------- --------- ----------------------- ---------
<S> <C>
Lewis S. Ranieri, Chairman........... -- * -- *
Barry C. Burkholder.................. 8,000 * -- *
Lawrence Chimerine................... 1,000 * 1,000 *
David M. Golush...................... 2,100 * -- *
Paul M. Horvitz...................... 400(2) * -- *
Alan E. Master....................... 600 * 2,000 *
Anthony J. Nocella................... 1,000 * 2,000 *
Salvatore A. Ranieri................. -- * -- *
Scott A. Shay........................ -- * -- *
Patricia A. Sloan.................... -- * -- *
Michael S. Stevens................... -- * -- *
Kendrick R. Wilson III............... -- * -- *
Ronald D. Coben...................... 200 * -- *
Jonathon K. Heffron.................. 478 * -- *
Sonny Lyles.......................... 240 * -- *
Directors and executive officers as a
group (17 persons)................. 15,070 * 5,000 *
</TABLE>
- ------------
* Percentages do not exceed 1% of the issued and outstanding shares.
(1) Calculated in accordance with Rule 13d-3 under the Exchange Act. Nature of
beneficial ownership is direct unless indicated otherwise by footnote.
(2) Includes 200 shares held directly and 200 shares held by Dr. Horvitz's
spouse.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Bank has from time to time made home mortgage or consumer loans to
directors and executive officers, of the Company in the ordinary course of
business, and on the same terms and conditions, including interest rates and
collateral, as those of comparable transactions prevailing at the time with
non-affiliated parties. No such loans are nonperforming or involve more than the
normal risk of collectability or present other unfavorable features.
As a general benefit to all full-time employees with at least six months of
service (excluding executive officers), the Bank will waive the 1% origination
fee for a mortgage loan for the purchase or refinance of the employee's
principal residence. In addition, the Bank offers a 0.50% discount on its posted
rates for consumer installment loans made to employees.
The disinterested directors of the Bank have approved an agreement with a
subsidiary of Hyperion
Partners II, Cardholder Management Services L.P. ("CMS") whereby CMS acts as
the servicer for a debit card offered to customers of the Bank and a credit card
portfolio originated by the Bank. Lewis S. Ranieri, Scott A. Shay, David M.
Golush and Patricia A. Sloan, who are directors of the Company, have a material
interest in Hyperion Partners II. During fiscal 1998, the Bank paid CMS an
aggregate of $288,290 pursuant to this agreement. The Company believes that the
terms and conditions of this agreement are as favorable to the Bank as those
that could have been arranged with an independent third party.
9
<PAGE>
In August 1996, the Company entered into a consulting agreement pursuant to
which Lewis S. Ranieri serves as a consultant to the Company providing strategic
and managerial advice to the Company in exchange for an annual consulting fee of
$250,000. The consulting agreement will be in effect until the earliest of (1)
the third anniversary of the agreement, (2) the date that is 180 days after the
date on which either Mr. Ranieri or the Company delivers written notice to the
other party terminating the agreement, and (3) the date on which Mr. Ranieri
becomes disabled or dies. The consulting agreement does not prevent Mr. Ranieri
from engaging in business endeavors which may be competitive with the businesses
of the Company. Mr. Ranieri is paid an Annual Retainer and meeting fees for his
service as a director of the Company and of the Bank.
The Bank is a party to a written investment advisory services agreement
which provides for payment by the Bank to Hyperion Capital, an affiliate of the
Bank, of $45,000 per year for investment advisory services and for payment by
Hyperion Capital to the Bank of $45,000 for information regarding the Bank's
mortgage pipeline. The Company believes that the terms and conditions of this
agreement are as favorable to the Bank as those that could have been arranged
with an independent third party.
The Company and the Bank have entered into an agreement with Hyperion
Partners acknowledging the relative value, as among the parties, of their claims
in certain litigation pending against the United States relating to an agreement
entered into in 1988 in connection with the Bank's acquisition of certain assets
of an insolvent savings and loan in which the government agreed to waive or
forbear from the enforcement of certain regulatory requirements. The agreement
confirms that the Company and the Bank are entitled to receive 85% of the
amount, if any, recovered as a result of the settlement of or a judgment on such
claims, and that Hyperion Partners is entitled to receive 15% of such amount.
The agreement was approved by the disinterested directors of the Company. The
plaintiffs in the case (Hyperion Partners, the Bank and the Company) have agreed
to continue to cooperate in good faith and will use their best efforts to
maximize the total amount, if any, that they may recover. The litigation is
ongoing and no payments were made during fiscal 1998 pursuant to this
arrangement.
STOCKHOLDER LETTER AGREEMENTS
In connection with the Company's initial public offering in August 1996
(the "August Offering"), certain of the holders of the Company's Common Stock
(the "Restricted Stockholders") entered into a Letter Agreement with each of
Hyperion Partners and the Company (the "Letter Agreements"). Pursuant to the
Letter Agreements, each Restricted Stockholder consented to the distribution
(the "Distribution") by Hyperion Partners of the shares of common stock of
Hyperion Holdings, Inc., a predecessor or the Company ("Hyperion Holdings"),
and agreed to hold the common stock of Hyperion Holdings received pursuant to
the Distribution according to the terms of such Letter Agreement. Also, each
Restricted Stockholder, by executing a Letter Agreement and agreeing to be bound
thereby, consented to and approved of, for purposes of Section 228 of the
Delaware General Corporation Law (the "DGCL") and otherwise, the Merger
Agreement, dated as of June 17, 1996, by and between Hyperion Holdings and the
Company (the "Merger Agreement"), and the related merger.
