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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
of the Securities Exchange Act of 1934
| Filed by the Registrant | þ | |
| Filed by a Party other than the Registrant | o |
Check the appropriate box:
| o | Preliminary Proxy Statement | |
| o | Confidential, for Use of the Commission only (as permitted by Rule 14a-6(e)(2)) | |
| þ | Definitive Proxy Statement | |
| o | Definitive Additional Materials | |
| o | Soliciting Material Pursuant to § 240.14a-12 |
Benjamin Franklin Bancorp, Inc.
(Name of Registrant as Specified In Its Charter)
Not Applicable
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
| þ | No fee required. | |
| o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| (1) | Title of each class of securities to which transaction applies: | ||
| (2) | Aggregate number of securities to which transaction applies: | ||
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | ||
| (4) | Proposed maximum aggregate value of transaction: | ||
| (5) | Total fee paid: |
| o | Fee paid previously with preliminary materials. | |
| o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. |
| (1) | Amount previously paid: | ||
| (2) | Form, Schedule or Registration Statement no.: | ||
| (3) | Filing Party: | ||
| (4) | Date Filed: |
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April 11, 2007
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of Benjamin Franklin Bancorp, Inc. to be held on Thursday, May 10, 2007 at 10:00 a.m., local time, at Lake Pearl Luciano’s, 299 Creek Street, Wrentham, Massachusetts 02093.
At the Annual Meeting, you will be asked to consider and vote upon the election of a class of four directors and the ratification of Wolf & Company, P.C. as our independent registered public accounting firm for our current fiscal year. The Board of Directors has fixed the close of business on March 20, 2007 as the record date for determining stockholders entitled to notice of and to vote at the Annual Meeting.
The officers and directors look forward to greeting you personally at the Annual Meeting. However, whether or not you plan to attend personally and regardless of the number of shares you own, it is important that your shares be represented.
You are urged to sign, date and return the enclosed proxy promptly in the postage-paid envelope provided for your convenience.
| Sincerely, | ||||
 | ||||
| Thomas R. Venables, | ||||
| President and Chief Executive Officer |
58 Main Street, Franklin, Massachusetts 02038
1-508-528-7000
www.benfranklinbank.com
1-508-528-7000
www.benfranklinbank.com
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BENJAMIN FRANKLIN BANCORP, INC.
58 Main Street
Franklin, Massachusetts 02038
58 Main Street
Franklin, Massachusetts 02038
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 10, 2007
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the “Annual Meeting”) of Benjamin Franklin Bancorp, Inc., a Massachusetts bank holding company (the “Company”), will be held at Lake Pearl Luciano’s, 299 Creek Street, Wrentham, Massachusetts , on Thursday, May 10, 2007, beginning at 10:00 a.m., local time, for the following purposes:
| 1. | To elect a class of four directors; | ||
| 2. | To ratify the appointment of Wolf & Company, P.C. as Benjamin Franklin Bancorp, Inc.’s independent registered public accounting firm for the current fiscal year ending December 31, 2007; and | ||
| 3. | To transact such further business as may properly come before the Annual Meeting, or any adjournment or postponement thereof. |
The Board of Directors recommends that you vote FOR the nominees for Director listed in the accompanying proxy statement and FOR the ratification of Wolf & Company, P.C. as our independent registered public accounting firm for the fiscal year ending December 31, 2007.
The Board of Directors has fixed the close of business on March 20, 2007 as the record date for determining the stockholders of the Company entitled to notice of and to vote at the Annual Meeting and any adjournments thereof. Accordingly, only stockholders of record on such date are entitled to notice of and to vote at the Annual Meeting or any adjournments thereof.
| By Order of the Board of Directors | ||||
 | ||||
| Anne M. King, | ||||
| Secretary | ||||
| Franklin, Massachusetts | ||||
| April 11, 2007 |
IMPORTANT
Even though you may plan to attend the Annual Meeting in person, please complete, sign, and date the enclosed proxy card and return it promptly in the enclosed envelope, which requires no postage if mailed in the United States. If you attend the Annual Meeting and desire to withdraw your proxy and vote in person, you may do so.
