<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
GreenPoint Financial Corp.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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 (set forth the amount on which
the filing fee is calculated and state how it was determined):
(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:
Notes:
<PAGE>
90 Park Avenue
New York, NY 10016
[LOGO]
GreenPoint Financial
March 20, 1998
Dear Fellow Stockholder:
I hope you will be able to join us at our annual stockholders meeting on
Friday, May 1, 1998. The meeting will be held at Terrace on the Park, 52-11
111th Street, in Flushing, New York, and will begin at 10:00 a.m.
Attached is the formal notice of the meeting and a proxy statement that
fully describes the business that will take place. The major business will be
the election of directors and ratification of Price Waterhouse LLP as our
auditors.
Officers of the Corporation as well as representatives of Price Waterhouse
will be present to answer any questions you may have regarding the business of
the meeting.
The Directors believe that the matters you will be asked to vote on at the
meeting are in the best interest of our Corporation, and we urge you to vote
"FOR" all of them. Our reasons are fully explained in the proxy statement.
It is important that your shares be represented at the meeting whether or
not you are present. Please be sure to complete and mail the enclosed proxy
card in the postage-paid return envelope--even if you plan to attend in
person.
On behalf of the Directors and our employees, let me thank you once again
for your support.
Sincerely yours,
/s/ Thomas S. Johnson
Thomas S. Johnson
Chairman and Chief Executive Officer
<PAGE>
- -------------------------------------------------------------------------------
GREENPOINT FINANCIAL CORP.
90 PARK AVENUE
NEW YORK, NEW YORK 10016
(212) 834-1710
- -------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 1, 1998
- -------------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of GreenPoint Financial Corp. (the "Corporation"), will be held at
Terrace on the Park, 52-11 111th Street, Flushing, New York, on Friday, May 1,
1998 at 10:00 a.m., local time.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of five Directors of the Corporation.
2. The ratification of the appointment of Price Waterhouse LLP as the
Corporation's independent auditors for the year ending December 31,
1998.
3. The transaction of such other matters as may properly come before the
Meeting or any adjournments thereof.
The Board of Directors is not aware of any other business to come before the
Meeting.
Action may be taken on any of the foregoing proposals at the Meeting on the
date specified above or on any date or dates to which the Meeting may be
adjourned. Stockholders of record as of the close of business on March 17,
1998 are the stockholders entitled to vote at the Meeting and any adjournments
thereof.
You are requested to complete and sign the enclosed form of proxy which is
solicited by the Board of Directors and to mail it promptly in the enclosed
postage-paid return envelope. The proxy will not be used if you attend and
vote at the Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Howard C. Bluver
Howard C. Bluver
Secretary
New York, New York
March 20, 1998
- -------------------------------------------------------------------------------
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE CORPORATION THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
PROXY STATEMENT
OF
GREENPOINT FINANCIAL CORP.
90 PARK AVENUE
NEW YORK, NEW YORK 10016
(212) 834-1710
ANNUAL MEETING OF STOCKHOLDERS
MAY 1, 1998
- -------------------------------------------------------------------------------
GENERAL
- -------------------------------------------------------------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board") of GreenPoint Financial Corp.
(the "Corporation") to be used at the Annual Meeting of Stockholders of the
Corporation (the "Meeting") which will be held at Terrace on the Park, 52-11
111th Street, Flushing, New York, on Friday, May 1, 1998 at 10:00 a.m., local
time. The accompanying Notice of Annual Meeting and this Proxy Statement are
being first mailed to stockholders on or about March 20, 1998.
- -------------------------------------------------------------------------------
VOTING AND REVOCABILITY OF PROXIES
- -------------------------------------------------------------------------------
Proxies solicited by the Board will be voted in accordance with the
directions given therein. WHERE NO INSTRUCTIONS ARE INDICATED, PROXIES WILL BE
VOTED FOR THE NOMINEES FOR DIRECTORS SET FORTH BELOW AND IN FAVOR OF THE
PROPOSALS SET FORTH IN THIS PROXY STATEMENT FOR CONSIDERATION AT THE MEETING.
The proxy confers discretionary authority on the persons named therein to vote
with respect to the election of any person as a Director where the nominee is
unable to serve or for good cause will not serve, and matters incident to the
conduct of the Meeting. Proxies marked as abstentions will not be counted as
votes cast. In addition, shares held in street name which have been designated
by brokers on proxies as not voted will not be counted as votes cast. Proxies
marked as abstentions or as broker non-votes, however, will be treated as
shares present for purposes of determining whether a quorum is present.
The presence, in person or by proxy, of the holders of at least a majority
of the total number of shares of the Corporation's common stock, par value
$.01 per share ("Common Stock"), entitled to vote is necessary to constitute a
quorum at the Meeting. In the event that there are not sufficient votes for a
quorum or to approve or ratify any proposal at the time of the Meeting, the
Meeting may be adjourned in order to permit the further solicitation of
proxies.
Stockholders who execute proxies retain the right to revoke them at any
time. Unless so revoked, the shares represented by such proxies will be voted
at the Meeting and all adjournments thereof. Proxies may be revoked by written
notice to Howard C. Bluver, Secretary of the Corporation, at the address shown
above, by filing a later dated proxy prior to a vote being taken on a
particular proposal at the Meeting, or by attending the Meeting and voting in
person.
- -------------------------------------------------------------------------------
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
- -------------------------------------------------------------------------------
Stockholders of record as of the close of business on March 17, 1998 are
entitled to one vote for each share then held. As of March 17, 1998, the
Corporation had 85,195,316 shares of Common Stock issued and outstanding.
As provided in the Corporation's Certificate of Incorporation (the
"Certificate of Incorporation"), holders of Common Stock who beneficially own
in excess of 10% of the outstanding shares of Common Stock (the "Limit") are
not entitled to any vote in respect of the shares held in excess of the Limit.
A person or entity is
<PAGE>
deemed the beneficial owner of shares owned by an affiliate of, and by persons
acting in concert with, such person or entity. The Certificate of
Incorporation authorizes the Board to (i) make all determinations necessary to
implement and apply the Limit, including determining whether persons or
entities are acting in concert, and (ii) demand that any person who is
reasonably believed to beneficially own Common Stock in excess of the Limit
supply information to the Corporation to enable the Board to implement and
apply the Limit. The Certificate of Incorporation provides that neither the
GreenPoint Bank Employee Stock Ownership Plan (the "ESOP") nor the trustee of
the ESOP (the "ESOP Trustee") may be deemed, for purposes of applying the
Limit, to beneficially own any Common Stock held by the ESOP.
Persons and groups owning in excess of 5% of the Common Stock are required
to file certain reports regarding such ownership pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Based upon such
reports, the following table sets forth, as of December 31, 1997, certain
information as to the Common Stock beneficially owned by persons owning in
excess of 5% of the outstanding Common Stock. Management knows of no person,
except as listed below, who owned more than 5% of the outstanding Common Stock
as of December 31, 1997.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OUTSTANDING
OF BENEFICIAL OWNER OWNERSHIP(1)(2) COMMON STOCK
------------------- ----------------- ------------
<S> <C> <C>
GreenPoint Bank Employee Stock Ownership Plan
90 Park Avenue
New York, New York 10016.................... 16,162,480(3) 19.10%
Fidelity Management and Research Corporation
82 Devonshire Street
Boston, Massachusetts 02109................. 7,188,100 8.49%
</TABLE>
- --------
(1) Adjusted for the dividend of one share of Common Stock for each
outstanding share of Common Stock made on March 4, 1998 (the "Two-For-One
Stock Split").
(2) In accordance with Rule 13d-3 promulgated under the Exchange Act, a person
is deemed to be the beneficial owner, for purposes of this table, of any
shares of Common Stock if such person has shared voting or investment
power with respect to such shares, or has a right to acquire beneficial
ownership at any time within sixty days of March 17, 1998. As used herein,
"voting power" is the power to vote or direct the voting of shares and
"investment power" is the power to dispose or direct the disposition of
shares.
(3) In accordance with the ESOP, the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), and the Internal Revenue Code of 1986, as
amended (the "Code"), the ESOP Trustee must vote all allocated shares of
Common Stock held in the ESOP in accordance with the instructions of the
participating employees. Pursuant to the ESOP, unallocated shares of
Common Stock will be voted by the ESOP Trustee in a manner calculated to
reflect most accurately the instructions the ESOP Trustee has received
from participants regarding the allocated shares of Common Stock.