Pursuant to the Letter Agreements, each Restricted Stockholder acknowledged
(i) that under the By-Laws of Hyperion Holdings, it is not permitted to transfer
any shares of capital stock of Hyperion Holdings except pursuant to the Merger
Agreement and (ii) that, under the By-Laws, after the Distribution and prior to
the consummation of the August Offering, such stockholder would not effect any
transfer of shares of capital stock of the Company (a) in the case of Restricted
Stockholders who received shares in respect of Class C Common Stock, $0.01 par
value per share ("Class C Common Stock"), in the Merger, except as such
stockholder would have been permitted to transfer such Class C Common Stock
under the Stockholders' Agreement, dated as of January 5, 1990, by and among the
Company and the other parties specified therein (the "Stockholders
Agreement"), and (b) in the case of any other Restricted Stockholders, except
in accordance with the terms of the limited partnership agreement of Hyperion
Partners applicable to the transfer of partnership interests of Hyperion
Partners. Each 5% Stockholder acknowledged that it is not permitted, prior to
the earlier of an initial public offering ("IPO") or October 31, 1996, to
transfer any such shares owned by such 5% Stockholder (other than to a person of
whom the 5% Stockholder is a wholly-owned subsidiary) or acquire any additional
such shares. An IPO was completed in August 1996.
Each Restricted Stockholder who retained shares of Common Stock was not
permitted to sell such shares for (1) one year after the August Offering, if
such stock was received in respect of general partnership interests in
10
<PAGE>
Hyperion Partners or (2) six months after the August Offering (although a
regulated New Jersey insurance company may sell shares in a private off-market
transaction subject to Rule 144 limits and reasonable representations requested
by the underwriters). Subject to certain adjustments by the Board of Directors
of the Company based upon advice of the underwriters to improve the
marketability of the shares of Class A Common Stock sold in the August Offering,
each 5% Stockholder was permitted to sell up to 45% of such holder's shares of
Common Stock in the August Offering, except for LW-SP1 and LW-SP2, affiliates of
Lehman Brothers Inc., which were prohibited from selling any shares until August
8, 1998, and any other Restricted Stockholder was permitted to sell up to 16% of
its shares in the August Offering (subject to increase pro rata in the
discretion of the Board of Directors of the Company if the 5% Stockholders
elected to sell fewer than the maximum number of shares they are permitted to
sell in the August Offering). Each selling stockholder in the August Offering
acknowledged that, except for shares that could have been sold pursuant to the
August Offering but were not sold at the election of such 5% Stockholder, no 5%
Stockholder is permitted by the By-Laws to acquire or transfer any shares of
capital stock of the Company for three years following the August Offering (or
upon termination of the Letter Agreement, if earlier) unless as of an earlier
date the Company Board determines that such acquisition or transfer would not be
reasonably likely to have a material adverse effect on the tax position of the
Company.
The Board of Directors of the Company approved sales of shares of Class A
Common Stock in excess of the 45% and 16% limitations as necessary to satisfy
the underwriters' over-allotment options in the August Offering.
Pursuant to the Letter Agreement, in January 1997 the Company filed a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act") with respect to shares of Class A or Class B Common Stock
then held by any Restricted Stockholder. The Company is obligated to take action
to keep such registration statement effective (subject to occasional periods of
suspension of such effectiveness as necessary) until the first to occur of (i)
the date on which all shares of Common Stock registered thereunder have been
sold pursuant thereto, (ii) December 31, 1999, and (iii) the date on which such
registration under the Securities Act is no longer required to sell such shares
without restriction.
11
<PAGE>
EXECUTIVE OFFICER COMPENSATION
SUMMARY OF CASH AND CERTAIN COMPENSATION
The following table sets forth the cash and non-cash compensation for each
of the last three fiscal years awarded to or earned by the CEO of the Company
and the other four most highly compensated executive officers of the Company and
the Bank. The individuals listed below became executive officers of the Company
in June and July 1996. Prior to that time, Lewis S. Ranieri served as President
and CEO of the Company, Salvatore A. Ranieri served as Vice President, Secretary
and General Counsel of the Company, Scott A. Shay served as Vice President of
the Company and Robert A. Perro served as Chief Financial Officer of the
Company. None of the former executive officers received any compensation from
the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS(7)
---------------------------------------- ------------------------- -------
OTHER SECURITIES
ANNUAL UNDERLYING
COMPEN- RESTRICTED OPTIONS/ LTIP
SALARY BONUS(1) SATION(4) STOCK(5) SARS(6) PAYOUTS
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
- --------------------------------------- ---- ------- --------- -------- ---------- ----------- -------
<S> <C> <C> <C> <C>
Barry C. Burkholder(2)................. 1998 375,000 825,000 -- -- 20,000 --
President and 1997 375,000 725,000 65,770 -- 30,000 --
Chief Executive Officer 1996 375,000 2,552,000 -- 1,578,051 491,327 --
Anthony J. Nocella..................... 1998 315,000 585,000 -- -- 18,000 --
Vice Chairman and 1997 315,000 500,000 -- -- 25,000 --
Chief Financial Officer 1996 315,000 874,000 -- 508,103 157,959 --
Jonathon K. Heffron.................... 1998 225,000 400,000 -- -- 16,000 --
Executive Vice President, 1997 225,000 350,000 -- -- 15,000 --
General Counsel, and 1996 225,000 804,000 -- 508,103 157,959 --
Chief Operating Officer
Ronald D. Coben(3)..................... 1998 200,000 275,000 -- -- 15,000
Executive Vice President 1997 200,000 200,000 -- -- 10,000 --
Community Banking 1996 200,000 160,000 -- 79,115 24,534 --
Sonny B. Lyles......................... 1998 185,000 150,000 -- -- 12,500 --
Senior Vice President 1997 170,000 100,000 -- -- 6,000 --
Chief Credit Officer 1996 150,000 165,000 -- 79,115 24,534 --
</TABLE>
ALL
OTHER
COMPEN-
SATION(8)
NAME AND PRINCIPAL POSITION ($)
- --------------------------------------- --------
Barry C. Burkholder(2)................. 7,856
President and 5,498
Chief Executive Officer 6,706
Anthony J. Nocella..................... 18,127
Vice Chairman and 5,607
Chief Financial Officer 7,919
Jonathon K. Heffron.................... 4,800
Executive Vice President, 5,613
General Counsel, and 9,458
Chief Operating Officer
Ronald D. Coben(3)..................... 4,749
Executive Vice President 4,807
Community Banking 6,130
Sonny B. Lyles......................... 4,415
Senior Vice President 3,825
Chief Credit Officer 4,071
- ------------
(1) For all named executives, the bonus column for 1998 and 1997 includes
payments from the Company's annual bonus plan and the bonus column for 1996
includes payments from the Company's Management Compensation Program. See
"-- Management Compensation Program".