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BENJAMIN FRANKLIN BANCORP, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To be held on Thursday, May 10, 2007
ANNUAL MEETING OF STOCKHOLDERS
To be held on Thursday, May 10, 2007
We are providing you with this Proxy Statement and the enclosed form of proxy in connection with the solicitation of proxies by the Board of Directors of Benjamin Franklin Bancorp, Inc. to be used at our Annual Meeting of Stockholders and at any adjournment or adjournments of the meeting. The Annual Meeting will be held at Lake Pearl Luciano’s, 299 Creek Street, Wrentham, Massachusetts 02093, on May 10, 2007, beginning at 10:00 a.m., local time.
Our executive offices are located at 58 Main Street, Franklin, Massachusetts 02038 and our telephone number is (508) 528-7000. We are sending this Proxy Statement and the enclosed form of proxy to stockholders on or about April 11, 2007.
Record Date and Outstanding Shares
The Board of Directors has fixed the close of business on March 20, 2007 as the record date for the Annual Meeting. Only stockholders of record as of the close of business on the record date will be entitled to notice of, and to vote at, the Annual Meeting and any adjournments of the meeting. As of the record date, there were 8,468,137 shares of our common stock, no par value, issued, outstanding and entitled to vote. Each of our stockholders will be entitled to one vote for each share of common stock held of record by that stockholder.
Solicitation and Revocation
Proxies in the form enclosed are solicited by and on behalf of the Board. The persons named in the proxy have been designated as proxies by the Board. Any proxy given in response to this solicitation and received in time for the Annual Meeting will be voted as specified in the proxy. If no instructions are given, proxies will be voted
“FOR”the election of the nominees listed below under “Election of Directors,” and
“FOR”the ratification of Wolf & Company, P.C. as our independent registered public accounting firm for the fiscal year ending December 31, 2007,
and in the discretion of the proxies named on the proxy card with respect to any other matters properly brought before the meeting and any adjournments of the meeting. If any other matters are properly presented at the Annual Meeting for action, the persons named in the proxy will vote the proxies in accordance with their best judgment. You may revoke any proxy given in response to this solicitation at any time before the proxy is exercised by delivering written notification to our Secretary (58 Main Street, P.O. Box 309, Franklin, Massachusetts 02038-0309), by voting in person at the Annual Meeting, or by signing and delivering another proxy bearing a later date. Your attendance at the Annual Meeting does not alone serve to revoke your proxy.
Quorum and Voting
The presence, in person or by proxy, of at least a majority of the shares of common stock issued, outstanding and entitled to vote at the Annual Meeting will constitute a quorum for transaction of business at the Annual Meeting. The affirmative vote of the holders of a plurality of the common stock present and
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voting, in person or by proxy, is required to elect each of the nominees for director. The affirmative vote of a majority of the common stock present and voting, in person or by proxy, is required to ratify the selection of Wolf & Company, P.C. as our independent registered public accounting firm for the fiscal year ending December 31, 2007. Any abstentions or “non-votes” will count as “present” toward formation of a quorum for transaction of business at the Annual Meeting. A non-vote occurs when a stockholder votes on one proposal, but does not vote on another proposal (for example, because the shares are held by a broker who does not have discretionary voting power on a particular matter and has not received instructions from the beneficial owner). Assuming the presence of a quorum, abstentions and non-votes will have no effect on the outcome of the election of directors or the ratification of Wolf & Company, P.C. as our independent registered public accounting firm. Votes will be tabulated by our transfer agent, American Stock Transfer & Trust Company.
ANNUAL REPORT TO STOCKHOLDERS; OTHER INFORMATION
The Company’s Annual Report to Stockholders for the fiscal year ended December 31, 2006 accompanies this Proxy Statement, but is not incorporated herein and is not to be deemed a part hereof.