Notwithstanding the foregoing, all unallocated shares of Common Stock must
be voted by the ESOP Trustee in accordance with the ESOP Trustee's
responsibilities under provisions of ERISA. As of March 17, 1998,
2,665,314 shares of Common Stock were allocated under the ESOP, excluding
shares of Common Stock distributed from the ESOP to former ESOP
participants.
2
<PAGE>
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PROPOSAL 1--ELECTION OF DIRECTORS
- -------------------------------------------------------------------------------
The Board is currently composed of fourteen members. Pursuant to the
Certificate of Incorporation, the Board is divided into three classes which
must be as nearly equal in number as possible. The term of one class of
Directors expires at each Meeting. The Certificate of Incorporation provides
that Directors are to be elected for terms of three years and until their
successors are elected and qualified.
Five Directors will be elected at the Meeting to serve for a three-year
period and until their respective successors have been elected and qualified.
The Board has nominated to serve as Directors Bharat B. Bhatt, Robert M.
McLane, Edward C. Schmults, Wilfred O. Uhl and Robert F. Vizza, all of whom
are currently members of the Board. It is intended that the persons named in
the proxies solicited by the Board will vote for the election of the named
nominees. If any nominee is unable to serve, the shares represented by all
valid proxies which have not been revoked will be voted for the election of
such substitute as the Board may recommend. At this time, the Board knows of
no reason why any nominee might be unavailable to serve.
A plurality of the votes cast by stockholders present at the Meeting, in
person or by proxy, and entitled to vote is required for the election of
Directors. Stockholders may not vote their shares of Common Stock cumulatively
for the election of Directors.
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES NAMED IN THIS
PROXY STATEMENT.
- -------------------------------------------------------------------------------
INFORMATION WITH RESPECT TO NOMINEES AND CONTINUING DIRECTORS
- -------------------------------------------------------------------------------
NOMINEES FOR ELECTION AS DIRECTORS FOR THE TERM EXPIRING IN 2001
BHARAT B. BHATT, 54, has been a Director of the Corporation since October
1997. Mr. Bhatt joined the Corporation in June 1995 as Vice Chairman and was
appointed as the Corporation's President and Chief Operating Officer in
October 1997. A graduate of the University of Bombay, Mr. Bhatt also attended
the Management Program at the Harvard Business School. Mr. Bhatt served as the
Chief Financial Officer of Shawmut National Corporation from 1992 to 1994, as
a Senior Vice President at Mellon Bank from 1989 to 1992 and held various
positions at Chemical Bank from 1971-1989.
ROBERT M. MCLANE, 68, has been a Director of the Corporation since its
formation in August 1993. A graduate of Yale University, Mr. McLane is a
retired Senior Vice President of Marsh & McLennan, Inc., an insurance
brokerage corporation. He is presently a Director of several private
corporations and is a Trustee of Greenwood Cemetery, Brooklyn, New York.
EDWARD C. SCHMULTS, 67, has been a Director of the Corporation since July
1994. Mr. Schmults served as Senior Vice President and General Counsel of GTE
Corporation from February 1984 to June 1994. A graduate of Yale University,
Mr. Schmults received a law degree from Harvard Law School. Mr. Schmults held
various positions in government, including service as Deputy Attorney General
of the United States and Under Secretary of the United States Treasury
Department. Mr. Schmults was a partner with White & Case, a law firm in New
York City. Mr. Schmults is a Director of The Germany Fund, The Central
European Equity Fund, Deutsche Portfolio and Deutsche Funds, Inc., and
Chairman of the Board of Trustees of The Edna McConnell Clark Foundation.
WILFRED O. UHL, 70, has been a Director of the Corporation since its
formation in August 1993. A graduate of The Cooper Union School of
Engineering, Mr. Uhl is the retired President of The Long Island Lighting
Company, and a member of The New York Society of Professional Engineers and
The Institute of Electrical and Electronic Engineers. Mr. Uhl is also
Treasurer of The Interdenominational Housing Project in Great Neck, New York,
and a Director of Wartburg Lutheran Services, Brooklyn, New York, a provider
of services to the elderly.
3
<PAGE>
ROBERT F. VIZZA, 64, has been a Director of the Corporation since its
formation in August 1993. He is President and Chief Executive Officer of the
St. Francis-Mercy Corporation, Roslyn, New York. Having earned a doctorate in
business administration from New York University, Dr. Vizza also attained an
Honorary Doctorate of Laws from LaSalle College and is a Fellow of The
International Academy of Management. He is a Director of the Phoenix Home Life
Mutual Insurance Company, Greater New York Hospital Association, and the
Catholic Health Network of L.I.
DIRECTORS WHOSE TERM EXPIRES IN 1999
DAN F. HUEBNER, 66, has been a Director of the Corporation since its
formation in August 1993. A graduate of the University of Minnesota, Mr.
Huebner also holds both a masters and professional degree in aeronautics from
the California Institute of Technology. He is the retired Vice Chairman and a
Director of Grumman Corporation. Mr. Huebner is presently a Trustee of the
Atlantic Mutual Insurance Co. and the Vesterheim Norwegian American Museum,
and a Director of the Centennial Insurance Co. and the Atlantic Specialty
Insurance Co.
THOMAS S. JOHNSON, 57, has been Chairman and Chief Executive Officer of the
Corporation since joining the Corporation in August 1993. He was also
President of the Corporation from August 1993 to October 1997. Mr. Johnson has
served as President of both Chemical Bank and Manufacturers Hanover Trust
Company. He is a Director of RR Donnelley & Sons, Inc., a printing company,
Online Resources & Communications Corporation and Alleghany Corporation, and a
number of not-for-profit organizations, including The Institute of
International Education, The Asia Society, The United States Japan Foundation,
The Cancer Research Institute of America and WNET Channel 13, New York. He is
Chairman of the Board of Trustees of Trinity College. A graduate of Trinity,
he also has a masters degree in business administration from Harvard
University.
SUSAN J. KROPF, 49, has been a Director of the Corporation since July 1994.
Ms. Kropf has served as Executive Vice President/President, North America of
Avon Products, Inc. ("Avon") since March, 1997. She served as Senior Vice
President/President--New and Emerging Markets of Avon from July 1996 to
February 1997. She served as Senior Vice President--Global Product and
Business Development/President--Eastern Europe of Avon from 1994 to July 1996.
She served as Senior Vice President--Global Product Management of Avon from
1993 to 1994, and Group Vice President, U.S. Product Marketing Group of Avon
from 1992 to 1993. Ms. Kropf is a Director of Avon and Mead Corporation. A
graduate of St. John's University, Ms. Kropf received a masters degree in
business administration from New York University.
JULES ZIMMERMAN, 63, has been a Director of the Corporation since its
formation in August 1993. A graduate of Hofstra University, Mr. Zimmerman is
the retired President and Chief Executive Officer of Hickok Associates,
Incorporated, a consulting firm. He was a senior officer with Avon Products,
Inc. from 1976 to 1985 and Chief Financial Officer from 1985 to 1988. Mr.
Zimmerman was the New York Chapter President of The National Association of
Corporate Directors and is affiliated with The American Institute of Certified
Public Accountants and the New York State Society of Certified Public
Accountants. He is a member of the Board of Directors of Projectvision Inc.,
an electronics company, Manhattan Scientific, Inc., a development stage
electronics company, and the Associated Blind.
DIRECTORS WHOSE TERM EXPIRES IN 2000
EDWARD C. BESSEY, 63, has been a Director of the Corporation since July
1994. Mr. Bessey served as Vice Chairman of Pfizer Inc. ("Pfizer") and
President of Pfizer's U.S. Pharmaceuticals Group from 1992 to his retirement
from Pfizer in January of 1996. A graduate of Dartmouth College, Mr. Bessey
received a masters degree in business administration from Dartmouth's Amos
Tuck School. Mr. Bessey is a Director of the Public Health Research Institute,
an internationally known organization focusing on infectious disease research.
WILLIAM M. JACKSON, 49, has been a Director of the Corporation since its
formation in August 1993. A graduate of Harvard College, Mr. Jackson received
a law degree from George Washington University Law School. Mr. Jackson is a
partner with Satterlee, Stephens, Burke & Burke, L.L.P., a law firm in New
York City.