(2) Mr. Burkholder was hired on April 10, 1991, and was paid a bonus based on
the financial performance of the Company, according to the provisions of his
employment contract, for each of the first five full years of his
employment. Mr. Burkholder's 1996 bonus amount included two bonus payments
pursuant to his employment contract: one payment of $550,000 for the
12-month period ended April 9, 1996 and a second payment of $300,000 for the
period April 10, 1996 through September 30, 1996. The latter payment was
made to change Mr. Burkholder's performance cycle to correspond to the
Company's fiscal year. See "-- Management Employment Arrangements". All
other management bonuses were paid as determined by the Compensation
Committee of the Company's Board of Directors and were based on the
Company's financial and individual performance for the respective fiscal
year. The Company's financial performance is measured by net income, return
on assets, and return on equity as compared to the Company's annual business
plan and a specified peer group of other any banks of comparable size.
(3) Mr. Coben was promoted to Executive Vice President, Community Banking
effective July 1, 1996.
(4) Messrs. Burkholder, Coben, Heffron, and Nocella are each provided an auto
allowance, financial planning, and country club and dining club memberships.
However, only in the case of Mr. Burkholder for fiscal 1997does the
aggregate value of such auto allowance, financial planning, and memberships
exceed the lesser of $50,000 or 10% of such officer's annual cash
compensation. Therefore, the value of auto allowances, financial planning,
and club memberships are included only for Mr. Burkholder for fiscal 1997.
(5) A total of 236,265 shares of Class B Common Stock were awarded to the named
executive officers in June 1996 and these shares were subsequently converted
into Class A Common Stock of the Company. Such shares are subject to
restrictions on transfer, which lapse on August 8, 1999 ("Officers
Restricted Stock"). As there was no public market for the Common Stock at
the date of grant, the fair market value of the shares at that date was
estimated by the Company. The dollar amounts reported for fiscal 1996
reflect the value of such grant as of September 30, 1996 based on the last
reported sales price of the Class A Common Stock on that date, without
diminution for restrictions on transfer. Based on the closing sale price of
the Class A Common Stock on The Nasdaq Stock Market ("NASDAQ") on
September 30, 1998, these shares had an aggregate fair market value of $8.5
million ($35.8125 per share), without giving effect to the diminution of
value attributable to the restrictions on such stock. Dividends are payable
on the Officers Restricted Stock at the same rate as all other shares of
Common Stock.
(6) In fiscal 1998 and 1997, the Company issued an aggregate of 81,500 and
86,000 options to named executives pursuant to option agreements under the
1996 Stock Incentive Plan. In fiscal 1996, the Company issued 856,313
options to the named executives pursuant to management option agreements
under the Executive Management Compensation Program.
(7) Represents the dollar value of all payouts pursuant to long-term incentive
plans ("LTIP"). An LTIP is any plan providing compensation intended to
serve as incentive for performance to occur over a period longer than one
fiscal year, whether such performance is measured by reference to financial
performance of the registrant or an affiliate, the registrant's stock price,
or any other measure, but excluding restricted stock, stock option and stock
appreciation right ("SAR") plans. The Company made no such payments for
the periods presented.
(8) "All Other Compensation" amounts represent contributions by the Company to
each executive's account in the Bank's 401(k) Plan. For fiscal 1998, the
amounts also include interest paid on a distribution from the Company's
Supplemental Executive Savings Plan for Messrs. Burkholder and Nocella. For
fiscal 1997 and 1996, the amounts also include a tax equalization amount
paid to Messrs. Burkholder, Nocella, Heffron, and Coben.
12
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR. The following table sets forth
individual grants of options to purchase Class A Common Stock of the Company
under the 1996 Stock Incentive Plan that were made during fiscal 1998 to the
executive officers named in the Summary Compensation Table. All options granted
in fiscal 1998 had an exercise price no less than the fair market value at the
date of grant.
<TABLE>
<CAPTION>
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/
UNDERLYING SARS
OPTIONS/ GRANTED TO EXERCISE
SARS EMPLOYEES OR BASE GRANT DATE
GRANTED IN FISCAL PRICE EXPIRATION PRESENT VALUE
NAME (#) YEAR(1) ($/SH) DATE $(2)
- ------------------------------------- ---------- ---------- -------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Barry C. Burkholder.................. 20,000 3.7 44.375 7/30/03 294,800
Anthony J. Nocella................... 18,000 3.3 44.375 7/30/03 265,320
Jonathon K. Heffron.................. 16,000 3.0 44.375 7/30/03 235,840
Ronald D. Coben...................... 15,000 2.8 44.375 7/30/03 221,100
Sonny B. Lyles....................... 12,500 2.3 44.375 7/30/03 184,250
</TABLE>
- ------------
(1) Based upon options to purchase an aggregate of 539,700 shares of Class A
Common Stock of the Company granted to employees in fiscal 1998. No SARs
were granted during fiscal 1998.
