UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant registrant ☒
Filed by a Partyparty other than the Registrant registrant ☐
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☐ | Preliminary proxy statement | ☐ | Confidential, for Use of the Commission Only (as permitted by Rule | |||
☒ | Definitive proxy statement |
☐ | Definitive |
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| Soliciting material under Rule 14a-12 |
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New York Community Bancorp, Inc.
(Name of Registrant as Specified In Itsspecified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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☒ | No fee required. |
☐ | Fee computed on table below per Exchange Act |
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☐ | Fee paid previously with preliminary materials. |
☐ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the |
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Explanatory Note
The sole purpose of filing this revised preliminary proxy statement, which was originally filed on April 14, 2020 (the “Original Filing”), is to correct formatting issues that, for technical reasons, caused certain information in the Original Filing to not display properly, particularly with respect to the information contained in the table headings of “Selected 2019 Financial Benchmarks” found on page 27 of the Original Filing.
Except as described above, this revised preliminary proxy statement does not modify or update in any way the disclosures contained in the Original Filing.
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April 24, 2020
16, 2021
Fellow Shareholders:
You are cordially invited to attend the 2021 Annual Meeting of Shareholders of New York Community Bancorp, Inc., the holding company for New York Community Bank. The safety of our stockholders is important to us, and given the current guidance by public health officials surrounding COVID-19 and group gatherings, the Annual Meetingmeeting will be held in a “virtual meeting” conducted exclusively via“virtual” format through a live webcast on Wednesday, June 3, 2020,May 26, 2021, at 10:00 a.m. Eastern Daylight Time. You will be able to attend the Annual Meeting, vote, and submit questions by visiting www.virtualshareholdermeeting.com/NYCB2020.
NYCB2021.
The attached Notice and Proxy Statement describe the formal business to be transacted at the Annual Meeting. DirectorsMeeting, including with respect to the Company governance, compensation, and officersother matters arising during a most extraordinary year.
In 2020, as the COVID-19 pandemic took hold, our employees quickly drew together around a common purpose – to aid our customers and the communities we serve in the face of the global calamity. From the outset, our Board and management identified a new set of critical priorities, adopted to our customers’ changing needs and sometimes heartbreaking circumstances. We transformed our organization to ensure that personnel at all levels were able to perform their jobs under the pandemic’s difficult conditions, focusing on the health and safety of our colleagues and customers and the resiliency of our business. We came through the year with strong financial results and a bright outlook for our future.
As we come together again as investors in New York Community Bancorp, Inc., as well as representatives of KPMG LLP, the Company’s independent registered public accounting firm, will be presentI encourage you to respond to any questions you may have.
On April 24, 2020, under rules established by the Securities and Exchange Commission, we sent the majority of those shareholders who are eligible to vote at the Annual Meeting a notice that explains how to access their proxy materials and our 2019 Annual Report online, rather than receive them in traditional printed form. The notice also explains the simple steps our eligible shareholders can follow in order to vote their shares online. If you are among the shareholders who received the notice explaining this process and would prefer to receive your proxy materials in the traditional hard copy format, the notice also explains how to arrange to have the printed materials sent to you in the mail. If you are among those who received their proxy materials in printed form, rather than the notice, you may still access these materials and vote your shares online by going to the following website: www.proxyvote.com and following the prompts.
To cast your vote please sign, date,by signing, dating, and returnreturning the enclosed proxy card promptly, or voteby voting online or by telephone as instructed on the proxy card. As the holders of a majority of the common stock entitled to vote must be represented, either in person or by proxy, to constitute a quorum at the meeting, we would appreciate your timely response.
In lightDirectors and officers of on-going developments related to coronavirus (COVID-19) and after careful consideration,New York Community Bancorp, Inc., as well as representatives of KPMG LLP, the Board of Directors determined to hold a virtual annual meeting in order to facilitate shareholder attendance and participation by enabling shareholders to participate from any location and at no cost. We believe this is the right choice for the Company at this time, as it enables engagement with our shareholders, regardless of size, resources, or physical location while safeguarding the health of our shareholders, Board, management, and other partners. We are committed to ensuring that shareholdersCompany’s independent registered public accounting firm, will be affordedpresent at the same rightsmeeting and opportunitieswill be pleased to participate in the annual meeting as they would at an in-person meeting.
respond to any questions you may have.
On behalf of the Board of Directors, officers, and employees of New York Community Bancorp, Inc., we thank you for your continued interest and support.
Sincerely,
Thomas R. Cangemi
Chairman of the Board
President and Chief Executive Officer
April 16, 2021
Fellow Shareholders:
Thank you for your continued confidence in the Board of Directors of New York Community Bancorp., Inc. and for your support during what has been an unprecedented and challenging period for our country and our industry. As Presiding Director, I am pleased to be working closely with my fellow Directors along with our new Chairman, President, and Chief Executive Officer Thomas Cangemi and our dedicated management team to overcome these challenges and move toward a brighter future.
Throughout the last year our organization has taken prompt and decisive actions adapting to the emergence of the COVID-19 pandemic. The Board believes that the changes we have made and the lessons we have learned have prepared our company to take on new challenges in our evolving industry, maintaining our steadfast commitment to credit quality and customer service. We continue to build strength and profitability as we transition through several important governance changes, including the appointment of Mr. Cangemi as our Chairman, President, and CEO, my appointment as Presiding Director, the appointment of Leslie Dunn as Chairwoman of our Nominating and Corporate Governance Committee, and Lawrence Rosano as Chairman of our Risk Committee.
Tom Cangemi has played an important role in the Company’s growth and success over many years, working alongside our former Chief Executive Officer Joseph Ficalora. Tom possesses deep and broad banking expertise and he has demonstrated an ability to deliver strong operating results. He is held in high-regard inside of the organization and is well-respected by the investment community. With Tom and the rest of our executive team, our Board is dedicated to enhancing our performance, evolving our business model, and increasing our shareholder value. Our goals for the future include developing our Board, including by expanding the diversity of its members, advancing important environmental, social, and governance objectives, and expanding our digital capabilities.
In the accompanying proxy statement, we share information about the Board’s role in shaping our values, governance, and strategy. We hope you will take the time to read it. Whether or not you can attend the annual meeting, we welcome your participation with the New York Community Bancorp, Inc. Board and management team and thank you for your continued interest and support.
Finally, on behalf of the Board of Directors, I would like to express our thanks to Joseph Ficalora for his long and distinguished career with the Company. In a career that lasted 55 years with the Company, Joe’s vision and leadership played a critical role in making New York Community Bancorp, Inc. one of the top banks in the country. The Board and I appreciate Joe’s decades of service and dedication to the Company and Community Bank, we thank him for his many valuable contributions, and we wish him all the best in his retirement.
Sincerely,
Hanif “Wally” Dahya
Presiding Director
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NOTICE OF 20202021 ANNUAL MEETING OF SHAREHOLDERS
OF NEW YORK COMMUNITY BANCORP, INC.
DATE AND TIME: | Wednesday, | |
PLACE: | The | |
ITEMS OF BUSINESS: | 1)The election of | |
2)The ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, | ||
3)Approval, on a non-binding advisory basis, of New York Community Bancorp, Inc.’s Named Executive Officer compensation; | ||
4)A proposal to amend the Amended and Restated Certificate of Incorporation of the Company in order to phase out the classification of the board of directors and provide instead for the annual election of directors; 5) A shareholder proposal requesting Board action to amend the Amended and Restated Certificate of Incorporation and Bylaws of the Company | ||
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WHO CAN VOTE: | You are entitled to vote if you were a shareholder of record at the close of business on Tuesday, April | |
VOTING: | We urge you to participate in the meeting, either by attending and voting in person or by voting as promptly as possible by telephone, through the Internet, or by mailing your completed proxy card (or voting instruction form, if you hold your shares through a broker, bank, or other nominee). Each share is entitled to one vote on each matter to be voted upon at the annual meeting. Your vote is important and we urge you to exercise your right to cast it. | |
MEETING ADMISSION: | To be admitted to the meeting at www.virtualshareholdermeeting.com/ | |
| A copy of our | |
DATE OF DISTRIBUTION: | This Notice, the Proxy Statement, and the proxy card are first being made available or mailed to shareholders on or about April |
By Order of the Board of Directors, | |
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R. Patrick Quinn | |
Executive Vice President, | |
General Counsel and Corporate Secretary Westbury, New York |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 3, 2020MAY 26, 2021
The Company’s Notice of Annual Meeting, Proxy Statement, and 20192020 Annual Report to Shareholders are available, free of charge, at www.proxyvote.com.
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This summary highlights selected information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider, and you should read the entire proxy statement carefully before voting. For more complete information regarding our 20192020 performance, please review our 20192020 Annual Report on Form 10-K, which accompanies this document.
VOTING MATTERS:
VOTING MATTERS:
Voting Matters: | Recommendation of the Board: | |||
Proposal 1 | The election of | FOR ALL | ||
Proposal 2 | Ratification of the appointment of KPMG LLP as our independent registered public accounting firm for | FOR | ||
Proposal 3 | Approval, on a non-binding advisory basis, of New York Community Bancorp, Inc.’s Named Executive Officer compensation. | FOR | ||
Proposal 4 | A proposal to amend the Amended and Restated Certificate of Incorporation of the Company in order to phase out the classification of the board of directors and provide instead for the annual election of directors. | FOR | ||
Proposal 5 | A shareholder proposal requesting Board action to provide for the right to act by written consent by amending the Amended and Restated Certificate of Incorporation and Bylaws of the Company, |
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HIGHLIGHTS:
Company Profile: |
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HIGHLIGHTS:
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New York Community Bancorp, Inc. is the largest
Based in Westbury, NY, New York Community Bancorp, Inc. is a leading producer of multi-family loans on non-luxury, rent-regulated apartment buildings in New York City, and the parent of New York Community Bank. At December 31, |
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•We |
•We underwrite our loans in accordance with conservative credit standards in order to maintain a high level of asset quality. |
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•We originate asset-based loans, dealer floor-plan loans, and equipment loans and leases to large corporate obligators in stable industries nationwide through the Community Bank’s specialty finance subsidiary, NYCB Specialty Finance LLC. |
•We |
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| PROXY | |
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| PROXY SUMMARY | |
Performance Highlights (cont’d): |
•We paid our shareholders an annual dividend of $0.68 per common share, which translates into total cash dividends of |
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•Over the course of our public life, we have produced multi-family loans totaling |
•Likewise, we have produced commercial real estate loans totaling |
•From 1993 through the end of |
•From 1993 through |
•Over the course of our public life, we have expanded our balance sheet by $35.3 billion through 10 mergers and acquisitions, involving seven in-market competitors and two out-of-market banks. |
•Reflecting our profitability – and our capital position – we have distributed |
Executive Compensation Highlights: |
The following provides an overview of 2020 executive compensation: |
• No adjustments were made to our NEO base salaries. The Compensation |
•Our executive incentive compensation program is designed to encourage our executives to deliver superior financial results and strong shareholder returns, both on an annual basis and over the long-term.
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•For a detailed discussion of our |
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| PROXY | |
We are committed to maintaining the highest standards of corporate governance. Strong corporate governance practices help us achieve our performance goals and maintain the trust and confidence of our shareholders and other constituents. Highlights of our governance standards and policies include: |
•Our Board of Directors is comprised of individuals possessing a well-rounded variety of skills, knowledge, experience and perspectives and who have unique experience and perspectives on our business. |
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•Our |
•Our Board in recent months has underwent several structural changes, including the appointment of Thomas R. Cangemi as our new Chairman, President, and Chief Executive Officer, and the appointment of new chairs to a number of Board Committees, including the Compensation Committee, Nominating & Corporate Governance Committee, and Risk Assessment Committee. |
• Recognizing that diversity and inclusion benefits companies by providing a broad range of perspectives and insights, and continuing the Board’s focus on diversity and refreshment, the Board has formed a new Board Development Subcommittee of the Nominating and Corporate Governance Committee to assist with identifying candidates with a diversity of ethnic and gender for potential Board service. |
• Our By-laws provide for “proxy access,” allowing eligible shareholders to include their own nominees for director in the Company’s proxy materials. |
•Our Board and Board Committees perform annual self-evaluations and adopt action plans to implement changes when deemed necessary or appropriate. |
•Our Board Risk Assessment Committee, which meets the requirements for U.S. Bank Holding Companies under the Dodd-Frank Act’s Enhanced Prudential Standards, meets at least on a monthly basis and oversees a robust and exacting enterprise risk management program. |
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Community Support: | ||
Service to our customers and the community is an important part of the New York Community |
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Bank Foundation and Richmond County Savings Foundation, with the following notable highlights: | |
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Information About Our Annual Meeting and Solicitation of Proxies
Why am I being provided this proxy statement?
This proxy statement summarizes information you need to know in order to vote at the 2020 Annual Meeting of Shareholders. The 2020 Annual Meeting of Shareholders of New York Community Bancorp, Inc. (the “Company”) will be a virtual meeting conducted exclusively via live webcast at www.virtualshareholdermeeting.com/NYCB2020 on June 3, 2020 at 10:00 a.m., Eastern Daylight Time (the “Annual Meeting”). This proxy statement is being sent to you because the Board of Directors (the “Board of Directors” or “Board”) of the Company is soliciting your proxy to vote your shares of common stock of the Company (the “Common Stock”) at the Annual Meeting. On or about April 24, 2020, the proxy statement and proxy materials, or a notice advising how to access these documents online, will be sent to shareholders of record as of April 7, 2020. The 2019 Annual Report to Shareholders, which includes the Annual Report on Form 10-K featuring the Company’s consolidated financial statements for the fiscal year ended December 31, 2019 accompanies this proxy statement.
What is a proxy?
A proxy is your designation of another person to vote stock you own. That other person is called a proxy. If you designate someone as your proxy in a written document, that document also is called a proxy or a proxy card. When you designate a proxy, you also may direct the proxy how to vote your shares. One or more of the Company’s directors will serve as the designated proxy to cast the votes submitted by the Company’s shareholders at the Annual Meeting.
What is a proxy statement?
It is a document that the Company is required to give you, or provide you with access to, in accordance with regulations of the Securities and Exchange Commission (the “SEC”), when asking you to designate proxies to vote your shares of the Common Stock at a meeting of shareholders. The proxy statement includes information regarding the matters to be acted upon at the meeting and certain other information required by regulations of the SEC and the rules of the New York Stock Exchange (the “NYSE”).
On what matters are the shareholders of record voting?
The shareholders of record will vote on the following proposals:
Proposal 1: Election of Directors. In Proposal 1, four director nominees have been recommended for election to the Board of Directors by the Nominating and Corporate Governance Committee of the Board. Directors are elected by a majority of the votes cast, meaning that the number of votes cast “FOR” a nominee must exceed the number of votes cast “AGAINST” that nominee, with broker non-votes and abstentions not counted as a vote cast either “FOR” or “AGAINST” that nominee. Shares not voted will have no impact on the election of directors. A properly executed proxy marked “FOR ALL” of the four nominees for director will be voted for each of the nominees, unless you mark the proxy card, or select the corresponding option in the electronic form, “WITHHOLD ALL” or “FOR ALL EXCEPT.” Marking the proxy card, or selecting the corresponding option in the electronic form, “WITHHOLD ALL” will withhold your vote as to all nominees for director. Marking the proxy card, or selecting the corresponding option in the electronic form, “FOR ALL EXCEPT” will direct that your shares be voted for all nominees except that your shares will be withheld as to any nominees you may specify.
Proposal 2: Ratification of Auditors. The affirmative vote of a majority of votes cast at the Annual Meeting is required to approve Proposal 2, a proposal to ratify the reappointment of KPMG LLP as the Company's independent registered public accounting firm for 2020. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card, or selected in the corresponding option in the electronic form, and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented.
Proposal 3: Approval, on a non-binding advisory basis, of the Company’s Named Executive Officer Compensation. As to the advisory approval of the 2019 Named Executive Officer compensation, the proxy card being provided by the Board of Directors enables a shareholder to check the appropriate box on the card, or select the corresponding option in the electronic form, to (i) vote “FOR” the proposal, (ii) vote “AGAINST” the proposal, or (iii) “ABSTAIN” from voting on the proposal. To approve Proposal 3, the affirmative vote of a majority of the votes cast at the Annual Meeting is required. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card, or selected in the corresponding option in the electronic form, and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented. Your vote on Proposal 3 is an advisory vote, which means that the Company and the Board of Directors are not required to take any action based on the outcome of the vote.
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Proposal 4: Eliminate the current supermajority voting requirements by approving amendments to the Amended and Restated Certificate of Incorporation and Bylaws of the Company. To be approved, at least 80 percent of the shares outstanding as of the record date must vote in favor of Proposal 4, a proposal to eliminate the charter document supermajority voting requirements for certain matters to be replaced by a majority of votes cast, or entitled to be cast, voting requirement, as applicable, on matters to be brought before the Company’s shareholders. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card or corresponding option in the electronic form and shares underlying broker non-votes or in excess of the Limit (as described below) will count as a vote against the proposal.
Proposal 5: Approval of the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan. As to the approval of the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan, the Board of Directors is enabling a shareholder to check the appropriate box on the proxy card or corresponding option in the electronic form to (i) vote “FOR” the proposal, (ii) vote “AGAINST” the proposal, or (iii) “ABSTAIN” from voting on the proposal. To approve Proposal 5, a majority of the votes cast at the Annual Meeting is required. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented.
Proposal 6: A shareholder proposal, as described herein, if properly presented at the meeting, requesting Board action to eliminate the classified Board of Directors.
Proposal 7: A shareholder proposal, as described herein, if properly presented at the meeting, regarding director age and term limits.
The affirmative vote of a majority of votes cast at the Annual Meeting is required to approve each of Proposals 6 and 7. In connection with each such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card or corresponding option in the electronic form and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented.
As discussed below, under NYSE Rules, if your broker holds shares in your name and delivers this proxy statement to you, the broker is not entitled to vote your shares on any non-routine proposal (Proposals 1 and 3 through 7) without your specific instructions.
Who may vote and what constitutes a quorum at the meeting?
The close of business on April 7, 2020 has been fixed by the Board of Directors as the record date (the “Record Date”) for the determination of shareholders of record entitled to receive notice of, and to vote at, the Annual Meeting and at any adjournments thereof.
In order to conduct the Annual Meeting, shareholders of record of at least a majority of the total number of shares of Common Stock entitled to vote (after subtracting any shares in excess of the Limit pursuant to the Company’s Certificate of Incorporation) must be present in person or by proxy. This is called a quorum. Shareholders who deliver valid proxies or vote in person at the meeting will be considered part of the quorum. Once a share is represented for any purpose at the meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjourned meeting. Abstentions will be counted as being present and entitled to vote for purposes of determining a quorum. Broker “non-votes” are counted as being present and entitled to vote for purposes of determining a quorum only for routine matters. In the event that there are not sufficient shares present for a quorum, or votes to approve or ratify any management proposal at the time of the Annual Meeting, the Annual Meeting may be adjourned in order to permit the further solicitation of proxies.
How many votes do I have?
The securities that may be voted at the Annual Meeting consist of shares of Common Stock, with each share entitling its owner to one vote on all matters to be voted on at the Annual Meeting, except as described below. There is no cumulative voting for the election of directors (in a cumulative voting system, each shareholder would be entitled to one vote per share multiplied by the number of directors to be elected). The total number of shares of Common Stock outstanding and entitled to vote as of the Record Date was 463,958,344.
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A shareholder may vote online during the Annual Meeting by visiting www.virtualshareholdermeeting.com/NYCB2020 and completing a ballot while the polls are open. You will need the control number printed on your proxy card, voting instruction form, or notice. A shareholder may also vote in advance of the Annual Meeting by using a proxy to authorize a proxy to vote on his or her behalf. There are three ways to use a proxy:
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• Almost 200 Bank employees have leadership roles within community organizations. • Employees participated in more than 177 community events and • The Foundations have awarded more than $94 million in grants to more than 6,000 community organizations since 2000, including $15.5 million for health and • The Community Bank’s corporate philanthropy program contributes nearly $1.0 million annually to
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The Community Bank is committed to continuing our leadership role in originating multi-family loans within |
The Internet and telephone voting procedures are designed to authenticate shareholders’ identities and allow shareholders to provide their voting instructions and confirm that the instructions have been properly recorded. Specific instructions for shareholders of record who wish to vote their proxies over the Internet or by telephone are set forth on the proxy card for the Annual Meeting.
The Company encourages shareholders to take advantage of the options to vote using the Internet or by telephone. Voting in this manner will result in cost savings for the Company.
Please be aware that if you vote over the Internet, you may incur costs such as telephone and Internet access charges for which you will be responsible. The Internet and telephone voting facilities for eligible shareholders of record will close at 11:59 p.m., Eastern Daylight Time, on June 2, 2020.
Your vote as a shareholder is important. Please vote as soon as possible to ensure that your vote is recorded.
How are the proxy materials delivered?
The Company is again reducing its costs by taking advantage of SEC rules that allow companies to furnish proxy materials to shareholders primarily through the Internet. Accordingly, the Company is sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to shareholders who (i) own shares directly in the Company (“shareholders of record”) and not through a broker, bank, or intermediary directly to their mailing address unless they have directed the Company to provide the materials in a different manner or (ii) hold shares of Common Stock through the Company’s stock-based benefit plans. See Benefit Plan Voting below. Shareholders whose shares are held for them by brokerage firms, banks, or other intermediaries (“beneficial owners”) will have the proxy materials or the Notice forwarded to them by the intermediary that holds their shares. The Notice provides instructions on how to access and review all of the important information contained in the Company’s proxy statement and 2019 Annual Report to Shareholders, as well as how to cast your vote, over the Internet.
Shareholders who receive the Notice and who would still like to receive a printed copy of the Company’s proxy materials, including the 2019 Annual Report to Shareholders, can find instructions for requesting these materials included in the Notice. The Company plans to mail the Notice to shareholders on April 24, 2020.
What is a broker non-vote?
If you hold your shares in “street name” (i.e., through a broker, bank, or other nominee), it is critical that you cast your vote if you want it to count in the election of directors. SEC regulations currently prohibit brokers or nominees to vote your uninstructed shares in the election of directors on a discretionary basis. Thus, if you hold your shares in street name and you do not instruct your bank or broker how to vote in the election of directors, with respect to the proposal to approve, on a non-binding advisory basis, the Company’s named executive officer compensation, with respect to the Company’s 2020 Omnibus Incentive Plan, or with respect to any of the shareholder proposals, if properly presented, no votes will be cast on your behalf with respect to these matters. These uncast “votes” are referred to as broker non-votes. Your bank or broker will, however, continue to have discretion to vote any uninstructed shares on the ratification of the appointment of the Company’s independent registered public accounting firm (Proposal 2).
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What effect do broker non-votes and abstentions have?
A broker or other nominee may generally vote your shares without instruction on routine matters, but not on non-routine matters. A broker “non-vote” occurs when your broker submits a proxy for your shares, but does not indicate a vote for a particular “non-routine” proposal (such as Proposals 1 and 3 through 7) because your broker does not have your authority to vote on that proposal and has not received specific voting instructions from you. Broker non-votes are not counted as votes for or against the proposal in question or as abstentions, nor are they counted to determine the number of votes present for a non-routine proposal. However, when a proposal requires the affirmative vote of a percentage of the Company’s outstanding shares entitled to vote in order to be approved (such as Proposal 4), a broker non-vote will have the same effect as a vote against the proposal.
If you abstain from voting on Proposals 1 and 3 through 7, your vote will be counted as present for determining whether a quorum exists but will not be treated as cast for or against that matter.
What if I sign and date my proxy but do not provide voting instructions?
Proxies solicited by the Board of Directors of the Company will be voted in accordance with the directions given therein. If you are a shareholder of record and do not provide voting directions, signed and dated proxy cards will be voted as follows:
FOR the election of each of the nominees for director named in this proxy statement;
FOR the ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company;
FOR approval of the Named Executive Officer compensation;
FOR the approval of the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan;
AGAINST approval of a shareholder proposal, if properly presented; and
AGAINST approval of a shareholder proposal, if properly presented.
Other than the matters listed on the attached Notice of 2020 Annual Meeting of Shareholders, the Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting. However, execution of a proxy or voting online or by telephone confers on the designated proxy holder discretionary authority to vote the shares represented by the proxy in accordance with his or her best judgment on such other business, if any, which may properly come before the Annual Meeting or any adjournments thereof, including whether or not to adjourn the meeting.
May I revoke my proxy?
A proxy may be revoked at any time prior to its exercise by filing a written notice of revocation with the Corporate Secretary of the Company, by delivering to the Company a duly executed proxy bearing a later date, by voting online or by telephone on a later date, or by attending the Annual Meeting and voting in person. Attendance at the Annual Meeting will not itself constitute revocation of your proxy.
Who pays the costs of soliciting proxies?
The cost of the solicitation of proxies on behalf of management will be borne by the Company. In addition to the solicitation of proxies by mail, Equinti (US) Services LLC, a proxy solicitation firm, will assist the Company in soliciting proxies for the Annual Meeting and will be paid a fee of $7,000 plus out-of-pocket expenses. Proxies also may be solicited, personally or by telephone, by directors, officers, and other employees of the Company and its subsidiary, New York Community Bank (the “Community Bank” or the “Bank”), without receipt of additional compensation.
The Company also will request that persons, firms, and corporations holding shares in their names, or in the names of their nominees that are beneficially owned by others, send proxy materials to, and obtain proxies from, such beneficial owners. The Company will reimburse such holders for their reasonable expenses in doing so.
If your Company shares are held in street name, your broker, bank, or other nominee will provide you with instructions that must be followed in order to have your shares voted. Your broker or bank may allow you to deliver your voting instructions via the Internet or by telephone. Please see the instruction form that was provided by your broker or bank with this proxy statement. If you wish to change your voting instructions after you have returned your voting instruction form, you will need to contact your broker or bank in order to do so.
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What is the admission policy for the Annual Meeting?
Attendance at the Annual Meeting is limited to:
(1) shareholders of record of Common Stock;
(2) beneficial holders of Common Stock; and
(3) authorized representatives of entities who are beneficial holders of Common Stock.
You will be able to attend the meeting online, vote your shares electronically, and submit questions during the meeting by visiting www.virtualshareholdermeeting.com/NYCB2020. To participate in the virtual meeting, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form. The meeting webcast will begin promptly at 10:00 a.m., Eastern Daylight Time. We encourage you to access the meeting prior to the start time. Online check-in will begin at 9:00 a.m., Eastern Daylight Time, and you should allow ample time for the check-in procedures. If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the Virtual Shareholder Meeting login page. Technical support will be available beginning at 9:30 a.m. Eastern Daylight Time on June 3, 2020 and will remain available until the meeting has ended.
What is the Limit on voting securities?
As provided in the Company’s 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 with respect to the shares held in excess of the Limit. A person or entity is deemed to beneficially own shares owned by an affiliate of, as well as by, persons acting in concert with such person or entity. The Company’s Certificate of Incorporation authorizes the Board of Directors (i) to make all determinations necessary to implement and apply the Limit, including determining whether persons or entities are acting in concert, and (ii) to demand that any person who is reasonably believed to beneficially own stock in excess of the Limit supply information to the Company to enable the Board of Directors to implement and apply the Limit.
Based solely on information in reports filed with the SEC, certain persons or entities are known by management to be the beneficial owners of more than 5% of the outstanding shares of Common Stock as of the Record Date and in some cases have indicated beneficial ownership of up to 10% of the Common Stock outstanding as of that date. If such owners were to increase their holdings above 10% or if other shareholders were to acquire beneficial ownership of shares in excess of that amount, they would not be entitled to any vote with respect to the shares held in excess of 10%.
Proxies solicited hereby will be tabulated by inspectors of election designated by the Board of Directors. The inspectors of election will not be employed by, or be directors of, the Company or any of its affiliates.
Active employee-participants in the Company benefit plans who hold Common Stock will receive an e-mail that contains a link to this proxy statement, along with procedures to follow in order to vote the shares of Common Stock credited to each participant’s account under the Company benefit plans and the shares of Common Stock (if any) held independent of the Company benefit plans. Retired and inactive employee-participants will receive their proxy materials via U.S. mail. Benefit plan voting instructions will be delivered to the trustee for the Company benefit plans and the shares will be voted as directed by participants. Shares for which no voting instructions are provided or are not timely received by the Company will be voted by the trustee for the Company’s tax-qualified plans holding Common Stock in the same proportion as the voting instructions the trustee receives from other participants or, in the case of the Company’s equity incentive plans, as directed by the Company. Benefit plan voting instructions must be received by 11:59 p.m., Eastern Daylight Time, on May 28, 2020.
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Security Ownership of Certain Beneficial Owners
The following table sets forth information as to those persons or entities known by management to be beneficial owners of more than 5% of the outstanding shares of Common Stock on April 7, 2020. Other than those persons or entities listed below, the Company is not aware of any person or entity or group that beneficially owned more than 5% of the Common Stock as of that date.
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Additionally, we support communities impacted by disasters through corporate donations to relief organizations. We also provide our employees with paid time off to volunteer with community organizations and encourage our employees to lead philanthropic initiatives that matter to them. In response to the COVID-19 pandemic, the health, safety, and financial well-being of our customers and employees remained a top priority. Some of the actions we have taken to address these evolving needs include: | |||
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• quickly transitioning to an effective work-from-home program for all of our employees; | |||
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• establishing a 24-hour help line for employees and their family members to speak with qualified clinicians and distributing daily communications to ensure that employees were able to have ongoing access to critical information about the pandemic and our responsive operations; | |||
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• offering extensive loan modifications to our borrowers who required temporary assistance under a carefully structured and phased loan relief program; | |||
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• providing grants and donations to community organizations to address coronavirus concerns, including for PPE, surgical equipment, and to address food insecurity; and | |||
• targeting investments to select New York City not-for-profit companies that address small business lending needs. |
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| SHAREHOLDER OUTREACH AND RECENT INITIATIVES |
Shareholder Outreach and Recent Initiatives
Our management and Board value direct and transparent engagement with our shareholders and regularly seek opportunities to obtain feedback in connection with our governance, management compensation, and strategies. We embrace engagement as an important tenet of good governance and we value the views of our shareholders and other stakeholders. We believe that positive dialogue builds informed relationships that promote transparency and accountability, allowing us to respond more fully to the interests of our shareholders as they adjust to evolving governance and compensation norms in our competitive industry.
Our shareholder outreach program consists of regular management dialogue with the investor community (the “Management Outreach Program”) and formal outreach by our independent Board members to institutional shareholders (the “Board Outreach Program”).
As part of our Management Outreach Program, our CEO, Chief Financial Officer, and other senior members of our management team conduct regular investor communications, including conferences, non-deal road shows and individual and group conference calls with portfolio managers and industry analysts. Each quarter’s earnings press release is thoroughly reviewed in open investor conference calls with broad participation and significant Q&A by the analyst community. Our senior management regularly makes themselves available for such communications across the United States and in Europe, focusing on elements of our strategic plans, consolidated business results and capital structure, and other topics of interest to shareholders. We believe that management can strengthen its ability to lead the Company by constructively discussing our business and strategy in such settings.
As part of the Management Outreach Program for 2020, our former CEO and Mr. Cangemi, then our Chief Financial Officer, met with shareholders at 13 investment conferences and held 26 investor meetings in person or by teleconference during the last 12 months. In total, management met with 273 shareholders or prospective shareholders from 120 discrete institutions.
102 different institutions that consisted of four investment conferences, one investor meeting in person (pre-COVID), seven virtual industry conferences, and five virtual investor meetings (post-COVID). As our new Chairman, President, and Chief Executive Officer, Mr. Cangemi continues this practice together with John Pinto, now our Chief Financial Officer.
Additionally, as part of the Board Outreach Program, our Presiding Director, a member of the Board’s Compensation Committee, Audit Committee Chairman, and other independent membersthe chair of the BoardBoard’s Nominating and Corporate Governance Committee participate in meetings with shareholders. For several years, the Company has conducted formal shareholder outreach in this manner in order to allow our Board members to hear directly from investors regarding their perspectives on our business. During such calls the Board members and a group of senior officers solicit feedback from institutional investors that is taken into account by the Board in making strategic and other corporate governance and compensation decisions.
The Board encourages participation from our shareholders in its outreach program. Participation levels vary from year-to-year. For this year’s Board Outreach Program, which began in early 2020,2021, we contacted our 2530 largest stockholders, who represented approximately 66.13%46.12% of our then-outstanding shares. Of those contacted, investors representing over 23%20% of the then-outstanding shares made themselves available to speak with us, including 35 of our 10 largest shareholders. The 35 largest shareholders included two2 of the top 3 shareholders listed on page 6.
Not all investors we spoke with expressed the same views about each topic discussed during our calls, but we listened carefully to each and gave each equal weight.