4
<PAGE>
CHARLES B. MCQUADE, 56, has been a Director of the Corporation since its
formation in August 1993. A graduate of Fordham College, Mr. McQuade also
obtained a masters degree in business administration at the Bernard M. Baruch
Graduate Business School. Mr. McQuade is the President and Chief Executive
Officer of the Securities Industry Automation Corporation. Mr. McQuade is a
Director with the Brooklyn Bureau of Community Service and serves on the
Advisory Boards of the Center for Advanced Technology in Telecommunications
(Polytechnic Institute) and The Stanton Heiskell Center for Public Policy in
Telecommunications and Information Systems (City University of New York).
ALVIN N. PURYEAR, 60, has been a Director of the Corporation since its
formation in August 1993. A graduate of Yale University, he received masters
and doctorate degrees from Columbia University's Graduate School of Business
Administration. Dr. Puryear is a Professor of Management at Bernard M. Baruch
College of the City University of New York. He is a director of Bank of Tokyo-
Mitsubishi Trust Company in New York City. He is also the Chairman of the
Presbyterian Church Investment and Loan Corporation, and a Director of the
Broadcast Capital Fund, a small business investment company licensed by the
Small Business Administration, and The Interracial Council for Business
Opportunity.
ROBERT P. QUINN, 61, has been a Director of the Corporation since its
formation in August 1993. A graduate of the University of Notre Dame, Mr.
Quinn was a General Partner and Managing Director of the investment banking
firm of Salomon Brothers Inc, where he continues as an Honorary Director. Mr.
Quinn is also a Trustee of G.E. Funds, a registered investment management
company with six mutual fund portfolios. Mr. Quinn is the former Chairman and
present member of the Board of Directors of St. Francis-Mercy Corporation,
Roslyn, New York. Mr. Quinn is a member of the Advisory Council for the
University of Notre Dame School of Arts and Letters.
5
<PAGE>
- -------------------------------------------------------------------------------
SECURITIES OWNED BY DIRECTORS AND EXECUTIVE OFFICERS
- -------------------------------------------------------------------------------
The following table sets forth, as of March 17, 1998, certain information as
to the Common Stock beneficially owned by each Director, by each executive
officer named in the Summary Compensation Table and by all Directors and
executive officers of the Corporation as a group. No Director or executive
officer beneficially owns directly or indirectly more than 1% of the
outstanding Common Stock. All Directors and executive officers of the
Corporation as a group beneficially own 3.39% of the outstanding Common Stock.
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
BENEFICIALLY
NAME OR OWNED AS OF
IDENTITY MARCH 17,
OF GROUP 1998(1)(2)(3)
-------- -------------
<S> <C>
Bernadette Arias........................................... 231,230
Edward C. Bessey........................................... 30,000
Bharat B. Bhatt............................................ 166,948
Martin S. Dash............................................. 228,386
Dan F. Huebner............................................. 56,620
William M. Jackson......................................... 39,400
Thomas S. Johnson.......................................... 1,018,162
Susan J. Kropf............................................. 24,000
Robert M. McLane........................................... 62,380
Charles B. McQuade......................................... 54,000
Alvin N. Puryear........................................... 48,222
Robert P. Quinn............................................ 70,442
Charles P. Richardson...................................... 321,654
Edward C. Schmults......................................... 30,000
Wilfred O. Uhl............................................. 51,380
Robert F. Vizza............................................ 50,000
Jules Zimmerman............................................ 24,000
All Directors and Executive Officers as a Group (25
Persons)................................................... 2,891,076
</TABLE>
- --------
(1) For the definition of beneficial ownership, see footnote (2) to the table
in "Voting Securities and Principal Holders Thereof."
(2) Includes certain shares of Common Stock owned by spouses, or as a
custodian or trustee or by spouses as a custodian or trustee, over which
shares of Common Stock such Director or executive officer effectively
exercises sole or shared voting and/or investment power, unless otherwise
indicated.
(3) Includes certain shares of Common Stock allocated to executive officers
under the ESOP, over which shares of Common Stock such officers
effectively exercise sole or shared voting power.
STOCK OWNERSHIP GUIDELINES
During 1997, the Board adopted stock ownership guidelines for Directors and
executive officers in order to encourage substantial equity ownership in the
Corporation by those individuals who are in the best position to work to
maximize stockholder value. Pursuant to these guidelines, each Director is
expected to own Common Stock equal in value to 5 times the annual retainer. In
addition, the Chairman of the Board and Chief Executive Officer is expected to
own Common Stock equal in value to 5 times salary, the President and Chief
Operating Officer is expected to own Common Stock equal in value to 3 times
salary, and certain other officers are expected to own Common Stock equal in
value to a multiple of salary depending on their positions. In all cases,
eligible shares for purposes of the guidelines exclude stock options, but
include shares obtained through the Corporation's employee benefit plans. The
guidelines also provide an appropriate transition period for the shares to be
acquired.
6
<PAGE>
- -------------------------------------------------------------------------------
MEETINGS AND COMMITTEES OF THE BOARD
- -------------------------------------------------------------------------------
The Board conducts business through meetings of the Board and of its
committees. During the fiscal year ended December 31, 1997, the Board held
twelve meetings. No Director attended fewer than 75% in the aggregate of the
total number of meetings of the Board or committees on which such Director
served during this period.
The Audit Committee of the Board (the "Audit Committee") meets with both
independent and internal auditors of the Corporation to review the plans and
reports of such auditors and to recommend the appointment of independent
auditors. The Audit Committee currently consists of Mr. Zimmerman, as Chair,
Messrs. Bessey, McLane and Uhl, and Dr. Puryear. During the fiscal year ended
December 31, 1997, the Audit Committee held five meetings.
The Nominating Committee of the Board (the "Nominating Committee")
recommends to the Board nominees for election to the Board. The Nominating
Committee currently consists of Mr. Jackson, as Chair, Ms. Kropf and Mr. Uhl.
During the fiscal year ended December 31, 1997, the Nominating Committee did
not meet.
The Compensation Committee of the Board (the "Compensation Committee")
reviews the performance and compensation of the officers of the Corporation,
as well as the human resources policies of the Corporation, and makes
recommendations to the Board with respect thereto. The Compensation Committee
currently consists of Mr. McQuade, as Chair, Ms. Kropf and Messrs. Jackson,
Quinn and Schmults. During the fiscal year ended December 31, 1997, the
Compensation Committee held five meetings.
- -------------------------------------------------------------------------------
DIRECTORS' COMPENSATION
- -------------------------------------------------------------------------------
DIRECTORS' FEE ARRANGEMENTS
Employees of the Corporation or any subsidiary of the Corporation who are
Directors receive no compensation for their service on the Board or the Board
of Directors of GreenPoint Bank (the "Bank Board"). Directors who are not
officers or employees of the Corporation or any subsidiary of the Corporation
("Non-Employee Directors") receive an annual retainer of $30,000 payable in
shares of Common Stock and fees of $1,000 per Board meeting and $800 per
committee meeting. The Board and the Bank Board are identically constituted,
and Non-Employee Director fees cover service on both the Board and the Bank
Board. Non-Employee Directors are offered the option of participation in the
medical insurance plan of GreenPoint Bank (the "Bank") which is available to
all of the Bank's full-time and regular part-time employees. The Bank has also
implemented a retirement plan for Non-Employee Directors. The maximum annuity
benefit under this retirement plan is equal to the annual retainer fee paid to
Non-Employee Directors. Only Non-Employee Directors who have accumulated ten
or more years of service as a Director of the Bank and who retire from the
Bank Board at age sixty-five or older or whose service as a Non-Employee
Director is terminated because of disability, are eligible to receive the
maximum annuity benefit.
NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
Under the GreenPoint Financial Corp. Non-Employee Directors Stock Option
Plan (the "Directors Stock Option Plan"), Non-Employee Directors are eligible
to receive stock options. The Directors Stock Option Plan is administered by
the Compensation Committee. However, grants of stock options to participants,
and the amount, nature and timing of such grants, are automatically determined
and are not subject to the determination of the Compensation Committee.
The total number of shares of Common Stock for which options may be granted
may not exceed 1,450,000 shares while the plan is in effect, subject to
certain adjustments. An adjustment was made for the Two-For-One Stock Split.