(2) The grant date present value is based on the Black-Scholes Option pricing
model and results in a grant date present value of $14.74 per share. The
calculation included the following assumptions: estimated volatility of
35.92%; risk-free interest rate of 5.52% (based on returns available through
U.S. Treasury bonds); dividend yield of 1.4% (assumes dividend yield paid
through expiration); and 1,826 days to expiration of options. Option values
are dependent on general market conditions and the performance of the Class
A Common Stock. There can be no assurance that the values in this table will
be realized.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES. The following table sets forth, with respect to the executive officers
named in the Summary Compensation Table, the aggregate number of options
exercised during fiscal 1998, any value realized thereon, the number of
unexercised options at the end of the fiscal year (exercisable and
unexercisable) and the value thereof.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/SARS AT IN-THE-MONEY OPTIONS/SARS
SHARES FISCAL YEAR END(#) AT FISCAL YEAR-END($)(1)
ACQUIRED ON VALUE ---------------------------- ----------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C>
Barry C. Burkholder.................. -- -- -- 541,327 -- 7,707,692
Anthony J. Nocella................... -- -- -- 200,959 -- 2,477,982
Jonathon K. Heffron.................. -- -- -- 138,112 -- 1,680,320
Ronald D. Coben...................... -- -- -- 49,534 -- 384,877
Sonny B. Lyles....................... -- -- -- 43,034 -- 384,877
</TABLE>
- ------------
(1) Total value of options based on a fair market value of $35.8125 per share as
of September 30, 1998, the closing sale price of the Class A Common Stock as
reported by the NASDAQ on that date.
LONG-TERM INCENTIVE PLAN-AWARDS IN LAST FISCAL YEAR. In fiscal 1998, the
Company's Board of Directors granted performance units to executive officers and
other key officers and employees under its 1996 Stock Incentive Plan. These
units, which equate to shares of the Company's Class A Common Stock on a one-
for-one basis, will be earned based on the achievement of certain corporate
performance goals over a performance period beginning October 1, 1997 and ending
September 30, 2000. Upon completion of the performance period, Compensation
Committee will determine the number of units that have been earned based on the
Company's performance. Cash will be distributed to the participants equal to the
fair value of the number of performance units of the Company's Class A Common
Stock, as of September 30, 2000. The maximum number of performance units is
201,000 in the aggregate.
13
<PAGE>
The following table sets forth individual awards of performance units under
the 1996 Stock Incentive Plan that were made during fiscal 1998 to executive
officers named in the Summary Compensation Table. As noted above, the awards are
contingent upon the achievement of certain corporate performance goals, and
there can be no assurance that any of the awards will be earned.
<TABLE>
<CAPTION>
FISCAL YEAR
PERFORMANCE ESTIMATE FUTURE PAYOUTS (#)
NUMBER OF PERIOD UNTIL ----------------------------
NAME UNITS MATURATION MINIMUM TARGET MAXIMUM
- ------------------------------------- --------- ------------ ------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Barry C. Burkholder.................. 22,000 1997 - 2000 11,000 22,000 44,000
Anthony J. Nocella................... 18,000 1997 - 2000 9,000 18,000 36,000
Jonathon K. Heffron.................. 9,000 1997 - 2000 4,500 9,000 18,000
Ronald D. Coben...................... 6,500 1997 - 2000 3,250 6,000 13,000
Sonny B. Lyles....................... 3,000 1997 - 2000 1,500 3,000 6,000
</TABLE>
MANAGEMENT COMPENSATION PROGRAM
In connection with the August Offering, the Board of Directors of the
Company approved a Management Compensation Program providing for the following:
(1) a cash bonus of $4.0 million; (2) an award of 318,342 shares of Class B
Common Stock, which had restrictions on transferability over a period of three
years from issuance; and (3) the issuance of 1,154,520 options to purchase
shares of Company common stock; (such options vest ratably from the date of
grant through June 26, 1999, and may not be exercised prior to the third
anniversary of the date of grant). The options expire if not exercised within
ten years of the date of grant. Twenty-three individuals, including the
Company's six executive officers -- Messrs. Burkholder, Nocella, Heffron, Coben,
Lyles and Ms. Hartnett -- two former executive officers -- Messrs. Bender and
Green -- and three directors -- Drs. Chimerine and Horvitz and Mr. Master --
participated in this program. The remaining twelve individuals participating are
other key officers and employees of the Bank. In connection with the February
1997 sale of mortgage offices, 33,718 of these options became fully vested. Mr.
Burkholder received $1,702,000 of the cash bonus, 491,327 of the stock options,
and 135,455 of the shares of Class B Common Stock. Messrs. Nocella and Heffron
each received $549,000 of the cash bonus, 157,959 of the stock options, and
43,614 of the shares of Class B Common Stock. Messrs. Lyles and Coben each
received $85,000 of the cash bonus, 24,534 of the stock options, and 6,791
shares of the Class B Common Stock. Drs. Chimerine and Horvitz each received
$52,000 of the cash bonus, 15,087 of the stock options, and 4,138 shares of the
Class B Common Stock. Mr. Master received $17,000 of the cash bonus, 4,854 of
the stock options, and 1,380 shares of the Class B Common Stock. Implementation
of this program replaced an equity based bonus program previously contemplated
in the case of all participants except Mr. Burkholder, whose participation
satisfies the terms of his former employment agreement. No further grants or
compensation may be made or awarded under the this program.
THE 1996 STOCK INCENTIVE PLAN
The Company has adopted the Bank United 1996 Stock Incentive Plan. This
plan is designed to promote the success and enhance the value of the Company by
linking the interests of certain of the full-time employees of the Company and
the Bank to those of the Company's stockholders and by providing an incentive
for outstanding performance. Non-employee directors are not eligible to
participate in this plan. The total number of shares of Class A Common Stock
available for grant under the 1996 Stock Incentive Plan may not exceed 1,600,000
shares.
The 1996 Stock Incentive Plan is administered by the Compensation Committee
of the Board of Directors of the Company (the "Compensation Committee"). Four
types of awards may be granted to Participants under the 1996 Stock Incentive
Plan: (i) stock options (both non-qualified and incentive), (ii) stock
appreciation rights ("SARs"), (iii) restricted Common Stock and (iv)
performance units. As of September 30, 1998, there were 977,200 options
outstanding under this plan and 622,800 shares of Class A Common Stock of the
Company remained available for future grants under this plan. No restricted
stock or SARs have been granted under the 1996 Stock Incentive Plan.
14
<PAGE>
In the event of a "Change of Control" (as defined in the 1996 Stock
Incentive Plan), (1) any option or SAR that is not then exercisable and vested
will become fully exercisable and vested, (2) the restrictions on any restricted
stock will lapse and (3) all performance units will be deemed earned. The 1996
Stock Incentive Plan defines a Change of Control as (1) the acquisition of 25%
or more of the common stock of the Company, (2) a change in a majority of the
Board of Directors, unless approved by the incumbent directors (other than as a
result of a contested election), and (3) certain reorganizations, mergers,
consolidations, liquidations, or dissolutions.