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The feedback we received was generally supportive, and the conversations included in-depth discussion about various compensation and corporate governance issues, including with respect to shareholder opinions about the benefits and drawbacks of our incentive compensation program, board composition, risk oversight, and other governance matters. The institutional investors confirmed that their shareholders our focusing more and more on ESG issues for the companies in which they invest. On the whole, we also learned that, although some consistent themes exist, our shareholders have varying views on compensation and governance topics, and much effort was made to balance the differing and sometimes contrasting viewpoints. OnNot all investors we spoke with expressed the whole,same views about each topic discussed during our calls, but we listened carefully to each and gave each equal weight.
The shareholders we spoke with also learnedexpressed approval for our recent changes in the compensation programs for executive management and encouraged the team to request that although some consistent themes exist, our shareholders have varying viewsthe Board continues to ensure that executive compensation is aligned with shareholder interest. In this area, the Board and management continue to focus on a compensation program that maximizes performance and governance topics, and much effort was madeshareholder returns in a way most suitable to balance the differing and sometimes contrasting viewpoints. Company.
Shareholders have generally been favorably consistent in their view regarding the evolution of the Company’s executive pay program over the last three years to a structure that improves the alignment of pay and performance, and commented positively on the metrics being utilized to gauge the Company’s performance and the use of the same metrics that shareholders use to evaluate their investment in the Company. Shareholders suggested that the Board consider the broader use of metrics tied solely to Company should provide greater detail onperformance to further improve the scopealignment of its shareholder outreach effortspay and describe the specific nature of shareholder concerns. Accordingly, beginning in 2019 we have included greater specifics on the scope of our shareholder outreach efforts and on the feedback we received, including with respect to shareholder views regarding our compensation programs (see performance. See Engaging with Our Shareholders in the Compensation Discussion and Analysis section of this proxy statement beginning on page 23.
Shareholders were generally consistent in their view that the Company should provide greater detail on the scope of its shareholder outreach efforts and describe the specific nature of shareholder concerns. Accordingly, we are including in this year’s proxy statement greater specifics on the scope of our shareholder outreach efforts and on the feedback we received, including with respect to shareholder concerns that triggered the adverse say-on-pay advisory vote in 2018.25.
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| SHAREHOLDER OUTREACH AND RECENT INITIATIVES | |
The Board was particularly disappointed inAdditionally, the vote against our 2018 say-on-pay resolution. While manyinvestors favorably acknowledged some of our institutional shareholders, who control significant blocksrecent leadership changes, including the appointment of Thomas Cangemi as Chairman, President and Chief Executive Officer, the appointment of Wally Dahya as Presiding Director, Leslie Dunn as Chairwoman of the ownership interests in our company, defer their decision-making to one or anotherBoard’s Nominating and Corporate Governance Committee, and Lawrence Rosano as Chairman of the world’s largest proxy advisory services, many ofBoard’s Risk Assessment Committee. We notified investors that the investors with whomBoard intends to continue focusing on this area, included by adding new members who can bring greater diversity and experience in areas that we have met and conferred with have said that while they do review the recommendations of proxy advisory services on say-on-pay votes asexpect to be a significant part of their voting determination process, they do not always vote consistent with such recommendations. The information we received from our investors, which covered compensation program design, shareholder voting processes, corporate governance, and disclosure matters, was shared with the Compensation Committee and the full Board. In response, the Board in 2018 undertook to refresh the Compensation Committee and restructure our executive compensation plans to their current form, as described below and in our Compensation Discussion and Analysis beginning on page 23. Shareholder feedback has been an essential element of the Committee’s evaluation of revisions to the program. While many of the outreach sessions ranged beyond executive pay to topics including the Company’s business going forward. This is evident in the Board’s formation of a Board Development Subcommittee of our Nominating and strategy, common themes relating to executive pay did emerge from these discussions.
Corporate Governance Committee also chaired by Leslie Dunn.
In 2020, although management held many meetings and direct conversations with investors, various circumstances, including those relating to the emergence of thee the COVID-19 pandemic, led many of our institutional investors to decline our requests to conduct outreach discussions with their governance teams.
While many of In our institutionalmore recent outreach discussions during 2021, shareholders who control significant blocks ofexpressed approval for the ownership interestsCompany’s responsiveness to the pandemic which included, among other things, successfully shifting to a work-from-home environment, assisting borrowers with loan relief, and participating in our company, conceded that they defer their decision-making to one or another of the world’s largest proxy advisory services, many of the investors with whom we met said that while they review the recommendations of proxy advisory services on say-on-pay votes as part of their voting determination process, they do not always vote consistent with such recommendations. The information we received from our investors, which covered compensation program design, shareholder voting processes, corporate governance and disclosure matters, was shared with the Compensation Committee and the full Board.
SBA’s Paycheck Protection Program.
The following lists certain corporate governance themes addressed in our outreach discussions during the last two annual shareholder meeting cycles:
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What we heard | Our Response | |||||
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Some shareholders favor declassification of the Board of Directors, while others favor a Board whose members are elected in multiple classes over three years. |
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The Board of Directors should seek to refresh its members from time to time so that its composition reflects an appropriate mix of individuals by tenure, skills, expertise, experience, age, and gender in connection with current and future Company business needs. |
| The Board maintains a policy to consider a mix of individuals by tenure, skills, expertise, experience, age, gender, race, and ethnicity in connection with current and future Company business needs. | ||||
The Board |
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Additional disclosure regarding the relationship between our NEO compensation programs and long-term value creation appears on page 31 of this proxy statement. Stockholders are urged to read the Compensation Discussion & Analysis section and other information in this Proxy Statement to better understand how the Company'sCompany’s executive compensation program engages and aligns with the Company’s performance.
Results of Election of Directors at 20192020 Annual Meeting - – At our 20192020 annual meeting of shareholders, Michael J. Levine, Ronald A. Rosenfeld,Dominick Ciampa, Leslie D. Dunn, Lawrence J. Savarese,Rosano, Jr., and John M. TsimbinosRobert Wann were re-elected to the term of the Board that expires at the 20222023 annual meeting of shareholders. AllEach received thean affirmative vote of more than 90%70% of the votes cast for their re-election.re-election
with the combined average percentage being 84% of the votes cast.
We value shareholder input and we encourage you to share your opinions with us. You can do so by writing to us at the address on page 8678 of this proxy statement. You can also provide feedback on our executive compensation program by contacting us through our Investor Relations Department (please visit our website www.myNYCB.com) or through the other contacts identified on page 2021 of this proxy statement.
Community Support - Service to our customers and the community is an important part of the New York Community Bank culture. We support the communities we serve through lending, investments, services, and charitable giving, including through New York Community Bank Foundation and Richmond County Savings Foundation, with the following notable highlights:Page 7
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ENVIRONMENTAL, SOCIAL AND | |
As a responsible steward of financial services, the Company integrates environmental, social, and governance considerations into its strategies through: corporate governance, human capital, responsible investments, risk management, ethics and integrity, and the environment.
Corporate Governance | Risk Management | Responsible Investments | ||||||
We are committed to maintaining robust governance practices that benefit the long term interests of our investors. | Our risk management framework is intended to facilitate an enterprise wide view of risk that supports a strong collaborative risk management culture across the entire Company. | We finance housing through our multi-family lending in our footprint states and support the vitality of the communities we serve through our investments. | ||||||
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We promote sustainable and environmentally friendly practices that reduce energy use, decrease waste, and increase recycling in the | We maintain policies and monitoring programs to ensure that our personnel at all levels conduct business in accordance with the highest ethical standards. | Our family of employees is our greatest asset and the is committed to promoting our employees’ engagement, development and |
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The Community Bank provides multi-family lendingBoard of Directors and management of the Company recognize the far reaching impacts of climate change and how important environmental sustainability is to borrowers with collateral properties in lowour shareholders, customers, employees, and moderate income areas of the communities we serve. TheIn response to directives by our Board of Directors in early 2021, our Chief Risk Officer established a management level committee, including senior leadership from key areas within the Company, which is charged with responsibility to address climate risks in all areas of our business. As the momentum in this area continues to build, New York Community Bank’s multi-family lendingBancorp’s Board and personnel at all levels are excited to participate and help lead the transition to long term sustainability for our planet.
Ø | Human Capital |
At December 31, 2020, our workforce included 2,948 employees, including 1,635 retail employees and 1,313 back office employees. None of our employees are represented by a collective bargaining agreement. We believe our employee relations to be good.
We believe our employees are among our most significant resources and that our employees are critical to our continued success. We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations. We pay our employees competitively and offer a broad range of benefits, both of which we believe are competitive with our industry peers and with other firms in lowthe locations in which we do business. Our employees receive salaries that are subject to annual review and moderate income areas represents 53%periodic benchmarking. Our benefits program includes a 401(k) Plan with an employer matching contribution, an employee stock ownership plan, healthcare and other insurance benefits, flexible spending accounts and paid time off. Many of total loans and 48% of total loan amount. our employees are also eligible to participate in the Company’s equity award program.
The Community Bank also provides lending for borrowers inPage 8
| ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) | |
We are proud to maintain a diverse and inclusive workforce that reflects the low and moderate income areasdemographics of the communities in which we serve, including financingdo business. Our company recognizes that the talents of a diverse workforce are a key competitive advantage. We strive to create and foster a supportive environment for all of our employees and are proud to share our business success with individuals whose cultural and personal differences create a more innovative and productive workplace. Our workforce is 33% male and 67% female and women represent 51% of the numberCompany’s leadership (defined to include employees at the level of loansvice president and 46%above). In addition, for those employees identifying as such, approximately 48% of loan amounts that wereour workforce have diverse ethnic backgrounds. We engage in significant outreach to veterans, women and minorities in our recruiting efforts, and our policies and practices reflect our commitment to diversity and inclusion in the lowworkplace.
Our management teams and moderate areasall of New York where we committedour employees are expected to continuing our leadership roleexhibit and promote honest, ethical and respectful conduct in the New York City multi-family housing market including by lending in low and moderate income areas.
Additionally, we support communities impacted by disasters through corporate donations to relief organizations. We also provideworkplace. All of our employees with paid time offmust adhere to volunteer with community organizationsa code of conduct that sets standards for appropriate behavior and encourageall employees are required to complete annual training that focuses on preventing, identifying, reporting and stopping any type of unlawful discrimination.
The health and safety of our employees to lead philanthropic initiatives that matter to them.is also of critical importance. In response to the COVID-19 Pandemic, pandemic, we implemented a response plan that included the Community Bank has demonstrated that the health, safety, and financial well-beingtransitioning of a significant percentage of our customers andback office workforce to a remote work model, while implementing additional safety protocols for employees who, due to the communitiesnature of their positions, continued on-site work. We took steps to ensure compliance with federal, state and local requirements that enhanced workplace safety, such as masking and social distancing, and we serve remains a top priority. Some notable actions that the Community Bank has takenprovided employees who either contracted or were exposed to assist its customers include: temporarily waiving certain fees including ATM, overdraft fees, and, on a case-by-case basis, early Certificate of Deposit withdrawal fees; addressing customer requests for loan modifications; providing customersCOVID-19 with access to certain Small Business Administration Pandemic related lending programs; and targeting investments to select New York City not-for-profit companies that address small business lending needs.
appropriate leave.
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CORPORATE GOVERNANCE Our Board, as stewards of shareholder interests, is committed to maximizing long-term shareholder value creation and to maintaining sound corporate governance principles consistent with current rules and practices. Under the leadership of the Nominating and Corporate Governance Committee, we have concentrated significant efforts and resources on ensuring that our overall corporate governance practices serve the best interests of the Company and its shareholders, focusing on the changing needs for financial institution boards in the current regulatory environment; we have taken into consideration the governance policies and practices of our peers; and we have also developed an active shareholder outreach program to better understand the views and concerns of our large shareholders. We have a Risk Assessment Committee comprised of independent directors to assist the Board in overseeing and reviewing information regarding our enterprise risk management program, risk exposure, and risk governance policies and practices. See page 19 for a description of the committee. Certain governance policies and practices in effect during Size of Board 11 Number of Independent Directors 9 Staggered Election of Directors Yes Majority Voting for Directors Yes Proxy Access for Shareholders Yes Separation of the Chairman of the Board and Chief Executive Officer Positions Yes Independent Presiding Director Yes Code of Business Conduct and Ethics Yes Annual Board & Committee Evaluations Yes Risk Assessment Committee Yes Executive Compensation Yes Claw Back Provision Yes Board Member and Executive Ownership of Shares Yes Anti-Pledging and Hedging Yes No Poison Pill Yes Chief Diversity Officer Yes Codes of Professional Conduct for Directors, Officers, and Employees Yes Anti-Harassment and Anti-Retaliation Policies Yes Statement of Vendor Principles Yes The Board-adopted Corporate Governance Guidelines are available on the corporate governance pages of the Investor Relations portion of our Company’s website, www.myNYCB.com, and also are available in print to any shareholder who requests a copy. These guidelines The Board has determined that Page 10Corporate Governance Philosophy In recent years, the Board has adopted various corporate governance policies and practices to address such views and concerns.20192020 are listed in the chart below.Board and Governance InformationPractices20192020 Environmental and Social Practices address,address, among other matters, the qualifications and responsibilities of directors; functions of the Board and Board committees; director compensation, training, and performance evaluations; and management performance evaluations and succession.We will continue to actively monitor, and consider additional changes to, our corporate governance practices in the future.the nineseven of our eleventen directors are “independent” within the meaning of the rules of the New York Stock Exchange including: Dominick Ciampa, Hanif “Wally” Dahya, Leslie D. Dunn, Michael J. Levine, James J. O’Donovan, Lawrence Rosano, Jr., Ronald A. Rosenfeld, Lawrence J. Savarese, and John M. Tsimbinos. Additionally, the Board has determined that each of the members of the Audit, Nominating and Corporate Governance, and Compensation Committees are independent in accordance with the listing standards of the NYSE and, in the case of the members of the Audit Committee, the rules of the SEC. In determining the independence of its members, the Board broadly considers all facts and circumstances it deems to be relevant and does not limit such review to a specific set of categorical independence standards. Such
| CORPORATE GOVERNANCE | |
determinations are made not merely from the standpoint of the director, but also from that of persons or organizations with whom or which the director has an affiliation. Material relationships can include commercial, industrial, banking, consulting, legal, accounting, charitable, and familial relationships, among others.
In arriving at its conclusions with respect to the directors named above, the Board determined that the directors had no material relationships (as such term is defined under the listing standards of the NYSE) with the Company either directly or as a partner, shareholder, or officer of an organization that has a relationship with the Company. Directors Levine andDirector Rosano
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are principals is a principal in, or havehas ownership interests in, organizations that maintain lending relationships with the Community Bank. These directors haveMr. Rosano has fully disclosed such relationships to the Board, and the Board has determined that the subject loans do not involve more than normal risk of collectability or present other unfavorable features, and were made on substantially the same terms (including interest rates and collateral requirements) as those prevailing at the same time for comparable transactions with unaffiliated persons. AllMr. Rosano’s loans to the two directors are fully performing in accordance with their terms. Accordingly, the lending relationships maintained by the Community Bank with Messrs. Levine and Rosanohim would not be inconsistent with a determination that they arehe is an independent directorsdirector of the Company.
Further, Directors Levine andDirector Rosano possesspossesses significant knowledge of, and each is a principal in companies that actively participate in, the New York metropolitan area real estate market, where the Community Bank currently conducts significant portions of its lending business. The Board has determined that it is in the best interests of the Community Bank and the Company not to exclude such potential borrowers from conducting business with the Community Bank in accordance with the arms-length terms described above, and under circumstances that are no more favorable than those available to the Community Bank’s other borrowers.
The Company currently relies on a three-partan efficient and balanced leadership structure, with Mr. CiampaDahya serving as Chairman of the Board of Directors, Mr. Levine serving asindependent Presiding Director and Mr. FicaloraCangemi serving as Chairman, President and Chief Executive Officer. The Board considers this structure an effective one for enabling the Chairman, Presiding Director, and CEO to share knowledge and responsibilities, for preserving Board independence, and for carrying out other important governance principles. Generally, the structure is intended to promote synergies amongbe a synergistic one, with Mr. Dahya and Mr. Cangemi working closely together on governance and other Board-level issues.
In the three leadership positions, with the Chairman overseeing the functioningposition of the Board and its stewardship of the Company, the Presiding Director, assisting the Chairman and overseeing certain Board stewardship and other governance functions, including by leading the independent members of the Board, and the President and Chief Executive Officer serving as senior managing officer of the Company, overseeing day-to-day operations and carrying out its strategic goals and objectives
The Chairman of the Board is an independent director. The Company does not have a formal policy with respect to the separation or combination of the offices of Chairman of the Board and CEO. Rather, the Board has the discretion to combine or separate these roles as it deems appropriate from time to time, which provides the Board with the necessary flexibility to adjust to changed circumstances. The Board has determined that separating the roles of Chairman and President and CEO allows the CEO to devote the requisite significant time to, and focus on, managing our business and maintaining our financial strength.
The Company's independent Presiding DirectorMr. Dahya functions as a Lead Independent Director, butidentifying strategic priorities to be discussed by the Board, overseeing the Board’s functioning, and helping to ensure that the Board fulfills its stewardship role. The Board prefers the term Presiding Director to emphasize that all directors share equally in their responsibilities as members of the Board. The Presiding Director presides at all Board meetings and executive sessions at which the Chairman is not present, presides over periodic executive sessions of the Board in which management directors and other members of management do not participate, and is responsible for coordinating the annual self-evaluations of the members of the Board. Additionally, the Presiding Director is available for consultation and communication with shareholders as part of the Board’s shareholder outreach programprogram. As a result, the Presiding Director provides a source of Board leadership complementary to, collaborative with, and performs suchindependent of the leadership of the Chairman, President and Chief Executive Officer, which promotes best practices and high standards of corporate governance.
As Chairman, President and Chief Executive Officer, Mr. Cangemi plays a central role in establishing and communicating the Company’s goals and strategies while also carrying out many critical leadership functions in our day-to-day operations. Mr. Cangemi frequently meets and confers with Mr. Dahya and other functions asmembers of the Board directs.of Directors, whose expertise and counsel provide for a sound and effective governance framework. As Chairman of the Board, he presides at all Board meetings, having no greater nor lesser vote on matters considered by the Board than any other director and sharing the fiduciary obligations of all our directors to serve the best interests of our shareholders.
With Mr. Cangemi’s transition to the position of President and CEO of the Company following the retirement of our former President and CEO on December 31, 2020, and upon the retirement of Michael J. Levine on March 26, 2021, the Board determined that it would be in the best interests of the Company to combine the positions of Chairman, President, and Chief Executive Officer. The Board believes that this change provides for an efficient leadership structure that effectively preserves Board independence, enabling the Chairman to share knowledge and responsibilities with the independent Presiding Director is appointed annually by, and to support other important governance principles. The Company does not have a formal policy with respect to the separation or combination of the offices of Chairman of the Board and CEO. Rather, the Board reassesses the separation of these roles and has the discretion to combine or separate them as it deems appropriate from among,time to time, which provides the independent directors. Board with the necessary flexibility to adjust to changed circumstances.
Some of the respective duties and responsibilities of the Chairman and Presiding Director include:
Chairman of the Board: | ✓ Calls Board and shareholder meetings | |
✓ Presides at Board and shareholder meetings |
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✓ Approves Board meeting schedules, agendas, materials, subject to the approval of the Presiding Director | ||
Presiding Director: | ✓ Presides at Board meetings in the Chairman’s absence or when otherwise appropriate | |
✓ Acts as a liaison between independent directors and the Chairman/CEO | ||
✓ Presides over executive sessions of independent directors | ||
✓ Engages and consults with major shareholders and other constituencies, where appropriate | ||
✓ Provides advice and guidance to the CEO on executing long-term strategy | ||
✓ Guides the annual performance review of the Chairman/CEO | ||
✓ Advises the CEO of the Board’s information needs | ||
✓ Guides the annual independent director consideration of Chairman/CEO compensation | ||
✓ Meets one-on-one with the Chairman/CEO following executive sessions of the independent directors | ||
✓ Guides the self-assessment of the Board | ||
✓ Approves agendas and adds agenda items for Board meetings and meetings of independent directors |
Committee Chairs -– All of the Company’s Board Committee chairpersons are independent and are appointed annually by the Board. They approve agendas and materials for their respective committee meetings and serve as the liaisons between committee members and the Board and between committee members and senior management.
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BOARD’S ROLE IN RISK OVERSIGHT
Our Board devotes significant attention to the oversight of risks inherent in our banking business, including, but not limited to, information security risk, credit risk, model risk, interest rate risk, liquidity risk, operational risk, strategic risk, compliance risk and reputational risk. Management of risk is important to the success of our operations and business strategies.
The Board reviews the key risks associated with the Company’s strategic plan annually and regularly throughout the year as part of its consideration of the strategic direction of the Company as well as reviewing the output of the Company’s risk management process each year and reviewing risks associated with specific business units and corporate functions.
While the Board of Directors as a whole is responsible for risk management oversight, management is responsible for the day-to-day management of the risks faced by the Company. As part of our risk oversight processes, our Chief Risk Officer reports to the Risk Assessment Committee; the Chairman of the Board’s Risk Assessment Committee meets regularly with management to discuss strategies and the risks facing the Company; and senior members of management attend Board meetings and are available to address questions or concerns raised by the Board on risk management and other matters.
In carrying out its responsibilities in this area, the Board has delegated important duties to its committees. The Risk Assessment Committee has responsibility to oversee the functioning of the Company’s enterprise risk management program and to ensure that risk is appropriately identified, measured, mitigated, monitored, and reported within approved governance structures. Among its duties, the Risk Assessment Committee reviews with management Company policies regarding risk assessment and management of risks that may be material to the Company, the Company’s system of disclosure controls and system of internal controls over financial reporting, the Company’s governance structure and processes, related person transactions, certain compliance issues and Board and committee structures, and the Company’s compliance with legal and regulatory requirements. The Chairman of the Risk Assessment Committee is independent and has the requisite risk experience required under the Dodd Frank Act’s Enhanced Prudential Standards for large banks.
The Risk Assessment Committee also is actively involved in oversightOur management devotes significant time and attention to protecting the information we maintain, including our customer’s sensitive information, and the Board of the Company’s cybersecurity risks.Directors requires regular reporting regarding our information security controls. Information security breaches and other cybersecurity events can lead to significant financial losses and reputational harm to a breached company, and information security, including cybersecurity, is a high priority for our Company. The Board’s Risk Assessment Committee is actively involved in oversight of the Company’s cybersecurity risks, remaining actively engaged in overseeing the Company’s processes for identifying, assessing, monitoring, and managing cybersecurity risk. Accordingly, we continue to develop policies and utilize technology to protect our information and that of our customers from cyberattacks or other corruption or loss. Our Chief Information Security Officer is responsible for
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| CORPORATE GOVERNANCE | |
developing, implementing, and maintaining an effective information security program, which includes but is not limiteda multitude of techniques to secure our operations and proprietary information, such as the performance of risk assessments for the purpose of identifying and documenting risks and mitigating controls. controls, network monitoring, access controls, and utilization of dedicated security personnel and consultation with third-party experts when necessary.
The information security program is subject to independent testing and relies upon the Federal Financial Institutions Examination Council’s Cybersecurity Assessment framework to gauge the program’s maturity level, New York State Department of Financial Services information security regulations, and other evolving standards. The Board, directly and through the Risk Assessment Committee, actively oversees management’s efforts to maintain and enhance our cybersecurity practices, reviewing and approving information security policies and programs, including those relating to cybersecurity, security risk assessment, security strategies, disaster recovery, business continuity, and incident response plans. The CISO conducts training and awareness programs for the Board to ensure that the Board remains aware and informed of information security incidents and response plans.
Both the Risk and Audit Committees have oversight of the management of our cybersecurity risk. The Audit Committee is responsible for overseeing our cybersecurity program under its risk oversight responsibilities as it relates to financial controls. The Risk Committee is responsible for oversight of management of cybersecurity risk consistent with the Company’s enterprise-wide risk management governance framework. Regular reporting on cybersecurity is provided to both committees as well as the Board.
The Audit Committee also serves a key role in managing our risk, mainly through its oversight of the external and internal audit function, which assesses and tests the adequacy of internal controls and the financial reporting process. The Audit Committee oversees risks related to the Company’s financial statements, the financial reporting process, other financial matters, certain compliance issues, and accounting and legal matters.
Finally, the Compensation Committee has responsibility for overseeing certain risks in the Company’s incentive compensation practices and has authority to conduct annual reviews of such compensation arrangements and practices to ensure that they do not encourage inappropriate risk-taking. The Compensation Committee also oversees succession planning for possible successors to the positions of Chief Executive Officer and Chief Operating Officer and planning for other key senior management positions. The Compensation Committee has concluded that the Company’s the compensation arrangements do not encourage inappropriate risks.
In performing these risk oversight functions, the Risk Assessment, Audit, and Compensation Committees of the Board each have full access to management in the Enterprise Risk Management and Internal Audit areas and in other first and second line functions within the Company, as well as the ability to engage advisors, and each committee reports back to the full Board and works with all members of the Board to fulfill risk oversight objectives.
During 2020, the Board took additional actions to ensure effective oversight of the Company’s management of the COVID-19 crisis and its resulting risks encompassing all aspects of the Company’s operations and stakeholders. In responding to the crisis, the Board’s oversight included management of risk associated with the health and safety of our customers and colleagues, provision of financial support to our customers and communities, the administration of the U.S. government’s Paycheck Protection and Small Business Administration programs, management of human capital, supply chain, fraud, cyber and technology, and capital allocation and management. During the crisis, management has conducted daily COVID Resiliency Team meetings to address operational risks and weekly COVID Lending Team meetings at which lending and other members of senior management reviewed and addressed the pandemic’s impacts to our borrowers. The Chief Risk Officer is a member of both teams.
Additionally, key members of management maintained regular dialogue with members of our Board and regular reporting to the Risk and Audit Committees, as well as the whole Board, regarding various operational, lending, other issues and actions related to the pandemic and the Company’s response. We continue to maintain enhanced risk monitoring and reporting relating to the ongoing COVID pandemic.
The entire Board reviews and approves, on an annual basis, all significant policies that address risk within our consolidated organization, including credit risk, interest rate risk, liquidity risk, operational risk, strategic risk, and reputational risk. The Board monitors risk through reports received on a periodicmonthly or more frequent basis from management.
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Majority Voting in Director Elections - – Our Certificate of Incorporation requires that nominees for Director in uncontested elections receive a majority of the votes cast in respect of their election as directors. If an election is uncontested, each of our director nominees has agreed to tender his or her irrevocable contingent resignation if he or she is not elected by a majority of votes cast by shareholders. The Board’s Nominating and Corporate Governance Committee
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| CORPORATE GOVERNANCE | |
will promptly consider the director’s resignation and recommend to the Board whether to accept or reject the resignation. Our Board will act on the Nominating and Corporate Governance Committee’s recommendation within ninety days of the applicable shareholder meeting and will then publicallypublicly disclose its decision.
Shareholder Rights Plan - – We do not have a shareholder rights plan and are not currently considering adopting one.
Corporate Governance Guidelines -–Our Corporate Governance Guidelines formalize certain of the Community Bank’s and the Board of Directors’ existing governance policies and practices with respect to board membership; leadership; roles, procedures and practices; committees; and executive officer evaluations, compensation and succession and also address the new governance policies discussed below. These Corporate Governance Guidelines are available on the Company’s website (www.myNYCB.com) under Investor Relations.
Board Self-Evaluations -– The Board of Directors annually assesses its effectiveness, the operations of its committees, and the contributions of director nominees. The independent Presiding Director coordinates the evaluation of the Board as a whole and its committees, as well as individual evaluations of those directors who are being considered for possible re-nomination to the Board.
Proxy Access -– Our amended and restated Bylaws permit a shareholder, or a group of up to 20 shareholders, that owns three percent or more of the Company’s common stock continuously for at least three years, to nominate and include in the Company’s proxy materials candidates for election as directors. Such shareholder(s) or group(s) of shareholders may nominate up to the greater of two individuals or 20% of the Board, provided that the shareholder(s) and the nominee(s) satisfy the eligibility, notice, and other requirements specified in the Bylaws.
Code of Business Conduct and Ethics - –The Company maintains a Code of Professional Conduct, applicable to all Company and Community Bank employees, which sets forth requirements relating to ethical conduct, conflicts of interest, and compliance with the law. The Code of Professional Conduct requires that the Community Bank’s employees avoid conflicts of interest, comply with all laws and other legal requirements, conduct business in an honest and ethical manner, and otherwise act with integrity and in the Company’s and the Community Bank’s best interests. The CEO, Chief Operating Officer, and Chief Financial Officer are bound by the Code of Professional Conduct. In addition, the Board of Directors has adopted a Code of Business Conduct and Ethics for the CEO, Chief Operating Officer, and Chief Financial Officer of the Company. Copies of both Codes, which also apply to the directors of the Company, are available, free of charge, on the corporate governance pages of the Investor Relations portion of our website, www.myNYCB.com, and are available in print to any shareholder who requests a copy.
Stock Ownership Policy - –The Company maintains a Stock Ownership Policy which is intended to align the interests of senior executives and non-executive directors of the Company with the interests of the Company'sCompany’s shareholders, and to support sound risk management by requiring each of them to attain and maintain a target level of stock ownership. The target level of stock ownership in the Company that each must attain and maintain shall differ depending on the applicable officer’s or director’s category and is expressed, for the year being measured, as a multiple of annual base salary for executives and as a multiple of annual retainer for non-executive directors. For the CEO, the multiple is six times base salary, for senior executives (including the NEOs), the multiple is four times base salary, and for the non-executive directors, the multiple is five times the annual retainer exclusive of any compensation for committee fees, meeting fees, and leadership roles.
Executive Sessions of the Board - – In 2019,2020, the Board met 1214 times in executive session with the CEO and COO present and, in keeping with the Company’s Corporate Governance Guidelines, met twothree times in executive session with no members of management present.
Board Diversity and Tenure -– The Nominating and Corporate Governance Committee has a commitment to diversity, and is guided by the Company’s diversity philosophy in its review and consideration of potential director nominees. In this regard, the Board and the Committee view diversity holistically. As set forth in the Company’s Corporate Governance Guidelines, the Board and the Committee consider:
| Whether the individual meets the requirements for independence; |
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| The individual’s general understanding of the various disciplines relevant to the success of a large publicly-traded company in today’s global business environment; |
| The individual’s understanding of the Company’s business and markets; |
| The individual’s professional expertise and experience; |
| The individual’s educational and professional background; and |
| Other characteristics of the individual that promote diversity of views and experiences, including diversity with respect to gender, age, race and ethnicity. |
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| CORPORATE GOVERNANCE
| |
TheEstablishment of a Board Development Subcommittee– In 2021, the Nominating and Corporate Governance Committee of the Board established a subcommittee, chaired by the Nominating and Corporate Governance Committee Chairwoman Leslie Dunn, to identify, assess, and make recommendations regarding new prospective candidates for membership on the Company and New York Community Bank Boards. The subcommittee has engaged and is working with a leading search firm to identify eligible candidates having characteristics and skillsets essential for prospective board members, with a focus on finding qualified candidates who can fulfill the Board’s commitment to pursuing diversity as represented by age, gender, ethnicity, professional background and other considerations at every level of the Company and New York Community Bank, including at the Board level.
The Board has not established any specific minimum qualification standards for nominees to the Board and evaluates each individual in the context of the Board as a whole, with the objective of recommending a group of directors who will best enhance the Company’s success and represent shareholder interests through the exercise of sound judgment and the application of its diversity of experience. In determining whether to recommend a director for re-election, the Committee also considers the director’s past attendance at meetings and participation in, and contributions, to the activities of the Board. In addition, the Committee considers whether the Board has specific needs for certain skills or attributes at a given time (for example, financial or chief executive officer experience). Other criteria for Board membership are set forth in the Company’s Corporate Governance Guidelines and Nominating and Corporate Governance Committee Charter, copies of which are available, free of charge, on the corporate governance pages of the Investor Relations portion of our website,, www.myNYCB.com,, and are available in print to any shareholder who requests a copy.
Long-tenured directors can offer significant benefits in the governance of the Company due to the deep knowledge of our business and functioning they acquire through years of service. They provide continuity and stability at the highest governance level, as well as historical perspectives that are indispensable in determining the Company’s strategic vision. Long-tenured directors maintain significant institutional knowledge and offer stability. In addition, due to their historical knowledge of the Company, long-tenured directors can be particularly well suited to exercise Board-level influence and to provide an effective challenge mechanism when required. Over the course of time, in addition to their stature, long-tenured directors develop important working relationships with other Board members and management, resulting in effective collaboration in carrying out the Company’s objectives and management oversight. Our Board believes that director tenure, like other governance policies and structures, should be tailored to the Company'sCompany’s unique governance needs and challenges.
Our Bylaws provide that, unless otherwise determined by a majority of the disinterested members of the Board, no person may be elected, appointed, or nominated as a director after December 31 of the year in which such person attains the age of 80. Based upon, among other things, the significant experience, knowledge, and value they offer the Board, the Board has previously and unanimously determined to exempt certain members from this retirement age requirement.