Each Non-Employee Director who was a Non-Employee Director on January 28, 1994
(an "Original Non-Employee Director") received on January 28, 1995, a non-
qualified stock option to acquire 100,000 shares
7
<PAGE>
of Common Stock at a price equal to the fair market value at the time of the
grant (adjusted for the Two-For-One Stock Split). Other Non-Employee Directors
receive a non-qualified stock option to purchase 10,000 shares of Common Stock
at a price equal to the fair market value at the time of the grant upon
becoming a Director.
During the term of the Directors Stock Option Plan, on the day following the
Corporation's Annual Meeting each year, each Non-Employee Director receives an
additional non-qualified stock option to purchase 4,000 shares of Common Stock
at a price equal to the fair market value at the time of the grant, provided
such individual continues to be a Non-Employee Director.
The term of each stock option is ten years from the date of grant. The
Directors Stock Option Plan will terminate on December 31, 2004.
- -------------------------------------------------------------------------------
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
- -------------------------------------------------------------------------------
The Compensation Committee (the "Committee") has responsibility for review
and oversight of the Corporation's compensation programs, and for
administering executive salary and incentive compensation plans. The following
report discusses executive compensation objectives and policies and their
relationship to corporate performance. Also, the report specifically discusses
the Committee's bases for compensation of the Chief Executive Officer in 1997.
EXECUTIVE COMPENSATION OBJECTIVES AND POLICIES
The Corporation's executive compensation program is designed to be closely
linked to corporate performance and returns to stockholders. The Corporation
has developed an overall compensation strategy and specific compensation plans
that tie a significant portion of executive compensation to the Corporation's
success in meeting specified performance goals. The overall objectives of this
strategy are to attract and retain the best possible executive talent, to
motivate these executives to achieve the goals contained in the Corporation's
business strategy, to link executive and stockholder interests through equity-
based plans, and to provide a compensation package that recognizes and rewards
individual contributions, as well as overall business results. The Committee
is of the view that compensation should be designed to stimulate performance
improvement and profitable growth and should reward exceptional performance
with remuneration that is commensurate with such performance. To this end,
total compensation for executive officers is designed to be, over time,
approximately at the 75th percentile of the Corporation's peer group, as
defined below, with the majority of compensation being at risk to performance.
Each year the Committee conducts a full review of the Corporation's
executive compensation. This review includes a comprehensive assessment of the
effectiveness of the Corporation's compensation program in stimulating growth
and maximizing total return to stockholders through performance-based
incentives. This review also includes a comparative analysis, produced by
independent compensation and benefits consultants, of the Corporation's
executive compensation, corporate performance and total return to stockholders
compared to a peer group representing the Corporation's most direct
competitors for executive talent. The strongest competitors for executive
talent for most positions are believed to be the largest thrift institutions,
specialty finance companies and mortgage banks throughout the country, as well
as medium size commercial banks.
The Committee determines the compensation of all of the executive officers
of the Corporation, including the named executive officers whose compensation
is detailed in this Proxy Statement. In reviewing the individual performance
of the executives whose compensation is detailed in this Proxy Statement
(other than Mr. Johnson), the Committee gives weight to the recommendations of
Mr. Johnson.
The key elements of the Corporation's executive compensation program consist
of base salary, annual and long-term performance-based cash incentives, and
stock-based incentives such as stock options and restricted stock. In
addition, while these elements of compensation are considered separately, the
Committee's policies take
8
<PAGE>
into account the total compensation package of each executive officer,
including pension benefits, supplemental retirement benefits, insurance and
other benefits.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
In evaluating Mr. Johnson's performance for 1997, the Committee is of the
opinion that Mr. Johnson's work throughout 1997 was critical to the
achievement of record financial performance for the year. Specifically, 1997
net income was a record $3.72 per share, or 23.2% higher than 1996. In
addition, total stockholder return for the year was over 54%. The Committee is
of the opinion that this performance is attributable to the achievement of key
strategic objectives during 1997, the most important of which was continuing
the expansion of the Bank's no documentation lending business outside of New
York while maintaining pricing discipline and a strong commitment to credit
quality. In addition, Mr. Johnson completed the building of a senior
management team in anticipation of future growth by establishing a top quality
risk management function that is independent from the Corporation's operating
units.
The Corporation's employment arrangement with Mr. Johnson provides him with
a competitive package at approximately the 75th percentile of the
Corporation's peer group. This package is described in detail in the
"Executive Compensation" section of this Proxy Statement. The Committee
designed this package after consulting with and receiving the advice of its
independent compensation and benefits consultant. Consistent with the
Corporation's overall compensation policy, the Corporation's employment
arrangement with Mr. Johnson is largely performance-based. Specifically, the
arrangement is based on performance-based plans that link compensation to
several measures of financial performance selected by the Committee.
Consequently, a substantial percentage of Mr. Johnson's compensation is at
risk and is directly linked to performance measures, which may include return
on equity, return on assets, net income, cash earnings, earnings per share,
total return to stockholders, and earnings growth. The arrangement also
provides that Mr. Johnson is to receive stock incentives intended to tie Mr.
Johnson's compensation directly to future stockholder value. See the
"Executive Compensation" section of this Proxy Statement for a description of
the amount and terms of stock options provided to Mr. Johnson.
For 1997, Mr. Johnson received $650,000 in base salary and an annual
performance award of $850,000. The Committee determined the amount of the
performance award based on measures of financial performance of the
Corporation, including net income, cash earnings, and total stockholder
return. In addition, the Committee considered the achievement of key strategic
objectives of the Corporation, including the continued expansion of the Bank's
no documentation lending business outside of the New York City metropolitan
area and completion of the building of a senior management team that can
successfully manage future growth. In addition, Mr. Johnson received a payout
of $625,000 pursuant to the Corporation's 1994 Long-Term Incentive Plan, based
on the achievement of specific target levels of long-term performance criteria
previously established by the Committee.
DEDUCTIBILITY OF EXECUTIVE OFFICER COMPENSATION
The Committee's policy with respect to the tax deductibility of executive
compensation above $1 million is to structure benefit plans in a manner that
permits the deductibility of such compensation under Section 162(m) of the
Code when the Corporation can do so without materially compromising the
objectives of its overall compensation program.
THE COMPENSATION COMMITTEE
Charles B. McQuade, Chair
Susan J. Kropf Robert P. Quinn
William M. Jackson Edward C. Schmults
9
<PAGE>
- -------------------------------------------------------------------------------
EXECUTIVE COMPENSATION
- -------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation paid by the Corporation
during each of the years ended December 31, 1997, 1996 and 1995, respectively,
to the Corporation's Chief Executive Officer and its four next highest paid
executive officers.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION(1) AWARDS PAYOUTS
--------------------------------- ----------------------- ---------
SECURITIES
OTHER ANNUAL RESTRICTED UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION STOCK OPTIONS/SARS PAYOUTS COMPENSATION
POSITION(S) YEAR ($) ($) ($)(2) ($)(3)(4) (#)(5) ($)(6) ($)(7)
------------------ ---- ------- ------- ------------ ---------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Thomas S. Johnson....... 1997 650,000 850,000 53,500 -- 230,000 625,000 79,309
Chairman and 1996 575,000 600,000 53,500 3,693,750 -- 1,250,000 68,162
Chief Executive Officer 1995 538,000 425,000 53,500 -- 680,000 -- 63,716
Bharat B. Bhatt......... 1997 450,000 460,000 -- 832,500 160,000 -- 77,041
President and 1996 325,000 300,000 -- -- -- -- 65,511
Chief Operating Officer 1995 175,000 105,000 -- -- 150,000 -- 100,000
Bernadette Arias........ 1997 290,000 230,000 -- -- 60,000 75,000 77,041
Executive Vice
President 1996 275,000 140,000 -- 1,846,875 -- 150,000 65,894
1995 263,000 120,000 -- -- 200,000 -- 60,174
Martin S. Dash.......... 1997 290,000 250,000 -- -- 70,000 75,000 79,309
Executive Vice
President 1996 275,000 140,000 -- 1,846,875 -- 150,000 65,894
1995 263,000 110,000 -- -- 200,000 -- 61,637
Charles P. Richardson... 1997 260,000 200,000 -- -- 50,000 75,000 75,697
Executive Vice
President 1996 250,000 125,000 -- 1,846,875 -- 150,000 64,454
1995 235,377 100,000 -- -- 200,000 -- 59,290
</TABLE>
- --------
(1) Annual compensation includes deferred compensation. Bonus amounts include
all bonus payments earned for the years ended December 31, 1997, 1996 and
1995, including amounts paid in 1998, 1997 and 1996, respectively.