THE DIRECTOR STOCK COMPENSATION PLAN
The Company has adopted the Bank United Director Stock Compensation Plan in
order to (1) promote a greater identity of interest between the Company's
non-employee directors (each an "Eligible Director") and its stockholders, and
(2) attract and retain individuals to serve as directors and to provide a more
direct link between directors' compensation and stockholder value. The plan is
administered by the Board of Directors of the Company. A maximum of 250,000
shares of Class A Common Stock is available for issuance and available for
grants under this plan.
The Director Stock Plan permits each Eligible Director to make an annual
irrevocable election to receive shares of Class A Common Stock in lieu of all or
any portion of their Annual Retainer. In addition, each eligible director is
granted stock options to purchase 1,000 shares of the Company's Class A Common
Stock when first elected to the Company's Board of Directors and following each
annual stockholders' meeting thereafter. The exercise price for the options will
be 115% of the fair market value of Class A Common Stock at the date of grant.
These options will become vested and exercisable if and when the fair value of
the Company's Class A Common Stock equals or exceeds the exercise price of the
option on any day during the 30-day period commencing on the first anniversary
of the date of the grant. If such stock does not attain such fair market value
during the 30-day period, then the option will be cancelled. Vested options will
expire if not exercised within ten years of the date of grant. Any unvested
Director options terminate and are cancelled as of the date the optionee's
service as a Director ceases for any reason. All Director options become fully
vested and exercisable upon a Change of Control. The Company granted a total of
10,000 Director options during fiscal 1998, 1997, and 1996.
MANAGEMENT EMPLOYMENT ARRANGEMENTS
Effective as of the date of the consummation of the August Offering, the
Company entered into new employment agreements with the following four
executives which superseded all prior employment arrangements.
Mr. Burkholder's agreement with the Company provides for his employment for
three years at an annual base salary of not less than $475,000 and a
discretionary bonus. Mr. Nocella's agreement with the Company provides for his
employment for three years at an annual base salary of not less than $350,000
and a discretionary bonus. Mr. Heffron's agreement with the Company provides for
his employment for three years at an annual base salary of not less than
$250,000 and a discretionary bonus. Mr. Coben's agreement with the Company
provides for his employment for three years at an annual base salary of not less
than $225,000 and a discretionary bonus. These agreements provide that the
period of employment is automatically extended on the first day of each month so
that the period of employment terminates three years from such date, unless the
executive or the Company gives notice to terminate the agreement at least sixty
days before such monthly renewal date. In addition, upon a Change of Control, if
the executive is still employed by the Company, the period of employment will be
extended until the third anniversary of the effective date of the Change of
Control or if the period of employment has terminated prior to the Change of
Control, a new three year employment period shall commence upon a Change of
Control. If for any reason other than cause the Company elects to terminate the
employment of any of the above executives before the scheduled expiration date
of his agreement, the executive's employment will be deemed to have been
terminated by the Company without cause for purpose of the severance and
retirement benefits described below.
Under the terms of Mr. Burkholder's employment agreement, the amount of the
discretionary bonus paid to Mr. Burkholder is in the sole discretion of the
Board of Directors of the Company, which will take into account such matters as
(1) the Company's actual financial performance as compared to its budgeted
financial performance, (2) Mr. Burkholder's performance in implementing new
business initiatives approved by the Board
15
<PAGE>
of Directors of the Company, (3) Mr. Burkholder's performance in improving the
financial performance of any division or unit of the Company or the Bank, or any
of their respective subsidiaries as determined by the Board of Directors of the
Company in its sole discretion, (4) the Company's actual financial performance
compared to its peers', and (5) Mr. Burkholder's total compensation as compared
to the total compensation of CEOs at comparable financial institutions. The
discretionary bonuses to be paid to the other executive officers are at the
discretion of the CEO and the Board of Directors of the Company.
Under each agreement described above and a written severance agreement with
Mr. Lyles, if the executive's employment is terminated by the Company: (i) other
than for cause or disability or by the executive for good reason or within a
30-day period following the first anniversary of a change of control (for
Messrs. Burkholder, Nocella, Heffron, and Coben); or (ii) during the one year
period following a change of control (for Mr. Lyles), he is generally entitled
to (1) receive a lump sum equal to three times (for Messrs. Burkholder and
Nocella), two times (for Messrs. Heffron and Coben) or one and one half times
(for Mr. Lyles) his annual base salary and the higher of his most recent bonus
under the Company's annual incentive plans and the highest bonus under such
annual incentive plans for the last three full fiscal years prior to the
effective date of the change of control, (2) continue in the Company's welfare
benefit plans for three years (for Messrs. Burkholder and Nocella), two years
(for Messrs. Heffron and Coben), or eighteen months (for Mr. Lyles), and (3)
receive in a lump sum a supplemental pension amount based on three years (for
Messrs. Burkholder and Nocella) or two years (for Messrs. Heffron and Coben) of
deemed employment after termination, (4) have all stock options, restricted
stock and other stock-based compensation become immediately exercisable or
vested, (5) receive outplacement services, at the Company's sole expense, as
incurred, up to a maximum of $45,000 (for Messrs. Burkholder, Nocella and
Heffron), and $25,000 (for Messrs. Coben and Lyles). A change of control
("Change of Control") is generally defined for purposes of these agreements as
(1) the acquisition of 25% or more of the common stock of the Company, (2) a
change in a majority of the Board of Directors, unless approved by the incumbent
directors (other than as a result of a contested election) and (3) certain
reorganizations, mergers, consolidations, liquidations or dissolutions. If any
payment or distribution by the Company to an executive is determined to be
subject to the excise tax imposed by Section 4999 of the Code, the amount of
payment or distribution may be reduced so that the excise tax liability of the
executive is minimized.