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CORPORATE GOVERNANCE The Board conducts its business through periodic meetings and through the activities of its committees. In The Board has four standing committees as follows: (i) Audit Committee, (ii) Compensation Committee, (iii) Nominating and Corporate Governance Committee, and (iv) Risk Assessment Committee. Each committee has a written charter adopted by the committee and ratified by the Page 16Board Committees2019,2020, the Board held 1211 regular monthly meetings, three special meetings, and the various standing committees of the Board met another 3429 times, for an aggregate of 4644 meetings. All incumbent directors of the Company attended at least 75% of the aggregate number of meetings of the Board and committees on which such directors served during fiscal year 2019.2020. Board members are expected to make reasonable efforts to attend all Board meetings and all meetings of the Board committees on which they serve. Absences are excused only for good cause.Board. As required by NYSE Rules, chartersBoard, which contain detailed lists of the respective Committees duties and responsibilities. Charters for the Audit, Compensation, and Nominating and Corporate Governance Committees can be found on the Investor Relations portion of the Company’s website at www.myNYCB.com,and are available in hardcopy to any shareholder who requests them. Each member of the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee has been determined by the Board to be independent for purposes of the NYSE corporate governance listing standards and within the meaning of regulations of the SEC.
|
CORPORATE GOVERNANCE | |
The following table presents the membership of our Board members on the various Board committees as of April 7, 2020:1, 2021:
Director | Audit | Compensation | Nominating & Corporate | Risk Assessment |
| Mortgage & Real Estate1 | Commercial Credit Committee1
|
|
|
|
|
|
|
|
|
Dominick Ciampa† |
|
|
| ||||
Hanif “Wally” M. Dahya# |
|
|
| ||||
Leslie D. Dunn |
|
|
| ||||
Michael J. Levine* @ |
|
| |||||
James J. O’Donovan |
|
|
| ||||
Lawrence Rosano, Jr. |
|
| |||||
Ronald A. Rosenfeld |
|
|
|
| |||
Lawrence J. Savarese*# |
|
|
| ||||
John M. Tsimbinos |
|
|
| ||||
Joseph R. Ficalora |
|
|
|
|
| ||
Robert Wann |
|
|
|
|
|
|
|
Meetings Held in 2019 | 13 | 7 | 2 | 12 |
| 52 | 51 |
Director | ||||||||||||||
Dominick Ciampa | ||||||||||||||
Hanif “Wally” Dahya@ # | ||||||||||||||
Leslie D. Dunn | ||||||||||||||
James J. O’Donovan | ||||||||||||||
Lawrence Rosano, Jr. | ||||||||||||||
Ronald A. Rosenfeld | ||||||||||||||
Lawrence J. Savarese*# | ||||||||||||||
John M. Tsimbinos | ||||||||||||||
Thomas R. Cangemi† | ||||||||||||||
Robert Wann | ||||||||||||||
Meetings Held in 2020 | 13 | 4 | 1 | 11 | 51 | 50 |
(1) | All Company Board Committees are replicated at the Community Bank level. Additionally, the Community Bank Board maintains a Mortgage and Real Estate Committee and Commercial Credit Committee. |
Chairman of the Committee Member of the Committee
† Chairman of the Board of Directors
* Designated as Audit Committee Financial Expert
@Designated independent Presiding Director
#Designated as Risk Committee Expert
Chairman of the Committee Member of the Committee |
† | Chairman of the Board of Directors effective March 26, 2021 |
* | Designated as Audit Committee Financial Expert |
@ | Designated independent Presiding Director |
# | Designated as Risk Committee Expert |
The Board and Board Committees met numerous times throughout 2020:
14 Board Meetings Communication between meetings as appropriate | 3 Executive sessions of independent directors Led by Presiding Director | 29 Meetings of Principal Standing Committees | 101 Meetings of Specific Purpose Committees | |||||||||||||
A description of the nature and purpose of each of the Board committees follows.
The Board Committees act under written charters adopted by the Board of Directors which include detailed lists of the respective Committees’ functions. Copies of the charters for the Audit, Compensation, Nominating and Corporate Governance, and Risk Assessment Committees are available, free of charge, on the corporate governance pages within the Investor Relations portion of our website at www.myNYCB.com, and are available in print to any shareholder who requests a copy.
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CORPORATE GOVERNANCE | |
Audit Committee | |||
Members: Lawrence J. Savarese (Chair) Dominick Ciampa Hanif Leslie D. Dunn
Ronald A. Rosenfeld
The Board of Directors has determined that
Meetings held in |
| The purpose of the Audit Committee is to assist the Board in fulfilling its oversight responsibilities, including with respect to review and, as applicable, approval of (1) the integrity of the
This Committee meets with the Company’s and the Community Bank’s internal auditors to review the performance of the internal audit function.
A detailed list of the
|
Compensation Committee | |||
Hanif “Wally” Dahya (Chair) Leslie D. Dunn Lawrence Rosano, Jr. Lawrence J. Savarese John M. Tsimbinos Meetings held in |
| This committee meets to establish compensation for the executive officers and to review the Company’s incentive compensation programs when necessary. (See Compensation Discussion and Analysis beginning on page
Consistent with SEC disclosure requirements, the Compensation Committee has assessed the
At the Committee’s direction, management of the Company maintains an Incentive Compensation and Performance Management Committee responsible for overseeing and monitoring non-executive incentive compensation objectives, performance management, and incentive compensation plans. The Committee, which consists of various senior officers, including the Chief Operating Officer and the Chief Risk Officer, has assessed the Company’s non-executive incentive compensation plans to determine if the programs’ provisions and operations create undesired or unintentional risk of a material nature. This risk assessment process includes a review of plan policies and practices; an analysis to identify risks and risk controls related to the plans; and determinations as to the sufficiency of risk identification, the balance of potential risk to potential reward, risk controls, and the consistency of the programs and their risks with regard to the Company’s strategies. Compensation agreements are subject to risk reviews by first and second lines of defense: an attorney designed by the Chief Operating Officer performs a first line review, which is followed by the Chief Risk Officer’s second line review. Reporting by the Incentive Compensation and Performance Management Committee to the Compensation Committee occurs at least annually.
Although the Compensation Committee reviews all compensation programs, it focuses on the programs with variability of payout, the ability of a participant to directly affect payout, and the controls on participant action and payout.
In response to the results of the 2018 shareholder advisory vote on executive compensation, the Compensation Committee was restructured and took several steps to revise the executive compensation program resulting in overwhelming support in the 2019 shareholder advisory vote on executive compensation.
Based on the foregoing, we believe that our executive compensation policies and practices do not create inappropriate or unintended significant risk to the Company as a whole. We also believe that our incentive compensation arrangements provide incentives that do not encourage risk-taking beyond the
|
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CORPORATE GOVERNANCE | |
Nominating and Corporate Governance Committee | |||
Members:
Dominick Ciampa Hanif
Lawrence Rosano, Jr. Ronald A. Rosenfeld Lawrence J. Savarese John M. Tsimbinos
Meetings held in |
| The Committee considers and recommends the nominees for director to stand for election at the Company’s Annual Meeting of Shareholders.
The Nominating and Governance Committee is responsible for recommending to the Board the qualifications for Board membership, identifying, assessing, and recommending qualified director candidates for the Board’s consideration, assisting the Board in organizing itself to discharge its duties and responsibilities, and providing oversight of the Company’s corporate governance practices and policies, including an effective process for shareholders to communicate with the Board. The Committee is composed entirely of independent directors as defined by the NYSE Corporate Governance Standards and operates under a written charter. The Nominating and Corporate Governance Committee’s charter is available on the corporate governance pages within the Investor Relations portion of the Company’s website at www.myNYCB.com and is available in print upon request.
The Committee’s role in, and process for, identifying and evaluating prospective director nominees is described herein and above in Board Diversity and Tenure. See also Procedures for Shareholders to Recommend Directors. In addition, the Committee makes recommendations to the Board concerning director independence, Board committee assignments, committee chairman positions, Audit Committee “financial experts,” the financial literacy of Audit Committee members, and Risk Assessment Committee “risk management experts.”
|
Risk Assessment Committee | |||
Lawrence Rosano, Jr. Dominick Ciampa Hanif Leslie D. Dunn
Ronald A. Rosenfeld Lawrence J. Savarese John M. Tsimbinos
The Board of Directors has determined that Messrs. Dahya and Savarese are “risk management experts” under the enhanced prudential standards of the Dodd-Frank Act.
Meetings held in |
| The Risk Assessment Committee has been appointed by the Company’s Board of Directors to assist the Board in fulfilling its responsibilities with respect to oversight of the Company’s risk management program, including as it relates to the risk appetite of the Company and the policies and procedures used to manage various risks, including credit, market, interest rate, liquidity, legal/compliance, regulatory, strategic, operational, reputational, and certain other risks. The Risk Assessment Committee enhances the Board’s oversight of risk management activities at the Company through active and frequent engagement.
The Risk Assessment Committee’s role is one of oversight, recognizing that management is responsible for designing, implementing, and maintaining an effective risk management program. The Company’s departmental managers are the first line of defense for managing risk in the areas for which they are responsible. As a second line of defense, the Company’s Chief Risk Officer provides overall leadership for
At each regularly scheduled meeting of the Risk Assessment Committee, the Committee receives a monthly report from the Chief Risk Officer with respect to the Company’s approach to the management of major risks, including the implementation of On a quarterly basis, the Risk Assessment Committee
The Risk Assessment Committee responsibilities also include oversight of the Company’s capital and stress testing program as required under the applicable rules and regulations of the Dodd-Frank Act and,
|
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| CORPORATE GOVERNANCE | |
In addition to the above described committees of the Company Board, the Community Bank Board maintains committees with important oversight responsibilities for the Community Bank’s lending functions: the Mortgage and Real Estate Committee and the Commercial Credit Committee of the Community Bank Board serve important governance functions in the lending businesses of the Company. The multi-family, commercial real estate, commercial and industrial, and other non-residential loans we originate all are made in accordance with loan underwriting policies and procedures approved by the respective Committees, which maintain active oversight of management’s loan origination, servicing, and collections processes. Committee members, who have significant experience in real estate businesses as well as real estate and other lending, apply their knowledge and expertise in key policy and risk-management decisions relating to these core business areas.
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Mortgage and Real Estate Committee - – The Mortgage and Real Estate Committee is a committee of the Community Bank Board of Directors and was appointed by that Board to oversee the Community Bank’s credit management policies and procedures. The authority of the Committee includes, among other things, oversight regarding the administration and implementation of loan policies, review of the risks associated with loans approved by management, and the delegation of credit authority. Each member has expertise in relevant areas of commercial and residential real estate; lending and lending risk; and the business of financial institutions.
The members of the Mortgage and Real Estate Committee are Messrs. O’Donovan (Chair), Cangemi, Ciampa, Ficalora, Levine, Rosano, and Tsimbinos. The Mortgage and Real Estate Committee met 5251 times in 2019.2020.
Commercial Credit Committee - – The Commercial Credit Committee is a committee of the Community Bank Board of Directors and was appointed by that Board in September 2018 to oversee the Community Bank’s credit management policies and procedures, and the lending activities of the Bank’s specialty finance company subsidiary, which originates asset-based loans, dealer floor-plan loans, and equipment loans and leases. The authority of the Committee includes, among other things, oversight regarding the administration and implementation of commercial and industrial loan policies, review of the risks associated with such loans approved by management, and the delegation of credit authority. Each member has expertise in relevant areas of commercial and industrial lending, lending risk, and the business of financial institutions.
The members of the Commercial Credit Committee are Messrs. Dahya (Chair), Cangemi, Ciampa, Ficalora, Levine, O’Donovan, Rosano, Savarese, and Tsimbinos. The Commercial Credit Committee of the Community Bank Board met 5150 times in 2019.2020.
Director Attendance at Annual Meetings
The Board of Directors expects all directors to attend the Annual Meeting of Shareholders. All of the then-serving Board members attended the Annual Meeting of Shareholders held on June 4, 2019.3, 2020. Because the meeting was held in a virtual format, all Board members attended telephonically.
communication With The Board of Directors
Shareholders and other parties interested in communicating directly with the Company by directing correspondence to any of the individuals listed below. Letters addressed to the Presiding Director will be opened by the Company’s Corporate Secretary, who will review them and forward a summary of such correspondence to the Presiding Director and, if applicable, the Board. If the Corporate Secretary determines that an item of correspondence relates to the functions of the Board or its committees, or otherwise requires their attention, he will direct the item itself to the Presiding Director or other Board members. Directors may at any time review a log of all correspondence received by the Company that is addressed to the Presiding Director as provided above, and request copies of any correspondence.
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| CORPORATE GOVERNANCE | |
How to contact us:
| New York Community Bancorp, Inc. 615 Merrick Avenue, Westbury, NY 11590 Attention: | |
Investor Relations | New York Community Bancorp, Inc. 615 Merrick Avenue, Westbury, NY 11590 Attention: Investor Relations
| |
Board of Directors | New York Community Bancorp, Inc. c/o Office of the Corporate Secretary 615 Merrick Avenue, Westbury, NY 11590 | |
Presiding Director | New York Community Bancorp, Inc. c/o Office of the Corporate Secretary 615 Merrick Avenue, Westbury, NY 11590 Attention: | |
Audit Committee of the Board of Directors | New York Community Bancorp, Inc. c/o Office of the Corporate Secretary 615 Merrick Avenue, Westbury, NY 11590 Attention: Lawrence J. Savarese, Audit |
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Procedures For Shareholders To Recommend Directors
It is the policy of the Nominating and Corporate Governance Committee to consider director candidates who appear to be qualified to serve on the Board and who are recommended by shareholders. The Nominating and Corporate Governance Committee may choose not to consider an unsolicited recommendation if no vacancy exists on the Board of Directors and if the Nominating and Corporate Governance Committee does not perceive a need to increase the size of the Board. To avoid the unnecessary use of its resources, the Nominating and Corporate Governance Committee will consider only those director candidates recommended in accordance with the procedures set forth below. To submit a recommendation of a director candidate to the Nominating and Corporate Governance Committee, a shareholder should submit the following information in writing, addressed to the Chairman of the Nominating and Corporate Governance Committee, care of the Corporate Secretary, at the main office of the Company:
a. | the name of the person recommended as a director candidate; |
b. | all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended; |
c. | the written consent of the person being recommended as a director candidate to being named in the proxy statement as a nominee and to serving as a director if elected; |
d. | the name and address of the shareholder making the recommendation, as they appear on the Company’s books; provided, however, that if the shareholder is not a registered holder of Common Stock, the shareholder should submit his or her name and address along with a current written statement from the record holder of the shares that reflects ownership of the Common Stock; |
e. | a statement disclosing whether such shareholder is acting with, or on behalf of, any other person and, if applicable, the identity of such person; and |
f. | such other information as the Company may require in accordance with its established nomination procedures then in effect. |
In order for a director candidate to be considered for nomination at the Company’s Annual Meeting of Shareholders, the recommendation must be received at the principal executive office of the Company not less than 90 days prior to the date of the meeting; provided, however, that in the event that less than 100 days’ notice or prior disclosure of the date of the annual meeting is given or made to shareholders, notice by the shareholder to be timely must be so received not later than the close of business on the 10th day following the day on which such notice of the date of the meeting was mailed or such public disclosure was made.
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| CORPORATE GOVERNANCE | |
Under the proxy access provisions of our Bylaws, eligible shareholders and/or shareholder groups were permitted to include shareholder-nominated director candidates in our proxy materials for the 20202021 annual meeting of shareholders. No such proposals were received. For details about the process to include shareholder-nominated director candidates in our proxy materials, please see Additional Information – Proxy Access Nominations and refer to Article I, Sections 6, 7, and 8 of our Amended and Restated Bylaws. A copy of the Amended and Restated Bylaws of the Company are available, free of charge, in print to any shareholder who requests a copy.
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| BENEFICIAL OWNERSHIP |
Information with Respect to Nominees, Continuing Directors, and Executive Officers
INFORMATION WITH RESPECT TO NOMINEES, CONTINUING DIRECTORS, AND EXECUTIVE OFFICERS |
The following table sets forth, as of April 7, 2020,1, 2021, the names of the nominees, continuing directors, and executive officers of the Company, their ages and, as applicable, the year in which he or she became a director and the year in which his or her term (or in the case of the nominees, their proposed terms) as director of the Company expire. The table also sets forth the amount and percentage of Common Stock beneficially owned by each director, by each named executive officer (as defined on page 23)24), and by all directors and executive officers as a group as of April 7, 2020.1, 2021.
Name | Age | Director Since | Shares of Common Stock Beneficially Owned (1) (2) | Percent of Class | Age | Director Since | Shares of Common Stock Beneficially Owned (1) (2) | Percent of Class | |||||||||||||
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Nominees (Whose Terms Would Expire in 2023): |
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Nominees (Whose Terms Would Expire in 2024): | Nominees (Whose Terms Would Expire in 2024): |
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Thomas R. Cangemi |
| 52 |
|
| 2020 |
|
| 1,544,329 | (3,4,5,6) |
| 0.332 | % | |||||||||
Hanif “Wally” Dahya |
| 65 |
|
| 2007 |
|
| 180,414 | (3,4) |
| 0.039 | % | |||||||||
James J. O’Donovan |
| 78 |
|
| 2003 |
|
| 1,388,667 | (3,4,5) |
| 0.299 | % | |||||||||
Directors Whose Terms Expire in 2022: | Directors Whose Terms Expire in 2022: |
| |||||||||||||||||||
Ronald A. Rosenfeld |
| 81 |
|
| 2012 |
|
| 119,482 | (3,4) |
| 0.026 | % | |||||||||
Lawrence J. Savarese |
| 64 |
|
| 2013 |
|
| 118,896 | (3,4) |
| 0.026 | % | |||||||||
John M. Tsimbinos |
| 83 |
|
| 2003 |
|
| 1,219,053 | (3,4) |
| 0.262 | % | |||||||||
Directors Whose Terms Expire in 2023 | Directors Whose Terms Expire in 2023 |
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Dominick Ciampa | 86 | 1995 | 511,821 | (3,4) | 0.110% |
| 87 |
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| 1995 |
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| 520,003 | (3,4) |
| 0.112 | % | ||||
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Leslie D. Dunn | 74
| 2015 | 25,604 | (3)(4) | 0.006% |
| 75 |
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| 2015 |
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| 33,816 | (3,4) |
| 0.007 | % | ||||
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Lawrence Rosano, Jr. | 67 | 2014 | 31,104 | (3,4) | 0.007% |
| 68 |
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| 2014 |
|
| 39,316 | (3,4) |
| 0.008 | % | ||||
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Robert Wann | 65 | 2008 | 2,416,794 | (3,5) | 0.521% |
| 66 |
|
| 2008 |
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| 2,435,622 | (3,5) |
| 0.524 | % | ||||
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Directors Whose Terms Expire in 2021 |
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Hanif “Wally” Dahya | 64 | 2007 | 169,009 | (3,4) | 0.036% | ||||||||||||||||
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Joseph R. Ficalora | 73 | 1989(7) | 7,103,211 | (3,4,5) | 1.531% | ||||||||||||||||
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James J. O’Donovan | 77 | 2003 | 1,360,814 | (3,4,5) | 0.293% | ||||||||||||||||
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Directors Whose Terms Expire in 2022: |
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Michael J. Levine | 75 | 2004 | 328,369 | (3,4) | 0.071% | ||||||||||||||||
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Ronald A. Rosenfeld | 80 | 2012 | 106,270 | (3,4) | 0.023% | ||||||||||||||||
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Lawrence J. Savarese | 63 | 2013 | 110,684 | (3,4) | 0.024% | ||||||||||||||||
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John M. Tsimbinos | 82 | 2003 | 1,210,841 | (3,4) | 0.261% | ||||||||||||||||
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Named Executive Officers Who Are Not Directors: | Named Executive Officers Who Are Not Directors: |
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| Named Executive Officers Who Are Not Directors: |
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Thomas R. Cangemi | 51 | -- | 1,240,0422 | (3,4,5,6) | 0.267% | ||||||||||||||||
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James J. Carpenter | 59 | -- | 669,651 | (3,4) | 0.144% | ||||||||||||||||
John T. Adams |
| 58 |
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| — |
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| 147,860 | (3,4) |
| 0.032 | % | |||||||||
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John J. Pinto | 49 | -- | 529,263 | (3,5) | 0.114% |
| 50 |
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| — |
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| 623,487 | (3,5) |
| 0.134 | % | ||||
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Joseph R. Ficalora (retired)(7) |
| 74 |
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| — |
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| 6,325,985 | (4,5) |
| 1.360 | % | |||||||||
All directors and executive officers as a group (14 persons) |
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| 15,813,477 |
| 3.408% |
| 14,812,976 |
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| 3.185 | % |
(1) | Includes the following shares of common stock held directly: Mr. Cangemi: 965,682; Mr. Ciampa: |
(2) | Each person effectively exercises sole (or shares with spouse or other immediate family member) voting or dispositive power as to shares reported herein (except as noted). Figures include all of the shares held directly and indirectly by directors and the Company’s executive officers, as well as the shares underlying stock awards that have been granted to, and are currently exercisable or exercisable within 60 days by, such directors and executive officers under the Company’s various stock-based benefit plans. |
(3) | Includes the following shares of unvested restricted stock awards: Mr. Cangemi – 385,169; Mr. Ciampa – |
(4) | Includes the following shares that are owned by spouses of the named nominees, continuing directors, and executive officers or are held in individual retirement accounts, trust accounts, custodian accounts, or foundation accounts for which the directors and the executive officers are deemed beneficial owners: Mr. Cangemi – 60,335; Mr. Ciampa – |
(5) | Includes the following shares allocated under the NYCB Employee Stock Ownership Plan (“ESOP”) (and in the case of Messrs. |
(6) | Mr. Cangemi has pledged 515,729 shares of Common Stock pursuant to margin account arrangements. The margin balances outstanding, if any, pursuant to such arrangements may vary from time to time. All pledge obligations entered into before the adoption of the new policy on pledging stock are grandfathered for the duration of the pledge commitment. See page |
(7) |
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Page 2223
Executive Compensation and Related Information
I. COMPENSATION DISCUSSION AND ANALYSIS
INTRODUCTION
We are pleased to provide our shareholders with an overview and analysis of the compensation programs in which the following executive officers (our “named executive officers” or “NEOs”) participated in during 20192020 and the process we use to make specific compensation decisions for our NEOs:
Joseph R. Ficalora*, President and Chief Executive Officer
Robert Wann, Senior Executive Vice President and Chief Operating Officer
Thomas R. Cangemi*, Senior Executive Vice President and Chief Financial Officer
John J. Pinto*, Executive Vice President and Chief Accounting Officer
John T. Adams, Executive Vice President and Chief Lending Officer
* |
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All persons standing for election as directors were unanimously nominated by the Nominating and Corporate Governance Committee of the Board of Directors. No person being nominated as a director is being proposed for election pursuant to any agreement or understanding between any such person and the Company.
The Board of Directors currently consists of 1110 members. All directors presently serve as directors of the Company and the Community Bank. Directors of the Company Board are elected for staggered terms of three years each, with the term of office of one of the three classes of directors expiring each year. Directors serve until their successors are elected and qualified.
The nominees proposed for election at this year’s Annual Meeting are
The Nominating and Corporate Governance Committee approved, and recommended to the Board of Directors, the director nominees standing for election at the |
In the event that any such nominee is unable to serve or declines to serve for any reason, it is intended that the proxies will be voted for the election of such other person as may be designated by the Nominating and Corporate Governance Committee of the Board of Directors. The Board of Directors has no reason to believe that any of the persons named will be unable or unwilling to serve. If a nominee is not elected by the requisite vote, he must tender his resignation, and the Board of Directors, through a process managed by the Nominating and Corporate Governance Committee, will decide whether to accept the resignation. It is intended that the shares represented by the enclosed proxy card, if executed, dated, and returned without voting instructions, will be voted “FOR” the election of each of the nominees proposed by the Board of Directors.
The following table indicates the names, ages, tenure, and principal professional experience of the current members of our Board of Directors as of April 1, 2021:
Name | Age | Director Since | Principal Professional Experience | |||||||||
Thomas R. Cangemi | 52 | 2020 | Banking | |||||||||
Dominick Ciampa | 87 | 1995 | Real Estate | |||||||||
Hanif “Wally” Dahya | 65 | 2007 | Investment Banking & Manufacturing | |||||||||
Leslie D. Dunn | 75 | 2015 | Law | |||||||||
James J. O’Donovan | 78 | 2003 | Banking | |||||||||
Lawrence Rosano, Jr. | 68 | 2014 | Real Estate | |||||||||
Ronald A. Rosenfeld | 81 | 2012 | Real Estate, Government | |||||||||
Lawrence J. Savarese | 64 | 2013 | Auditing | |||||||||
John M. Tsimbinos | 83 | 2003 | Banking | |||||||||
Robert Wann | 66 | 2008 | Banking |
Page 49
|
PROPOSALS TO BE VOTED ON AT THE MEETING | |
The following table presents a summary of the various experience, expertise, and/or attributes of our Board members on the various Board Committees1as of April 7, 2020:1, 2021:
Director | Age | Director Since | Experience, Expertise, or Attribute | Audit | Compensation | Nominating & Corporate | Risk Assessment | Mortgage & Real Estate | Commercial Credit |
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Dominick Ciampa† | 86 | 1995 |
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| ● | ● | ● | ● | |
Hanif “Wally” M. Dahya # | 64 | 2007 |
| ● |
| ● | ● |
| ¤ |
Leslie D. Dunn | 74 | 2015 | ● | ● | ● | ● |
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Joseph R. Ficalora | 73 | 1989 |
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| ● | ● | |
Michael J. Levine * @ | 75 | 2004 | ● |
| ¤ | ¤ | ● | ● | |
James J. O’Donovan | 77 | 2003 |
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| ● | ● | ¤ | ● |
Lawrence Rosano, Jr. | 67 | 2014 |
| ● | ● | ● | ● | ● | |
Ronald A. Rosenfeld | 80 | 2012 |
| ● |
| ● | ● |
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Lawrence J. Savarese * # | 63 | 2013 | ¤ |
| ● | ● |
| ● | |
John M. Tsimbinos | 82 | 1999 |
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| ● | ● |
Robert Wann | 65 | 2007 |
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Experience operating in an executive leadership position demonstrating the ability to understand and direct business operations, analyze risk, manage human capital, oversee implementation of organizational change and deliver strategic plans. |
| 10 | ||||||||||||||||||||||
Board or management experience in retail banking, commercial banking, mortgage lending, mortgage servicing, consumer lending, small business banking, investment banking and/or other financial services. | 10 | |||||||||||||||||||||||
Leadership and understanding of technology, digital platforms and cyber risk | 6 | |||||||||||||||||||||||
Public Accounting and Financial Reporting Experience assessing or overseeing performance of companies or public accounting firms regarding preparation, auditing or evaluation of financial statements | 9 | |||||||||||||||||||||||
Public Company Corporate Governance Experience serving as a board member or senior executive at a public company and/or experience with public company governance issues, policies and best practices. | 10 | |||||||||||||||||||||||
Business Operations and Strategic Planning Experience setting long-term corporate vision and goals, developing products and services, evaluating competitive position and assessing progress toward achievement | 10 | |||||||||||||||||||||||
Compliance / Regulatory / Legal Experience with regulated businesses, regulatory requirement and compliance, legal expertise, and relationships with federal and state agencies. | 10 | |||||||||||||||||||||||
Risk Significant understanding and experience with identification, assessment and oversight of risk management programs and practices | 7 | |||||||||||||||||||||||
Real Estate / Housing Board or management experience in multi-family real estate and lending, commercial real estate and lending, construction and industrial real estate and lending, residential mortgage lending, and mortgage servicing | 9 | |||||||||||||||||||||||
Sustainability, Charitable, or other Corporate Responsibility Experience and leadership in embracing corporate responsibility and encouraging a positive impact through philanthropic efforts, volunteering, charitable giving, and other activities related to the environment, consumers, employees, and communities. | 5 | |||||||||||||||||||||||
Human Capital Management and Compensation Understanding executive compensation issues, succession planning, talent management and development | 5 | |||||||||||||||||||||||
Ethnic, Gender, Nationality, or other Diversity Board members with different attributes relating to, among other things, ethnicity, gender, and nationality. | 3 |
Page 50
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Page 50
Director Qualifications and Business Experience
The following provides information about each member of the Company’s Board of Directors, including their business experience, and additional information about the specific experience, qualifications, attributes, or skills that led to the Board’s conclusion that each should serve as a director of the Company.
Nominees:
Thomas R. Cangemi | |||||
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Director since: Age: | Thomas R. Cangemi serves as Chairman, President, and Chief Executive Officer of New York Community Bancorp, Inc. and New York Community Bank. He was appointed President and CEO effective December 31, 2020 and was named Chairman effective March 26, 2021. Prior to this, Mr. Cangemi served as Senior Executive Vice President and Chief Financial Officer of the Company and the Bank since April 5, 2005. He joined the Company on July 31, 2001 as Executive Vice President and Director of the Capital Markets Group, and was named Senior Executive Vice President on October 31, 2003.
| Mr.
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Mr. Cangemi’s experience and contributions advance the Board’s objective of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank.
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Page 51
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Committees:
Mortgage & Real Estate (Bank Board) Commercial Credit (Bank Board)
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Page 51
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
Hanif (“Wally”) Dahya | ||||
Director since: 2007 Age: 65 |
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Page 52
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| Mr. Dahya is the Chief Executive Officer of The Y Company LLC, a private investment firm that focuses on emerging-market companies in the information, communications, financial, and environmental services industries. The company also is involved in distressed assets in the emerging markets. Mr. Dahya currently serves as the Board’s Independent Presiding Director as well as the Chairperson for the Compensation Committee of the Company and the Chair of the Commercial Credit and the Salary and Personnel Committees of the Bank. Prior to forming The Y Company, Mr. Dahya spent 14 years on Wall Street, having started his career in investment banking at E.F. Hutton and Co., Inc. Thereafter, Mr. Dahya was Managing Director at L.F. Rothschild Co. Inc., headed the Mortgage-Backed Securities Group at UBS Securities Inc., and was a partner at Sandler O’Neill + Partners L.P. Mr. Dahya previously served as an independent director of TerraForm Power, Inc. and TerraForm Global, Inc., affiliated companies which own clean power generation assets for utility, commercial, and residential customers.
Mr. Dahya is a graduate of Harvard Business School and earned his undergraduate degree at Loughborough University of Technology in the United Kingdom.