(2) For each of the years ended December 31, 1997, 1996 and 1995,
respectively, there were not (i) perquisites over the lesser of $50,000 or
10% of the individual's total salary and bonus for the year for anyone
other than Mr. Johnson; (ii) payments of above-market preferential
earnings on deferred compensation; (iii) payments of earnings with respect
to long-term incentive plans prior to settlement or maturation; (iv) tax
payment reimbursements; or (v) preferential discounts on stock. Mr.
Johnson's perquisites in 1997, 1996 and 1995 consisted of a $50,000
housing allowance and $3,500 for personal use of an automobile owned by
the Corporation.
(3) On January 28, 1996, Mr. Johnson was granted 300,000 shares of restricted
Common Stock ("Restricted Stock") and Mrs. Arias and Messrs. Dash and
Richardson were granted 150,000 shares of Restricted Stock each. These
grants vest at a rate of 20% per year beginning one year from the date of
grant. On January 29, 1997, Mr. Bhatt was granted 30,000 shares of
Restricted Stock, which vests at a rate of 25% per year beginning one year
from the date of grant. At December 31, 1997, Mr. Johnson held 240,000
shares of Restricted Stock having a value of $8,707,500, Mr. Bhatt held
30,000 shares of Restricted Stock having a value of $1,088,438 and Mrs.
Arias and Messrs. Dash and Richardson each held 120,000 shares of
Restricted Stock having a value of $4,353,750 each. Each grant of
Restricted Stock has been adjusted for the Two-For-One Stock Split.
(4) Whenever Restricted Stock is paid to a named executive officer, the
executive officer is entitled to receive, with respect to each share of
Restricted Stock paid, an amount attributable to any cash dividends and a
number of shares of Common Stock equal to any stock dividends declared and
paid with respect to a share of Common Stock (including an appropriate
amount of net earnings, if any) between the date the relevant Restricted
Stock award was granted and the date the Restricted Stock is paid, unless
any such dividend is paid to a named executive officer on a current basis.
(5) Adjusted for the Two-For-One Stock Split.
(6) LTIP payouts include payouts earned for the one-year period ended December
31, 1997 and the two-year period ended December 31, 1996 and paid in 1998
and 1997, respectively.
(7) Includes (i) $68,209, $59,612 and $57,941, which is the value of shares of
Common Stock allocated under the ESOP based on 1997, 1996 and 1995
compensation, respectively, for Mr. Johnson, $68,209 and $59,565, which is
the value of shares of Common Stock allocated under the ESOP based on 1997
and 1996 compensation, respectively, for Mr. Bhatt, and $68,209, $59,612
and $57,941, which is the value of shares of Common Stock allocated under
the ESOP based on 1997, 1996 and 1995 compensation, respectively, for Mrs.
Arias, Mr. Dash and Mr. Richardson; (ii) the Bank's contributions to its
401(k) Savings Plan of $4,800 and $2,250 for each of Messrs. Johnson and
Bhatt, Mrs. Arias and Messrs. Dash and Richardson for 1997 and 1996,
respectively; (iii) the value of the life insurance premiums paid by the
Corporation of $6,300, $6,300 and $5,775 for Mr. Johnson for 1997, 1996
and 1995, respectively, $4,032 and $3,696 for Mr. Bhatt for 1997 and 1996,
respectively, $4,032, $4,032 and $2,233 for Mrs. Arias for 1997, 1996 and
1995, respectively, $6,300, $4,032 and $3,696 for Mr. Dash for 1997, 1996
and 1995, respectively, and $2,688, $2,592 and $1,349 for Mr. Richardson
for 1997, 1996 and 1995, respectively; and (iv) a bonus of $100,000 paid
to Mr. Bhatt in 1995 as part of his initial employment.
10
<PAGE>
FISCAL 1997 STOCK OPTION GRANTS
The following table contains information concerning the grant of options to
purchase Common Stock to the named executive officers during the year ended
December 31, 1997. The table also sets forth the hypothetical gains that would
exist for the options at the end of their ten-year terms, assuming compound
rates of stock appreciation of 5% and 10%. The actual future value of the
options will depend on the market value of the Common Stock. The Corporation
has not granted any freestanding stock appreciation rights ("SARs") to the
named executive officers.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)(2)
-------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
NUMBER OF % OF TOTAL RATES OF STOCK PRICE
SHARES OPTIONS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO TERM(4)
OPTION EMPLOYEES IN EXERCISE EXPIRATION ------------------------
NAME GRANTS 1997 PRICE(3) DATE 5% 10%
---- ---------- ------------ -------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Thomas S. Johnson....... 230,000 17.84% $27.75 01/29/07 $ 4,013,920 $ 10,172,061
Bharat B. Bhatt......... 160,000 12.41% $27.75 01/29/07 $ 2,792,292 $ 7,076,217
Bernadette Arias........ 60,000 4.65% $27.75 01/29/07 $ 1,047,110 $ 2,653,581
Martin S. Dash.......... 70,000 5.43% $27.75 01/29/07 $ 1,221,628 $ 3,095,845
Charles P. Richardson... 50,000 3.88% $27.75 01/29/07 $ 872,591 $ 2,211,318
</TABLE>
- --------
(1) Adjusted for the Two-For-One Stock Split.
(2) The options shown were granted on January 29, 1997 and are exercisable at
a rate of 33 1/3% per year beginning one year from the date of grant.
(3) The exercise price per share for each option is equal to the fair market
value of the Common Stock on the date of grant.
(4) The potential realizable value is calculated in accordance with the
disclosure rules promulgated by the Securities and Exchange Commission
(the "Commission"). The hypothetical gains shown are based on compound
annual rates of stock price appreciation of 5% and 10% from the date of
grant to the expiration date. The assumed rates of growth are prescribed
by the Commission and are for illustrative purposes only. They are not
intended to predict future Common Stock prices. Actual realized value, if
any, will depend on the market value of the Common Stock at the time of
exercise, and no gain to the optionee is possible without an increase in
the Common Stock price.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth information on the aggregate number of
unexercised options to purchase Common Stock granted in all years to the named
executive officers and held by them as of December 31, 1997 and the value of
unexercised in-the-money options (i.e., options that had a positive spread
between the exercise price and the fair market value of Common Stock) as of
December 31, 1997. None of the named executive officers exercised options
during the fiscal year ended December 31, 1997, except Mrs. Arias and Messrs.
Dash and Richardson. The Corporation has not granted any free-standing SARs to
the named executive officers.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
SHARES AT 12/31/97(1) AT 12/31/97(3)
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE(1) REALIZED(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Thomas S. Johnson....... 0 0 340,000 570,000 $ 8,616,875 $10,579,063
Bharat B. Bhatt......... 0 0 75,000 235,000 $ 1,860,938 $ 3,225,938
Bernadette Arias........ 50,000 $1,096,875 50,000 160,000 $ 1,267,188 $ 3,046,250
Martin S. Dash.......... 100,000 $1,904,572 0 170,000 $ 0 $ 3,131,563
Charles P. Richardson... 4,900 $ 86,669 95,100 150,000 $ 2,410,191 $ 2,960,938
</TABLE>
- --------
(1) Adjusted for the Two-For-One Stock Split.
(2) The value realized as shown represents the difference between the fair
market value of the Common Stock on the date of exercise and the exercise
price of the option.
(3) The value of unexercised in-the-money options as shown represents the
difference between the fair market value of the Common Stock on December
31, 1997 and the exercise price of the options.
11
<PAGE>
FISCAL YEAR-END LONG-TERM INCENTIVE PLAN AWARDS
The following table sets forth target and maximum payout opportunities under
the GreenPoint Financial Corp. 1994 Long-Term Incentive Plan (the "Long-Term
Incentive Plan") for the four-year performance period ending December 31,
1998.