NON-QUALIFIED RETIREMENT SAVINGS PLAN
The Supplemental Executive Savings Plan ("SESP") is available to a select
group of management and other highly compensated employees. Eligible employees
are allowed to make irrevocable decisions prior to the beginning of the plan
year to defer up to 20% of compensation (as defined in the SESP) and up to 100%
of bonus income. The monies deferred earn interest at a rate approximately equal
to the Bank's five-year borrowing rate. The Bank does not contribute to the
SESP. The SESP is funded from the general assets of the Bank and participants
are general unsecured creditors of the Bank. As of September 30, 1998, there
were eight participants in the SESP, the total amount of deferrals and interest
equaled approximately $1.1 million and the rate of interest for the SESP was
5.57%.
DIRECTORS SUPPLEMENTAL SAVINGS PLAN
The Directors Supplemental Savings Plan ("DSSP") is available to outside
directors. Eligible directors are allowed to make irrevocable decisions prior to
the beginning of the plan year to defer up to 100% of cash retainer and meeting
fees. The monies deferred earn interest at a rate approximately equal to the
Bank's five-year borrowing rate. The Bank does not contribute to the DSSP. The
DSSP is funded from the general assets of the Bank, and participants are general
unsecured creditors of the Bank. As of September 30, 1998, there were three
participants in the DSSP, the total amount of deferrals and interest equaled
approximately $237,000 and the rate of interest for the DSSP was 5.57%.
STANDARD ARRANGEMENTS WITH DIRECTORS
See "Directors and Officers of Registrant -- Compensation of Directors."
16
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors of the Company
determines the compensation of the Company's executive officers. The
Compensation Committee consists of all of the directors of the Company other
than Barry C. Burkholder and Anthony J. Nocella. No other member of the
Compensation Committee is an officer or employee of the Company or the Bank.
Lewis S. Ranieri, Salvatore A. Ranieri and Scott A. Shay are also members of the
Compensation Committee of the Board of Directors of the Bank and are also
members of various boards of directors and compensation committees of various
companies which are subsidiaries of, or entities controlled by, Hyperion
Partners and, in the case of Lewis S. Ranieri, Scott A. Shay and David M.
Golush, of subsidiaries of, or entities controlled by, Hyperion Partners II as
well.
REPORT OF THE COMPENSATION COMMITTEE
AND STOCK AWARD COMMITTEE
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors of the Company
includes only directors who are not employees of the Company or the Bank. The
Committee is responsible for recommending to the full Board of Directors the
compensation arrangements and plans for senior management and directors.
COMPENSATION PHILOSOPHY
The Committee believes that the ultimate goal of executive compensation
should be to closely align the interests of executives with the long-term
interests of the Company and its stockholders and to enable the Company to
attract, retain and reward executive officers who contribute to the long-term
success of the Company. Executive officer compensation generally consists of (1)
a base salary and (2) a variable, discretionary cash bonus, stock options, and
other equity-based incentives based on individual and Company performance.
BASE SALARY AND BONUSES
It is the policy of the Committee that the total cash compensation paid to
executives of the Company should be competitive with cash compensation paid by
the Company's competitors. The Committee emphasizes bonus compensation that
rewards performance which exceeds budget or anticipated results, rather than
base salary and salary increases. Bonuses are determined by the Board based on
recommendations of the Committee. Company performance measures considered by the
Committee in recommending bonuses include net income, return on assets and
return on equity. Individual performance measures vary depending on the
executive's area of responsibility. No specific weight is applied to any
particular measure in establishing total cash compensation levels. The Company
has entered into employment agreements with certain of its executives which
specify the terms and conditions of their employment. These agreements
incorporate post-Change in Control employment arrangements, which the Company
believes are an important aspect of the terms of employment of senior executive
officers, recognizing the importance to the Company of retaining its senior
executive officers during and after an attempted or successful Change in Control
(as defined in the agreements).
STOCK-BASED AWARDS
The Committee recognizes that stock options and other equity-based
incentives are important in motivating executives and focusing the executive's
attention on stock price as a significant measure of performance. All options
granted to executive officers of the Company have been granted with an exercise
price equal to the fair market value of the Class A Common Stock on the date of
grant so that executives realize gain only to the extent the Company's stock
price appreciates. The quantity of options and other stock-based awards made
during fiscal 1998 under the 1996 Stock Incentive Plan reflect the compensation
level of the individual executive, the individual's contribution to the success
of the Company and the Bank and the Committee's assessment of the individual's
potential for future contribution to the success of the Company. The Committee
also considers an appropriate vesting schedule designed to retain senior
executive officers while encouraging officers to view their compensation and
Company performance over the long-term.
17
<PAGE>
COMPENSATION OF THE CEO
The salary, bonus and other incentives paid or awarded to the CEO are
determined based in part on the same Company and individual criteria described
above. Effective August 1, 1996, the Company and the CEO entered into a new
three-year employment agreement. Bonus compensation for the period of fiscal
1996 prior to April 9, 1996, was based on a formula set forth in the prior
employment agreement and was determined based upon the Company's (1) return on
average assets and (2) asset growth. Under the terms of the new employment
agreement, the amount of the discretionary bonus is in the sole discretion of
the Board of Directors of the Company, which takes into account such matters as
(1) the Company's actual financial performance as compared to its budgeted
financial performance, (2) the CEO's performance in implementing new business
initiatives approved by the Board of Directors, (3) the CEO's performance in
improving the financial performance of any division or unit of the Company or
the Bank, or any of their respective subsidiaries, as determined by the Board of
Directors in its sole discretion, (4) the Company's actual financial performance
compared to its peers, and (5) the CEO's total compensation as compared to the
total compensation of CEOs at comparable financial institutions. None of these
factors has a specific weight and no particular formula or procedure is used.
Primary consideration is given to individual contribution with periodic
evaluation of compensation of other CEOs of comparable institutions. Mr.
Burkholder's fiscal 1998 compensation included payouts and awards under the
Compensation Program, which satisfied the terms of his former employment
agreement.