With his extensive financial and risk management experience in investments, capital markets, asset and liability management, emerging markets, real estate, and bank and thrift investments, Mr. Dahya provides the Board with valuable insight on these and others matters that are beneficial to the Company in furtherance of the Board’s objective of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank. |
Page 53
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Committees:
Compensation (Chair) Nominating and Corp. Governance Risk Assessment Commercial Credit (Bank Board)
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Page 54
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James J. O’Donovan | ||||
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Director since: 2003 Age: |
| of the Company in July 1993. From
Mr. O’Donovan’s experience as a former executive officer of the Company and as current Chairman of the Mortgage and Real Estate Committee of the Community Bank Board not only brings valuable management and leadership skills, extensive industry knowledge, and business acumen to the Board, but also significant insight in overseeing matters critical to the Company’s lending businesses. Mr. O’Donovan’s experience and contributions advance the Board’s objective of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank. | |
Committees: Mortgage & Real Estate (Bank Board) (Chair) Commercial Credit (Bank Board) |
Page 52
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
Current Directors:
Dominick Ciampa | ||||
Director since: 1995 Age: 87 | Mr. Ciampa is the founder of, and a former Partner in, the Ciampa Organization, a Queens-based real estate development and management firm founded in 1975 which continues to be operated by other family members. A member of the Boards of Directors of the Company and the Bank since 1995. Mr. Ciampa previously served as non-executive Chairman of the Board from January 3, 2011 to January 5, 2021. Mr. Ciampa also served as Chairman of the Mortgage and Real Estate Committee of the Bank from 2003 through 2010, and has since served as a member of that committee and of the Commercial Credit Committee of the Community Bank since its formation. Mr. Ciampa also serves as a member of the Audit, Nominating and Corporate Governance, and Risk Assessment Committees of the Company and the Bank. Mr. Ciampa is also a Director of the New York Community Bank Foundation and the Richmond County Savings Foundation. In addition, Mr. Ciampa served as the President of the Queens Chamber of Commerce from 1989 to 1991. Mr. Ciampa’s combined experience with the Company, and in leading a large commercial real estate development firm with significant ownership interests in our markets, brings valuable insight to the Board in overseeing a wide range of banking and real estate matters, in furtherance of the Board’s objective of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank. | |||
Committees: Audit Nominating and Corp. Governance Risk Assessment Mortgage & Real Estate (Bank Board) Commercial Credit (Bank Board) |
Leslie D. Dunn | ||||
Director since: 2015 Age: 75 | Ms. Dunn has been an independent member of the Boards of Directors of the Company and the Bank since 2015, and currently serves as Chair of the Nominating and Corporate Governance Committee of the Company and the Bank and is a member of the Audit and Risk Assessment Committees of the Company and the Bank as well as a member of the Compensation Committee of the Company. An experienced executive, legal, and governance professional, Ms. Dunn was recently appointed to the Board of Directors of GrafTech International Ltd. (NYSE: EAF), a leading manufacturer of high quality graphite electrode products to the steel industry, in August 2020. Ms. Dunn previously served as an independent director of the Federal Home Loan Bank of Cincinnati from 2007 until completing her term of service in 2020. Additionally, Ms. Dunn previously served as an independent director of E&H Family Group, Inc., an Ohio-based business that operates chains of retail stores, serving as the Chair of that company’s Compensation Committee and as a member of its Finance Committee. Ms. Dunn’s board experience also includes over 15 years as a director of Telarc International Corporation, a Grammy Award-winning recording company. From 1997 through 2004, Ms. Dunn was Senior Vice President of Business Development at Cole National Corporation, a New York Stock Exchange-listed specialty retailer with over 10,000 employees and 3,000 locations in Canada, Europe, and the United States. Her responsibility focused on implementation of the Company’s acquisition growth strategy. Ms. Dunn also served as Cole’s General Counsel and Secretary, overseeing the company’s government relations and law departments, ensuring its compliance with SEC regulations, and serving as principal corporate governance advisor to the board. Prior to joining Cole, Ms. Dunn was a partner in the Business Practice Group in the Cleveland office of Jones Day, a global law firm with more than 40 locations, and before then, was a partner in the corporate practice of Squire Sanders & Dempsey (now Squire Patton Boggs), also in Cleveland. A graduate of Case Western Reserve University School of Law, Ms. Dunn is also an active civic leader and philanthropist in her home state of Ohio, including serving as the President and Trustee of the David and Inez Myers Foundation, the immediate past President of the Board of the Cleveland Museum of Contemporary Art, a Life Trustee and Past Chair of the Mt. Sinai Health Care Foundation, a Trustee of the Jewish Federation of Cleveland, and past Co-Chair of the Northeast Ohio Chapter of Women Corporate Directors. Ms. Dunn’s experience and contributions advance the Board’s objective of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank. In addition, Ms. Dunn previously served as a member of the Advisory Board of the New York Community Bank’s Ohio Savings Bank Division until its disbandment during the first quarter of 2019. | |||
Committees: Audit Compensation Nominating and Corp. Govern. (Chair) Board Development Subcommittee (Chair) Risk Assessment Other Public Company Directorships: GrafTech International Ltd. |
Page 53
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
Lawrence Rosano, Jr. | ||||
Director since: 2014 Age: 68 | Mr. Rosano has been an independent member of the Boards of the Company and Community Bank since July 22, 2014. He currently serves as the Chairman of the Risk Assessment Committee of the Company and the Community Bank and is a member on the Nominating and Corporate Governance Committees of the Company and the Bank. Mr. Rosano also serves as a member on the Compensation Committee of the Company as well as on the Mortgage and Real Estate, Commercial Credit, and Salary and Personnel Committees of the Community Bank. Since May 1974, Mr. Rosano has served as a principal, owner, and operator of various real estate development and management businesses in the New York metropolitan area, including Associated Development Corp. (since 1984), Associated Properties, Inc. (since 2002), and 460 Grand Street Realty LLC (since August 2013). In addition, he is currently a member of the Board of the Queens & Bronx Building Association, a regional trade group for which he formerly served as president. Additionally, in November 2016 he was appointed a member of the Contractor & Expert Committee of the MS4 Policy Group formed by the New York City Department of Environment & Protection, the Urban Green Council, and the Real Estate Board of New York whose mission is to develop a storm water management program for the City of New York in order to make it compliant with the New York State and Federal standard for MS4 Stormwater Permitting Process. With his extensive experience in real estate development and executive management, Mr. Rosano brings valuable insight to the Board of the Company in overseeing a wide range of banking and real estate matters, and furthers the Board’s objectives of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community Bank. | |||
Committees: Compensation Nominating and Corp. Governance Board Development Subcommittee Risk Assessment (Chair) Mortgage & Real Estate (Bank Board) Commercial Credit (Bank Board) |
Page 54
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
Ronald A. Rosenfeld | ||||
Director since: 2012 Age:
| Mr. Rosenfeld has been a member of the Boards of Directors of the Company, the Community Bank, and the former Commercial Bank since January 1, 2012, and
A graduate of Harvard Law School and The Wharton School, University of Pennsylvania, Mr. Rosenfeld also lends his expertise to several not-for-profit organizations in the housing, education, and cultural arenas. In addition to serving on the Housing Commission of the Bi-Partisan Policy Center, Mr. Rosenfeld is a Trustee of Howard University. With his extensive experience in housing and development, corporate finance, and investment banking, Mr. Rosenfeld brings valuable insight to the Board of the Company in overseeing a wide range of banking and real estate matters, and furthers the Board’s objectives of maintaining a membership of experienced and dedicated individuals with diverse backgrounds, perspectives, skills, and other qualities that are beneficial to the Company and the Community | |||
Committees: Audit Nominating and Corp. Governance Board Development Subcommittee Risk Assessment |
Page 55
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Director since: 2013 Age:
| Mr. Savarese has been a member of the Boards of Directors of the Company, the Community Bank, and the former Commercial Bank since March 4, 2013. From 1978 through 2012, Mr. Savarese was with the independent public accounting firm KPMG LLP. For 19 years, he was an Audit Partner in KPMG’s Financial Services Practice, serving as partner in charge of audits of both community banks (including the Company and the Community Bank) and international banks with branches and agencies in the United States. During this time, Mr. Savarese served as KPMG’s representative to the New York Bankers Association and The Institute of International Bankers.
From 2008 to 2012, Mr. Savarese served as Audit Partner, Risk Management, for
Prior to his retirement in 2012, Mr. Savarese was an Audit Partner in | ||||
Committees: Audit (Chair) Compensation Nominating and Corp. Governance Risk Assessment Commercial Credit (Bank Board) |
Page 55
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
John M. Tsimbinos | ||||
Director since: 1999 Age:
| Mr. Tsimbinos has been a member of the Boards of Directors of the Company and the Community Bank since the merger of Roslyn Bancorp, Inc. with and into the Company and of the Roslyn Savings Bank with and into the Community Bank on October 31, 2003. In addition, he served as a member of the Board of Directors of the former Commercial Bank since its establishment on December 30, 2005 and
Prior to Roslyn’s acquisition of TR Financial Corp. in February 1999, Mr. Tsimbinos was the Chairman of the Board and Chief Executive Officer of Roosevelt Savings Bank, a position he assumed in 1983. He also served as Chairman of the Board and Chief Executive Officer of TR Financial Corp. from the time of its inception in 1993. In addition to his service to the Company, the Community Bank, and the former Commercial Bank, Mr. Tsimbinos served on the Board of the Federal Home Loan Bank of New York from 1989 through 1995 and as Vice Chairman of the Board for two three-year terms. Mr. Tsimbinos holds a B.A. from the City College of New York, an M.B.A. from the Baruch School of Business and Public Administration, and is a graduate of the Program for Management Development at Harvard University. Also, Mr. Tsimbinos was a lecturer in Economics at Queens College for a number of years, teaching courses in Basic Economics, Money and Banking, and Corporate Finance. As the former Chairman of the Board and Chief Executive Officer of two bank holding companies and savings banks, Mr. Tsimbinos offers a wealth of management experience, business understanding, and knowledge of banking regulations along with a deep understanding of the role of the Board of Directors. Additionally, Mr. Tsimbinos’ prior experience as a senior executive officer of a publicly traded bank holding company has given him front-line exposure too many of the issues facing the Company as well as extensive and valuable experience in overseeing, among other matters, the Company’s banking business. | |||
Committees: Compensation Nominating and Corp. Governance Risk Assessment Mortgage & Real Estate (Bank Board) Commercial Credit (Bank Board) |
Business Experience of Named Executive Officers Who are Not Directors
Thomas R. Cangemi. Senior Executive Vice President and Chief Financial Officer of New York Community Bancorp, Inc. and New York Community Bank since April 5, 2005. He joined the Company on July 31, 2001 as Executive Vice President and Director of the Capital Markets Group, and was named Senior Executive Vice President on October 31, 2003.
Prior to joining the Company, Mr. Cangemi was Executive Vice President, Chief Financial Officer, and Treasurer of
Page 56
Robert Wann | ||||
Director since: 2007 Age: 66 | Mr. Wann has been the Senior Executive Vice President and Chief Operating Officer of the Company since 2003. Prior to Mr. Wann is a member of the American Bankers Association and the New York Bankers Association, and serves on the Board of Directors of various organizations. A graduate of Queens College with a degree in accounting, Mr. Wann is on the Board of Trustees of the Queens College Foundation and is a past Chairman of its Audit Committee. An active member of the community, Mr. Wann previously served as president of the Flushing Central Lions Club and as a member of the Board of Trustees of the Queens Museum of Art, and currently serves on the Board of Directors of a private charitable foundation based in New York. With over 30 years of experience at the |
BUSINESS EXPERIENCE OF NAMED EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS |
both Richmond County Financial Corp. and Richmond County Savings Bank. Before joining Richmond County in 1997, John T. Adams.Mr. Cangemi served as Senior Vice President, Chief Financial Officer, and Corporate Secretary of Continental Bank, a commercial bank based in Garden City, New York and, previously, as Director of Corporate SEC Reporting for an electronics corporation in Boca Raton, Florida. From 1993 to 1996, Mr. CangemiAdams was Vice President and Chief Financial Officer of Sunrise Bancorp, a publicly traded thrift headquartered on Long Island. Previously, Mr. Cangemi was a member of the SEC Professional Practice Group of KPMG Peat Marwick serving financial institutions.
Mr. Cangemi holds a B.B.A. from the School of Professional Accountancy at Dowling College, and is
a certified public accountant and a member of the AICPA.
Mr. Cangemi serves as Treasurer and a member of the Board of Directors of both the Richmond County Savings Foundation and the New York Community Bank Foundation. In addition, Mr. Cangemi is a Board member and a member of the Development Committee of the Long Island Children’s Museum, and a member of the Board of Trustees of the The Whaling Museum & Education Center of Cold Spring Harbor. Previously, Mr. Cangemi was on the Board of Directors of Friends of the Arts, a member of the Council of Overseers of the Tilles Center for the Performing Arts; and a member of the Board of Trustees of the East Woods School.
James J. Carpenter. Seniorappointed Executive Vice President and Chief Lending Officer on January 1, 2020. Prior to this appointment, Mr. Adams has served in positions of increasing responsibility at New York Community
Page 56
| PROPOSALS TO BE VOTED ON AT THE MEETING | |
Bank since joining the Company and the Communityin 2000 in conjunction with its acquisition of Haven Bancorp, Inc., parent of CFS Bank, from January 1, 2006 to December 31, 2019, and Senior Executive Vice President of the former Commercial Bank from December 30, 2005 to November 30, 2018:where he began his career in 1983. Most recently, Mr. Adams served as Executive Vice President and Chief LendingCredit Officer, managing credit risk and credit risk administration to ensure the Bank’s asset quality is acceptable. Overall he has over 36 years of the Community Bank from February 1, 2005 to December 31, 2005; Executive Vice Presidentbanking, lending and Assistant Chief Lending Officer of the Community Bank from January 1, 2003 to February 1, 2005; Senior Vice Presidentcredit experience.
Previously and Mortgage Lending Officer of the Community Bank from November 30, 2000 to January 1, 2003.
Prior to joiningthroughout his tenure with the Company, Mr. Carpenter served as Senior Vice President responsible for MultifamilyAdams assumed senior roles including retail branch management, commercial mortgage lending, originations and Commercial Real Estateconstruction lending management. In 2013, his role was expanded to include Chief Administration Officer duties where he oversaw the day to day operations of the Bank’s Lending for Haven Bancorp, Inc. and CFS Bank from November 1994 to November 2000 and its Commercial Real Estate and Asset Management departments from December 1991 to November 1994. Prior to CFS Bank, Mr. Carpenter worked for both Beneficial Finance and The Minnesota Mutual Life Insurance CompanyDepartment before being named Chief Credit Officer in credit insurance sales.
2017.
Mr. CarpenterAdams holds an MBA in Accounting from Fordham University, a Bachelor of ScienceBachelor’s Degree in Business Administration/FinanceManagement from the UniversityNew York Institute of RichmondTechnology and is a graduate ofPost Graduate Degree from the National School of Banking at Fairfield University.
with Honors. Mr. CarpenterAdams is a member of the Boards of DirectorsNew York Mortgage Bankers Association, the Queens, Bronx, and Long Island Builders Association, Chairman of the Real Estate Practitioners Institute at Stony Brook UniversityBoard for the Cleary School for the Deaf, and the Long Island Museums. Previously, he served on the Boardsis a Board Member of the Family Service LeagueNew York Community Bank Foundation and Catholic Charities of Long Island and the Long Island Housing Partnership.Rockville Centre.
Mr. Carpenter retired from his position of Chief Lending Officer as of December 31, 2019 and transitioned to a consulting relationship with the Company effective January 1, 2020. Executive Vice President John T. Adams has succeeded Mr. Carpenter as Chief Lending Officer of the Company.
John J. Pinto.Executive Vice President and Pinto. Mr. Pinto has served as theChief AccountingFinancial Officer of the Company and New York Community Bank since AprilDecember 31, 2020 and was appointed to Senior Executive Vice President on February 5, 2005.2021. Mr. Pinto joined the Company on July 31, 2001 in connection with the Richmond County merger, and served as Senior Vice President, and then First Senior Vice President, in the Capital Markets Group.
From April 5, 2005 until December 31, 2020, Mr. Pinto served as Executive Vice President and Chief Accounting Officer of the Company.
Prior to joining the Company, Mr. Pinto served as Senior Vice President and General Auditor of Richmond County Financial Corp. and Richmond County Savings Bank. From 1997 to 1998, Mr. Pinto served as Director, Financial Reporting at American Express Bank, a multinational bank based in New York City. From 1993 to 1997, he was a member of the Financial Services Group of Ernst & Young, LLP, based in New York City, providing auditing and consulting services to financial institutions throughout the Northeast.
Mr. Pinto holds a Bachelor’s degree from Fairfield University. He is a certified public accountant and a member of the AICPA.
Mr. Pinto serves as a member of the Board of Directors of the Noble Maritime Collection in Staten Island.
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The Nominating and Corporate Governance Committee of the Board periodically reviews with the Board the skills and characteristics appropriate for Board members. The Board seeks diversity in its members with respect to background, skills and expertise, industry knowledge, experience, gender, age, race, and ethnicity. In accordance with the Company’s Bylaws, an individual may not be elected, appointed, or nominated as a Director after December 31 of the year in which an individual attains the age of 80, provided, however, that the Board, by written resolution approved by a majority of the disinterested members of the whole Board, may exclude an incumbent director from such age limitation. The Board members of the Company’s Board are the same members of the Community Bank’s Board of Directors, each of whom are elected annually by the Company Board. The Community Bank’s Bylaws also provide the same age limitation considerations as the Company’s Bylaws and, as a result, the Nominating and Corporate Governance Committee of the Community Bank’s Board discusses and considers such age limitation of all incumbent members each year. As part of its nomination discussions this year, the Community Bank’s Board granted Directors Ciampa, Rosenfeld, and Tsimbinos a one-year exception to the Director mandatory retirement age. The Board determined that, particularly in light of the disruptions and challenges created by the pandemic, maintaining stability at the Board level was in the best interests of the Company and its stakeholders.
➢ØOur Approach to Director Compensation
Our directors are compensated with three basic objectives in mind:
✓ | The director compensation program should recognize the significant amount of work expected from a director at an institution the size of the Company, taking into account the significant time commitment necessary to prepare for meetings that cover complex strategic and operational matters and the duration and frequency of such meetings. |
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✓ | The director compensation program should include a meaningful equity component that helps align the interests of directors with our shareholders and should encourage retention of equity through stock ownership guidelines. |
✓ | The structure of the program should be transparent to shareholders so they can understand the business reasons for specific director compensation decisions. |
Our directors fulfill a critical oversight role for the Company and the Community Bank, in part, through their service on board committees that have been assigned specific functional responsibilities. We believe it is important for our shareholders to understand the significant extent to which our directors engage directly with the business of the Company and its subsidiaries through our Company Board and, particularly, our Community Bank board committees, and how the structure and level of our board compensation directly reflects the unique characteristics of our Board. The directors’ high level of engagement reflects both an awareness of their responsibilities as directors of a publicly traded financial institution that operates within a complex business and regulatory environment and the Company’s desire to take advantage of the breadth of their experience in areas of critical importance to the Company’s business.
business, such as commercial real estate lending.
The frequency of Community Bank Board committee meetings is directly related to specific operational needs. Directors who serve on the Community Bank’s Mortgage and Real Estate Committee and/or the Commercial Credit Committee are directly involved in credit management, loan review and loan administration. The committee members work closely with key management personnel in the lending area to ensure that lending activity is consistent with the Community Bank’s lending policies and committee members are direct participants in the loan approval process through review of loan proposals, analysis of borrower due diligence findings and inspection of properties that serve as loan collateral. This partnership of experienced directors and experienced lending professionals is a key factor in the Community Bank’s success and is directly reflected in the Community Bank’s minimal exposure to loan losses. The commitment of our directors to the success of our lending operation is demonstrated by the fact that the committees meet almost weekly throughout the year (52) meetings for the Mortgage and Real Estate Committee and (51) meetings for the Commercial Credit Committee).year. Each meeting represents a substantial time commitment for committee members (typically in the range of 3-6 hours), requiring not only attendance at each meeting but significant preparation in advance of each meeting to facilitate an understanding of each loan subject to committee approval. The Board’sCompany’s key committees, such as the Audit, Risk Assessment and Compensation, also meet frequently to ensure appropriate oversight of the areas that fall within the scope of their respective charters. Given the complexity of the matters considered by these committees,committee, these meetings also require significant preparation and a significant time commitment for attendance.each meeting.
|
|
Ø 2020 Director Compensation Review
The Compensation Committee has continued to monitorcarefully monitored changes in the structure of director pay programs industry-wide and among our peers as part of the Committee’s annual review of director pay. The annual review is designed to ensure consistency withidentify and incorporate best practices while ensuring that the program is aligned with our director pay objectives. The Committee also considers the cost of the director compensation program on an individual director basis and on an aggregate basis.
Based on the 2021 review, the Committee initiated a significant restructuring of the director compensation program in effect during 2020. The 2021 review confirmed the prevalence of retainer-only pay at the board level among our peers and a growing trend toward the elimination of committee meeting fees in favor of retainer-only pay at the committee level. Recognizing these developments, the Committee adopted a retainer-only approach to ensure that our directors are appropriately compensateddirector compensation at the Company board and committee level. Under the new program, which became effective on January 1, 2021, each board member receive separate retainers for the extensive services they provideboard and committee service with premium retainers paid to the Company chair, lead director and committee chairs. The chair and lead director do not receive separate compensation for committee service. Finally, the Bank. Committee revised director equity grant practices by providing for more uniform grants among similarly situated directors and by shortening the vesting period for director equity awards to one year, in each case reflecting trends identified by the Committee during the annual review.
The Committee understandsdid not, however, modify the compensation structure for board members who serve on the Community Bank’s lending-related committees. The Committee determined that some companies, including peer banks, have eliminated the usecurrent structure directly supports the Company’s business model and appropriately recognizes the significant time commitment associated with service on the lending-related committees, both factors that justify a level of meeting fees as an element of directorpay that is consistent with the demands placed on committee members. The Committee concluded that a change in the compensation and moved to a retainer-only approach. However, the Committee believes that this approach wouldstructure could undermine the Company’s long-standing and highly successful practice of involving directors with management on a weekly basis in key operational matters, including lending. Nevertheless, the Committee has made
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adjustments to the pay structure for our Chairman and for key committee chairs (Audit and Risk Assessment) to improve the alignment of their compensation with emerging trends (see below), while ensuring that their level of compensation remains consistent with the significance of their roles.
In 2018, the Compensation Committee made significant modifications to the director compensation schedule after considering pay practices at peer institutions. In early 2019, the Compensation Committee again reviewed peer data and concluded that further modifications to director pay were appropriate to improve the alignment of director pay with peer practices. This review resulted in the introduction of a fixed annual $75,000 retainer for the Chairs of the Company’s Audit and Risk Assessment Committees and the Chair of the Community Bank’s Mortgage and Real Estate Committee. In addition, separate meeting fees, which were $9,000 per meeting through March 2019 and which were paid in addition to a quarterly retainer, were eliminated for the Chairs of the Audit and Risk Assessment Committees. Further, in recognition of the increasingly significant role played by the Risk Assessment Committee, meeting fees were increased from $450 to $1,800 per meeting to match the meeting fee received by Audit Committee members. Finally, the Committee authorized equity grants at the same per director share levels as 2018. All of these changes were reviewed and confirmed by the full Board. The revised cash compensation schedule took effect on April 1, 2019. In early 2020, the Committee again reviewed and approved the director compensation schedule without modification.
The Committee believes that, taking into account the unique responsibilities of the Company’s directors, and particularly the duties that several directors assume through their membership on Community Bank Board committees that have a substantive role in the management of the Community Bank’s core lending business, the current director compensation structure reflects an appropriate balance of business needs and best practices.business.
|
|
Ø 2020 Director Compensation
The following table provides details of the 20192020 compensation received by directors of the Company for service on the Company Board and the Boardboard of the Community Bank. Directors who are also employees do not receive separate compensation for their service on either the Company or Bank Board.
Non-Employee Directors |
| Fees Earned or Paid in Cash ($) |
|
Stock Awards ($) (1) |
| All Other Compensation ($) (2) |
| Total ($) |
Dominick Ciampa |
| $255,000 |
| $158,125 |
| $36,000 |
| $449,625 |
Hanif “Wally” Dahya |
| 110,850 |
| 94,875 |
| 36,330 |
| 242,055 |
Leslie D. Dunn |
| 109,600 |
| 37,950 |
| 7,888 |
| 155,438 |
Michael J. Levine |
| 183,950 |
| 94,875 |
| 102,930 |
| 381,750 |
James J. O’Donovan(3) |
| 73,650 |
| 105,225 |
| 186,195 |
| 365,070 |
Lawrence Rosano, Jr. |
| 85,950 |
| 42,090 |
| 110,294 |
| 238,334 |
Ronald A. Rosenfeld |
| 87,750 |
| 42,090 |
| 8,640 |
| 138,480 |
Lawrence J. Savarese |
| 185,725 |
| 105,225 |
| 44,450 |
| 335,400 |
John M. Tsimbinos |
| 71,190 |
| 42,090 |
| 101,790 |
| 215,070 |
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Non-Employee Directors | Fees Earned ($) | Stock Awards ($) (1) | All Other Compensation ($) (2) | Total ($) | ||||||||||||
Dominick Ciampa |
| $250,000 |
|
| $159,995 |
|
| $35,302 |
|
| $445,297 |
| ||||
Hanif “Wally” Dahya |
| 103,950 |
|
| 100,000 |
|
| 40,776 |
|
| 244,726 |
| ||||
Leslie D. Dunn |
| 105,750 |
|
| 40,000 |
|
| 7,959 |
|
| 153,709 |
| ||||
Michael J. Levine(3) |
| 159,600 |
|
| 100,000 |
|
| 106,026 |
|
| 365,626 |
| ||||
James J. O’Donovan(4) |
| 86,400 |
|
| 100,000 |
|
| 196,687 |
|
| 383,087 |
| ||||
Lawrence Rosano, Jr. |
| 88,200 |
|
| 40,000 |
|
| 151,941 |
|
| 280,141 |
| ||||
Ronald A. Rosenfeld |
| 103,950 |
|
| 40,000 |
|
| 7,041 |
|
| 150,991 |
| ||||
Lawrence J. Savarese |
| 161,400 |
|
| 100,000 |
|
| 43,026 |
|
| 304,426 |
| ||||
John M. Tsimbinos |
| 90,000 |
|
| 60,000 |
|
| 94,021 |
|
| 244,021 |
|
(1) | In accordance with SEC disclosure requirements for equity compensation, the reported amount represents the full grant date fair value of each award calculated in accordance with FASB ASC Topic 718. All |
(2) | The following table sets forth the components of the All Other Compensation column in |
Director | Dividends on ($) | Community Bank ($) | Perquisites ($) | Total ($) | ||||||||||||
Mr. Ciampa |
| $35,302 |
|
| — |
|
| — |
|
| $35,302 |
| ||||
Mr. Dahya |
| 21,426 |
|
| 19,350 |
|
| — |
|
| 40,776 |
| ||||
Ms. Dunn |
| 7,959 |
|
| — |
|
| — |
|
| 7,959 |
| ||||
Mr. Levine |
| 21,426 |
|
| 84,600 |
|
| — |
|
| 106,026 |
| ||||
Mr. O’Donovan |
| 21,256 |
|
| 159,300 |
|
| 16,131 | (b) |
| 196,687 |
| ||||
Mr. Rosano, Jr. |
| 7,041 |
|
| 144,900 |
|
| — |
|
| 151,941 |
| ||||
Mr. Rosenfeld |
| 7,041 |
|
| — |
|
| — |
|
| 7,041 |
| ||||
Mr. Savarese |
| 21,426 |
|
| 21,600 |
|
| — |
|
| 43,026 |
| ||||
Mr. Tsimbinos |
| 9,421 |
|
| 84,600 |
|
| — |
|
| 94,021 |
|
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|
| Dividends on Unvested Restricted Stock ($) |
| Community Bank Mortgage and Real Estate Committee Retainers, Meeting Fees and Inspection Fees(a) ($) |
| Community Bank Commercial Credit Committee Meeting Fees(b) ($) |
| Perquisites ($) |
| Total ($) | |
Mr. Ciampa |
| $36,550 |
| -- |
| -- |
| -- |
| $36,550 |
Mr. Dahya |
| 21,930 |
| -- |
| $14,400 |
| -- |
| 36,330 |
Ms. Dunn |
| 7,888 |
| -- |
| -- |
| -- |
| 7,888 |
Mr. Levine |
| 21,930 |
| $59,400 |
| 21,600 |
| -- |
| 102,930 |
Mr. O’Donovan |
| 21,080 |
| 243,350 |
| 20,250 |
| 19,928(c) |
| 304,608 |
Mr. Rosano, Jr. |
| 6,698 |
| 64,800 |
| 21,600 |
| -- |
| 93,098 |
Mr. Rosenfeld |
| 6,018 |
| -- |
| -- |
| -- |
| 6,018 |
Mr. Savarese |
| 21,930 |
| -- |
| 20,250 |
| -- |
| 42,180 |
Mr. Tsimbinos |
| 7,038 |
| 64,800 |
| 21,600 |
| -- |
| 93,438 |
a. | Mortgage and Real Estate Committee members receive a $1,350 fee for each meeting attended. In |
| Commercial Credit Committee members receive a $450 fee for each meeting attended. In 2020, the Committee held |
| To facilitate the performance of his duties as Chairman of the Mortgage and Real Estate Committee, the Community Bank paid certain costs associated with Mr. O’Donovan’s membership in a golf club. No other director had perquisites in excess of $10,000. |
(3) |
|
(4) | Upon his retirement as a senior executive officer of the Company in 2006, Mr. O’Donovan entered into a retirement agreement with the Company providing for supplemental retirement compensation and his acceptance of certain restrictive covenants relating to his future business activities in the banking industry. In |
Director Compensation Schedule.Effective April 1, 2019,2020, directors of the Company received a quarterly retainer of $10,350 and a fee of $2,250 per Board meeting attended. Directors also received fees ranging from $450 to $1,800 for each committee meeting attended. The Chairs of the Audit and Risk Assessment Committees received a quarterly retainer of $18,750 but did not receive meeting fees. The former Company Chairman, Mr. Ciampa, received a quarterly retainer of $62,500 but did not receive Board or committee meeting fees. As described above, this schedule was replaced in 2021 with a compensation program that relies solely on retainers for Board and committee service.
Director Stock Ownership Guidelines. Our directors are subject to stock ownership guidelines that require them to hold Company stock with a value equal to five times their annual cash retainer. All non-employee directors are either in compliance with this requirement or within the phase-in period applicable to new directors.
Director Benefits. The Company provides limited life insurance coverage for directors. Mr. Ciampa participates in a legacy director retirement plan that was sponsored by the Community Bank. No other directors are eligible to participate in the plan.
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Director Equity Compensation. Directors participate in the Company’s equity compensation programs and such awards are an integral part of each director’s annual compensation. Typically,Prior to the 2021 revision of the director compensation program as described above, awards arewere made in the form of restricted stock that vestsvested over a five-year period. Awards are determined by the Compensation Committee and confirmed by the full Board. Beginning with the 2021 equity grants, the vesting schedule was reduced to one year based on the Committee’s consideration of peer practices. The 20192020 director equity grants are included in the Director Compensation Table.
Compensation Committee Interlocks and Insider Participation. No executive officer of the Company or the Community Bank serves, or has served, as a member of the compensation committee of another entity, one of whose executive officers serves on the Compensation Committee of the Company. No executive officer of the Company or the Community Bank serves, or has served, as a director of another entity, one of whose executive officers serves on the Compensation Committee of the Company.
Transactions with certain related persons
The federal banking laws require that all loans or extensions of credit to executive officers and directors must be made on substantially the same terms (including interest rates and collateral) and follow substantially the same credit underwriting procedures as those prevailing at the time for comparable transactions with other persons. Furthermore, they must not involve more than the normal risk of repayment or present other unfavorable features. The Community Bank, from time to time, may make mortgage loans to its directors, officers, and employees, including consumer loans or loans to purchase
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or refinance personal residences, and may make loans secured by income-producing properties to entities in which a director or officer has an ownership interest (or, in the case of directors, a management interest), provided that all such loans are made in accordance with federal banking laws and are made in the ordinary course of business; do not involve a more than normal risk of collectability, or present other unfavorable features; and are made on substantially the same terms (including interest rates and collateral requirements) as those prevailing at the same time for comparable transactions with unaffiliated persons. The Community Bank has made a commercial loan, in accordance with the criteria set forth above, with a principal balance of $2,850,000.00$2,850,000 and an initial interest rate of 4.375% to Pacific Norse LLC, a limited liability company owned by former director Michael Levine’s son, which was considered a problem loan and was subject to workout provisions at December 31, 2019.
2020. The largest aggregate amount of principal outstanding on the loan was $2,489,255 during the year ended December 31, 2020. During the year ended December 31, 2020, no principal nor interest was paid on the loan. The Community Bank obtained a judgment of foreclosure on the loan, the principal balance of which totaled $1,829,959 at the time of foreclosure after recognizing a charge-off of $659,296, with foreclosure sale of the collateral property pending as of December 31, 2020. The Company has also obtained a personal judgment against the borrower.
From time to time, in accordance with written policies, the Board of Directors reviews a summary of the Company’s transactions with its directors and executive officers and with firms that employ directors, as well as any other related-person transactions, for the purpose of recommending to the disinterested members of the Board of Directors that the transactions are fair, reasonable, and within Company policy, and should be ratified and approved. The Board of Directors also reviews any transactions reported to the Board by the Company’s Corporate Secretarythat are required to be reported under SEC regulations. Additionally, in accordance with federal regulations, the Board of Directors reviews all loans made to a director or executive officer in an amount that, when aggregated with the amount of all other loans to such person and his or her related interests, exceeds the greater of $25,000 or 5% of the Company’s capital and surplus (up to a maximum of $500,000), and such loan must be approved in advance by a majority of the disinterested members of the Board of Directors. Further, pursuant to the Company’s Code of Business Conduct and Ethics and other business standards applicable to them, all executive officers and directors of the Company must disclose any existing or emerging conflicts of interest to the Chief Executive Officer. Such potential conflicts of interest include, but are not limited to, any position or interest (financial or otherwise) which could materially conflict with an executive officer’s or director’s performance or which affects such executive officer’s or director’s independence or judgment concerning transactions between the Company, its customers, suppliers, or competitors.
The Company determined that Mr. Ficalora used his Company issued credit card for certain home furnishings totaling approximately $1.3 million between February and July 2020. Mr. Ficalora fully reimbursed the Company before the Company was obligated to pay any corresponding credit card invoice. The Company’s written policies regarding the use of Company issued credit cards do not authorize the personal use of such credit cards; our internal controls identified and addressed the matter. The Company has determined that the credit card charges were extensions of credit to Mr. Ficalora because the Company was a co-guarantor on the credit card used. The largest balance attributed to these purchases was $408,162. There was no outstanding balance nor indebtedness relating to these purchases after August 31, 2020.
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Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s executive officers and directors, and persons who own more than 10% of a registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with the SEC. Executive officers, directors, and greater than 10% shareholders are required by the SEC regulations to furnish the Company with copies of all Section 16(a) forms they file.