<TABLE>
<CAPTION>
PERFORMANCE OR ESTIMATED FUTURE PAYOUTS UNDER
NUMBER OF OTHER PERIOD NON-STOCK PRICE-BASED PLANS(1)(2)
SHARES, UNITS UNTIL MATURATION ---------------------------------
NAME OR OTHER RIGHTS OR PAYOUT THRESHOLD($) TARGET($) MAXIMUM($)
---- --------------- ---------------- ------------ --------- ----------
<S> <C> <C> <C> <C> <C>
Thomas S. Johnson....... -- 1995-1998 -- 2,500,000 3,750,000
Bernadette Arias........ -- 1995-1998 -- 300,000 450,000
Martin S. Dash.......... -- 1995-1998 -- 300,000 450,000
Charles P. Richardson... -- 1995-1998 -- 300,000 450,000
</TABLE>
- --------
(1) Under the Long-Term Incentive Plan, payments are to be made in cash, based
on the Corporation's return on equity or total stockholder return
performance over a period of four years relative to the performance of a
selected comparable group of companies. For each of the 1995-1997
performance periods, no awards would be paid unless target performance was
achieved by the Corporation, although target awards not earned in one
performance period are carried over to the next performance period and
could be earned if target performance is achieved in that or a subsequent
performance period. An award for above target performance can only be paid
in connection with the 1998 performance period. The Long-Term Incentive
Plan is described in detail in the "Long-Term Incentive Plan" section of
this Proxy Statement. Mr. Bhatt is not a participant in the Long-Term
Incentive Plan.
(2) Payouts for the one-year performance period ended December 31, 1997 and
the two-year performance period ended December 31, 1996 are reflected in
the Summary Compensation Table.
STOCK PERFORMANCE GRAPH
The following graph shows a comparison of cumulative total stockholder
return on the Common Stock from January 28, 1994 to December 31, 1997, with
the cumulative total returns of both a broad-market index and a peer group
index. The broad-market index chosen was the S&P 500 Total Return Index
produced by SNL Securities ("SNL"), and the peer group index chosen was all
publicly-traded thrift institutions with total assets in excess of $5 billion
also produced by SNL. The Common Stock began trading on January 28, 1994. The
graph depicts a limited period of time. As a result, the graph may not be
indicative of possible future performance of the Common Stock.
LOGO
<TABLE>
<CAPTION>
PERIOD ENDING
1/28/94 12/31/94 12/31/95 12/31/96 12/31/97
Index ------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
GreenPoint Financial Corp........... 100.00 111.63 149.65 272.27 422.58
S&P 500............................. 100.00 98.60 135.66 166.67 222.29
SNL $5B+ Thrifts.................... 100.00 91.31 150.34 201.85 341.98
</TABLE>
12
<PAGE>
EMPLOYMENT AGREEMENTS
The Corporation has an employment agreement with Mr. Johnson as Chairman and
Chief Executive Officer of the Corporation (the "Employment Agreement"). The
Employment Agreement provides for a base salary of not less than $500,000 per
year and an annual performance award of between 0% and 150% of base salary
with a target award of 75%, with a greater or lesser award percentage being
paid based on performance. He is also entitled to participate in the Long-Term
Incentive Plan with a target award for the first four-year cycle of $2.5
million, with greater or lesser awards being paid based on performance.
On January 28, 1995, January 29, 1997 and January 13, 1998, Mr. Johnson was
granted options to purchase, for a period of ten years, 680,000 shares,
230,000 shares and 230,000 shares, respectively, of Common Stock pursuant to
the GreenPoint Financial Corp. Amended and Restated 1994 Stock Incentive Plan
(the "Stock Incentive Plan"). The options, granted at fair market value, vest
over four years, three years and three years, respectively, subject to
acceleration upon the occurrence of certain specified events. On January 28,
1996, Mr. Johnson was granted 300,000 shares of Restricted Stock that will
vest over five years, also subject to acceleration upon the occurrence of
certain specified events. Each of the option grants and the Restricted Stock
grant have been adjusted for the Two-For-One Stock Split.
Under the Employment Agreement, the Corporation will provide Mr. Johnson
with a supplemental retirement benefit, after offset of all other retirement
benefits received by him and social security, of 60% of his final average pay
which is defined as the average of his highest three years of salary and
annual performance awards. The Employment Agreement provides Mr. Johnson with
termination benefits under defined circumstances of $2 million, plus any
accrued but unpaid base salary and a pro rata annual performance award. The
Employment Agreement also provides Mr. Johnson with certain disability and
death benefits.
Mr. Johnson is entitled to a change in control payment if, subsequent to a
change in control (as defined in the Employment Agreement), his employment is
terminated by the Corporation without cause, or if he terminates his
employment for good reason. Any termination by Mr. Johnson during the thirty-
day period immediately following the first anniversary of a change in control
constitutes termination for good reason. The change in control payment
consists of all accrued but unpaid base salary and a pro rata portion of Mr.
Johnson's annual performance award for the year in which the termination
occurs, plus an amount equal to three times the sum of Mr. Johnson's base
salary and annual performance award, plus an additional amount determined
pursuant to any retirement or supplemental retirement plan in which Mr.
Johnson participates.
The Employment Agreement also provides that if Mr. Johnson's employment is
terminated for cause, he will not compete with the Corporation or the Bank for
a period of one year thereafter. The Employment Agreement has a three-year
term that is extended on a rolling basis.
The Corporation also has an employment agreement with Mr. Bhatt as President
and Chief Operating Officer (the "Agreement"). The Agreement provides for an
annual base salary of not less than $325,000 and an annual performance award
of between 0% and 120% of base salary with a target award of 60%, with a
greater or lesser award percentage being paid based on performance. The
Agreement has a three-year term that is extended on a rolling basis. Under the
Agreement, the Corporation will provide Mr. Bhatt with a supplemental
retirement benefit, after offset of all other retirement benefits received by
him and social security, of 60% of his final average pay which is defined as
the average of his highest three years of salary and annual performance
awards.
The Agreement provides Mr. Bhatt with termination benefits under defined
circumstances. In addition, a termination payment is payable upon a
termination by Mr. Bhatt of his employment for any reason during the thirty-
day period immediately following a change of control (as defined in the
Agreement). The termination payment under these circumstances consists of all
accrued but unpaid base salary and a pro rata portion of Mr. Bhatt's annual
performance award for the year in which the termination occurs, plus an amount
equal to three times the sum of Mr. Bhatt's base salary and annual performance
award, plus an additional amount determined
13
<PAGE>
pursuant to any retirement or supplemental retirement plan in which Mr. Bhatt
participates. The Agreement also provides Mr. Bhatt with certain disability
and death benefits.
The Corporation also has entered into a Change in Control Agreement with Mr.
Richardson (the "Change in Control Agreement"). The Change in Control
Agreement has a three-year term that is extended on an annual basis. Under the
Change in Control Agreement, an amount is payable to Mr. Richardson upon the
occurrence of a change in control (as defined in the Change in Control
Agreement) followed at any time during the term of the Change in Control
Agreement by the involuntary termination or certain voluntary terminations of
Mr. Richardson's employment, other than for cause. The termination payment
consists of all accrued but unpaid base salary and a pro rata portion of Mr.
Richardson's annual performance award for the year in which the termination
occurs, plus an amount equal to three times the sum of Mr. Richardson's base
salary and annual performance award, plus an additional amount determined
pursuant to any retirement or supplemental retirement plan in which Mr.
Richardson participates.
Under the Employment Agreement, the Agreement and the Change in Control
Agreement, payments in the event of a change in control, including other
payments that might be made as a result of the change in control, may
constitute an excess parachute payment under Section 280G of the Code,
resulting in the imposition of an excise tax (under Section 4999 of the Code)
on the recipient and denial of the deduction for such excess amounts to the
Corporation. The Employment Agreement, the Agreement and the Change in Control
Agreement contain gross-up provisions with respect to any excise tax the
executive may incur as a result of an excess parachute payment.
On January 28, 1995, Mrs. Arias and Messrs. Dash and Richardson were each
granted options to purchase 200,000 shares of Common Stock. On June 19, 1995,
Mr. Bhatt was granted an option to purchase 150,000 shares of Common Stock. On
January 29, 1997, Mr. Bhatt, Mrs. Arias and Messrs. Dash and Richardson were
granted options to purchase 160,000, 60,000, 70,000 and 50,000 shares of
Common Stock, respectively. On January 13, 1998, Messrs. Bhatt and Richardson
were granted options to purchase 160,000 and 50,000 shares of Common Stock,
respectively. The options were granted at fair market value. The options
granted during 1995 vest over four years and the options granted during 1997
and 1998 vest over three years. On January 28, 1996, Mrs. Arias and Messrs.