Lewis S. Ranieri, Chairman Salvatore A. Ranieri
Lawrence Chimerine, Ph.D. Scott A. Shay
David M. Golush Patricia A. Sloan
Paul M. Horvitz, Ph.D. Michael S. Stevens
Alan E. Master Kendrick R. Wilson, III
18
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
The following chart compares the cumulative total return to stockholders
for the period from August 8, 1996, when trading in the Class A Common Stock
commenced on The NASDAQ Stock Market's National Market, through September 30,
1998, for a holder of Class A Common Stock against the cumulative total return
of the NASDAQ Composite Index and a peer group consisting of the following
financial institutions reported on in the Merrill Lynch Thrift Financial Guide:
H. F. Ahmanson & Company; Albank Financial Corporation; Andover Bancorp Inc.;
Astoria Financial Corp.; Bay View Capital Corporation; Charter One Financial,
Inc.; Chittenden Corp.; Commercial Federal Corporation; Dime Bancorp, Inc.;
Golden State Bancorp Inc.; Golden West Financial Corp.; GreenPoint Financial
Corp.; Long Island Bancorp, Inc.; Peoples Bank; Peoples Heritage Financial
Group, Inc.; Roslyn Bancorp Inc.; Sis Bancorp Inc.; Sovereign Bancorp, Inc.; St.
Paul Bancorp Inc.; Washington Federal Inc.; Washington Mutual, Inc.; and Webster
Financial Corp. The peer group is the same as the peer group used in the
February 16, 1998 Proxy Statement except that CitFed Financial was deleted
because it was merged with another financial institution during the fiscal year.
The chart depicts the value on September 30, 1998, of a $100 investment made on
August 8, 1996, with all dividends reinvested.
COMPARISON OF 26 MONTH CUMULATIVE TOTAL RETURN*
AMONG BANK UNITED CORP., THE NASDAQ STOCK MARKET (U.S.) INDEX
AND A PEER GROUP
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
CUMULATIVE TOTAL RETURN
-------------------------------------------------
8/8/96 9/96 9/97 9/98
BANK UNITED CORP. 100 124 225 185
PEER GROUP 100 107 186 162
NASDAQ STOCK MARKET (U.S.) 100 108 148 151
* $100 INVESTED ON 8/8/96 IN STOCK OF INDEX -
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING SEPTEMBER 30.
(a) Fully adjusted share price is adjusted for stock splits, stock dividends and
cash dividends.
(b) Note: Peer group returns weighted using beginning of the period market
capitalization.
19
<PAGE>
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
The following table sets forth information concerning executive officers of
the Company and executive officers of the Bank who do not serve on the Board of
Directors of the Company. All executive officers of the Company and the Bank are
elected by the Board of Directors of the Company and the Board of Directors of
the Bank, respectively, and serve until their successors are elected and
qualified. There are no arrangements or understandings between the Company and
any person pursuant to which such individual was elected an executive officer of
the Company or the Bank.
PRINCIPAL OCCUPATION DURING LAST FIVE YEARS
<TABLE>
<CAPTION>
NAME AGE POSITION AND OCCUPATION
- ------------------------------------- ---- ----------------------------------------------------
<S> <C>
Jonathon K. Heffron.................. 46 Chief Operating Officer of the Company since July
15, 1996 and of the Bank since May 1994. General
Counsel of the Company since July 15, 1996 and of
the Bank since May 1990. Prior to joining the Bank,
Mr. Heffron served for two years as President and
CEO of First Northern Bank, Keene, New Hampshire.
Prior to joining First Northern Bank, Mr. Heffron
served for more than 10 years in several capacities
at the FHLB Board, Washington, D.C. and at the FHLB
Dallas, including as Attorney Advisor, Trial
Attorney, General Counsel, Chief Administrative
Officer, and Chief Operating Officer. Mr. Heffron
received a B.A. Magna Cum Laude from the University
of Minnesota, a J.D. from Southwestern University
School of Law, and an LL.M. from the National Law
Center of George Washington University. Mr. Heffron
is a member of the Government Affairs Steering
Committee and the FHLB System Committee of America's
Community Bankers. Mr. Heffron was a director of the
FHLB of Dallas from 1995 to 1996.
Ronald D. Coben...................... 41 Executive Vice President -- Community Banking of the
Company since July 15, 1996 and of the Bank since
July 1996. Previously, Mr. Coben served as Regional
Retail Director and Marketing Director since joining
the Bank in October 1989. Prior to joining the Bank,
Mr. Coben was employed by Texas Commerce Bancshares
(Chemical Bank) since 1986 as Vice President and
Manager of the Relationship Banking Division of the
Retail Bank. Prior to joining Texas Commence Banc-
shares, Mr. Coben served as the Director of Market
Research for ComputerCraft, Inc. and Foley's De-
partment Stores. Mr. Coben received a B.A. degree
from the University of Texas at Austin. Mr. Coben is
a member of the Executive Committee of the Board of
Directors of the Houston Festival Foundation, Inc.
and also sits on the Board of Directors of TREK, a
transportation management organization serving
central Houston. Mr. Coben is also a member of the
Houston Symphony Marketing Committee. Prior awards
include the MS Leadership Award in 1996 and a Gold
Effie for the nation's most effective financial
advertising campaign of 1989.
20
<PAGE>
<CAPTION>
NAME AGE POSITION AND OCCUPATION
- ------------------------------------- ---- ----------------------------------------------------
Karen J. Hartnett.................... 50 Senior Vice President -- Human Resources of the
Company since July 15, 1996 and of the Bank since
January 1991. Prior to joining the Bank, Ms.
Hartnett was employed by Equimark as Senior Vice
President Human Resources since 1989. From 1988 to
1989, Ms. Hartnett was Senior Vice President and
Chief Personnel Officer for NCNB Texas, and she
served predecessor organizations as Vice President
and as Director of Human Resources from 1983. Ms.