Delinquent Section 16(a) Reports. Based solely on its review of copies of the reports of ownership furnished to the Company, or written representations that no other reports were required, the Company believes that during the 20192020 fiscal year, its executive officers and directors complied with applicable reporting requirements for transactions in the Company’s securities, except for a late Form 4 filing by Mr. Dahya with respect to the purchase of shares of the Company’s Series A preferred stock in May 2019.securities.
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PROPOSALS TO BE VOTED ON AT THE MEETING | |
PROPOSAL 2: RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
Proposal 2: Ratification of the Appointment of Independent Registered Public Accounting Firm
The Company’s independent registered public accounting firm for the fiscal year ended December 31, | ||
Unless marked to the contrary, the shares represented by the enclosed proxy card, if properly signed and dated, will be voted FOR ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company. | ||
The Audit Committee will consider on a case-by-case basis and, if appropriate, approve all audit and non-audit services to be provided by the Company’s independent registered public accounting firm. Alternatively, the Audit Committee may adopt a policy for pre-approval of audit and permitted non-audit services by the independent registered public accounting firm. In 2020, all audit-related services, tax services, and other services were approved by the Audit Committee, which concluded that the provision of such services by KPMG LLP was compatible with the maintenance of that firm’s independence in the conduct of its audit functions. | ||
Unless marked to the contrary, the shares represented by the enclosed proxy card, if properly signed and dated, will be voted FOR ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company.
The Audit Committee will consider on a case-by-case basis and, if appropriate, approve all audit and non-audit services to be provided by the Company’s independent registered public accounting firm. Alternatively, the Audit Committee may adopt a policy for pre-approval of audit and permitted non-audit services by the independent registered public accounting firm. In 2019, all audit-related services, tax services, and other services were approved by the Audit Committee, which concluded that the provision of such services by KPMG LLP was compatible with the maintenance of that firm’s independence in the conduct of its audit functions.
audit committee report to shareholders
The Audit Committee of the Company’s Board of Directors is composed of Messrs. Savarese, Levine,Ciampa, Dahya, Rosenfeld, Dahya, and Ms. Dunn, all of whom are non-employee, independent directors, and operates under a written charter adopted by the Board of Directors.
The Company’s management is responsible for the Company’s internal control over financial reporting. The independent registered public accounting firm is responsible for performing an independent audit of the Company’s consolidated financial statements and issuing an opinion on the conformity of those financial statements to generally accepted accounting principles. The independent registered public accounting firm is also responsible for issuing an opinion on the effectiveness of the Company’s internal control over financial reporting. The Audit Committee oversees the Company’s internal controls and financial reporting process on behalf of the Board of Directors.
In this context, the Audit Committee has met and held discussions with management and the independent registered public accounting firm for 2019.2020. Management has discussed with and represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles, and the Audit Committee has reviewed and discussed the consolidated financial statements with management and the independent registered public accounting firm. The Audit Committee discussed with the independent registered public accounting firm matters required to be discussed under Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 1301, Communications with Audit Committees (AS 1301), including discussing with the Audit Committee in detail the independent registered public accounting firm’s evaluation and conclusions about significant and critical accounting policies and practices, critical accounting estimates, significant unusual transactions, and the Company’s financial reports.
In addition, the Audit Committee has received from the independent registered public accounting firm written disclosures regarding the auditors’ independence required by PCAOB Ethics and Independence Rule 3526, Communication with Audit Committees Concerning Independence, and has discussed with the independent registered public accounting firm its independence from the Company and its management. In concluding that the independent registered public accounting firm is independent, the Audit Committee considered, among other factors, whether the non-audit services provided by the independent registered public accounting firm in 20192020 were compatible with its independence.
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The Audit Committee discussed with the Company’s independent registered public accounting firm the overall scope and plans for its 20192021 audit. The Audit Committee meets with the independent registered public accounting firm, with and without management present, to discuss the results of their examinations, their evaluation of the Company’s internal control
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over financial reporting, and the overall quality of the Company’s financial reporting process.
In performing all of these functions, the Audit Committee acts only in an oversight capacity. In its oversight role, the Audit Committee relies on the work and assurances of the Company’s management, which has the primary responsibility for financial statements and reports, and of the independent registered public accounting firm, which, in its reports, expresses an opinion on the conformity of the Company’s financial statements to generally accepted accounting principles, and an opinion on the effectiveness of the Company’s internal control over financial reporting. The Audit Committee’s oversight does not provide it with an independent basis to determine that management has maintained appropriate accounting and financial reporting principles or policies, or appropriate internal control over financial reporting designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the Audit Committee’s considerations and discussions with management and the independent registered public accounting firm do not assure that the Company’s financial statements are presented in accordance with generally accepted accounting principles, that the audit of the Company’s financial statements has been carried out in accordance with the standards of the PCAOB, or that the Company’s independent registered public accounting firm is in fact “independent.”
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board approved, that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 20192020 for filing with the SEC. The Audit Committee and the Board of Directors also have approved, subject to shareholder ratification, the selection of the Company’s independent registered public accounting firm to audit the Company'sCompany’s consolidated financial statements for the year ending December 31, 2020.2021.
The Audit Committee
Lawrence J. Savarese, Chair
Dominick Ciampa
Hanif “Wally” Dahya
Leslie D. Dunn
Michael J. Levine
AUDIT AND NON-AUDIT FEES |
The following table presents fees for professional services rendered by KPMG LLP for the audit of the Company’s consolidated financial statements for fiscal years 20192020 and 2018,2019, and fees billed for audit-related services, tax services, and all other services rendered by KPMG LLP for fiscal years 20192020 and 2018. 2019.
Year Ended |
| Year Ended | ||||||||||||||
| 2019 |
| 2018 |
| 2020 | 2019 | ||||||||||
|
|
|
|
| ||||||||||||
Audit Fees | $2,970,000(1) |
| $2,765,000(1)(4) |
| $ | 3,155,000 | (1) | $ | 2,970,000 | (1) | ||||||
Audit-Related Fees | 198,000(2)(3) |
| 150,184(2) |
| 189,000 | (2)(4) | 198,000 | (2)(3) | ||||||||
Tax Fees | -- |
| -- |
| 75,000 | (5) | — |
| ||||||||
All Other Fees | 3,500(5) |
| -- |
| 5,434 | (6) | 3,500 | (7) |
(1) | Includes fees for professional services rendered in connection with the audit of the |
(2) | Includes fees billed for professional services rendered in connection with audits of the Company’s stock ownership, employee benefit, and retirement plans’ financial |
(3) | Includes fees for professional services rendered in connection with the reading of the |
(4) | Includes fees for professional services rendered in connection with |
(5) | Includes fees for professional services rendered in connection with tax treatment of lending transactions in response to the |
(6) |
|
(7) | Includes fees for renewal of a license for the KPMG Accounting Research Online service and automated disclosure checklist for the period June 30, 2019 to June 30, 2020. |
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PROPOSALS TO BE VOTED ON AT THE MEETING | |
PROPOSAL 3: ADVISORY VOTE ON APPROVAL OF COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS |
Proposal 3: advisory vote on approval of compensation of the company’s named executive officers
As required under Section 14A of the Securities Exchange Act of 1934, we provide our shareholders with the opportunity to express their views, on a non-binding, advisory basis, on the compensation of our named executive officers as disclosed in this proxy statement. The Board has determined that shareholders should be provided with this opportunity on an annual basis. This vote, which is often referred to as the “say-on-pay”“say-on-pay” vote, provides shareholders with the opportunity to endorse or not endorse the following resolution:
“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K and Section 14A of the Securities Exchange Act of 1934, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.”
The Compensation Committee annually reviews our executive compensation program to ensure that the program demonstrates a proper alignment of pay and performance, operates within a framework of sound governance and is consistent with industry best practices. The affirmative steps we took in 2018 to realign our executive compensation program with our peers and with industry best practices continued in |
Because your vote on this Proposal is an advisory vote, it is not binding on the Board or the Compensation Committee. However, shareholders should be assured that the Compensation Committee will seriously consider the vote of our shareholders on this Proposal when determining the nature and scope of future executive compensation programs.
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PROPOSALS TO BE VOTED ON AT THE MEETING | |
PROPOSAL 4: PROPOSAL TO PHASE OUT THE CLASSIFIED BOARD BY APPROVING AMENDMENTS TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF THE COMPANY. |
PROPOSAL 4: Approval of AMENDMENTs TO THE Company’s Amended and Restated Certificate of Incorporation and Bylaws TO ELIMINATE THE SUPERMAJORITY VOTing REQUIREMENTS.
The Board of Directors recommends approval of phasing out the classification of the Board of Directors and providing instead for the annual election of Directors. The Board took into consideration arguments in favor of and against continuation of the classified Board and determined that it is in the Company’s Amended and Restated Certificatebest interests to propose to declassify its Board of Incorporation (the “Certificate of Incorporation”) and Amended and Restated Bylaws (the “Bylaws,” and together with the Certificate of Incorporation, the “Governance Documents”) be amended to remove all supermajority voting requirements. Our Governance Documents currently require that the holders of 80% of the voting power of the then-outstanding shares of Company capital stock entitled to vote generally in the election of directors approve certain fundamental corporate governance provisions, including:Directors.
At the
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AtIn advocating against the 2019shareholder proposal at the 2020 Annual Meeting, the Board explained its belief that the classified structure creates stability and continuity, not only in the Board but also in the overall management of the Company’s shareholders, our shareholders approved a proposal submitted by onebusiness of our common shareholders requesting that the Board of Directors take the steps necessary to eliminate the supermajority voting provisions in the Company’s Governance Documents. Approximately 73% of our shareholders voted to approve the proposal.
AfterCompany However, after careful consideration of the vote results at the 20192020 Annual Meeting and the Company’s discussions with shareholders as part of our 2020 shareholder engagement program, the Board is again recommending amendments to our Governance DocumentsCertificate of Incorporation to eliminate all supermajority voting requirements. Ifphase out the proposal is approved, under Delaware law, future amendmentsclassified board structure and provide for the annual election of Directors, with the full Board being completely declassified and subject to the Governance Documents would require approvalannual election by shareholders representing a majority of the votes cast or entitled to be cast, as applicable, on a matter.
2024.
The Board recommends this Proposal 4 due in significant part to the results of the shareholder proposal which passed at the 20192020 Annual Meeting and the feedback received from shareholders during the course of the Company’s 20192020 shareholder outreach efforts.
However, the Board also recognizes that annually elected boards are perceived by many institutional shareholders as increasing the accountability of directors to such shareholders. Annual election of directors provides a particularly powerful shareholder right because the Company has adopted majority voting for the election of directors.
In advocating againstUnder Article SIXTH of the shareholder proposalCompany’s Amended and Restated Certificate of Incorporation, the Board of Directors is currently divided into three classes, as nearly equal in number as possible, composed of directors each serving terms of office of three years. If the proposed measure is approved by our shareholders in 2021, the directors who have been elected to three-year terms prior to the effectiveness of the amendment, including directors elected at the 20192021 annual meeting, would complete those three-year terms, and thereafter would be eligible for annual re-election after completion of their current terms. If the proposed measure is approved, beginning with the 2024 Annual Meeting of Shareholders, the Board explained that it believedof Directors will be completely declassified and all directors will be subject to annual election to one-year terms. If the supermajority requirements inproposed measure is not approved by the shareholders, the Board will remain classified and our Governance Documents protect key provisionsdirectors will continue to be subject to the Certificate of Incorporation’s current classification. The proposed amendments to the Certification of Incorporation to phase out the classification of the Governance Documentsboard of directors and provide for the annual election of directors will be approved if 80% of the shares outstanding are voted in favor of the proposal and the proposal will become effective upon the filing of the amendments with the Secretary of State of the State of Delaware.
Proposed amendments to Article SIXTH, Section A are set forth below.
A. The number of Directors shall be fixed from arbitrary amendment and prevent a simple majority of shareholders from taking actions that may be harmfultime to other shareholders or making changes to certain provisions of our Governance Documents that are intended to protect all shareholders. With respect to amending the Governance Documents,time exclusively by the Board explained that the supermajority provisions included were limited to the few fundamental corporate governance provisions outlined above and, by adopting the proposal, shareholders could seek to remove a director, approve a transaction between the Company and an Interested Stockholder, or approve amendments to certain provisions of the Governance Documents which could have a harmful long-lasting effects on the Company and its corporate governance. The Board further explained that it believes it is reasonable and appropriate to ensure that a broad consensus of shareholders agree that a change is prudent and in the best interests of the Company and its shareholders, adding that the supermajority voting provisions included in our Governance Documents do not applyDirectors pursuant to a vastresolution adopted by a majority of the matters on which our shareholders may vote, and do not pose an obstacle to changes that are broadly supported by shareholders.
Whole Board. The textDirectors shall be divided into three classes, as nearly equal in number as reasonably possible,with the term of office of the with each Director to hold office until his or her successor shall have been duly elected and qualified. At each annual meeting of stockholdersproposed amendmentsfirst class to our Governance Documentsexpire at the first annual meeting of stockholders, the term of office of the second class to eliminate these supermajority requirements is set forth below.expire at the annual meeting of stockholders one year thereafter and the term of office of the third class to expire at the annual meeting of stockholders two years thereafterfollowing such initial classification and election,held before the 2022 annual meeting of stockholders, the class of Directors elected to succeed those
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PROPOSALS TO BE VOTED ON AT THE MEETING | |
Directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election. At each annual meeting of stockholders commencing with the 2022 annual meeting of stockholders, Directors electedto succeed those Directors whose terms then expire shall be elected for a term expiring at the next annual meeting of stockholders. Beginning with the 2024 annual meeting of stockholders, the foregoing classification of the Board of Directors shall cease. If the number of Directors is changed prior to the 2022 annual meeting of stockholders, any increase or decrease shall be apportioned among the classes so as to maintain the number of Directors in each class as nearly equal as possible, and any additional Director of any class elected to fill a vacancy resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class. If the number of Directors is increased at or following the 2024 annual meeting of stockholders, any additional Director elected to fill a vacancy resulting from such increase shall hold office for a term expiring at the next annual meeting of stockholders. In no case shall a decrease in the number of Directors remove or shorten the term of any incumbent Director.witheEach Directortoshall hold office for the term for which elected and until his or her successor shall have been duly elected and qualified.
Proposed amendments to certain provisions of Article SIXTH, Article SEVENTH, Article EIGHTH, Article NINTH, Article TENTH, and Article TWELFTH of the Certificate of IncorporationSection B are set forth as follows:below.
SIXTH: D.SubjectB. Subject to the rights of the holders of any series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of Directors or any vacancies in the entire Board of Directors resulting from death, resignation, retirement, disqualification, removal from office, or other cause may be removed from office at any time, but only for cause andfilled only by the affirmativea majority vote of the holdersDirectors then in office, though less than a quorum, and Directors so chosen shall hold office for a term expiring at the annual meeting of a majoritystockholders at which the term of office of the voting powerclass to which they have been chosen expires, except that Directors elected to fill vacancies after the 2024 annual meeting of allstockholders shall hold office for a term expiring at the next annual meeting of the then-outstanding shares of capital stock of the Corporationthen entitled to vote generallystockholders. No decrease in theat an election number of Directors (after giving effect to the provisions of Article FOURTH of this Certificate of Incorporation (“Article FOURTH”), voting together as a single class.
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SEVENTH:The Board of Directors is expressly empowered to adopt, amend orrepeal Bylaws of the Corporation. Any adoption, amendment or repeal of the Bylaws of the corporation byconstituting the Board of Directors shall requireshorten the approval of a majority of the Whole Board. The stockholders shall also have power to adopt, amend or repeal the Bylaws of the Corporation; provided, however, that, in addition to any vote of the holdersterm of any class or series of stock of this Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of the voting power of all of the then-outstandingmajority of shares of the capital stock of the Corporationpresent in person or represented by proxy at the meeting and entitled to vote generally in the election of Directorsthereon (after giving effect to the provisions of Article FOURTH), voting together as a single class, shall be required to adopt, amend or repeal any provisions of the Bylaws of the Corporation.incumbent Director.
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EIGHTH: A. In addition to any affirmative vote required by law or this
Certificate of Incorporation, and except as otherwise expressly provided in this Article EIGHTH:
5. any reclassification of securities (including any reverse stock split), or recapitalization of the Corporation, or any merger or consolidation of the Corporation with any of its Subsidiaries or any other transaction (whether or not with or into or otherwise involving an Interested Stockholder) which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class of equity or convertible securities of the Corporation or any Subsidiary which is directly or indirectly owned by any Interested Stockholder or any Affiliate of any Interested Stockholder; shall require the affirmative vote of the holders of the voting powera majority of the then-outstanding shares of capital stock of the Corporationoutstanding and entitled to vote in the election of Directorsthereon (the “Voting Stock”) (after giving effect to the provisions of Article FOURTH), voting together as a single class. Such affirmative vote shall be required notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law or by any other provisions of this Certificate of Incorporation or any Preferred Stock Designation or in any agreement with any national securities exchange or otherwise.
F.Notwithstanding any other provisions of this Certificate of Incorporation or any provision of law which-might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the Voting Stock required by law, this Certificate of Incorporation or any Preferred Stock Designation, the affirmative vote of the holders of the voting power of alla majority of the then-outstanding shares of the Voting Stockcapital stock outstanding and entitled to vote thereon (after giving effect to the provisions of Article FOURTH), voting together as a single class, shall be required to alter, amend or repeal this Article EIGHTH.
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TWELFTH: The Corporation reserves the right to amend or repeal any provision contained in this Certificate of Incorporation in the manner prescribed by the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation; provided, however, that, notwithstanding any other provision of this Certificate of Incorporation or any provision of law which might otherwise permit a lesser vote or no
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vote, but in addition to any vote of the holders of any class or series of the stock of this Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of of the voting power of all of the then-outstandinga majority of theshares of the capital stock of the Corporationoutstanding andentitled to vote generally in the election of Directorsthereon (after giving effect to the provisions of Article FOURTH), voting together as a single class, shall be required to amend or repeal this Article TWELFTH, Section C of Article FOURTH, Sections C or D of Article FIFTH, Article SIXTH, Article SEVENTH, Article EIGHTH, Article NINTH or Article TENTH.
BYLAWS
Article VII of the Bylaws currently requires the affirmative vote of 80% of the total number of shares outstanding to amend, alter, change or repeal the Bylaws.
Upon the approval by our shareholders of the proposed amendment, Article VII of our Bylaws would be amended as follows, with the proposed deletion stricken through as indicated below:
ARTICLE VIII – AMENDMENTS
The Board of Directors, by a resolution adopted by a majority of the Whole Board, may, except as otherwise expressly provided herein, amend, alter, or repeal these Bylaws at any meeting of the Board, provided notice of the proposed change was given not less than two days prior to the meeting. The stockholders shall also have power to amend, alter, or repeal these Bylaws at any meeting of stockholders provided notice of the proposed change was given in the notice of the meeting; provided, however, that, notwithstanding any other provisions of the Bylaws or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the voting stock required by law, the Certificate of Incorporation, any Preferred Stock Designation, or these Bylaws, the affirmative votesvote of the holders of a majority of the voting shares of Common Stock of the Company for a quorum at a regular or special meeting of the shareholdersshares of capital stock present in person or represented by proxy at a meeting and entitled to vote thereon, shall be required to alter, amend, or repeal any provisions of these Bylaws..
If the amendments to our Governance Documents are approved, under Delaware law, amendments to the Governance Documents would require approval by shareholders representing a majority of the votes cast, or entitled to be cast, on a matter, as applicable.
VOTE REQUIRED FOR APPROVAL
The proposed amendments to eliminatephase out the supermajority voting requirementclassified board structure and provide for the annual election of directors of the Company’s Governance DocumentsAmended and Restated Certificate of Incorporation will be approved if 80% of the shares outstanding as of the Record Date are voted in favor of the Proposal and the Proposal will become effective upon (i) the filing of the amendments to our Certificate of Incorporation with the Secretary of State of the State of Delaware and (ii) the subsequent approval of the amendment to our Bylaws by our Board of Directors following the receipt of shareholder approval of the proposed amendments.
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PROPOSAL 5: Approval of the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan.
We are seeking shareholder approval of the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan (the “2020 Plan”), including the authority to issue up to 12,000,000 shares of our common stock under the 2020 Plan, subject to adjustment as described below.
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Our Current Stock Incentive Plan is Almost Depleted
We currently grant long-term incentive awards annually to our executives and key employees under our 2012 Stock Incentive Plan (the “2012 Plan”). However, we anticipate that, as of the date of the 2020 Annual Meeting, there will be less than 200,000 shares of common stock available for grant under the 2012 Plan. If the 2020 Plan is approved by our shareholders, no additional awards will be made from the 2012 Plan. However, all awards granted under the 2012 Plan that are still outstanding upon the approval of the 2020 Plan will remain outstanding and will continue to be subject to all of the terms and conditions of the 2012 Plan.
If the 2020 Plan is not approved by our shareholders, we will not have sufficient shares to support our long-term incentive program, which covers our NEOs and wide range of key employees who serve in significant roles at the Company. Consistent with the long-term incentive program applicable to our NEOs for 2020, our NEOs received time-based vesting restricted stock awards in March 2020 with a value representing 25% of their total award opportunity at the target level. The award opportunities under the 2020 program were the same as the award opportunities under the 2019 program. See 2019 Executive Incentive Compensation Program in the Compensation Discussion and Analysis section of this proxy statement. However, if shareholders do not approve the 2020 Plan, we will be unable to make performance-based awards to our NEOs for the 2020-2022 performance period and we will have to curtail future grants to the over 400 key employees who receive equity compensation as a significant part of their annual compensation. Consequently, the Company may be required to increase significantly the cash component of our incentive compensation program in order to remain competitive and adequately compensate our employees. We believe that this development would seriously undermine our ability to attract and retain key employees and our goal of creating an alignment of executive and shareholder interests. If the 2020 Plan is approved by shareholders, the Compensation Committee will consider performance-based restricted stock unit awards for the NEOs in June 2020 for the 2020-2022 performance period. See New Plan Benefits below.
Our Grant Practices Support Our Strategic Objectives
We use performance-based equity awards for our senior management team to reinforce the connection between results achieved and compensation earned. Our long-term incentive plan provides our NEOs with 75% of their annual awards in the form of performance-based restricted stock units that are earned over a three-year, forward looking performance period. For purposes of these awards, performance is measured relative to a comprehensive peer index using metrics that are critical to an investor’s evaluation of the Company such as 3-year earnings per share growth and 3-year average return on tangible common equity. Other key employees are considered annually for the grant of restricted stock awards. The awards are based on an evaluation of the individual employee’s role and performance assessment and provide a significant retention incentive through the use of a five-year vesting period.
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The Share Reserve for the 2020 Plan is Consistent with Market Practice
The share reserve under the 2020 Plan reflects a balancing of the Company’s desire to continue granting equity awards with the interests of our shareholders in minimizing dilution. In determining the appropriate number of shares to make available under the Plan, the Compensation Committee considered the recommendation of Meridian Compensation Partners, LLC, its independent compensation consultant, and reviewed potential dilution and burn rate data, as well as the estimated value transfer cost of the 2020 Plan. The Company believes that the 2020 Plan share reserve representsanacceptablelevelofdilutiontoourexisting shareholdersinlightofthebenefitstoourfutureperformancethatweexpectthe2020 Plantosupport.
Burn Rate. Burn rate refers to how fast a company uses the supply of shares authorized for awards under its stock plans. The burn rate is calculated by dividing the number of shares subject to equity awards (stock and options) granted in a particular year by the weighted-average number of shares outstanding during the year. Over the last three years we have maintained an average burn rate of 1.66% of shares of common stock outstanding. Based on our current burn rate and anticipating shares that will become available through forfeiture or cancellation, the additional 12,000,000 shares authorized upon approval of the 2020 plan are expected to cover awards over the next 4-5 years, a period which is consistent with market practice.
Overhang. Overhang is a measure commonly used to assess the dilutive impact of equity programs such as the proposed 2020Plan. A plan’s overhang is equal to the number of equity award shares outstanding plus the number of shares available to be granted, divided by a company’s total shares of common stock outstanding. Overhang shows how much existing shareholder ownership would be diluted if all outstanding stock and option awards and all authorized but unissued shares were introduced into the market. The additional 12,000,000 million shares being requested in this proposal would bring our aggregate overhang to approximately 4.5%, which we believe aligns with market practice in the banking sector.
The 2020 Plan Reflects a Strong Corporate Governance Framework
The design of the 2020 Plan reflects the Compensation Committee’s commitment to ensuring that the Company’s equity compensation program incorporates a strong corporate governance framework that is consistent with best practices. The 2020 Plan includes many provisions designed to protect shareholder interests and promote effective corporate governance, including the following:
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Summary of the 2020 Plan
The following is a summary of the material provisions of the 2020 Plan. A copy of the 2020 Plan is attached to this Proxy Statement as Appendix A and is incorporated by reference into this Proxy Statement in its entirety. This summary is subject to the language of the 2020 Plan and the 2020 Plan will control if there is any inconsistency between this summary and the 2020 Plan.
Administration. The 2020 Plan will be administered by the Board or the Compensation Committee (the “Committee”), or any other committee of the Board or one or more of our officers to whom the Board or Committee has delegated authority,whicharecollectivelyreferredtoasthe“Administrator.”TheAdministratorwillhavetheauthoritytointerpretthe2020 Plan or award agreements entered into with respect to the 2020 Plan; make, change, and rescind rules and regulations relating to the 2020 Plan; make changes to, or reconcile any inconsistency in, the 2020 Plan or any award or agreement covering an award; and take any other needed to administer the 2020 Plan.
Eligibility; Non-Employee Director Award Limits. The Administrator may designate any of the following as a participant under the 2020 Plan: any officer or employee, or individuals engaged to become an officer or employee, of the Company or our affiliates; and consultantsoftheCompanyorouraffiliates,andourdirectors,includingournon-employeedirectors.Subjecttoadjustmentdescribedbelow, no non-employee director may begrantedawardsthat could result in suchParticipant receiving awards with a fair market value in excess of $350,000 in respect of any fiscal year of the Company. In general, fair market value is, on any date, based on the closing price of a share of Common Stock on the national securities exchange where the shares are traded or the preceding trading date if no trades occurred on the specified date.
Types of Awards. The2020 PlanpermitstheAdministratortograntstockoptions,stockappreciationrights,performanceshares, performanceunits,sharesofcommonstock,restrictedstock,restrictedstockunits,cashincentiveawards,dividendequivalentunits,or any other type of award permitted under the 2020 Plan. If the 2020 Plan is approved, then the Administrator may grant any type of awardtoanyparticipantitselects,butonlyouremployeesoroursubsidiaries’employeesmayreceivegrantsofincentivestockoptions withinthemeaningofSection422oftheInternalRevenueCodeof1986,asamended(the“Code”).Awardsmaybegrantedaloneorin addition to, in tandem with, or (subject to the repricing prohibition described below) in substitution for any other award (or any other awardgrantedunderanotherplanofourCompanyoranyaffiliate,includingtheplanofanacquiredentity).
Shares Reserved under the 2020 Plan. The 2020 Plan provides that 12,000,000 shares of our common stock are reserved for issuance under the 2020 Plan, plus the amount of shares available for issuance under the 2012 Plan on the effective date of the 2020 Plan, all of which are subject to adjustmentasdescribedbelow. It is estimated that less than 200,000 shares will be available for issuance under the 2012 Plan as of the date of the 2020 Annual Meeting. Wemayonlyissue12,000,000sharespursuanttotheexerciseofincentivestockoptions.Furthermore,if anysharessubjecttoawardsgrantedunderthe2012 Planwouldagainbecomeavailablefornewgrantsunderthetermsofthe 2012 plan if suchplanwerestillineffect, i.e., such as in the event of a forfeiture of a 2012 Plan award,thenthoseshareswillbeavailableunderthe2020
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Plan (but only up to a maximum of 250,000 shares in each 12-month period beginning on the effective date of the plan),unless(1)wepurchasethesharesusingproceeds of option exercises, (2) they are shares tendered or withheld in payment of the exercise price of an option or in settlement of an outstanding stock appreciation right, or (3) they are shares tendered or withheld to satisfy federal, state, or local tax withholding obligations. The average rate of forfeiture under the 2012 Plan of shares that would be subject to the rules described in the preceding sentence is approximately 300,000 shares per year
The number of shares reserved for issuance under the 2020 Plan will be reduced on the date of the grant of any award by the maximum number of shares, if any, with respect to which such award is granted. However, an award that may settled solely in cash will not deplete the 2020 Plan share reserve at the time the award is granted. If (i) an award expires, is canceled, or terminates without issuance of shares or is settled in cash, (ii) the Administrator determines that the shares granted under an award will not be issuable because the conditions for issuance will not be satisfied, (iii) shares are forfeited under an award, or (iv) shares are issued under any award and we reacquire them pursuant to our reserved rights upon the issuance of the shares, then those shares are added back to the reserve and may again be used for new awards under the 2020 Plan. Shares that are tendered or withheld in payment of the exercise price of a stock option or as a result of the net settlement of an outstanding stock appreciation right, shares we purchase using proceeds from stock option exercises, and shares tender or withheld to satisfy any federal, state, or local tax withholding obligations may not reissued under the 2020 Plan.
Options. TheAdministratormaygrantstockoptionsanddeterminealltermsandconditionsofeachstockoption,whichinclude the number of stock options granted, whether a stock option is to be an incentive stock option or non-qualified stock option, and the grantdateforthestockoption.However,theexerciseprice of a stock optionmayneverbelessthanthefairmarketvalueof a share of common stock on the date of grant and the expiration date may not be later than 10 years after the date of grant. Stock options will be exercisable and vest at such times and be subject to such restrictions and conditions as are determined by the Administrator,includingwithrespecttothemannerofpaymentoftheexercisepriceofsuchstockoptions.
Stock Appreciation Rights. TheAdministratormaygrantstockappreciationrights(“SARs”).ASARistherightofaparticipant to receive cash in an amount, and/or common stock with a fair market value, equal to the appreciation of the fair market value of a shareofcommonstockduringaspecifiedperiodoftime.The2020 PlanprovidesthattheAdministratorwilldeterminealltermsand conditionsofeachSAR,including,amongotherthings:(i)whethertheSARisgrantedindependentlyofastockoptionorrelatestoa stockoption,(ii)thegrantprice,whichmayneverbelessthanthefairmarketvalueofourcommonstockasdeterminedonthedateof grant,(iii)atermthatmustbenolaterthan10yearsafterthedateofgrant,and(iv)whethertheSARwillsettleincash,commonstock or a combination of thetwo.
Performance and Stock Awards. The Administrator may grant awards of shares of common stock, restricted stock, restricted stockunits(“RSUs”),performanceshares,orperformanceunits.Restrictedstockmeanssharesofcommon stock that are subject to a risk of forfeiture and/or restrictions on transfer, which may lapse upon the achievement or partial achievement of performance goals (as described below) and/or upon the completion of a period of service. An RSU grants the participanttherighttoreceivecashand/orsharesofcommonstockthevalueofwhichisequaltothefairmarketvalueofoneshareof common stock, to the extent performance goals are achieved and/or upon the completion of a period of service. Performance shares givetheparticipanttherighttoreceivesharesofcommonstocktotheextentperformancegoalsareachieved.Performanceunitsgives theparticipanttherighttoreceivecashand/orsharesofcommonstockvaluedinrelationtoaunitthathasadesignateddollarvalueor the value of which is equal to the fair market value of one or more shares of common stock, to the extent performance goals are achieved.
The Administrator will determine all terms and conditions of the awards including (i) whether performance goals must be achieved for the participant to realize any portion of the benefit provided under the award, (ii) the length of the vesting and/or performance period, subject to the minimum vesting period requirement (described below), and, if different, the date that payment of the benefit will be made, (iii) with respect to performance units, whether to measure the value of each unit in relation to a designated dollar value or the fair market value of one or more shares of common stock, and (iv) with respect to performance shares, performance units, and RSUs, whether the awards will settle in cash, in shares of common stock (including restricted stock), or in a combination of the two.
Cash Incentive Awards. The Administrator may grant cash incentive awards. An incentive award is the right to receive a cash paymenttotheextentoneormoreperformancegoalsareachieved.TheAdministratorwilldeterminealltermsandconditionsofacash incentive award, including, but not limited to, the performance goals (as described above), the performance period, the potential amount payable, and the timing of payment.
Performance Goals. Forpurposesofthe2020 Plan,theAdministratormayestablishesperformancegoalswhichrelatetooneor moreofthefollowingmeasureswithrespecttoourCompanyoranyoneormoreofour
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subsidiaries,affiliates,orotherbusinessunits and such goals may be established on an absolute or relative basis. Performancegoalsmayalsorelatetoaparticipant’sindividualperformance.TheAdministratorreservestherighttoadjust any performance goals or modify the manner of measuring or evaluating a performancegoal for any reason the Administrator determines is appropriate, including but not limited to: (i) by excluding the effects of charges for reorganizing and restructuring; discontinued operations; asset write-downs; gains or losses on the disposition of a business; or mergers, acquisitions or dispositions; and extraordinary, unusual and/or non-recurring items of gain or loss; (ii) excluding the costs of litigation, claims, judgments or settlements; (iii) excluding the effects of changes laws or regulations affecting reported results, or changes in tax or accounting principles, regulations or law; and (iv) excluding any accruals of amounts related to payments under the Plan or any other compensation arrangement maintained by the Company or anaffiliate.