Dash and Richardson were each granted 150,000 shares of Restricted Stock that
will vest over five years. On January 29, 1997, Mr. Bhatt was granted 30,000
shares of Restricted Stock that will vest over four years. The period over
which the options and Restricted Stock vest is subject to acceleration upon
the occurrence of certain specified events. Each of the option grants and each
of the Restricted Stock grants have been adjusted for the Two-For-One Stock
Split.
Mrs. Arias and Mr. Dash retired from the Corporation effective January 17,
1998 and February 1, 1998, respectively. Upon her retirement, the Corporation
entered into a retirement agreement with Mrs. Arias that provides her with
monthly payments of $118,304 each through December 1, 1999. Upon Mr. Dash's
retirement, the Corporation entered into a consulting agreement with Mr. Dash.
Pursuant to this agreement, Mr. Dash will receive a consulting fee of $122,525
per month for continuing to consult with the Corporation on its nonconforming
mortgage banking business until December 31, 1999.
STOCK INCENTIVE PLAN
The Stock Incentive Plan is intended to help the Corporation attract, retain
and provide appropriate incentives for management personnel. It provides that
the total number of shares of Common Stock available for grant is 11,000,000
shares, of which no more than 5,000,000 shares may be granted over the life of
the plan for incentive stock options. Awards under the plan may be granted in
any one or a combination of stock options, limited rights and Restricted
Stock. The Compensation Committee administers the plan and authorizes the
employees to whom awards are granted, the number of awards granted and the
specific terms and conditions of each grant, subject to the provisions of the
plan. Awards under the plan must have an exercise price of not less than fair
market value at the date of grant. In each calendar year, no individual may be
granted stock options on more than 800,000 shares of Common Stock.
14
<PAGE>
Adjustments in the number and type of shares and other equitable adjustments
may be made by the Board or the Compensation Committee in the event of a
merger, reorganization, consolidation, recapitalization, spin-off, stock
dividend, stock split or any other similar event. An adjustment was made for
the Two-For-One Stock Split. A participant may satisfy a tax withholding
requirement by applying shares of Common Stock to which the participant is
entitled.
The Stock Incentive Plan will terminate on January 28, 2004. Awards granted
and outstanding when the plan terminates are not affected or impaired by the
termination.
ANNUAL INCENTIVE PLAN
Under the GreenPoint Financial Corp. 1994 Annual Incentive Plan, certain
executive officers of the Corporation are eligible to receive additional
annual cash compensation based on performance. The executive officers eligible
to participate in this plan are the Chief Executive Officer and any other
officer whose compensation is required to be disclosed in the annual proxy
statement pursuant to rules promulgated under the Exchange Act. The plan is
intended to provide participating executive officers with financial incentives
to meet and exceed predetermined performance goals. Under the plan,
performance criteria are selected by the Compensation Committee each year from
one or more of the following: (i) return on equity, (ii) return on assets,
(iii) earnings per share, (iv) net income and (v) achievement of predetermined
strategic milestones. Target levels may be specified relative to budgeted or
other internal goals, or relative to performance of one or more peer groups.
In addition, goals may be stated as alternatives, or as combinations. The
maximum amounts payable annually to the Chief Executive Officer and to each of
the other eligible officers are $1,250,000 and $500,000, respectively. During
1997, Messrs. Johnson, Bhatt, Dash and Richardson, and Mrs. Arias participated
in this plan.
LONG-TERM INCENTIVE PLAN
Under the Long-Term Incentive Plan, the Chief Executive Officer and the
Executive Vice Presidents of the Corporation named in this Proxy Statement are
eligible to receive additional compensation based on longer-term performance.
The plan is intended to provide these participants with financial incentives
to meet and exceed predetermined long-term performance goals. Under the plan,
cash awards are paid to eligible participants for the achievement of target
levels of specified long-term performance criteria selected by the
Compensation Committee from one or more of the following: (i) return on
equity, (ii) total return to stockholders, (iii) return on assets and (iv)
earnings growth. Target levels may be specified relative to budgeted or other
internal goals, or relative to performance of one or more peer groups. In
addition, goals may be stated as alternatives, or as combinations.
Payout opportunities occur under the plan during each of the four years
ending December 31, 1995, 1996, 1997 and 1998, respectively, depending on the
achievement of interim, cumulative or other goals. The maximum amounts payable
for the four-year period to the Chief Executive Officer and to each of the
Executive Vice Presidents are $3,750,000 and $450,000, respectively.
BANK BENEFIT PLANS
Pension Plan. As of May 6, 1996, the benefit formula under the Bank's
defined benefit plan (the "Pension Plan") was changed to a cash balance
formula. An account balance was established for each participant equal to the
then present value of the participant's benefit earned to date. For service
periods after May 5, 1996, this account balance is to be increased by interest
at a specified rate and a contribution credit equal to a percentage of the
participant's eligible base salary. Generally, the interest credit percentage
will represent the average of the one-year U.S. Treasury bill rate during
February, May, August and November of the previous year plus 1%. The
contribution credit percentage ranges from 3% to 6% depending on the
participant's years of service with the Corporation. Employees who were
participants on May 6, 1996 who had at least ten years of service with
15
<PAGE>
the Corporation and who were at least age 50 or whose age plus years of
service totalled at least 75 will receive the greater of their account balance
or the benefit derived from the "grandfathered" formula. The grandfathered
formula is equal to 2% of the participant's average annual compensation during
the 60 consecutive calendar months within the participant's 120 consecutive
calendar months of participation affording the highest such average,
multiplied by the participant's years of credited service, limited to 60% of
the final three years of average annual compensation.
Employees are enrolled in the Pension Plan following the completion of one
year of service. The normal retirement age is the later of age 65 and the
fifth anniversary of the employee's date of hire, although earlier options are
available. The Pension Plan has a five-year vesting provision, and
participants who are vested may receive their account balance or annuity
equivalent if they leave the employ of the Corporation before retirement.
Annual pension benefits attributable to amounts in excess of the limits
imposed under the Code are provided under the GreenPoint Bank Supplemental
Executive Retirement Plan and not under the Pension Plan. As of December 31,
1997, the estimated annual Pension Plan benefit payable upon normal retirement
age (assuming the individual continues to work to age 65 at the current rate
of compensation and a 6% interest credit percentage) for Mr. Johnson, Mr.
Bhatt, Mrs. Arias, Mr. Dash and Mr. Richardson was $12,211, $10,222, $116,667,
$116,667 and $22,645, respectively.
Employee Stock Ownership Plan. The Bank has established the ESOP for
employees of the Bank and its affiliates, including the Corporation, who have
been credited with at least one year of service. As of March 17, 1998, the
ESOP Trustee had purchased a total of 16,467,604 shares of Common Stock.
Purchases by the ESOP were funded by a loan from the Corporation totaling
$137.1 million, which is collateralized by the Common Stock purchased by the
ESOP. The loan will be repaid principally from the Bank's discretionary
contributions to the ESOP over the applicable loan amortization period. Shares
of Common Stock purchased by the ESOP and pledged as collateral for the ESOP
loan are held in a suspense account and released for allocation among
participants in the ESOP annually in amounts proportionate to the repayment of
the ESOP loan.
Contributions to the ESOP and shares of Common Stock released from the
suspense account are allocated among participants in the ESOP on the basis of
each participant's eligible compensation. Benefits generally become vested
over a five-year period. However, in the event of a change in control of the
Corporation or the Bank and other events set forth in the ESOP, the unvested
portion of any participant's account would vest immediately. Participants who
terminate employment for any other reason before becoming 100% vested forfeit
the unvested portion of their accounts. Forfeitures will be reallocated among
remaining participants, in the same proportion as their respective
allocations. Benefits are payable in the form of Common Stock. Since the
Bank's contributions to the ESOP are not fixed, benefits payable under the
ESOP cannot be estimated.