The Annual Report to Stockholders includes the Company’s Annual Report onForm 10-K for the year ended December 31, 2006, as filed with the Securities and Exchange Commission (excluding exhibits). Additional copies of the Company’s Annual Report onForm 10-K (excluding exhibits) are available without charge upon request. Such requests should be directed to Shareholder Relations, Benjamin Franklin Bancorp, Inc., 58 Main Street, P.O. Box 309, Franklin, Massachusetts 02038-0309.
PROPOSAL 1 — ELECTION OF DIRECTORS
Our Board of Directors currently consists of 16 members and is divided into three classes, with one class of directors elected each year. Directors serve for three-year terms. Mr. Fuller and Mr. Mann are retiring from the Board of Directors effective at the Annual Meeting, and our Board of Directors has voted to reduce the size of the Board to 14 members effective upon their retirement.
Pursuant to Nasdaq rules, our Governance Committee, consisting of seven independent directors of our Board, has nominated William F. Brady, Jr., Donald P. Quinn, Thomas R. Venables and Alfred H. Wahlers as directors for a three-year term. Each of the nominees is currently serving as a director of the Company.
Unless otherwise specified in the form of proxy, the proxies solicited by management will be votedFORthe election of the four nominees, to hold office until the 2010 annual meeting of stockholders or special meeting in lieu thereof and until their respective successors are elected and qualified. If you submit a proxy that withholds authority to vote for one or more nominees for director, your instructions will be followed.
We have no reason to believe that any of the nominees will not be able to serve. In the event that any nominee is unable to serve at the time of the election, the shares represented by the proxy will be voted for the other nominees and may be voted for a substitute for that nominee.
The Board of Directors recommends that you vote FOR the election of the four nominees for director listed in this proxy statement.
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INFORMATION REGARDING DIRECTORS
Biographical Information regarding Directors and Nominees
The following table sets forth certain information (as of March 31, 2007) regarding our directors, including those whose terms continue beyond the Annual Meeting, those who are retiring, and the nominees for election at the Annual Meeting:
| Name | Age | Date Elected | Term Expires | |||
| Dr. Mary Ambler | 74 | 1977 (4) | 2008 | |||
| William P. Bissonnette | 61 | 1997 (4) | 2009 | |||
| Richard E. Bolton, Jr | 48 | 2005 (5) | 2008 | |||
| William F. Brady, Jr., D.D.S. (1) | 74 | 1985 (4) | 2007 | |||
| Paul E. Capasso | 50 | 2005 (5) | 2009 | |||
| John C. Fuller (2) | 74 | 1998 (4) | 2007 | |||
| Jonathan A. Haynes | 51 | 2005 (5) | 2009 | |||
| Anne M. King | 77 | 1997 (4) | 2009 | |||
| Richard D. Mann (2) | 71 | 1967 (4) | 2007 | |||
| Daniel F. O’Brien | 51 | 2005 (5) | 2008 | |||
| Charles F. Oteri | 61 | 1984 (4) | 2008 | |||
| Donald P. Quinn (1) | 69 | 2005 (5) | 2007 | |||
| Dr. Neil E. Todreas | 71 | 2005 (5) | 2009 | |||
| Thomas R. Venables (1)(3) | 51 | 2002 (4) | 2008 | |||
| Alfred H. Wahlers (1) | 73 | 1973 (4) | 2007 | |||
| Charles Yergatian | 78 | 1980 (4) | 2009 |
| (1) | Nominee for election at Annual Meeting | |
| (2) | Mr. Fuller and Mr. Mann are retiring from the Board of Directors effective at the Annual Meeting. The Board of Directors has voted to reduce the size of the Board to 14 members effective upon their retirement. | |
| (3) | Mr. Venables has been nominated for reelection to a three-year term, notwithstanding that his current term does not expire until the 2008 annual meeting, in order to balance the three classes of directors. | |
| (4) | Includes (where applicable) service as trustee of Benjamin Franklin Bank prior to its reorganization into the mutual holding company form of organization and as a trustee of Benjamin Franklin Bancorp, M.H.C. from the date of the mutual holding company reorganization until our conversion from a mutual to a stock holding company. | |
| (5) | Served as a director of Chart Bank and became a director upon the merger of Chart Bank with Benjamin Franklin Bank in April 2005, pursuant to the terms of the merger agreement. |
The principal occupation and business experience during at least the last five years for each director and nominee is set forth below.