Dividend Equivalent Units. The Administrator may grant dividend equivalent units. A dividend equivalent unit gives the participanttherighttoreceiveapayment,incashorsharesofcommonstock,equaltothecashdividendsorotherdistributionsthatwe pay with respect to a share of common stock. The Administrator will determine all terms and conditions of a dividend equivalent unit award, except that dividendequivalentunitsmaynotbegrantedinconnectionwithastockoptionorSAR,dividendequivalentunitawardsthatrelateto performancesharesorperformanceunitsmaynotprovideforpaymentpriortovestingofsuchsharesorunits,anddividendequivalent unitawardsgrantedintandemwithanotherawardmaynotincludevestingprovisionsmorefavorablethanthevestingprovisionsofthe tandemaward.
Other Stock-Based Awards. The Administrator may grant to any participant shares of unrestricted stock as a replacement for othercompensationtowhichsuchparticipantisentitled,suchasinpaymentofdirectorfees,inlieuofcashcompensation,inexchange for cancellation of a compensation right, or as abonus.
Minimum Vesting. All awards granted under the 2020 Plan must have a minimum vesting period of one year from the grant date, except for awards with respect to up to 5% of the total number of shares of common stock reserved under the 2020 Plan. The Administratormay,however,acceleratethevestingordeemanawardearned,inwholeorinpart,uponaparticipant’sdeath,disability, or, in the limited circumstances described below, atthetimeofachangeofcontrol.
Transferability. Awardsarenottransferable,includingtoanyfinancialinstitution,otherthanbywillorthelawsofdescentand distribution, unless the Administrator allows a participant to (i) designate in writing a beneficiary to exercise the award or receive payment under the award after the participant’s death, (ii) transfer an award to a former spouse as required by a domestic relations order incident to a divorce, or (iii) transfer an award without receiving anyconsideration.
Adjustments. If (i) we are involved in a merger or other transaction in which our shares of common stock are changed or exchanged; (ii) we subdivide or combines shares of common stock or declare a dividend payable in shares of common stock, other securities, or other property (other than stock purchase rights issued pursuant to a shareholder rights agreement); (iii) we effect a cash dividendthatexceeds10%ofthefairmarketvalueofashareofcommonstockoranyotherdividendordistributionintheformofcash or a repurchase of shares of common stock that our Board determines is special or extraordinary, or that is in connection with a recapitalizationorreorganization;or(iv)anyothereventoccursthatintheAdministrator’sjudgmentrequiresanadjustmenttoprevent dilution or enlargement of the benefits intended to be made available under the 2020 Plan, then the Administrator will, in a manner it deems equitable, adjust any or all of (A) the number and typeof sharessubjecttothe2020 Planandwhichmay,aftertheevent,bemadethesubjectofawards;(B)thenumberandtypeofsharesof common stock subject to outstanding awards; (C) the grant, purchase, or exercise price with respect to any award; and (D) the performance goals applicable to anaward. Inanysuchcase,theAdministratormayalsoprovideforacashpaymenttotheholderofanoutstandingawardinexchangeforthe cancellationofalloraportionoftheaward,subjecttothetermsofthe2020 Plan. The Administrator may, in connection with any merger, consolidation, acquisition of property or stock, or reorganization, authorizetheissuanceorassumptionofawardsupontermsandconditionswedeemappropriatewithoutaffectingthenumberofshares of common stock otherwise reserved or available under the 2020 Plan.
Effect of a Change in Control.
Awards Assumed by Successor. Uponachange incontrol(asdefined inthe2020 Plan), thesuccessororsurviving corporationmayagreeto assume some or all outstanding awards or replace them with the same type of award with similar terms and conditions, without the consent of any participant, subject to the followingrequirements:
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Awards Not Assumed by Successor. Totheextentthesuccessor as a result of the change in control transactiondoes notassumetheawardsorissuereplacementawards,thenimmediatelyprior to the date of the change in control:
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Term of Plan. UnlessearlierterminatedbytheBoard,the2020 Plan for a period of 10 years from the date of shareholder approval.
Termination and Amendment. TheBoardor the Administratormayamend,alter,suspend,discontinueor
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terminatethe2020 Planat any time, subject to the followinglimitations: (i) theBoardmustapproveanyamendmenttothe2020 Planifsuchapprovalisrequiredbyprioractionofthe Board, applicable corporate law, or any other applicablelaw; (ii) shareholders must approve any amendment to the 2020 Plan, which may include an amendment to materially increase the numberofsharesreservedunderthe2020 Plan,ifsuchapprovalisrequiredbySection16oftheSecurities ExchangeActof1934,theCode,thelistingrequirementsofanyprincipalsecuritiesexchangeormarketonwhichtheshares are then traded, or any other applicable law;and (iii) shareholdersmustapproveanyamendmenttothe2020 Planthatwoulddiminishtheprotectionsaffordedbytheparticipant award limits or repricing and backdatingprohibition.
Subject to the requirements of the 2020 Plan, the Administrator may modify or amend any award or waive any restrictions or conditions applicable to any award or the exercise of the award, or amend, modify, or cancel any terms and conditions applicable to any award, in each case, by mutual agreement of the Administrator and the participant or any other person(s) that may have an interest in the award, so long as any such action does not increase the number of shares of common stock issuable under the 2020 Plan. The Administrator need not obtain participant (or other interested party) consent for any such action (i) that is permitted pursuant to the adjustment provisions of the 2020 Plan; (ii) to the extent the action is deemed necessary to comply with any applicable law or the listing requirements of any principal securities exchange or market on which our common stock is then traded; (iii) to the extent the action is deemed necessary to preserve favorable accounting or tax treatment of any award for us; or (iv) to the extent the action does not materially and adversely affect the value of an award or that such action is in the best interest of the affected participant or any other person(s) as may then have an interest in the award.
The authority of the Board and the Committee to terminate or modify the 2020 Plan or awards, and to otherwise administer the 2020 Plan, with respect to outstanding awards, will extend beyond the termination date of the 2020 Plan. In addition, termination of the 2020 Plan will not affect the rights of participants with respect to awards previously granted to them, and all unexpired awards will continue in force and effect after termination of the 2020 Plan except as they may lapse or be terminated by their own terms and conditions.
Repricing Prohibited. Exceptfortheadjustmentsprovidedforinthe2020 Plan,neithertheAdministratornoranyotherperson mayamendthetermsofoutstandingstockoptionsorSARstoreducetheirexerciseorgrantprice,canceloutstandingstockoptionsor SARs in exchange for stock options or SARs with an exercise or grant price that is less than the exercise or grant price of the awards being cancelled, or cancel outstanding stock options or SARs with an exercise or grant price above the current fair market value of a shareinexchangeforcashorothersecurities.Inaddition,theAdministratormaynotgrantastockoptionorSARwithagrantdatethat is effective prior to the date the Administrator takes action to approve suchaward.
Certain Federal Income Tax Consequences.
The following summarizes certain U.S. federal income tax consequences relating to the 2020 Plan under current tax law.
Stock Options.Thegrantofastockoptionwillcreatenoincometaxconsequencestousortherecipient.A participantwhoisgrantedanon-qualifiedstockoptionwillgenerallyrecognizeordinarycompensationincomeatthetimeofexercise inanamountequaltotheexcessofthefairmarketvalueofthecommonstockatsuchtimeovertheexerciseprice.The Companywillgenerally be entitled to a deduction in the same amount and at the same time as ordinary income is recognized by the participant. Upon the participant’s subsequent disposition of the shares of common stock received with respect to such stock option, the participant will recognizeacapitalgainorloss(long-termorshort-term,dependingontheholdingperiod)totheextenttheamountrealizedfromthe salediffersfromthetaxbasis,i.e.,thefairmarketvalueofthecommonstockontheexercisedate.
In general, a participant will recognize no income or gain as a result of exercise of an incentive stock option (except that the alternative minimum tax may apply). Except as described below, the participant will recognize a long-term capital gain or loss on the disposition of the common stock acquired pursuant to the exercise of an incentive stock option and the Company will not be allowed a deduction. If the participant fails to hold the shares of common stock acquired pursuant to the exercise of an incentive stock option for at least two years from the grant date of the incentive stock option and one year from the exercise date, then the participant will recognize ordinary compensation income at the time of the disposition equal to the lesser of (a) the gain realized on the disposition, or (b) the excess of the fair market value of the shares of common stock on the exercise date over the exercise price. The Company will generally be entitled to a deduction in the same amount and at the same time as ordinary income is recognized by the participant. Any additional gain realized by the participant over the fair market value at the time of exercise will be treated as a capital gain.
Stock Appreciation Rights.ThegrantofaSARwillcreatenoincometaxconsequencestousortherecipient.
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Upontheexerciseor maturity of a SAR, the participant will recognize ordinary income equal to the amount of cash and the fair market value of any shares received. The Company generally be entitled to a corresponding deduction in the same amount and at the same time as the participant recognizes income. If shares are delivered under the SAR, upon the participant’s subsequent disposition of the shares, the participant willrecognizecapitalgainorloss(long-termorshort-term,dependingontheholdingperiod)totheextenttheamountrealizedfromthe dispositiondiffersfromtheshares’taxbasis,i.e.,thefairmarketvalueofthesharesonthedatetheparticipantreceivedtheshares.
Restricted Stock. Generally, a participant will not recognize income and the Company will not be entitled to a deduction at the time an award of restricted stock is made, unless the participant makes the election described below. A participant who has not made such an electionwillrecognizeordinaryincomeatthetimetherestrictionsonthestocklapseinanamountequaltothefairmarketvalueofthe restrictedstockatsuchtime.The Companywillgenerallybeentitledtoacorrespondingdeductioninthesameamountandatthesametimeasthe participantrecognizesincome.Anyotherwisetaxabledispositionoftherestrictedstockafterthetimetherestrictionslapsewillresultin acapitalgainorloss(long-termorshort-term,dependingontheholdingperiod)totheextenttheamountrealizedfromthesalediffers from the tax basis, i.e., the fair market value of the common stock on the date the restrictions lapse. Dividends paid in cash and received by a participant prior to the time the restrictions lapse will constitute ordinary income to the participant in the year paid and the Companywillgenerallybeentitledtoacorrespondingdeductionforsuchdividends.Anydividendspaidinstockwillbetreatedasanaward of additional restricted stock subject to the tax treatment describedherein.
A participant may, within 30 days after the date of the award of restricted stock, elect to recognize ordinary income as of the date of the award in an amount equal to the fair market value of such restricted stock on the date of the award (less the amount, if any, the participant paid for such restricted stock). If the participant makes such an election, then the Company will generally be entitled to a corresponding deduction in the same amount and at the same time as the participant recognizes income. If the participant makes the election, then any cash dividends the participant receives with respect to the restricted stock will be treated as dividend income to the participant in the year of payment and will not be deductible by us. Any otherwise taxable disposition of the restricted stock (other than by forfeiture) will result in a capital gain or loss. If the participant who has made an election subsequently forfeits the restricted stock, then the participant will not be entitled to deduct any loss. In addition, the Company would then be required to include as ordinary income the amount of any deduction that was originally claimed with respect to such shares.
Performance Shares. The grant of a performance share award will create no income tax consequences for us or the participant. Upon the participant’s receipt of shares after the end of the applicable performance period and any applicable vesting period, the participantwillrecognizeordinaryincomeequaltothefairmarketvalueofthesharesreceived,exceptthatiftheparticipantreceives shares of restricted stock in payment of performance shares, recognition of income may be deferred in accordance with the rules applicabletorestrictedstockasdescribedabove.Inaddition,theparticipantwillrecognizeordinarycompensationincomeequaltothe dividend equivalents, if any, paid on performance shares. The Company will generally be entitled to a deduction in the same amount and at the sametimeasincomeisrecognizedbytheparticipant.Upontheparticipant’ssubsequentdispositionoftheshares,theparticipantwill recognize capital gain or loss (long-term or short-term, depending on the holding period) to the extent the amount realized from the dispositiondiffersfromtheshares’taxbasis,i.e.,thefairmarketvalueofthesharesonthedatetheparticipantreceivedtheshares.
Performance Units and RSUs. The grant of a performance unit or RSU will create no income tax consequences to us or the participant. Upon the participant’s receipt of cash and/or shares at the end of the applicable performance or vesting period, the participantwillrecognizeordinaryincomeequaltotheamountofcashand/orthefairmarketvalueofthesharesreceived,andthe Companywill generallybeentitledtoacorrespondingdeductioninthesameamountandatthesametime.IfperformanceunitsorRSUsaresettledin whole or inpart inshares,upontheparticipant’ssubsequentdispositionofthesharestheparticipantwillrecognizeacapitalgainorloss(long-termor short-term,dependingontheholdingperiod)totheextenttheamountrealizedupondispositiondiffersfromtheshares’taxbasis,i.e., the fair market value of the shares on the date the employee received theshares.
Cash Incentive Awards.Aparticipantwhoispaidanincentiveawardwillrecognizeordinaryincomeequaltotheamountofcash paid,andthe Companywillgenerallybeentitledtoacorrespondingdeductioninthesameamountandatthesametime.
Other Stock Based Awards.Aparticipantwhoreceivessharesofcommonstockpursuanttoastockawardwillrecognizeordinary incomeequaltothefairmarketvalueofthesharesreceivedandthe Companywillgenerallybeentitledtoacorrespondingdeductioninthesame amountandatthesametime.Upontheparticipant’ssubsequentdispositionofthesharestheparticipantwillrecognizeacapitalgainor loss (long-term or short-term, depending on the holding period) to the extent the amount realized upon disposition differs from the tax basis of the shares,i.e.,thefairmarketvalueof
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thesharesonthedatetheemployeereceivedtheshares.
Tax Withholding.Intheeventthatthe Companyoranaffiliate is requiredtowithholdanyfederal,stateorlocaltaxesorotheramounts inrespectofanyincomerecognizedbyaparticipantasaresultofthegrant,vesting,paymentorsettlementofanawardordisposition of any shares acquired under an award, we may satisfy such obligationby:
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No Guarantee of Tax Treatment. Notwithstanding any provisions of the 2020 Plan, we do not guarantee that (i) any award intendedtobeexemptfromSection409AoftheCodeissoexempt,(ii)anyawardintendedtocomplywithSection409AorSection 422oftheCodedoessocomply,or(iii)anyawardwillotherwisereceiveaspecifictaxtreatmentunderanyotherapplicabletaxlaw, norinanysuchcasewillthe Company or an affiliateberequiredtoindemnify,defend,orholdharmlessanyindividualwithrespectto the tax consequences of anyaward.
Section 162(m) Limit on Deductibility of Compensation. Section 162(m) of the Code limits the Company’s deduction to $1 million of compensationpaidperpersonperyear,includingcompensationarisingfromawardsgrantedunderthe2020 Plan,withrespecttoany individualwhoservedas the Company’s ChiefExecutiveOfficerorChiefFinancialOfficeratanypointduringtheyear,orwhowasotherwise includedasoneofthethreeotherhighestpaidofficersinthe Company’s proxy for the fiscal year.
New Plan Benefits
Assuming shareholder approval of the 2020 Plan, the Compensation Committee intends to grant performance-based RSUs (“PBRSUs) to our CEO and other named executive officers covering the 2020-2022 performance period at the target level shown in the following table with award opportunities ranging from 50% to 150% of the target. The number of shares underlying each PBRSU award will be determined by reference to the closing price of the Company’s common stock on the grant date, which is expected to occur in mid-June 2020. The awards will be granted under terms consistent with awards with the 2020 Plan and will utilize the same performance metrics that the Committee applied to awards made in 2019 for the 2019-2021 performance period. See Compensation Discussion and Analysis for additional detail on the PBRSU awards made in 2019. These awards would have been made under the 2012 Plan in March 2020 as part of the Committee’s annual cycle for consideration of senior management long-term incentive awards but there were insufficient shares available under the 2012 plan to reserve for these grants. Except as noted in the table below, if the 2020 Plan is approved by shareholders, grants of awards to eligible participants will be made in the future by the Compensation Committee as it deems necessary or appropriate.
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Equity Compensation Plan Information
The following table provides information about our equity compensation plans as of December 31, 2019.
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Vote Required
The affirmative vote of a majority of the votes cast in person or by proxy at the Annual Meeting will be required to approve the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan. Abstentions will be treated as votes “against” the proposal. Broker non-votes will have no effect on the outcome of the vote.
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Shareholder proposals1PROPOSALS TO BE VOTED ON AT THE MEETING
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PROPOSAL 7:
Director Term Limits82
1The names, addresses and beneficial holdings of the
proponents and any co-sponsors to a proposal are
available to shareholders upon request by writing to
the Corporate Secretary at the address listed on page 20
of this proxy statement.
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Proposal 6: Shareholder Proposal Requesting Board Action to Eliminate THE CLASSIFIED BOARD BY amending the Amended and Restated Certificate of Incorporation of the Company.
The following proposal was submitted by Kenneth Steiner of 14 Stoner Ave., 2M, Great Neck, NY 11021.
Mr. Steiner owns at least 500 shares of our common stock.
Shareholder Proposal
Proposal 6 — Elect Each Director Annually5 – Adopt a Mainstream Shareholder Right – Written Consent
RESOLVED, shareholders askShareholders request that our Companyboard of directors take all the necessary steps to permit written consent by the shareholders entitled to cast the minimum number of votes that would be necessary to reorganizeauthorize an action at a meeting at which all shareholders entitled to vote thereon were present and voting. This written consent is to give shareholders the Boardfullest power to act by written consent consistent with applicable law. This includes shareholder ability to initiate any appropriate topic for written consent.
This proposal topic won 95%-support at Dover Corporation and 88%-support at AT&T.
Taking action by written consent in place of Directors into one class with each director subjecta meeting is a means shareholders can use to election each year for a one-year term.
Arthur Levitt, former Chairman ofraise important matters outside the Securities and Exchange Commission said, “In my view it’s best fornormal annual meeting cycle like the investor if the entire board is elected once a year. Without annual election of each director shareholders have far less control over who represents them.”a new director.
A total of 79 S&P 500 and Fortune 500 companies, worth more than $ One trillion dollars, also adopted this important proposal topic since 2012. Annual elections are widely viewed as a corporate governance best practice. Annual election of each director could make directors more accountable, and thereby contribute to improved performance and increased company value.
Adoption of this proposal would be facilitated by the adoption of the simple majority vote shareholder proposal which won 75%-support at the 2019 NYCB annual meeting. The 2019 NYCB proxy hyped the “shareholder outreach” of NYCB. This so-called outreach was apparently clueless by not foreseeing the 75%-vote.
NYCB failed to cite any governance improvement as a result of its so-called “outreach.” NYCB directors seem to have abdicated in regard to governance and shareholder proposals have taken the lead in improving the governance of NYCB. NYCB adopted shareholder proxy access due to a shareholder proposal submitted by The City of New York Office of the Comptroller.
The timing is right to enhance the corporate governance of NYCB with this proposal and the other governance improvement proposal mentioned in this proposal that received 75%-support in 2019. In less than 5-years our stock price has fallen from $19 to $11. It is especially important for each director to stand for election annually since our Lead Director, Michael Levine,For instance Dominick Ciampa, age 86, was rejected by 8%81 million votes in 2020 and Mr. Lawrence Rosano was rejected by 57 million votes. In spite of such strong rejection Mr. Ciampa is untouchable by a shareholder vote again until he is age 89.
Directors John Tsimbinos age 82, Ronald Rosenfeld age 80 and James O’Donovan age 77 would only be up for election once in 3-years.
Corporate governance reform, such as this proposal, is important for New York Community Bancorp since our stock is now down from $17 in 2015 and down from $34 in 2004.
A shareholder right to act by written consent still affords NYCB management a strong defense for a management holdout position against a majority of shareholders. Any action taken by written consent would still need 68% supermajority approval from the shares that normally cast ballots at the NYCB annual meeting to equal the required majority vote from all NYCB shares outstanding.
With the avalanche of bare bones online shareholder meetings in 20192020 shareholder engagement and management transparency have taken a big hit. Shareholders are so restricted in online meetings that management will never want a return to the more transparent in-person shareholder meeting format. This is all the more reason to support this corporate governance reform.
Shareholders are restricted in making their views known at online shareholder meetings because all constructive questions and comments can be screened out by management. For instance the Goodyear shareholder meeting was spoiled by a trigger-happy management mute button for shareholders. AT&T, with 3000 institutional shareholders, would not even allow shareholders to speak at its online shareholder meeting.
Now more than ever shareholders need to have the option to take action outside of a shareholder meeting and send a wake-up call to management, if need be, since tightly controlled online shareholder meetings are the Death Valley of shareholder engagement and management transparency.
Please vote yes:
Adopt a Mainstream Shareholder Right – double the typical director rejection vote.Written Consent – Proposal 5
Shareholder proposals have taken the lead in improving the governance of NYCB. NYCB did away with plurality voting after shareholders gave 54%-support to a proposal by the California Public Employees’ Retirement System.
[END OF SHAREHOLDER PROPOSAL]
Elect Each Director Annually — Proposal 6Page 67
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The Board’s Statement in Opposition The Board of Directors believes that that proposal is not in the best interests of shareholders and recommends a vote “Against” the proposal for the following reasons: ✓The ✓Holding Shareholder Meetings is the Most Transparent and
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The Board of Directors recommends that shareholders vote against this shareholder proposal for a number of reasons, as discussed below.
The Company is Committed to High Standards of Corporate Governance and Accountability
Our Board, as stewards of shareholder interests, is committed to maximizing long-term shareholder value creation and to maintaining sound corporate governance principles consistent with current rules and practices. Under the leadership of the Nominating and Corporate Governance Committee, we have concentrated significant efforts and resources on ensuring that our overall corporate governance practices serve the best interests of the Company and its shareholders, focusing on the changing needs for financial institution boards in the current regulatory |
DespiteAs part of our commitment to corporate governance and shareholder accountability, we have also developed an active shareholder outreach program to better understand the views and concerns of our large shareholders. Contrary to the proponent’s assertionclaim that shareholder proposalsengagement and management transparency “have taken a big hit” in 2020, we continued to emphasize our shareholder outreach program, and continued to encourage shareholder participation in the program, during 2020. Consistent with past years, during 2020, our shareholder outreach program consisted of regular management dialogue with the investor community and formal outreach by our independent Board members to institutional shareholders. As part of the Management Outreach Program, our executive management team met with shareholders or prospective shareholders from 102 discrete institutions during 2020. In addition, as part of our Board Outreach Program, we contacted our 25 largest stockholders, who represented approximately 66.13% of our then-outstanding shares during 2020. Of those contacted, investors representing over 23% of the then-outstanding shares made themselves available to speak with us, including 3 of our 10 largest shareholders. During the entirety of our 2020 shareholder engagement process, not a single shareholder with whom we communicated advocated for a written consent proposal such as the one contemplated by the proponent.
We have taken the lead in improving the Company’s governance, wealso demonstrated a history of responding to shareholder feedback, and have voluntarily implemented numerous corporate governance enhancements in recent years in response to our shareholder outreach program. For example, in response to feedback received from our shareholder outreach program, beginning in 2019, we have included greater specifics in our annual meeting proxy statement on the scope of our shareholder outreach efforts and on the feedback we received, including with respect to shareholder views regarding our compensation programs. In addition, following the Company’s 2018 annual meeting of shareholders, shareholder feedback indicated that the Company’s Compensation Committee should be refreshed. In response to that feedback, our Board appointed three new members of the Compensation Committee, replacing the previous Chairman and all other members. Additionally, in 2016 we encouragedFor more information on our shareholder engagement efforts during 2020, see “Shareholder Outreach and Recent Initiatives.”
Our management and Board value direct and transparent engagement with our shareholders and regularly seek opportunities to approveobtain feedback in connection with our governance, management compensation, and strategies. We embrace shareholder engagement as an amendment toimportant tenet of good governance and we value the views of our certificate of incorporation that would eliminate our classified board structureshareholders and allow all directors to be elected annually. The proposed amendment did not receive the requisite vote required to pass, andother stakeholders. As a result, our Board of Directors has continued to assess the potential for the adoption of such a measure at a future annual meeting.
Throughbelieves that our ongoingexisting shareholder outreach program we have learned that, although some consistent themes exist, ourprovides a more effective means for shareholders have varying views on governance topics, and we have made efforts to balanceraise important matters outside the differing and sometimes contrasting viewpoints. Specifically, we have learned that while some shareholders favor declassificationnormal annual meeting cycle, such as the election of our Board of Directors, others favor a Board whose members are elected to multiple classes every three years. Accordingly, after continued careful consideration,new director, than the Board has determined that the approval of the proposal would not serve to enhance shareholder value at this time for the reasons discussed below and, therefore, it is notmeasures set forth in the best interests of the Company or its shareholders.proponent’s proposal.
The Company’s Classified Board Provides Stability and Continuity and Promotes Long-Term Goals and ObjectivesPage 68
As provided for in the Company’s certificate of incorporation, the Company’s Board of Directors is currently divided into three separate classes, with each class of directors serving for a three-year term. Our Board of Directors believes that our classified Board structure creates stability and continuity that is in the best interests of the Company and its shareholders. This classified Board structure ensures that, at any given time, our Board of Directors is comprised of experienced directors who are familiar with the Company’s business, strategic goals and objectives, history, culture and market area. In addition, our three-year director terms are tailored to enable our existing and future directors to develop a substantive and meaningful understanding of the Company’s specific operations and goal, which better allows them to make long-term strategic decisions that are in the best interests of the Company and its shareholders.
Our classified Board structure also provides for orderly change alongside continuity as new directors with fresh perspectives interact and work with experienced directors. In the absence of a classified Board structure, the entire Board of Directors could be replaced in a single year with new directors who are not familiar with the Company’s business, strategic goals and objectives, history, culture and market area.
Our Board of Directors also believes that the Company’s classified Board structure also encourages directors to make decisions that are in the long-term interests of the Company and its shareholders by strengthening the independence of non-employee directors against the short-term focus of certain investors or special interest groups. In contrast, the annual election
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PROPOSALS TO BE VOTED ON AT THE MEETING | |
of all directors can, in some cases, leadHolding Shareholder Meetings is the Most Transparent and Fair Way for Shareholders to short-term focus or a concentration on only immediate results, which can discourage or impair long-term strategic objectivesTake Action and initiatives.
The Company’s Classified Board is Designed to ProtectPromotes and Protects Shareholder Value and Provide Accountability to Shareholders
Interests
Our Board of Directorsfurther believes that holding meetings with proper notice whereby all shareholders may deliberate and discuss the proposed actions, receive and consider the Company’s classified Board structureposition, and then vote their shares is alsothe most transparent and fair way for shareholders to take action. Currently, under the Company’s Certificate of Incorporation and Bylaws, shareholders must receive advance notice of any matter that the Company, or a shareholder, wishes to present for a shareholder vote and the matter must then be presented at a meeting of shareholders. The transparency and fairness of these procedural requirements permits all shareholders to consider, discuss and vote on all pending shareholder actions. In contrast, the measures set forth in the best interestsproponent’s proposal would permit a small group of Company shareholders, who would not owe any fiduciary duties to other shareholders, to initiate action with no prior notice to the Company or other shareholders. As a result, the measures set forth in the proponent’s proposal would prevent all shareholders from having an opportunity to deliberate in an open and transparent manner and to be presented with, and consider, the Company’s position for or against an action and any other arguments related to a proposed action.
Furthermore, allowing shareholder action by written consent could also lead to substantial confusion and disruption for shareholders, with potentially multiple, even conflicting, written consents being solicited by multiple shareholder groups. In addition, this approach may prevent shareholders from receiving accurate and complete information on important pending actions. It would also deny the Board the opportunity to consider the merits of the Companyproposed action and itsto suggest alternatives for shareholder evaluation.
Historically, we have held annual meetings of shareholders because it helps protectin person. Our shareholder valuemeetings have included a presentation from management and provides accountabilitya robust question and answer exchange with shareholders. However, due to shareholders. The classified Board structure reducesthe health and safety concerns resultant of the COVID-19 pandemic, we like many other companies, held our 2020 annual meeting virtually. This was the first virtual shareholder meeting in the Company’s vulnerabilityhistory. As they will be this year, all shareholders in attendance at last year’s meeting were permitted and encouraged to hostilesubmit questions for response at the meeting. During the question and potentially abusive takeover tactics and better positions the Board to negotiate effectively on behalf of allanswer phase of the 2020 annual meeting, fifteen meaningful questions regarding the Company’s shareholders. Whileoperations and strategies were received and answered. As a classifiedresult of the COVID-19 pandemic’s continued presence in New York and across the country, for the safety of our shareholders, employees, directors and partners, we will again use an interactive virtual meeting platform for the Annual Meeting. Yet despite the proponent’s contention that shareholder participation is restricted in the context of an online meeting, our Board alone does not precludebelieves that shareholder meetings are the most transparent and fair way for shareholders to take action, regardless of whether the shareholder meeting is held in person or online. Shareholders will be afforded the same rights and opportunities to participate in this year’s online meeting as they would at an in-person meeting. They will be permitted to ask questions during the meeting, and we will answer as many questions as time permits. This ensures that, even at a successful takeover offer, staggered director terms may provide the Companyvirtual meeting of shareholders, shareholders are provided with the time andimportant opportunity to evaluateadequately consider, discuss and vote on all proposals before the fairness of a takeover proposal,shareholders at the Annual Meeting. Nevertheless, we look forward to negotiate on behalf of all shareholders, andthe opportunity to weigh alternatives withreturn to in person annual meetings once the objective of maximizing overall shareholder value.COVID-19 pandemic has passed.
In addition, our Board of Directors believes that our current classified Board structure does not in any way diminish the accountability of directors to our shareholders. Our directors are committed to acting in the best interests of the Company and our shareholders, and are required by law to fulfill fiduciary duties owed to both, regardless of the length of their terms. Our Nominating and Corporate Governance Committee plays a significant role in ensuring director accountability by compiling data from the Board’s self-evaluation and peer review processes, evaluating shareholder communications and shareholder voting results, and reviewing commentary about Board governance and individual director performance from a variety of sources. The Nominating and Corporate Governance Committee also uses this information to inform the Board’s succession planning process in order to develop a thoughtful process that will enhance accountability by facilitating orderly change without disrupting the Company’s financial or operational performance.
Furthermore, our Board of Directors believes that, even with a classified Board, shareholders have considerable influence over the composition of the Company’s Board of Directors. It is important to note that, our certificate of incorporation requires that nominees for director in uncontested elections receive a majority of the votes cast in respect of their election as directors. If an election is uncontested, each of our director nominees has agreed to tender his or her irrevocable contingent resignation if he or she is not elected by a majority of votes cast by shareholders. Our Nominating and Corporate Governance Committee will promptly consider the director’s resignation and recommend to our Board whether to accept or reject the resignation. Our Board will act on the Nominating and Corporate Governance Committee’s recommendation within ninety days of the applicable shareholder meeting and will then publically disclose its decision. This majority vote standard increases our directors’ accountability to our shareholders and provides our shareholders with increased influence over the election of directors serving on our classified Board.
Conclusion
The Board believes that the proposal’s request for the Company to take action to effect the annual election of directorsnecessary steps to permit shareholders to take action by written consent is unnecessary and will eliminatenot in the benefitsbest interests of a classified Board of Directors discussed above.shareholders. The Board, therefore, recommends a vote AGAINST this proposal.
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INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | |
INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES |
Proposal 7: Shareholder Proposal Regarding Director Age and Term LimitsWhy am I being provided this proxy statement?
This proxy statement summarizes information you need to know in order to vote at the 2021 Annual Meeting of Shareholders. The 2021 Annual Meeting of Shareholders of New York Community Bancorp, Inc. (the “Company”) will be a virtual meeting conducted exclusively via live webcast at www.virtualshareholdermeeting.com/NYCB2021 on May 26, 2021 at 10:00 a.m., Eastern Daylight Time (the “Annual Meeting”). This proxy statement is being sent to you because the Board of Directors (the “Board of Directors” or “Board”) of the Company is soliciting your proxy to vote your shares of common stock of the Company (the “Common Stock”) at the Annual Meeting. On or about April 16, 2021, the proxy statement and proxy materials, or a notice advising how to access these documents online, will be sent to shareholders of record as of April 1, 2021. The 2020 Annual Report to Shareholders, which includes the Annual Report on Form 10-K featuring the Company’s consolidated financial statements for the fiscal year ended December 31, 2020 accompanies this proxy statement.
What is a proxy?
A proxy is your designation of another person to vote stock you own. That other person is called a proxy. If you designate someone as your proxy in a written document, that document also is called a proxy or a proxy card. When you designate a proxy, you also may direct the proxy how to vote your shares. One or more of the Company’s directors will serve as the designated proxy to cast the votes submitted by the Company’s shareholders at the Annual Meeting.