Hartnett's human resources experiences include
positions at Zale Corporation, Mobil Oil Corporation
and Sweet Briar College. Ms. Hartnett received an
A.B. from Sweet Briar College in 1970. Ms. Hartnett
serves on the Board of Trustees for the Houston
Ballet Foundation and is a lifetime member of the
Houston Livestock Show and Rodeo.
Sonny B. Lyles....................... 53 Senior Vice President and Chief Credit Officer of
the Company since July 15, 1996 and of the Bank
since February 1991. Prior to joining the Bank, Mr.
Lyles was employed by First Union National Bank as
Senior Credit Officer beginning in 1983. Prior to
joining First Union National Bank, Mr. Lyles was
employed at First Tulsa Bank, Florida National Bank
and South Carolina National Bank. Mr. Lyles received
a B.A. from Wofford College. Mr. Lyles is a member
of the Board of the Texas Chapter, and a member of
the International Board of Directors of Robert
Morris Associates, a trade association of bank
lending and credit officers. Mr. Lyles is the
Wofford College alumni representative from Houston.
Wayne J. Sadin....................... 45 Executive Vice President and Chief Information
Officer of the Company since March 30, 1998. Prior
to joining the Company, Mr. Sadin was employed by
Michigan National Bank, a subsidiary of National
Australia Bank, as Senior Vice President, Chief
Technology Officer and Director of Information
Technology since 1992. From 1990 to 1992 Mr. Sadin
was employed by Data-Link Systems, a subsidiary of
Mellon Bank, as Vice President and Director of
Product Production and Operations. From 1981 to 1990
Mr. Sadin was employed by Murray Financial
Corporation as Senior Vice President and Director of
Human Resources and Information Technology. Prior to
joining Murray, Mr. Sadin held technology management
and consulting positions at Axios and Bleyer
Industries. Mr. Sadin received a B.S. degree from
Boston University and an M.S. degree from the
University of Texas, and completed the program in
Delivering Information Services at the Harvard
Business School. Mr. Sadin is a Certified Computing
Professional, with four certificates: Management,
Procedural, Systems Programming, Business Program-
ming.
</TABLE>
21
<PAGE>
DATE FOR SUBMISSION OF STOCKHOLDER PROPOSALS
In order for proposals submitted by stockholders pursuant to the
Commission's Rule 14a-8 to be included in the Company's Proxy Statement and
proxy relating to the Company's next Annual Meeting of Stockholders, such
proposals must be received by the Company at its principal executive offices not
later than October 13, 1999. A stockholder choosing not to use the procedures
established in Commission Rule 14a-8 to submit a proposal for action at the
Company's next Annual Meeting of Stockholders must deliver the proposal to the
Secretary of the Company not later than the close of business on December 18,
1999 nor earlier than the close of business on November 18, 1999.
OTHER MATTERS
The firm of Deloitte & Touche LLP served as the Company's independent
accountants for the year ended September 30, 1998 and has been selected as the
Company's independent accountants for the year ending September 30, 1999. A
member of the firm of Deloitte & Touche LLP is expected to be present at the
Meeting with the opportunity to make a statement if so desired and will be
available to respond to appropriate questions.
Whether or not you are planning to attend the Meeting, you are urged to
complete, date and sign the enclosed proxy and return it in the enclosed
envelope at your earliest convenience.
By Order of the Board of Directors
/s/ RANDOLPH C. HENSON
Randolph C. Henson
SECRETARY
22
<PAGE>
BANK UNITED CORP.
ANNUAL MEETING OF STOCKHOLDERS
MARCH 18, 1999
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Barry C. Burkholder, Anthony J.
Nocella and Jonathon K. Heffron, and each of them, as proxies, each with
full power of substitution, to vote all shares of Class A Common Stock
of Bank United Corp. (the "Company"), that the undersigned is entitled
to vote at the Annual Meeting of Stockholders to be held on March 18,
1999, and any adjournment thereof, in accordance with the instructions
specified herein and with discretionary authority with respect to such
other matters as may properly come before such meeting and any
adjournment thereof, including any matter presented by a stockholder at
the Annual Meeting for which advance notice was not received by the
Company in accordance with its Bylaws.
YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE VOTE AT THE
ANNUAL MEETING. ALL SHARES REPRESENTED BY PROXIES WILL BE VOTED AS
DIRECTED. UNLESS OTHERWISE DIRECTED, SHARES WILL BE VOTED FOR EACH OF
THE NOMINEES FOR CLASS III DIRECTOR, AND IN ACCORDANCE WITH THE JUDGMENT
OF THE PERSONS VOTING SUCH PROXIES WITH RESPECT TO ANY OTHER BUSINESS
PROPERLY BROUGHT BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
The undersigned hereby revokes any proxy heretofore given to vote
such shares, and acknowledges receipt of the Notice of Annual Meeting
and Proxy Statement relating to the March 18, 1999 Annual Meeting of
Stockholders.
(Please SEE REVERSE SIDE and date and sign.) BANK UNITED CORP.
P.O. BOX 11234
NEW YORK, N.Y. 10203-0234
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1. ELECTION OF CLASS III [ ] FOR all nominees [ ] WITHHOLD AUTHORITY to vote [ ] *EXCEPTIONS
DIRECTORS listed below for all nominees listed below
</TABLE>
Nominees: PAUL M. HORVITZ, SCOTT A. SHAY, PATRICIA A. SLOAN, and MICHAEL S.
STEVENS
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ONE OR MORE NOMINEES, MARK THE
"EXCEPTIONS" BOX AND WRITE THE NAME OF ANY EXCLUDED NOMINEES OR NOMINEE IN THE
SPACE PROVIDED BELOW.)
* Exceptions ___________________________________________________________________
[ ] CHANGE OF ADDRESS MARK HERE
*Please sign exactly as name appears
hereon. Joint owners should each
sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give full title as
such.
Dated _______________________, 1999
_____________________________________
_____________________________________
Signature of Shareholder(s)*
(PLEASE SIGN, DATE AND RETURN VOTES MUST BE INDICATED
THIS PROXY IN THE ENCLOSED (X) IN BLACK OR BLUE INK.
POSTAGE PREPAID ENVELOPE.)