Dr. Mary Ambleris a retired physician and a Professor Emeritus of Brown University.
William P. Bissonnetteis a certified public accountant and a partner in the firm of Little & Bissonnette, CPAs. Mr. Bissonnette’s firm does not perform accounting services for Benjamin Franklin Bancorp or Benjamin Franklin Bank.
Richard E. Bolton, Jr.served as the President and Chief Executive Officer of Chart Bank from 1995 until its merger with Benjamin Franklin Bank in April 2005. Since July 2005, Mr. Bolton has served as President of Vitek Extrusion, a manufacturer of extruded aluminum products headquartered in Franklin, New
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Hampshire. Mr. Bolton also serves as a director of Creative Strategic Solutions, Inc. (“CSSI”), our ATM cash supply and management subsidiary.
William F. Brady, Jr., D.D.S.is a retired dentist.
Paul E. Capassois the President of Capasso Realty Corporation located in Newton, Massachusetts, a real estate investment company engaged in building, developing, owning and managing real estate, particularly apartment and office buildings.
John C. Fulleris retired. He was formerly a Vice President and member of the Board of Directors of the Foxboro Company of Foxborough, Massachusetts, a supplier of instruments, systems, and services for industrial process automation.
Jonathan A. Haynesis the President of Haynes Management, Inc., a real estate management firm located in Wellesley Hills, Massachusetts, and President of D.M. Bernardi, Inc., a general contracting firm located in Wellesley Hills, Massachusetts. Mr. Haynes is also the manager of numerous limited liability companies and trusts that own and lease parcels of commercial real estate.
Anne M. Kingis a retired journalist. Mrs. King serves as Secretary of Benjamin Franklin Bancorp and Clerk of Benjamin Franklin Bank, although she is not an employee of either entity.
Richard D. Mannis an owner, director and president of Buckley & Mann, Inc., a textile manufacturer located in Norfolk, Massachusetts. He also serves as a member of the Board of Directors of Clark-Cutler-McDermott Co. of Franklin, Massachusetts and of Draper Knitting Co. of Canton, Massachusetts.
Daniel F. O’Brienis a certified public accountant and owner and president of O’Brien, Riley and Ryan, a CPA firm located in Boston. Mr. O’Brien is also the manager of State Street Wealthcare Advisors, LLC, a financial services company, and State Street Consulting, LLC, a computer services consulting firm. Mr. O’Brien is also a practicing attorney. Mr. O’Brien’s firm does not perform accounting or legal services for Benjamin Franklin Bancorp or Benjamin Franklin Bank.
Charles F. Oteri,a funeral director, is the chief executive officer and treasurer of Oteri Funeral Home in Franklin, Massachusetts.
Donald P. Quinnis an attorney in private practice in Plymouth, Massachusetts. He was formerly a partner concentrating in commercial business and real estate matters at Goodwin ProcterLLP, a law firm located in Boston. Mr. Quinn does not perform legal services for Benjamin Franklin Bancorp or Benjamin Franklin Bank.
Dr. Neil E. Todreasis Professor Emeritus at Massachusetts Institute of Technology. He also provides consulting services through his company, Energy Technology Applications, Inc. Dr. Todreas also serves as a director of CSSI, our ATM cash supply and management subsidiary.