What is a proxy statement?
It is a document that the Company is required to give you, or provide you with access to, in accordance with regulations of the Securities and Exchange Commission (the “SEC”), when asking you to designate proxies to vote your shares of the Common Stock at a meeting of shareholders. The proxy statement includes information regarding the matters to be acted upon at the meeting and certain other information required by regulations of the SEC and the rules of the New York Stock Exchange (the “NYSE”).
On what matters are the shareholders of record voting?
The shareholders of record will vote on the following proposal was submitted by Jeffrey L. Doppeltproposals:
Proposal 1: Election of 6 Grassfield Road, Great Neck, NY 11024. Mr. Doppelt owns at least 3,000 shares of our common stock.
ShareholderDirectors. In Proposal
To recommend 1, three director nominees have been recommended for election to the Board of Directors by the Nominating and Corporate Governance Committee of the Board. Directors are elected by a majority of the votes cast, meaning that the number of votes cast “FOR” a nominee must exceed the number of votes cast “AGAINST” that nominee, with broker non-votes and abstentions not counted as a vote cast either “FOR” or “AGAINST” that nominee. Shares not voted will have no impact on the election of directors. A properly executed proxy marked “FOR ALL” of the four nominees for director will be voted for each of the nominees, unless you mark the proxy card, or select the corresponding option in the electronic form, “WITHHOLD ALL” or “FOR ALL EXCEPT.” Marking the proxy card, or selecting the corresponding option in the electronic form, “WITHHOLD ALL” will withhold your vote as to adoptall nominees for director. Marking the proxy card, or selecting the corresponding option in the electronic form, “FOR ALL EXCEPT” will direct that your shares be voted for all nominees except that your shares will be withheld as to any nominees you may specify.
Proposal 2: Ratification of Auditors. The affirmative vote of a term limitmajority of votes cast at the Annual Meeting is required to restrictapprove Proposal 2, a proposal to ratify the lengthreappointment of timeKPMG LLP as the Company’s independent registered public accounting firm for 2021. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card, or selected in the corresponding option in the electronic form, and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented.
Proposal 3: Approval, on a non-binding advisory basis, of the Company’s Named Executive Officer Compensation. As to the advisory approval of the 2020 Named Executive Officer compensation, the proxy card being provided by the Board of Directors enables a shareholder to check the appropriate box on the card, or select the corresponding option in the electronic form, to (i) vote “FOR” the proposal, (ii) vote “AGAINST” the proposal, or (iii) “ABSTAIN” from voting on the proposal. To approve Proposal 3, the affirmative vote of a majority of the votes cast at the Annual Meeting is required. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card, or selected in the corresponding option in the electronic form, and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented. Your vote on Proposal 3 is an independent directoradvisory vote, which means that the Company and the Board of Directors are not required to take any action based on the outcome of the vote.
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Proposal 4: Phase out the classified Board of Directors by approving amendments to the Amended and Restated Certificate of Incorporation. To be approved, at least 80 percent of the shares outstanding as of the record date must vote in favor of Proposal 4, a proposal phasing out the classification structure of the Board of Directors and providing instead for the annual election of directors. In connection with such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card and shares underlying broker non-votes or in excess of the Limit (as described below) will count as a vote against the proposal.
Proposal 5: A shareholder proposal, as described herein, if properly presented at the meeting, requesting Board action to provide for shareholder action by written consent.The affirmative vote of a majority of votes cast at the Annual Meeting is required to approve Proposal 5. In connection with each such proposal, shares as to which the “ABSTAIN” box has been selected on the proxy card or corresponding option in the electronic form and shares underlying broker non-votes or in excess of the Limit (as described below) will not be counted as votes cast, and will have no effect on the vote on the matter presented.
As discussed below, under NYSE Rules, if your broker holds shares in your name and delivers this proxy statement to you, the broker is not entitled to vote your shares on any non-routine proposal (Proposals 1 and 3 through 5) without your specific instructions.
Who may servevote and what constitutes a quorum at the meeting?
The close of business on April 1, 2021 has been fixed by the Board of Directors as follows:the record date (the “Record Date”) for the determination of shareholders of record entitled to receive notice of, and to vote at, the Annual Meeting and at any adjournments thereof.
In order to conduct the Annual Meeting, shareholders of record of at least a majority of the total number of shares of Common Stock entitled to vote (after subtracting any shares in excess of the Limit pursuant to the Company’s Certificate of Incorporation) must be present in person or by proxy. This is called a quorum. Shareholders who deliver valid proxies or vote in person at the meeting will be considered part of the quorum. Once a share is represented for any purpose at the meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjourned meeting. Abstentions will be counted as being present and entitled to vote for purposes of determining a quorum. Broker “non-votes” are counted as being present and entitled to vote for purposes of determining a quorum only for routine matters. In the event that there are not sufficient shares present for a quorum, or votes to approve or ratify any management proposal at the time of the Annual Meeting, the Annual Meeting may be adjourned in order to permit the further solicitation of proxies.
An independent directorHow many votes do I have?
The securities that may not standbe voted at the Annual Meeting consist of shares of Common Stock, with each share entitling its owner to one vote on all matters to be voted on at the Annual Meeting, except as described below. There is no cumulative voting for the election of directors (in a cumulative voting system, each shareholder would be entitled to one vote per share multiplied by the number of directors to be elected). The total number of shares of Common Stock outstanding and entitled to vote as of the Record Date was 465,074,384.
How do I vote?
A shareholder may vote online during the Annual Meeting by visiting www.virtualshareholdermeeting.com/NYCB2021 and completing a ballot while the polls are open. You will need the control number printed on your proxy card, voting instruction form, or re-election at an annual meeting that follows either (i)notice. A shareholder may also vote in advance of the Annual Meeting by using a proxy to authorize a proxy to vote on his or her 72nd birthday, or (ii) the 12th year anniversary of such director’s service on the Board.
Supporting Statement
NYCB does not have any specific minimum qualification standards for director nominees, although the goal of the Nominating and Governance Committee isbehalf. There are three ways to nominate people who will “enhance the Company’s success and represent shareholder interests.” The committee, however, has relied chiefly on re-nominating the same incumbent individual directors over and over again. Asuse a result, six of the nine non-executive directors have served for over twelve years and more than half of the board members are in their 70s and 80s. This situation is not optimal. A board functions best when it is refreshed with new board members, who can bring fresh ideas and new perspectives to the job of steering the company towards improving shareholder value. This proposal, which imposes an age limit and service limit, is beneficial in refreshing the board, while reasonably accommodating the goal of maintaining institution knowledge.proxy:
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Mail: If you received your proxy materials by mail, you may vote by completing, signing, and dating the
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The Board of Directors recommends that shareholders vote against this shareholder proposal for a number of reasons, as discussed below.
| Internet: You may access the | |
Telephone: You may call toll free at 1-800-690-6903 and follow the instructions on the proxy card or on the Notice of Internet Availability. |
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The Board believesInternet and telephone voting procedures are designed to authenticate shareholders’ identities and allow shareholders to provide their voting instructions and confirm that imposingthe instructions have been properly recorded. Specific instructions for shareholders of record who wish to vote their proxies over the Internet or by telephone are set forth on the proxy card for the Annual Meeting.
The Company encourages shareholders to take advantage of the options to vote using the Internet or by telephone. Voting in this manner will result in cost savings for the Company.
Please be aware that if you vote over the Internet, you may incur costs such as telephone and Internet access charges for which you will be responsible.
When is my vote required?
The following table indicates the date and times for voting deadlines in connection with the proposals for this year’s annual meeting:
If You Are: | And You Are Voting by: | Your Vote Must Be Received: | ||
A shareholder of record | Prior to the Meeting Date, no later than May 25, 2021 | |||
Internet, mobile device, or telephone | By 11:59 P.M. ET on May 25, 2021 | |||
A street name holder | Prior to the Meeting Date, no later than May 25, 2021 | |||
Internet, mobile device, or telephone | By 11:59 P.M. ET on May 25, 2021 | |||
A participant in Company Benefit Plans | Internet, mobile device, or telephone | By 11:59 P.M. ET on May 20, 2021 |
Your vote as a mandatory director retirement age or mandatory limits on director tenureshareholder is notimportant. Please vote as soon as possible to ensure that your vote is recorded.
How are the proxy materials delivered?
The Company is again reducing its costs by taking advantage of SEC rules that allow companies to furnish proxy materials to shareholders primarily through the Internet. Accordingly, the Company is sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to shareholders who (i) own shares directly in the Company (“shareholders of record”) and not through a broker, bank, or intermediary directly to their mailing address unless they have directed the Company to provide the materials in a different manner or (ii) hold shares of Common Stock through the Company’s stock-based benefit plans. See Benefit Plan Voting below. Shareholders whose shares are held for them by brokerage firms, banks, or other intermediaries (“beneficial owners”) will have the proxy materials or the Notice forwarded to them by the intermediary that holds their shares. The Notice provides instructions on how to access and review all of the important information contained in the Company’s proxy statement and 2020 Annual Report to Shareholders, as well as how to cast your vote, over the Internet.
Shareholders who receive the Notice and who would still like to receive a printed copy of the Company’s proxy materials, including the 2020 Annual Report to Shareholders, can find instructions for requesting these materials included in the Notice. The Company plans to mail the Notice to shareholders on April 16, 2021.
What is a broker non-vote?
If you hold your shares in “street name” (i.e., through a broker, bank, or other nominee), it is critical that you cast your vote if you want it to count in the election of directors. SEC regulations currently prohibit brokers or nominees to vote your uninstructed shares in the election of directors on a discretionary basis. Thus, if you hold your shares in street name and you do not instruct your bank or broker how to vote in the election of directors, with respect to the proposal to approve, on a non-binding advisory basis, the Company’s named executive officer compensation, or with respect to the proposed amendment to the Company’s Amended and Restated Certificate of Incorporation, or with respect to the shareholder proposal, if properly presented, no votes will be cast on your behalf with respect to these matters. These uncast “votes” are referred to as broker non-votes. Your bank or broker will, however, continue to have discretion to vote any uninstructed shares on the ratification of the appointment of the Company’s independent registered public accounting firm (Proposal 2).
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What effect do broker non-votes and abstentions have?
A broker or other nominee may generally vote your shares without instruction on routine matters, but not on non-routine matters. A broker “non-vote” occurs when your broker submits a proxy for your shares, but does not indicate a vote for a particular “non-routine” proposal (such as Proposals 1 and 3 through 5) because your broker does not have your authority to vote on that proposal and has not received specific voting instructions from you. Broker non-votes are not counted as votes for or against the proposal in question or as abstentions, nor are they counted to determine the number of votes present for a non-routine proposal. However, when a proposal requires the affirmative vote of a percentage of the Company’s outstanding shares entitled to vote in order to be approved (such as Proposal 4), a broker non-vote will have the same effect as a vote against the proposal.
If you abstain from voting on Proposals 1 and 3 through 5, your vote will be counted as present for determining whether a quorum exists but will not be treated as cast for or against that matter.
What if I sign and date my proxy but do not provide voting instructions?
Proxies solicited by the Board of Directors of the Company will be voted in accordance with the directions given therein. If you are a shareholder of record and do not provide voting directions, signed and dated proxy cards will be voted as follows:
FOR the election of each of the nominees for director named in this proxy statement;
FOR the ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company;
FOR approval of the Named Executive Officer compensation;
FOR the approval of amendments to the Amended and Restated Certificate of Incorporation and Bylaws of the Company eliminating the classified board structure to be replaced with an annual election structure; and
AGAINST approval of a shareholder proposal, if properly presented.
Other than the matters listed on the attached Notice of 2021 Annual Meeting of Shareholders, the Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting. However, execution of a proxy or voting online or by telephone confers on the designated proxy holder discretionary authority to vote the shares represented by the proxy in accordance with his or her best interestsjudgment on such other business, if any, which may properly come before the Annual Meeting or any adjournments thereof, including whether or not to adjourn the meeting.
May I revoke my proxy?
A proxy may be revoked at any time prior to its exercise by filing a written notice of revocation with the Corporate Secretary of the Company, by delivering to the Company a duly executed proxy bearing a later date, by voting online or by telephone on a later date, or by attending the Annual Meeting and voting in person. Attendance at the Annual Meeting will not itself constitute revocation of your proxy.
Who pays the costs of soliciting proxies?
The cost of the solicitation of proxies on behalf of management will be borne by the Company. In addition to the solicitation of proxies by mail, Equinti (US) Services LLC, a proxy solicitation firm, will assist the Company in soliciting proxies for the Annual Meeting and will be paid a fee of $6,500 plus out-of-pocket expenses. Proxies also may be solicited, personally or by telephone, by directors, officers, and other employees of the Company and its subsidiary, New York Community Bank (the “Community Bank” or the “Bank”), without receipt of additional compensation.
The Company also will request that persons, firms, and corporations holding shares in their names, or in the names of their nominees that are beneficially owned by others, send proxy materials to, and obtain proxies from, such beneficial owners. The Company will reimburse such holders for their reasonable expenses in doing so.
If your Company shares are held in street name, your broker, bank, or other nominee will provide you with instructions that must be followed in order to have your shares voted. Your broker or bank may allow you to deliver your voting instructions via the Internet or by telephone. Please see the instruction form that was provided by your broker or bank with this proxy statement. If you wish to change your voting instructions after you have returned your voting instruction form, you will need to contact your broker or bank in order to do so.
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What is the admission policy for the Annual Meeting?
Attendance at the Annual Meeting is limited to:
(1) shareholders because such term limits would arbitrarily depriveof record of Common Stock;
(2) beneficial holders of Common Stock; and
(3) authorized representatives of entities who are beneficial holders of Common Stock.
You will be able to attend the Company of qualified, experiencedmeeting online, vote your shares electronically, and effective directors.submit questions during the meeting by visiting www.virtualshareholdermeeting.com/NYCB2021. To participate in the virtual meeting, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form. The proponent cites no evidencemeeting webcast will begin promptly at 10:00 a.m., Eastern Daylight Time. We encourage you to access the meeting prior to the start time. Online check-in will begin at 9:00 a.m., Eastern Daylight Time, and you should allow ample time for the check-in procedures. If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the Virtual Shareholder Meeting login page. Technical support will be available beginning at 9:30 a.m. Eastern Daylight Time on May 26, 2021 and will remain available until the meeting has ended.
What is the Limit on voting securities?
As provided in the Company’s performance has been hamperedCertificate 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 with respect to the shares held in excess of the Limit. A person or entity is deemed to beneficially own shares owned by director agean affiliate of, as well as by, persons acting in concert with such person or tenure, that arbitrary limits on director age or tenure would lead to improved results, or that theentity. The Company’s existing processes cannot be relied upon to ensure a proper compositionCertificate of Incorporation authorizes the Board of Directors going forward.(i) to make all determinations necessary to implement and apply the Limit, including determining whether persons or entities are acting in concert, and (ii) to demand that any person who is reasonably believed to beneficially own stock in excess of the Limit supply information to the Company to enable the Board of Directors to implement and apply the Limit.
Based solely on information in reports filed with the SEC, certain persons or entities are known by management to be the beneficial owners of more than 5% of the outstanding shares of Common Stock as of the Record Date and in some cases have indicated beneficial ownership of up to 10% of the Common Stock outstanding as of that date. If such owners were to increase their holdings above 10% or if other shareholders were to acquire beneficial ownership of shares in excess of that amount, they would not be entitled to any vote with respect to the shares held in excess of 10%.
Proxies solicited hereby will be tabulated by inspectors of election designated by the Board of Directors. The Board further understands that only a small minorityinspectors of public companieselection will not be employed by, or be directors of, the Company or any of its affiliates.
Active employee-participants in the United States has mandatory director term limitsCompany benefit plans who hold Common Stock will receive an e-mail that contains a link to this proxy statement, along with procedures to follow in order to vote the shares of Common Stock credited to each participant’s account under the Company benefit plans and the shares of Common Stock (if any) held independent of the Company benefit plans. Retired and inactive employee-participants will receive their proxy materials via U.S. mail. Benefit plan voting instructions will be delivered to the trustee for the Company benefit plans and the shares will be voted as directed by participants. Shares for which no voting instructions are provided or are not timely received by the Company will be voted by the trustee for the Company’s tax-qualified plans holding Common Stock in the same proportion as the voting instructions the trustee receives from other participants or, in the case of the Company’s equity incentive plans, as directed by the Company. Benefit plan voting instructions must be received by 11:59 p.m., Eastern Daylight Time, on May 20, 2021.
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Experienced Directors SupportThe following table sets forth information as to those persons or entities known by management to be beneficial owners of more than 5% of the Company’s Long-Term Approach to Creating Shareholder Valueoutstanding shares of Common Stock on April 1, 2021. Other than those persons or entities listed below, the Company is not aware of any person or entity or group that beneficially owned more than 5% of the Common Stock as of that date.
The Company’s Board of Directors takes a long-term approach to generate shareholder value. Our longest-tenured directors, whose terms exceed 12 years, have overseen the growth of the Company from a modest financial institution serving Queens County, New York, to a financial services company with total consolidated assets of $53.6 billion at December 31, 2019 and with eight local divisions and 238 branches in Metro New York, New Jersey, Ohio, Florida, and Arizona. These long-serving outside directors continue to bring important experience and institutional knowledge to the Board regarding the Company and its operations, which is a valuable asset to the Company and its shareholders due to the complex nature of the issues that our Board faces in connection with its oversight of the Company. The imposition of director term limits would deprive the Company of directors whose tenure has given them an important perspective on the development and implementation of the Company’s historical operations and long-term growth strategies.
Our Board of Directors Adequately Considers Director Age and Tenure
Rather than adopting fixed term limits, the Board of Directors believes it is more beneficial to periodically review the Board’s effectiveness and composition to ensure that the skill mix of directors adequately matches the evolving nature of the Company’s business. The Board appreciates that an increasing number of shareholders view the age and tenure of directors, individually and as a group, as a relevant consideration in director elections. Our Nominating and Corporate Governance Committee, which is composed exclusively of independent directors with an average tenure of less than 10 years, oversees an annual evaluation process for the Board of Directors and its committees. That evaluation process includes consideration of director age and tenure. The Nominating and Corporate Governance Committee also reviews director age and tenure for purposes of director succession planning and as factors in determining whether Board members should be nominated for re-election.
As a result of these practices, and the Company’s growth, the Company has replenished its Board with new members who bring unique perspectives, including by adding five independent directors since 2007, reducing the average tenure for all independent directors to less than 14 years. Two of the longest-tenured Board members (over 20 years) are the Company’s Chief Executive Officer, Joseph R. Ficalora, and Chairman of the Board, Dominick Ciampa, both of whom the Board believes currently make invaluable contributions to the Board.
Conclusion
The Board believes that the proposal’s request to implement director term limits is unnecessary and counterproductive to the Board’s ability to nominate for shareholder approval the best candidates to lead the Company. The Board, therefore, recommends a vote AGAINST this proposal
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Beneficial Owner |
| Amount and Nature of Beneficial Ownership | Percent of Class | |||||||||||||||||
BlackRock, Inc. 55 East 52nd Street New York, NY 10055 | 52,352,569 | (1) | 11.3 | % | ||||||||||||||||
The Vanguard Group 100 Vanguard Boulevard Malvern, Pennsylvania 19355 | 40,800,185 | (2) | 8.79 | % | ||||||||||||||||
Barrow Hanley Mewhinney & Strauss, LLC 2200 Ross Avenue, 31st Floor Dallas, Texas 75201 | 29,554,926 | (3) | 6.37 | % |
(1) | Based solely on information filed in a Schedule 13G with the SEC on January 27, 2021. |
(2) | Based solely on information filed in a Schedule 13G/A with the SEC on February 11, 2021. |
(3) | Based solely on information filed in a Schedule 13G with the SEC on February 11, 2021. |
| ADDITIONAL INFORMATION
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Shareholder Proposals
To be considered for inclusion in the Company’s proxy statement and form of proxy relating to the annual meeting of shareholders to be held in 2021,2022, a shareholder proposal must be received by the Corporate Secretary of the Company, at the address set forth on page 2021 of this proxy statement, no later than December 25, 2020.17, 2021. If such annual meeting is held on a date more than 30 days from June 3, 2021,May 26, 2022, a shareholder proposal must be received within a reasonable time before the Company begins to print and mail its proxy solicitation materials for such annual meeting. Any such proposal will be subject to the proxy rules adopted by the SEC.
Proxy Access Nominations
Any shareholder (or group of no more than 20 shareholders) meeting the Company’s continuous ownership requirements set forth in our Bylaws who wishes to nominate a candidate or candidates for election for up to 20% of our Board and to require the Company to include such nominee(s) in our 2021 proxy statement, must submit such nomination and request by no earlier than November 25, 202017, 2021 nor later than December 25, 2020.17, 2021. The nomination and supporting materials must also comply with the requirements set forth in our By-laws for inclusion of director nominees in the proxy statement.
Notice of Business to be Conducted at an Annual Meeting
The Bylaws of the Company, a copy of which may be obtained from the Company, set forth the procedures by which a shareholder may properly bring business before a meeting of shareholders. Pursuant to the Bylaws, only business brought by, or at the direction of, the Board of Directors may be conducted at a special meeting. The Bylaws of the Company provide an advance notice procedure for a shareholder to properly bring business before an annual meeting. The shareholder must give written advance notice to the Corporate Secretary of the Company not less than 90 days before the date originally fixed for such meeting; provided, however, that in the event that less than 100 days'days’ notice or prior public disclosure of the date of the meeting is given or made to shareholders, notice by the shareholder, to be timely, must be received not later than the close of business on the tenth day following the date on which the Company’s notice to shareholders of the annual meeting date was mailed or such public disclosure was made.
Attendance at the Annual Meeting
The 20202021 Annual Meeting of Shareholders will be a virtual meeting conducted exclusively via live webcast at www.virtualshareholdermeeting.com/NYCB2020.NYCB2021. We are committed to ensuring that shareholders will be afforded the same rights and opportunities to participate as they would at an in-person meeting. You will be able to attend the meeting online, vote your shares electronically and submit questions during the meeting by visiting www.virtualshareholdermeeting.com/NYCB2020.NYCB2021. We will try to answer as many shareholder-submitted questions as time permits that comply with the meeting rules of conduct. However, we reserve the right to exclude questions that are not pertinent to meeting matters or that are otherwise inappropriate. If we receive substantially similar questions, we will group such questions together and provide a single response to avoid repetition.
To participate in the virtual meeting, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form. The meeting webcast will begin promptly at 10:00 a.m., Eastern Daylight Time. We encourage you to access the meeting prior to the start time. Online check-in will begin at 9:00 a.m., Eastern Daylight Time, and you should allow ample time for the check-in procedures. If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the Virtual Shareholder Meeting login page. Technical support will be available beginning at 9:30 a.m. Eastern Daylight Time on June 3, 2020May 26, 2021 and will remain available until the meeting has ended.
Other Matters Which May Properly Come Before the Annual Meeting
The Board of Directors knows of no business that will be presented for consideration at the Annual Meeting other than as stated in the Notice of Annual Meeting of Shareholders. If, however, other matters are properly brought before the Meeting, it is the intention of the members of the Proxy Committee to vote the shares represented thereby on such matters in accordance with their best judgment.
Whether or not you intend to be present at the Annual Meeting, you are urged to sign, date, and return your proxy card, or to vote via the Internet or by telephone, promptly. If you are then present and wish to vote your shares in person, your original proxy may be revoked by voting at the Annual Meeting.
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Online Delivery of Proxy and Other Materials
We have elected to take advantage of SEC rules that allow companies to furnish proxy materials to their shareholders on the Internet. We believe that these rules allow us to provide our shareholders with the information they need to vote at our Annual Meeting, while also reducing the costs of delivery and reducing the environmental impact of producing and distributing the related proxy materials.
Since April 24, 2020,16, 2021, the proxy materials for the 20202021 Annual Meeting (which include the 20192020 Annual Report to Shareholders) have been available at the following web site: www.proxyvote.com. Shareholders who wish to receive a printed copy of the proxy materials available on this web site may request copies in any of the following ways: (i) via the Internet, at www.proxyvote.com; (ii) by telephone, at 1-800-579-1639; or (iii) by sending an e-mail to sendmaterial@proxyvote.com. Shareholders who are not eligible to vote at the Annual Meeting may find our 20192020 Annual Report to Shareholders and the Notice of 20202021 Annual Meeting of Shareholders and Proxy Statement on the Investor Relations portion of our Company website, www.myNYCB.com.
We encourage all of our shareholders who have Internet access to receive future proxy materials online rather than through the U.S. mail delivery system. By electing to receive our materials electronically, you will be supporting our efforts to reduce expenses and thus add to shareholder value. Other benefits of this service include:
✓ | Receiving shareholder communications, including the Company’s annual report to shareholders and proxy statement, as soon as they are available, thus eliminating the need to wait for them to arrive by mail; |
✓ | Enjoying easier access to convenient online voting; and |
✓ | Eliminating bulky paper documents from your personal files. |
Householding of Proxy Statements and Annual Reports
The SEC has adopted rules that permit companies to mail a single proxy statement and a single annual report to two or more shareholders sharing the same address. This practice is known as “householding.” Householding provides greater convenience to shareholders and saves the Company money by reducing excess printing costs. You may have been identified as living at the same address as another Company shareholder. If this is the case, and unless the Company receives contrary instructions from you, we will continue to “household” your proxy statement and annual report for the reasons stated above.
If you are a shareholder or a beneficial owner at a shared address to which a single copy of both the proxy statement and the annual report has been delivered, and you would like to receive your own copy of this proxy statement and the annual report, you may obtain them electronically from the Investor Relations portion of our website, www.myNYCB.com, by selecting “SEC Documents”; by contacting the Investor Relations Department of the Company by phone (516-683-4420) or by e-mail (ir@myNYCB.com); or by writing to the Investor Relations Department of the Company and indicating that you are a shareholder at a shared address and would like an additional copy of each document.
If you are a recordholder and would like to receive a separate proxy statement or annual report in the future, please contact Computershare, Shareowner Services LLC eitherInc. by phone at (866) 293-6077, online at www.computershare.com/investor, or by mail at P.O. Box 30170, College Station, Texas 77842.505000, Louisville, KY, 40233-5000, or online at www.computershare.com/investor. If you are a beneficial owner and would like to receive a separate proxy statement or annual report in the future, please contact your broker, bank, or other nominee.
If, on the other hand, you are a shareholder of record sharing an address, and are receiving multiple copies of this proxy statement or the annual report, please contact Computershare Ltd. at the number or addresses listed above so that all shareholders at the shared address can request that only a single copy of each document be mailed to your address in the future. If you are the beneficial owner, but not the recordholder, of Company shares, and you wish to receive only one copy of the proxy statement and annual report in the future, you will need to contact your broker, bank, or other nominee so that all shareholders at the shared address can request that only a single copy of each document be mailed to your address in the future.
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ADDITIONAL INFORMATION | |
A copy of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019,2020, as filed with the SEC, accompanies this proxy statement. An additional copy will be furnished without charge to shareholders upon written request to New York Community Bancorp, Inc., Investor Relations Department, 615 Merrick Avenue, Westbury, New York 11590.
By Order of the Board of Directors,
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Westbury, New York April | R. Patrick Quinn Executive Vice President,
General Counsel and Corporate Secretary |
YOU ARE CORDIALLY INVITED TO ATTEND THE VIRTUAL ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED
TO PROMPTLY COMPLETE, SIGN, DATE, AND RETURN THE ACCOMPANYING PROXY CARD
IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR TO VOTE VIA THE INTERNET OR BY TELEPHONE.
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APPENDIX A | |
Discussion and Reconciliation of GAAP and non-GAAP
Financial Measures
While stockholders’ equity, return on stockholders’ equity and total assets are financial measures that are recorded in accordance with U.S. generally accepted accounting principles (“GAAP”), tangible stockholders’ equity, return on average tangible stockholders’ equity and tangible assets are not. Nevertheless, it is management’s belief that these non-GAAP measures should be disclosed to investors for the following reasons: (i) tangible stockholders’ equity is an important indication of the Company’s ability to grow organically and through business combinations, as well as its ability to pay dividends and to engage in various capital management strategies; and (ii) returns on average tangible assets and average tangible stockholders’ equity are among the profitability measures considered by current and prospective investors, both independent of, and in comparison with, the Company’s peers.
The following table provides information to reconcile to GAAP those non-GAAP financial metrics used by the Compensation Committee in the determination of awards under our short- and long-term incentive program as described in greater detail under the heading 20192020 Performance Metrics in the Compensation Discussion and Analysis.
Reconciliation of GAAP and non-GAAP Financial Measures
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(in thousands) | At or for the Twelve Months Ended December 31, 2020 | ||||
Total Stockholders’ Equity | $ | 6,841,644 | |||
Less: Goodwill | (2,426,379 | ) | |||
Preferred stock | (502,840 | ) | |||
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Tangible common stockholders’ equity | $ | 3,912,425 | |||
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Total Assets | $ | 56,306,120 | |||
Less: Goodwill | (2,426,379 | ) | |||
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Tangible assets | $ | 53,879,741 | |||
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Average Common Stockholders’ Equity | $ | 6,205,286 | |||
Less: Average goodwill | (2,426,379 | ) | |||
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Average tangible common stockholders’ equity | $ | 3,778,907 | |||
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Average Assets | $ | 54,109,037 | |||
Less: Average goodwill | (2,426,379 | ) | |||
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Average tangible assets | $ | 51,682,658 | |||
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Net Income | $ | 511,109 | |||
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Net income available to common shareholders | $ | 478,281 | |||
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GAAP Measures | |||||
Return on average assets | 0.94 | % | |||
Return on average common stockholders’ equity | 7.71 | ||||
Common stockholders’ equity to total assets | 11.26 | ||||
Non-GAAP Measures | |||||
Return on average tangible assets | 0.99 | % | |||
Return on average tangible common stockholders’ equity | 12.66 | ||||
Tangible common stockholders’ equity to tangible assets | 7.26 |
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NYCB
NEW YORK COMMUNITY BANCORP, INC.®
C/O COMPUTERSHARE
480 WASHINGTON BOULEVARD JERSEY CITY, NJ 07310
SCAN TO
VIEW MATERIALS & VOTE
VOTE BY INTERNET
Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above
If the shares you held at the record date were held through a Company benefit plan, the deadline for providing voting instructions via the Internet is 11:59 p.m. Eastern Daylight Time on May 20, 2021. For all others, the deadline for voting via the Internet is 11:59 p.m. Eastern Daylight Time on May 25, 2021. In either case, please be sure to have your proxy card in hand when you access the website, and follow the instructions provided to obtain your records and to create an electronic voting instruction form.
During The Meeting - Go to www.virtualshareholdermeeting.com/NYCB2021
You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.
VOTE BY PHONE - 1-800-690-6903
You may use any touch-tone phone to vote; just be sure to have your proxy card in hand when you call, and then follow the instructions provided. Please Note: If the shares you held at the record date were held through a Company benefit plan, the deadline for voting by phone is 11:59 p.m. Eastern Daylight Time on May 20, 2021. For all others, the deadline for voting by phone is 11:59 p.m. Eastern Daylight Time on May 25, 2021.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
D46085-P53161 KEEP THIS PORTION FOR YOUR RECORDS
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY
NEW YORK COMMUNITY BANCORP, INC.
The Board of Directors recommends you vote FOR the following:
1. Election of Directors For Against Abstain
Nominees:
1a. Thomas R. Cangemi
The Board of Directors recommends that you vote For Against Abstain
1b. Hanif “Wally” Dahya
AGAINST the following proposal:
1c. James J. O’Donovan 5. A shareholder proposal requesting board action to provide shareholders with the right to act by written consent.
The Board of Directors recommends that you vote FOR NOTE: If any other business is presented at the Annual Meeting, the following proposals: including whether or not to adjourn the meeting, this proxy will be voted by the proxies in their best judgment.
2. The ratification of the appointment of KPMG LLP as the independent registered public accounting firm of New York Community Bancorp, Inc. for the fiscal year ending December 31, 2021.
3. An advisory vote to approve compensation for our executive officers disclosed in the accompanying Proxy
Statement.
4. A proposal to amend the Amended and Restated
Certificate of Incorporation of the Company in order to phase out the classification of the board of directors and provide instead for the annual election of directors.
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give your full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.
Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
NEW YORK COMMUNITY BANCORP, INC. ANNUAL MEETING OF SHAREHOLDERS
Wednesday, May 26, 2021 10:00 a.m., Eastern Daylight Time
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice of Meeting and Proxy Statement and the Annual Report to Shareholders, including the 2020 OMNIBUS INCENTIVE PLAN
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(a)Form 10-K, are available at www.proxyvote.com.Purpose. D46086-P53161TheTHIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
REVOCABLE PROXY
NEW YORK COMMUNITY BANCORP, INC. ANNUAL MEETING OF SHAREHOLDERS
Wednesday, May 26, 2021 10:00 a.m., Eastern Daylight Time
Except for those shares of Common Stock of the Company held in the plans defined below, the undersigned hereby appoints the Proxy Committee of the Board of Directors of New York Community Bancorp, Inc. (the “Company”), with full power of substitution, to act as attorney and proxy for the undersigned, and to vote all shares of Common Stock of the Company which the undersigned is entitled to vote only at the Annual Meeting of Shareholders to be held on Wednesday, May 26, 2021, at 10:00 a.m., Eastern Daylight Time, virtually at www.virtualshareholdermeeting.com/NYCB2021, and at any and all adjournments thereof, as set forth on the reverse side. This proxy, when properly executed, will be voted in the manner directed herein. Except as set forth in the following paragraph, if no such direction is made, this proxy will be voted in accordance with the Board of Directors’ recommendations.
If you hold shares of Common Stock of the Company through the New York Community Bancorp, Inc. Employee Savings Plan (the “401(k) Plan”) or the New York Community Bancorp, Inc. Employee Stock Ownership Plan (collectively referred to as the “tax-qualified plans”), or you have been awarded shares of restricted stock under the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan has two principal purposes: (i) to assist with the objective of attracting and retaining outstandingindividualstoserveasofficers,directors,employeesandconsultantsand(ii)toincreaseshareholdervalue.ThePlanwill provideparticipants with incentivestoincreaseshareholdervaluebyofferingtheopportunitytoacquiresharesoftheCompany’scommon stock, receive monetary payments based on the value of such common stock, or receive other incentive compensation, on the terms that(the “Stock Plan”), this Planprovides.
(b)Effective Date. This Plan will become effective, and Awards may be only be granted under this Plan, on and after the Effective Date. ThisPlanwillterminateas provided in Section15.
(c)EffectonPriorPlan.OntheEffectiveDate, thePriorPlan will terminatesuchthatnonewawardsmaybegrantedunderthePriorPlan,althoughawardspreviouslygrantedunderthe PriorPlanandstilloutstandingwillcontinuetobesubjecttoproxy card covers alltermsandconditionsofthePriorPlan.
2.Definitions. CapitalizedtermsusedandnototherwisedefinedinthisPlanorinanyAwardagreement shares for which you havethefollowing meanings:
“Administrator” means the Board or the Committee; provided that, to the extent the Board or the Committee has delegated authority and responsibility as an Administrator of the Plan to one or more committees or officers of the Company as permitted by Section 3(b), the term “Administrator” shall also mean such committee(s) and/or officer(s).
“Affiliate”hasthemeaningascribedtosuchterminRule12b-2undertheExchangeAct.Notwithstandingtheforegoing, forpurposesofdeterminingthoseindividualstowhomanOptionoraStockAppreciationRightmaybegranted,theterm“Affiliate” meansanyentitythat,directlyorthroughoneormoreintermediaries,iscontrolledbyorisundercommoncontrolwith,theCompany withinthemeaningofCodeSections414(b)or(c);providedthat,inapplyingsuchprovisions,thephrase“atleast20percent”shallbe used in place of “at least 80 percent” each place it appearstherein.
“Award” means a grant of Options, Stock Appreciation Rights, Performance Shares, Performance Units, Stock, Restricted Stock, Restricted Stock Units, a Cash Incentive Award, or any other type of award permitted under this Plan.
“Board” means the Board of Directors of the Company.
“CashIncentiveAward” means the right to receive a cash paymentgive voting instructions to Pentegra Trust Company, the trustee for the tax-qualified plans and the Stock Plan (the “Trustee”). This proxy card, when properly executed and dated, will be voted by the Trustee as you direct. If you do not direct the Trustee how to vote the shares of Company Common Stock credited to the extent Performance Goals are achieved (or other requirements are met)plan account(s) by 11:59 p.m., as described in Section 10.
“Cause” means, with respect to a Participant,Eastern Daylight Time, on May 20, 2021, the occurrence of any one ofTrustee will vote the following, (i) the repeated failure or refusal of the Participant to follow the lawful directives of the Company or an Affiliate (except due to sickness, injury or disabilities), (ii) gross inattention to duty or any other willful, reckless or grossly negligent act (or omission to act) by the Participant, which,shares held in the good faith judgment of the Company, could result in a material injury to the Company or an Affiliate including but not limited to the repeated failure to follow the policies and procedures of the Company, or (iii) the commission by the Participant of a felony or other crime involving moral turpitude or the commission by the Participant of an act of financial dishonesty against the Company or an Affiliate.
“Change in Control” shall mean the occurrence of any of the following events:
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Notwithstanding the above and solely with respect to any Award that constitutes “deferred compensation” subject to Section 409A of the Code and that is payable on account of a Change in Control (including any installments or stream of payments that are accelerated on account of a Change in Control), a Change in Control shall occur only if such event also constitutes a “changetax-qualified plans in the ownership”, “change in effective control”, and/or a “change insame proportion as the ownershipvoting instructions it receives from other participants as of a substantial portionthat date and time. All shares of assets” of the Company as those terms are defined under Treasury Regulation §1.409A-3(i)(5), but only to the extent necessary to establish a time or form of payment that complies with Section 409A of the Code, without altering the definition of Change in Control for purposes of determining whether a Participant’s rights to such Award become vested or otherwise unconditional upon the Change in Control.
“Code” means the Internal Revenue Code of 1986, as amended. Any reference to a specific provision of the Code includes any successor provision and the regulations promulgated under such provision.
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“Committee”meanstheCompensationCommitteeoftheBoard,anysuccessorcommitteetheretoorsuchothercommittee of the Board that is designated by the Board with the same or similar authority. The Committee shall consist only of Non-Employee Directors(notfewerthantwo(2))whoalsoqualifyasOutsideDirectorstotheextentnecessaryforthePlantocomplywithRule16b-3 promulgated under the ExchangeAct.
“Company” means New York Community Bancorp, Inc., a Delaware corporation, or any successor thereto.
“Director” means a member of the Board.
“DividendEquivalentUnit” means the right to receive a payment, in cash or Shares, equal to the cash dividends or other cash distributions paid with respect to a Share.
“Effective Date” means the date of shareholder approval of the Plan
“ExchangeAct” means the Securities Exchange Act of 1934, as amended. Any reference to specific provision of the Exchange Act includes any successor provision and the regulations and rules promulgated under such provision.
“Fair Market Value” means, per Share on a particular date, (i) if the Shares are listed on a national securities exchange, the last sales price for such date on the national securities exchange on which the Stock is then traded, or if no sales of Stock occur on such date, then on the last preceding date on which there was a sale on such exchange; or (ii) if the Shares are not listed on a national securities exchange, but are traded in an over-the-counter market, the last sales price (or, if there is no last sales price reported, the average of the closing bid and asked prices) for the Shares on such date, or on the last preceding date on which there was a sale of Shares on that market; or (iii) if the Shares are neither listed on a national securities exchange nor traded in an over-the-counter market, the price determined by the Administrator, in its discretion. Notwithstanding the foregoing, in the case of the sale of Shares, the actual sale price shall be the Fair Market Value of such Shares.
“Good Reason” means the occurrence of any of the following events, without the Participant’s advance writtenconsent: (i) a material reduction in the Participant’s base salary, cash bonusopportunity or long-term incentive opportunity; (ii) amaterialadversechangeintheParticipant’sduties,responsibilities,authority,title,statusorreportingstructure;or (iii) a geographical relocation of the Participant’s principal office location by more than fifty (50) miles that materially increases the distance of the Participant’scommute.
“Non-EmployeeDirector” means a Director who is not also an employee of the Company or its Subsidiaries.
“Option” means the right to purchase Shares at a stated price for a specified period of time.
“Participant” means an individual selected by the Administrator to receive an Award.
“Performance Goals” means any objective or subjective goals the Administrator establishes with respect to an Award. Performance Goals may include, but are not limited to, the performance of the Company or any one or more of its Subsidiaries, Affiliates or other business units and may be established on an absolute or relative basis. Performance Goals may also relate to a Participant’s individual performance. The Administrator reserves the right to adjust Performance Goals, or modify the manner of measuring or evaluating a Performance Goal, for any reason the Administrator determines is appropriate, including but not limited to: (i) by excluding the effects of charges for reorganizing and restructuring; discontinued operations; asset write-downs; gains or losses on the disposition of a business; or mergers, acquisitions or dispositions; and extraordinary, unusual and/or non-recurring items of gain or loss; (ii) excluding the costs of litigation, claims, judgments or settlements; (iii) excluding the effects of changes laws or regulations affecting reported results, or changes in tax or accounting principles, regulations or law; and (iv) excluding any accruals of amounts related to payments under the Plan or any other compensation arrangement maintained by the Company or an Affiliate.
“PerformanceShares” means the right to receive Shares to the extent Performance Goals are achieved (or other requirements are met).
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“Performance Unit” means the right to receive a cash payment and/or Shares valued in relation to a unit that has a designateddollarvalueorthevalueofwhichisequaltotheFairMarketValueofoneormoreShares,totheextentPerformanceGoals are achieved (or other requirements aremet).
“Person” has the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, or any group of Persons acting in concert that would be considered “persons acting as a group” within the meaning of Treas. Reg. § 1.409A-3(i)(5).
“Plan” means this New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan, as it may be amended from time to time.
“Prior Plan” means the New York Community Bancorp, Inc. 2012 Stock Incentive Plan.
“Restricted Stock” means Shares that are subject to a risk of forfeiture or restrictions on transfer, or both a risk of forfeiture and restrictions on transfer, which may lapse upon the achievement or partial achievement of Performance Goals or upon the completion of a period of service, or both.
“RestrictedStockUnit” means the right to receive a Share or a cash payment the value of which is equal to the Fair Market Value of one Share
“Section16Participants” means Participants who are subject to the provisions of Section 16 of the Exchange Act.
“Share” means a share of Stock.
“Stock” means the Common Stock of the Company $.01 par value.
“StockAppreciationRight” or “SAR” means the right to receive a cash payment, and/or Shares with a Fair Market Value, equal to the appreciation of the Fair Market Value of a Share during a specified period of time.
“Subsidiary” means any corporation, limited liability company or other limited liability entity in an unbroken chain of entities beginning with the Company if each of the entities (other than the last entitiesheld in the chain) ownsStock Plan for which timely instructions are not received will be voted by the stock or equity interest possessing more than fifty percent (50%) ofTrustee as directed by the total combined voting power of all classes of stock or other equity interests in one of the other entities in the chain.
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(a)Company.Administration. PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE ORIn addition to the authority specifically granted to the Administrator in this Plan, the Administrator has fullVOTE VIA THE INTERNET OR BY TELEPHONEdiscretionaryauthoritytoadministerthisPlan,includingbutnotlimitedtotheauthorityto:(i)interprettheprovisionsofthisPlan or any agreement covering an Award; (ii) prescribe, amend and rescind rules and regulations relating to this Plan; (iii) correct any defect,supplyanyomission,orreconcileanyinconsistencyinthePlan,anyAwardoranyagreementcoveringanAwardinthemanner(Continued, and to the extent it deems desirable to carry this Plan or such Award into effect;be marked, dated, and (iv) make all other determinations necessary or advisablefortheadministrationofthisPlan.AllAdministratordeterminationsshallbemadeinthesolediscretionoftheAdministrator and are final and binding on all interestedparties.
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(b)Delegation to Other Committees or Officers. To the extent applicable law permits, the Board may delegate to another committeeoftheBoard,ortheCommitteemaydelegatetooneormoreofficersoftheCompany,anyoralloftheirrespectiveauthority and responsibility as an Administrator of the Plan; provided that no such delegation is permitted with respect to Stock-based Awards made to Section 16 Participants at the time any such delegated authority or responsibility is exercised unless the delegation is to another committee of the Board consisting entirely of Non-Employee Directors. If the Board or the Committee has made such a delegation, then all references to the Administrator in this Plan include such other committee or one or more officers to the extent of suchdelegation.
(c)No Liability; Indemnification. No member of the Board or the Committee, and no officer or member of any other committee to whom a delegation under Section 3(b) has been made, will be liable for any act done, or determination made, by the individualingoodfaithwithrespecttothePlanoranyAward.TheCompanywillindemnifyandholdharmlesseachsuchindividualas toanyactsoromissions,ordeterminationsmade,ineachcasedoneormadeingoodfaith,withrespecttothisPlanoranyAwardtothe maximum extent that the law and the Company’s By-Lawspermit.
Eligibility; Certain Award Limits.
(a)Eligibility. The Administrator may designate any of the following as a Participant from time to time, to the extent of the Administrator’s authority: any officer or other employee of the Company or its Affiliates; any individual that the Company or an Affiliate has engaged to become an officer or employee; any consultant or advisor who provides services to the Company or its Affiliates; or any Director, including a Non-Employee Director. The Administrator’s designation of, or granting of an Award to, a ParticipantwillnotrequiretheAdministratortodesignatesuchindividualasaParticipantorgrantanAwardtosuchindividualatany futuretime.TheAdministrator’sgrantingofaparticulartypeofAwardtoaParticipantwillnotrequiretheAdministratortograntany other type of Award to suchindividual.
(b)Non-Employee Director AwardLimits.SubjecttoadjustmentasprovidedinSection17,noParticipant who is a Non-Employee Director maybegrantedAwardsthat could result in suchParticipant receiving Awards with a Fair Market Value in excess of $350,000 in respect of any fiscal year of the Company.
4.Types of Awards. Subject to the terms of this Plan, the Administrator may grant any type of Award to any Participant it selects,butonlyemployeesoftheCompanyoraSubsidiarymayreceivegrantsofincentivestockoptionswithinthemeaningofCode Section 422. Awards may be granted alone or in addition to, in tandem with, or (subject to the prohibition on repricing set forth in Section 15(e)) in substitution for any other Award (or any other award granted under another plan of the Company or any Affiliate, including the plan of an acquiredentity).
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(a)Plan Reserve. Subject to adjustment as provided in Section 17, an aggregate of twelve million (12,000,000)Shares,plusthenumberofSharesavailableforissuanceunderthePriorPlanthathadnotbeenmadesubjecttooutstanding awardsasoftheEffectiveDate (but not to exceed 150,000 Shares),plusthenumberofSharesdescribedinSection6(c),arereservedforissuanceunderthisPlan,ofwhich twelve million (12,000,000) Shares may be issued pursuant to the exercise of incentive stock options. The Shares reserved for issuance may be either authorized and unissued Shares or Shares reacquired at any time and now or hereafter held as treasurystock.
(b)ReductionandRecyclingofSharesunder thePlan.
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After the Effective Date, if any Shares subject to awards granted under the Prior Plan again become available for new grants under the terms of such plan if such plan were still in effect (taking into account such Prior Plan’s provisions concerning termination or expiration, if any), then those Shares will be available for the purpose of granting Awards under this Plan, thereby increasing the number of Shares available for issuance under this Plan as determined under the first sentence of Section 6(a) (but not in excess of 250,000 shares in each 12-month period beginningsigned on the Effective Date); provided that no Shares subject to awards granted under the Prior Plan shall be available for purposes of granting Awards under this Plan to the extent they are (i) Shares purchased by the Company using proceeds from Option exercises, (ii) Shares tendered or withheld in payment of the exercise price of an Option or as a result of the net settlement of an outstanding Stock Appreciation Right, or (iii) Shares tendered or withheld to satisfy federal, state or local tax withholding obligations. Any such Shares will not be available for future awards under the terms of the Prior Plan.
6.Options. Subject to the terms of this Plan, the Administrator will determine all terms and conditions of each Option, includingbutnotlimitedto:(a)whethertheOptionisan“incentivestockoption”whichmeetstherequirementsofCodeSection422, ora“nonqualifiedstockoption”whichdoesnotmeettherequirementsofCodeSection422;(b)thegrantdate,whichmaynotbeany daypriortothedatethattheAdministratorapprovesthegrant;(c)thenumberofSharessubjecttotheOption;(d)theexerciseprice, which may never be less than the Fair Market Value of the Shares subject to the Option as determined on the date of grant; (e) the terms and conditions of vesting and exercise; (f) the term, except that an Option must terminate no later than ten (10) years after the dateofgrant;and(g)themannerofpaymentoftheexerciseprice.Inallotherrespects,thetermsofanyincentivestockoptionshould comply with the provisions of Code Section 422 except to the extent the Administrator determines otherwise. If an Option that is intended to be an incentive stock option fails to meet the requirements thereof, the Option shall automatically be treated as a nonqualifiedstockoptiontotheextentofsuchfailure.TotheextentpermittedbytheAdministrator,andsubjecttosuchproceduresas theAdministratormayspecify,thepaymentoftheexercisepriceofOptionsmaybemadeby(w)deliveryofcashorotherSharesor othersecuritiesoftheCompany(includingbyattestation)havingathenFairMarketValueequaltothepurchasepriceofsuchShares, (x)bydelivery(includingbyfax)totheCompanyoritsdesignatedagentofanexecutedirrevocableoptionexerciseformtogetherwith irrevocable instructions to a broker-dealer to sell or margin a sufficient portion of the Shares and deliver the sale or margin loan proceedsdirectlytotheCompanytopayfortheexerciseprice,(y)bysurrenderingtherighttoreceiveSharesotherwisedeliverableto theParticipantuponexerciseoftheAwardhavingaFairMarketValueatthetimeofexerciseequaltothetotalexerciseprice,or(z)by any combination of (w), (x) and/or (y). Except to the extent otherwise set forth in an Award agreement, a Participant shall have no rights as a holder of Stock as a result of the grant of an Option until the Option is exercised, the exercise price and applicable withholding taxes are paid and the Shares subject to the Option are issuedthereunder.reverse side)
7.StockAppreciationRights.SubjecttothetermsofthisPlan,theAdministratorwilldeterminealltermsandconditionsof each SAR, including but not limited to: (a) the grant date, which may not be any day prior to the date that the Administrator approves thegrant;(b)thenumberofSharestowhichtheSARrelates;(c)thegrantprice,whichmayneverbelessthantheFairMarketValueof the Shares subject to the SAR as determined on the date of grant; (d) the terms and conditions of exercise or maturity, including vesting;(e)theterm,providedthatanSARmustterminatenolaterthanten(10)yearsafterthedateofgrant;and(f)whethertheSAR will be settled in cash, Shares or a combinationthereof.
8.Performance and Stock Awards. Subject to the terms of this Plan, the Administrator will determine all terms and conditionsofeachawardofShares,RestrictedStock,RestrictedStockUnits,PerformanceSharesorPerformanceUnits,includingbut not limited to: (a) the number of Shares and/or units to which such Award relates; (b) whether, as a condition for the Participant to realize all or a portion of the benefit provided under the Award, one or more Performance Goals must be achieved during such period as the Administrator specifies; (c) the length of the vesting and/or performance period and, if different, the date on which payment of thebenefitprovidedundertheAwardwillbemade;(d)withrespecttoPerformanceUnits,whethertomeasurethevalueofeachunitin relationtoadesignateddollarvalueortheFairMarketValueofoneormoreShares;and(e)withrespecttoRestrictedStockUnitsand Performance Units, whether to settle such Awards in cash, in Shares (including Restricted Stock), or in a combination of cash and Shares.
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9.CashIncentiveAwards.SubjecttothetermsofthisPlan,theAdministratorwilldeterminealltermsandconditionsofa CashIncentiveAward,includingbutnotlimitedtothePerformanceGoals,performanceperiod,thepotentialamountpayable,andthe timing ofpayment.
10.DividendEquivalentUnits.SubjecttothetermsofthisPlan,theAdministratorwilldeterminealltermsandconditionsof eachawardofDividendEquivalentUnits,includingbutnotlimitedtowhether:(a)suchAwardwillbegrantedintandemwithanother Award; (b) payment of the Award will be made concurrently with dividend payments or credited to an account for the Participant which provides for the deferral of such amounts until a stated time; (c) the Award will be settled in cash or Shares; and (d) as a conditionfortheParticipanttorealizealloraportionofthebenefitprovidedundertheAward,oneormorePerformanceGoalsmustbe achievedduringsuchperiodastheAdministratorspecifies;providedthatDividendEquivalentUnitsmaynotbegrantedinconnection with an Option or Stock Appreciation Right.
OtherStock-BasedAwards. SubjecttothetermsofthisPlan,theAdministratormaygranttoaParticipantsharesof unrestrictedStockasreplacementforothercompensationtowhichtheParticipantisentitled,suchasinpaymentofdirectorfees,in lieuofcash compensation, inexchangeforcancellationofacompensationright,orasabonus.
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(a)Minimum Vesting Period. All Awards granted under the Plan shall have a minimum vesting period of one year from the date of grant, provided that such minimum vesting period will not apply to Awards with respect to up to 5% of the total number of SharesreservedpursuanttoSection6(a).
(b)Discretion to Accelerate. Notwithstanding Section 13(a), the Administrator may accelerate the vesting of an Award or deem an Award to be earned, in whole or in part, in the event of a Participant’s death or disability (as defined by the Administrator in an Award Agreement),orasprovidedinSection17(c).
12.Transferability. Awards are not transferable, including to any financial institution, other than by will or the laws of descent and distribution, unless and to the extent the Administrator allows a Participant to: (a) designate in writing a beneficiary to exercisetheAwardorreceivepaymentundertheAwardaftertheParticipant’sdeath;(b)transferanAwardtotheformerspouseofthe Participant as required by a domestic relations order incident to a divorce; or (c) transfer an Award; provided, however, that with respecttoclause(c)abovetheParticipantmaynotreceiveconsiderationforsuchatransferofanAward.
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(a)Term of Plan. Unless the Board earlier terminates this Plan pursuant to Section 15(b), this Plan will terminate upon the tenth anniversary of the Effective Date. Notwithstanding the foregoing, the authority of the Board and the Administrator underthisSection15andtootherwiseadministerthePlanwithrespecttothen-outstandingAwardswillextendbeyondthedateofthis Plan’s termination. In addition, termination of this Plan will not affect the rights of Participants with respect to Awards previously grantedtothem,andallunexpiredAwardswillcontinueinforceandeffectafterterminationofthisPlanexceptastheymaylapseorbe terminated by their own terms andconditions.
(b)TerminationandAmendment.TheBoardortheAdministratormayamend,alter,suspend,discontinueorterminatethis Plan at any time, subject to the followinglimitations:
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(d)Repricing and Backdating Prohibited. Notwithstanding anything in this Plan to the contrary, and except for the adjustmentsprovidedforinSection18,neithertheAdministratornoranyotherpersonmay(i)amendthetermsofoutstandingOptions or SARs to reduce the exercise or grant price of such outstanding Options or SARs; (ii) cancel outstanding Options or SARs in exchange for Options or SARs with an exercise or grant price that is less than the exercise or grant price of the original Options or SARs; or (iii) cancel outstanding Options or SARs with an exercise or grant price above the current Fair Market Value of a Share in exchangeforcashorothersecurities.Inaddition,theAdministratormaynotmakeagrantofanOptionorSARwithagrantdatethatis effective prior to the date the Administrator takes action to approve suchAward.
(a)Withholding. In the event the Company or one of its Affiliates is required to withhold any Federal, state or local taxes or otheramountsinrespectofanyincomerecognizedbyaParticipantasaresultofthegrant,vesting,paymentorsettlementofanAward ordispositionofanySharesacquiredunderanAward,theCompanymaysatisfysuchobligationby:
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(b)No Guarantee of Tax Treatment. Notwithstanding any provisions of this Plan to the contrary, the Company does not guarantee to any Participant or any other Person with an interest in an Award that (i) any Award intended to be exempt from Code Section409Ashallbesoexempt,(ii)anyAwardintendedtocomplywithCodeSection409AorCodeSection422shallsocomply,or (iii) any Award shall otherwise receive a specific tax treatment under any other applicable tax law, nor in any such case will the CompanyoranyAffiliateberequiredtoindemnify,defendorholdharmlessanyindividualwithrespecttothetaxconsequencesofany Award.
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(a)Adjustment of Shares. If (i) the Company shall at any time be involved in a merger or other transaction in which the Shares are changed or exchanged; (ii) the Company shall subdivide or combine the Shares or the Company shall declare a dividend payable in Shares, other securities (other than stock purchase rights issued pursuant to a shareholder rights agreement) or other property; (iii) the Company shall effect a cash dividend the amount of which, on a per Share basis, exceeds ten percent (10%) of the FairMarketValueofaShareatthetimethedividendisdeclared,ortheCompanyshalleffectanyotherdividendorotherdistribution on the Shares in the form of cash, or a repurchase of Shares, that the Board determines by resolution is special or extraordinary in nature or that is in connection with a transaction that the Company characterizes publicly as a recapitalization or reorganization involving the Shares; or (iv) any other event shall occur, which, in the case of this clause (iv), in the judgment of the Administrator necessitatesanadjustmenttopreventdilutionorenlargementofthebenefitsorpotentialbenefitsintendedtobemadeavailableunder this Plan, then the Administrator shall, in such manner as it may deem equitable to prevent dilution or enlargement of the benefits or potentialbenefitsintendedtobemadeavailableunderthisPlan,adjustanyorallof:(A)thenumberandtypeofSharessubjecttothis Plan (including the number and type of Shares described in Sections 6(a), (b) and (c)) and which may after the event be made the subject of Awards; (B) the number and type of Shares subject to outstanding Awards; (C) the grant, purchase, or exercise price with respect to any Award; and (D) the Performance Goals of an Award. In any such case, the Administrator may also (or in lieu of the foregoing)makeprovisionforacashpaymenttotheholderofanoutstandingAwardinexchangeforthecancellationofalloraportion of the Award (without the consent of the holder of an Award) in an amount determined by the Administrator effective at such time as the Administrator specifies (which may be the time such transaction or event is effective). However, in each case, with respect to Awards of incentive stock options, no such adjustment may be authorized to the extent that such authority would cause this Plan to violateCodeSection422(b).Further,thenumberofSharessubjecttoanyAwardpayableordenominatedinSharesmustalwaysbea wholenumber.Inanyevent,previouslygrantedOptionsorSARsaresubjecttoonlysuchadjustmentsasarenecessarytomaintainthe relative proportionate interest the Options and SARs represented immediately prior to any such event and to preserve, without exceeding, the value of such Options orSARs.
Without limitation, in the event of any reorganization, merger, consolidation, combination or other similar corporate transaction or event, whether or not constituting a Change in Control (other than any such transaction in which the Company is the continuing corporation and in which the outstanding Stock is not being converted into or exchanged for different securities, cash or other property, or any combination thereof), the Administrator may substitute, on an equitable basis as the Administrator determines, for each Share then subject to an Award and the Shares subject to this Plan (if the Plan will continue in effect), the number and kind of shares of stock, other securities, cash or other property to which holders of Stock are or will be entitled in respect of each Share pursuant to the transaction.
Notwithstanding the foregoing, in the case of a stock dividend (other than a stock dividend declared in lieu of an ordinary cash dividend) or subdivision or combination of the Shares (including a reverse stock split), if no action is taken by the Administrator, adjustments contemplated by this subsection that are proportionate shall nevertheless automatically be made as of the date of such stock dividend or subdivision or combination of the Shares.
(b)Issuance or Assumption. Notwithstanding any other provision of this Plan, and without affecting the number of Shares otherwise reserved or available under this Plan, in connection with any merger, consolidation, acquisition of property or stock, or reorganization,theAdministratormayauthorizetheissuanceorassumptionof
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awardsunderthisPlanuponsuchtermsandconditions as it may deemappropriate.
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(a)OtherTermsandConditions.TheAdministratormayprovideinanyAwardagreementsuchotherprovisions(whetheror not applicable to the Award granted to any other Participant) as the Administrator determines appropriate to the extent not otherwise prohibited by the terms of the Plan. No provision in an Award agreement shall limit the Administrator’s discretion hereunder unless such provision specifically so provides for suchlimitation.
(b)EmploymentandService.TheissuanceofanAwardshallnotconferuponaParticipantanyrightwithrespectto continuedemploymentorservicewiththeCompanyoranyAffiliate,ortherighttocontinueasaDirector.Unlessdetermined otherwisebytheAdministrator,forpurposesofthePlanandallAwards,thefollowingrulesshallapply:
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Notwithstanding the foregoing, for purposes of an Award that is subject to Code Section 409A, if a Participant’s termination of employment or service triggers the payment of compensation under such Award, then the Participant will be deemed to have terminated employment or service upon his or her “separation from service” within the meaning of Code Section 409A. Notwithstanding any other provision in this Plan or an Award to the contrary, if any Participant is a “specified employee” within the meaning of Code Section 409A as of the date of his or her “separation from service” within the meaning of Code Section 409A, then, to the extent required by Code Section 409A, any payment made to the Participant on account of such separation from service shall not be made before a date that is six months after the date of the separation from service.
(c)No Fractional Shares. No fractional Shares or other securities may be issued or delivered pursuant to this
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Plan. Unless otherwisedeterminedbytheAdministratororotherwiseprovidedinanyAwardagreement,allfractionalSharesthatwouldotherwise be issuable under the Plan shall be canceled for noconsideration.
(d)Unfunded Plan; Awards Not Includable for Benefits Purposes. This Plan is unfunded and does not create, and should not be construed to create, a trust or separate fund with respect to this Plan’s benefits. This Plan does not establish any fiduciary relationshipbetweentheCompanyandanyParticipantorotherperson.TotheextentanypersonholdsanyrightsbyvirtueofanAward grantedunderthisPlan,suchrightsarenogreaterthantherightsoftheCompany’sgeneralunsecuredcreditors.Incomerecognizedby a Participant pursuant to an Award shall not be included in the determination of benefits under any employee pension benefit plan (as suchtermisdefinedinSection3(2)oftheEmployeeRetirementIncomeSecurityActof1974,asamended)orgroupinsuranceorother benefitplansapplicabletotheParticipantwhicharemaintainedbytheCompanyoranyAffiliate,exceptasmaybeprovidedunderthe terms of such plans or determined by resolution of theBoard.
(e)RequirementsofLawandSecuritiesExchange.ThegrantingofAwardsandtheissuanceofSharesinconnectionwithan Award are subject to all applicable laws, rules and regulations and to such approvals by any governmental agencies or national securities exchanges as may be required. Notwithstanding any other provision of this Plan or any award agreement, the Company has no liability to deliver any Shares under this Plan or make any payment unless such delivery or payment would comply with all applicable laws and the applicable requirements of any securities exchange or similar entity, and unless and until the Participant has taken all actions required by the Company in connection therewith. The Company may impose such restrictions on any Shares issued under the Plan as the Company determines necessary or desirable to comply with all applicable laws, rules and regulations or the requirements of any national securitiesexchanges.
(f)Code Section 409A. Any Award granted under this Plan shall be provided or made in such manner and at such time as to either make the Award exempt from, or comply with, the provisions of Code Section 409A, to avoid a plan failure described in Code Section409(a)(1),andtheprovisionsofCodeSection409AareincorporatedintothisPlantotheextentnecessaryforanyAwardthatis subject to Code Section 409A to complytherewith.
(g)GoverningLaw;Venue.ThisPlan,andallagreementsunderthisPlan,willbeconstruedinaccordancewithandgoverned bythelawsoftheStateofDelaware,withoutreferencetoanyconflictoflawprinciples.Anylegalactionorproceedingwithrespectto thisPlan,anyAwardoranyawardagreement,orforrecognitionandenforcementofanyjudgmentinrespectofthisPlan,anyAward or any award agreement, may only be brought and determined in a court sitting in the State of New York and anypartytosuchactionorproceedingshallagreetowaiveitsrighttoajurytrial.
(h)LimitationsonActions.AnylegalactionorproceedingwithrespecttothisPlan,anyAwardoranyawardagreement,must bebroughtwithinoneyear(365days)afterthedaythecomplainingpartyfirstkneworshouldhaveknownoftheeventsgivingriseto thecomplaint.
(i)Construction.Wheneveranywordsareusedhereininthemasculine,theyshallbeconstruedasthoughtheywereusedin thefeminineinallcaseswheretheywouldsoapply;andwhereveranywordsareusedinthesingularorplural,theyshallbeconstrued asthoughtheywereusedinthepluralorsingular,asthecasemaybe,inallcaseswheretheywouldsoapply.Titlesofsectionsarefor generalinformationonly,andthisPlanisnottobeconstruedwithreferencetosuchtitles.
(j)Severability. If any provision of this Plan or any award agreement or any Award (i) is or becomes or is deemed to be invalid,illegalorunenforceableinanyjurisdiction,orastoanypersonorAward,or(ii)wouldcausethisPlan,anyawardagreementor anyAwardtoviolateorbedisqualifiedunderanylawtheAdministratordeemsapplicable,thensuchprovisionshouldbeconstruedor deemedamendedtoconformtoapplicablelaws,orifitcannotbesoconstruedordeemedamendedwithout,inthedeterminationofthe Administrator,materiallyalteringtheintentofthisPlan,awardagreementorAward,thensuchprovisionshouldbestrickenastosuch jurisdiction, person or Award, and the remainder of this Plan, such award agreement and such Award will remain in full force and effect.
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