401(k) Savings Plan. Effective July 1, 1996 the Bank amended its Incentive
Savings Plan to include provisions that qualify under Section 401(k) of the
Code (the "401(k) Savings Plan"). Substantially all of the employees of the
Corporation employed prior to July 1, 1996 and employees employed after such
date who have been credited with 1000 hours of service during a twelve-month
period are eligible to participate. Participants may contribute up to 6% of
their eligible compensation on a pre-tax basis and may be eligible to receive
a matching contribution equal to 100% of the first 3% of their eligible
compensation contributed. The matching contribution may be funded by using
shares released for allocation under the ESOP.
Participants in the 401(k) Savings Plan are always 100% vested in their
contributions and in the earnings thereon. Generally, participants vest in
employer matching contributions and earnings thereon over a five-year period.
Participants may invest contributions in any of the investment funds made
available under the 401(k) Savings Plan, including a fund that invests
primarily in Common Stock.
Incentive Compensation Plan. The Bank maintains an incentive compensation
plan for certain officers of the Bank (the "Bank Incentive Plan"). Generally,
officers with the title of Vice President and above are eligible to
participate in the Bank Incentive Plan. The Bank Incentive Plan provides for
cash payments to these officers based upon the Corporation's performance
relative to predetermined financial goals, as well as the individual
performance of each officer.
16
<PAGE>
Insurance Plans. After a three-month waiting period, the Bank makes
available to all full-time and regular part-time employees medical, dental,
life, accidental death and dismemberment, and short- and long-term disability
insurance, as well as tuition assistance.
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TRANSACTIONS WITH CERTAIN RELATED PERSONS
- -------------------------------------------------------------------------------
The Corporation's policies require that all transactions between the
Corporation and its executive officers, Directors, holders of 10% or more of
its Common Stock and affiliates thereof, contain terms no less favorable to
the Corporation than could have been obtained by it in arms-length
negotiations with unaffiliated persons. In addition, with respect to loans,
the Corporation's policies prohibit the granting of loans at an interest rate
discount or with any other favorable features to officers at and above the
Senior Vice President level and further require that loans to any such person
must be approved by the Board. As of March 17, 1998, no such loans had been
made.
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BENEFICIAL OWNERSHIP REPORTS
- -------------------------------------------------------------------------------
Pursuant to regulations promulgated under the Exchange Act, the
Corporation's officers and Directors and persons who own more than 10% of the
Common Stock are required to file reports detailing their ownership and
changes of ownership in the Common Stock and to furnish the Corporation with
copies of all such ownership reports that are filed. Based solely on the
Corporation's review of the copies of such ownership reports which it has
received in the past fiscal year or the current fiscal year, or written
representations from such persons that no annual report of change in
beneficial ownership was required, the Corporation believes that all persons
subject to such reporting requirements have complied with such reporting
requirements.
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PROPOSAL 2--RATIFICATION OF APPOINTMENT OF AUDITORS
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The Board has appointed Price Waterhouse LLP ("Price Waterhouse") to perform
the audit of the Corporation's financial statements for the year ending
December 31, 1998, subject to ratification by the Corporation's stockholders
at the Meeting. Price Waterhouse served as the independent auditors of the
Corporation for the year ended December 31, 1997. Representatives from Price
Waterhouse will be present at the Meeting and will be given the opportunity to
make a statement if they so desire, and will be available to respond to
appropriate questions from stockholders.
The affirmative vote of the holders of a majority of the Common Stock
present at the Meeting, in person or by proxy, and entitled to vote is
required to ratify the appointment of Price Waterhouse as the Corporation's
independent auditors for the year ending December 31, 1998.
THE BOARD RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT OF PRICE
WATERHOUSE AS THE CORPORATION'S INDEPENDENT AUDITORS FOR THE YEAR ENDING
DECEMBER 31, 1998.
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OTHER MATTERS
- -------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described in this Proxy Statement. However,
if any other matters should properly come before the Meeting, it is intended
that proxies in the accompanying form will be voted in respect thereof in
accordance with the judgment of the person or persons voting the proxies.
17
<PAGE>
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MISCELLANEOUS
- -------------------------------------------------------------------------------
The cost of soliciting proxies will be borne by the Corporation. In addition
to the solicitation of proxies by mail, D.F. King & Co., Inc. will assist the
Corporation in soliciting proxies for the Meeting and will be paid a fee of
$11,000 plus reimbursement for out-of-pocket expenses. The Corporation will
reimburse brokerage firms and other custodians, nominees and fiduciaries for
reasonable expenses incurred by them in sending proxy material to the
beneficial owners of Common Stock. In addition to solicitations by mail,
Directors, officers and regular employees of the Corporation may solicit
proxies personally or by telephone, telegram or other means of communication
without additional compensation.
The Corporation's 1997 Annual Report to Stockholders, including financial
statements, was mailed to all stockholders with the Proxy Statement. Any
stockholder who has not received a copy of such Annual Report may obtain a
copy by writing to the Secretary of the Corporation. Such Annual Report is not
to be treated as a part of the proxy solicitation material nor as having been
incorporated herein by reference.
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STOCKHOLDER PROPOSALS
- -------------------------------------------------------------------------------
In order to be eligible for inclusion in the Corporation's proxy materials
for next year's Annual Meeting of Stockholders, any stockholder proposal to
take action at such meeting must be received at the Corporation's main office
at 90 Park Avenue, New York, New York 10016, no later than November 27, 1998.
Any such proposal shall be subject to the requirements of the proxy rules
adopted under the Exchange Act.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Howard C. Bluver
Howard C. Bluver
Secretary
New York, New York
March 20, 1998
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ANNUAL REPORT ON FORM 10-K
- -------------------------------------------------------------------------------
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR 1997 FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, WILL BE FURNISHED TO STOCKHOLDERS WITHOUT CHARGE UPON
REQUEST. WRITTEN REQUESTS SHOULD BE DIRECTED TO THE SECRETARY OF THE
CORPORATION AT THE ADDRESS STATED HEREIN.
18
<PAGE>
GreenPoint Financial Corp.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE 1998 ANNUAL MEETING OF STOCKHOLDERS--MAY 1, 1998
The undersigned hereby appoints Thomas S. Johnson, Charles P. Richardson and
Ramesh Shah, and each of them, with full power of substitution, for and in the
name of the undersigned, to vote all common stock, par value $.01 per share, of
GreenPoint Financial Corp., a Delaware corporation, that the undersigned would
be entitled to vote if personally present at the 1998 Annual Meeting of
Stockholders to be held at Terrace on the Park, 52-11 111th Street, Flushing,
New York, on Friday, May 1, 1998 at 10:00 a.m., local time, and at any
adjournment thereof, upon the matters described in the accompanying Notice of
Annual Meeting of Stockholders and Proxy Statement, receipt of which is hereby
acknowledged, subject to any direction indicated on the reverse side of this
card, and upon any other business that may properly come before the meeting or
any adjournment thereof, hereby revoking any proxy heretofore executed by the
undersigned to vote at said meeting.
This proxy is being solicited by the Board of Directors of GreenPoint Financial
Corp. THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED, THIS
PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2 AND, WITH RESPECT TO ITEM 3, AS SAID
PROXIES, AND EACH OF THEM, MAY DETERMINE.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
-----------
SEE REVERSE
SIDE
-----------
FOLD AND DETACH HERE
<PAGE>
Please mark
your votes as [X]
indicated in
this example
The Board of Directors recommends a vote FOR Proposals 1 and 2
1. Election of Directors
FOR all nominees WITHHOLD
(except as noted authority to
to the contrary vote for all
Nominees: below) nominees
Bharat B. Bhatt, Robert M. McLane,
Edward C. Schmults, Wilfred O. Uhl [ ] [ ]
and Robert F. Vizza
<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
2. Ratification of appointment of Price Waterhouse LLP as the Corporation's [ ] [ ] [ ]
independent auditors for the year ending December 31, 1998.
</TABLE>
3. In their discretion on such other matters as may properly come before the
meeting or any adjournment thereof.
(Instruction: To withhold authority to vote for any individual
nominee write that nominee's name on the space provided below.)
- ---------------------------------------------------------------
Please sign and date below and return in enclosed envelope promptly.
Signature(s) Date: , 1998
------------------------------------------------- -------
NOTE: Please date and sign this proxy exactly as your name appears hereon. In
case of joint owners, each joint owner should sign. When signing in a fiduciary
or representative capacity, please give your full title. If this proxy is
submitted by a corporation or partnership, it should be executed in the full
corporate or partnership name by a duly authorized person.
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FOLD AND DETACH HERE