Thomas R. Venableshas served as President and Chief Executive Officer of Benjamin Franklin Bancorp and Benjamin Franklin Bank since 2002. Prior to 2002, Mr. Venables co-founded Lighthouse Bank of Waltham, Massachusetts in 1999 and served as its President and Chief Executive Officer. From 1998 to 1999, Mr. Venables was employed as a consultant with Marsh and McLennan Capital, Inc. He was employed by Grove Bank of Newton, Massachusetts from 1974 until it was acquired by Citizens Bank in 1997, serving as its President and Chief Executive Officer for the last 11 years of his tenure. Mr. Venables also serves as a director of CSSI, our ATM cash supply and management subsidiary. Mr. Venables serves on the Board of Trustees of the Ironwood Isabelle Small Company Stock (formerly ICM/Isabelle Small Cap Value Fund), a mutual fund which is registered as an investment company under the Investment Company Act of 1940.
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Alfred H. Wahlersis the Chairman of the Board of Benjamin Franklin Bancorp and Benjamin Franklin Bank. Mr. Wahlers is a retired insurance executive.
Charles Yergatianis a retired residential real estate developer. Mr. Yergatian also serves as a director of CSSI, our ATM cash supply and management subsidiary.
Committees of the Board of Directors
The Board of Directors of Benjamin Franklin Bancorp currently has four standing Board Committees: the Executive Committee, the Audit and Risk Management Committee, the Compensation Committee and the Governance Committee. The Board of Directors may, by resolution, designate one or more additional committees. If you would like information about the independence of our directors and committee members and about the meetings of our Board of Directors and its committees, see “Corporate Governance—Board and Committee Independence” and “—Board, Committee and Stockholder Meetings” in this proxy statement.
The following committee descriptions set forth the current members of each of Benjamin Franklin Bancorp’s existing Board committee.
Executive Committee
The Executive Committee consists of eight members of the Board. The current members of the Executive Committee are William F. Brady, Jr., William P. Bissonnette, Richard E. Bolton, Jr., Jonathan A. Haynes, Paul E. Capasso, Thomas R. Venables, Alfred H. Wahlers and Charles Yergatian, with Dr. Brady serving as Chair. The Executive Committee meets semi-monthly to review ongoing activities and performance of the Bank. The Committee approves loan originations that exceed certain internal limitations, and reviews other loans originations, the monthly asset/liability report and monthly financial reports.
Audit and Risk Management Committee
The Audit and Risk Management Committee (“Audit Committee”) consists of six independent members of the Board. The current members of the Audit Committee are Charles F. Oteri, Mary Ambler, John C. Fuller, Anne M. King, Daniel F. O’Brien and Donald P. Quinn, with Mr. Oteri serving as Chair. The Audit and Risk Management Committee, which operates under a written charter, oversees the independent auditor relationship, the internal audit, risk management and compliance functions. For a copy of the report of the Audit Committee, see “Audit and Risk Management Committee Report” in this proxy statement. A current copy of the charter of the Audit Committee is available on our website atwww.benfranklinbank.comunder the section entitled “About Us—Board of Directors—Corporate Governance.”
Compensation Committee
The Compensation Committee consists of six independent members of the Board. The current members of the Compensation Committee are William P. Bissonnette, John C. Fuller, Richard D. Mann, Daniel F. O’Brien, Donald P. Quinn and Alfred H. Wahlers, with Mr. Bissonnette serving as Chair. The Compensation Committee, which operates under a written charter, oversees executive officer and director compensation and certain employee benefit plans. The Compensation Committee also administers the Benjamin Franklin Bancorp, Inc. 2006 Stock Incentive Plan. For a copy of the report of the Compensation Committee, see “Compensation Discussion and Analysis—Compensation Committee Report” in this proxy statement. A current copy of the charter of the Governance Committee is available on our website atwww.benfranklinbank.comunder the section entitled “About Us—Board of Directors—Corporate Governance.”
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Governance Committee
The Governance Committee consists of seven independent members of the Board. The Governance Committee’s current members are Neil E. Todreas, Mary Ambler, William F. Brady, Jr., Anne M. King, Charles F. Oteri, Jonathan A. Haynes and Alfred H. Wahlers, with Dr. Todreas serving as Chair. The Governance Committee, which operates under a written charter, is responsible for identifying and selecting director nominees and considering factors relevant to such selection. The Governance Committee is also responsible for addressing other governance issues, such as evaluating from time to time the size and composition of the Board and its committees and overseeing the periodic evaluation of the performance of the Board and its members. A current copy of the charter of the Governance Committee is available on our website atwww.benfranklinbank.comunder the section entitled “About Us—Board of Directors—Corporate Governance.”
Compensation of Directors
Retainer and Meeting Fees.During 2006, members of the Benjamin Franklin Bank Board of Directors received an annual retainer of $10,000 for their service on the Board. The Chairman of the Board, the Chairmen of each of the four standing Board committees, and the Clerk received an additional annual retainer of $2,000. In addition, Board members and Executive Committee members received $500 per Board or Executive Committee meeting attended. Members of the Audit and Risk Management Committee, Governance Committee and Compensation Committee do not currently receive per meeting fees for committee meetings attended, but instead receive annual retainers of $8,000, $3,000 and $3,000, respectively. Three of our non-officer directors also receive a $3,000 annual retainer for serving on the Board of Directors of Benjamin Franklin Bank’s subsidiary, Creative Strategic Solutions, Inc.
Members of the Board who are employees of Benjamin Franklin Bank or Benjamin Franklin Bancorp do not receive these fees. Generally, Benjamin Franklin Bancorp’s Board of Directors meets immediately prior to or after a Benjamin Franklin Bank Board meeting. In such instances, directors do not receive additional fees for attendance at meetings of Benjamin Franklin Bancorp’s Board. Otherwise, the directors of Benjamin Franklin Bancorp receive the same fees they receive for attendance at a Benjamin Franklin Bank Board meeting.
Director Fee Continuation Plan. Benjamin Franklin Bancorp has established a director fee continuation plan that provides certain benefits to all eligible non-employee members of the Boards of Directors of Benjamin Franklin Bank and Benjamin Franklin Bancorp upon retirement. A director is eligible to receive these benefits (provided that the director was not terminated for cause) if the director has served as a director for three years or more with Benjamin Franklin Bank or Benjamin Franklin Bancorp. Service with a corporate predecessor, such as Chart Bank, is not included in determining whether this three-year service requirement has been met.
Under the director fee continuation plan, a director who has served on the Board or as clerk for at least 15 years (10 years for those who have attained age 70) is entitled to receive an annual payment, commencing upon termination of service and payable for five years, equal to the average total yearly fees for services as a director paid by Benjamin Franklin Bancorp or Benjamin Franklin Bank to the director for the three calendar years preceding the year of the director’s retirement. Service with a corporate predecessor, such as Chart Bank, is included in determining the amount of the normal retirement benefit. Eligible directors who retire prior to attaining the full 15 (or 10) years of service are entitled to receive a reduced retirement benefit, based upon the director’s number of years of service, payable annually for five years following termination of service.
If an eligible director’s service is terminated or if the director is not proposed for reelection within three years following a “change in control,” as defined in the director fee continuation plan, the director is entitled to receive a full normal retirement benefit (as if he had served as a director for 15 years) as a lump sum upon termination of service. An eligible director who becomes disabled prior to age 70 is also entitled to
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receive the normal retirement benefit, payable in equal installments over five years and commencing upon termination of service. In addition, upon the death of an eligible director prior to termination of service, the director’s beneficiary is entitled to receive a normal retirement benefit, and upon the death of an eligible director after retirement, the director’s beneficiary is entitled to receive the remainder of any benefit payments to which the director is entitled, with each such benefit payable annually and commencing upon the death of the director.
Stock Options and Restricted Stock Awards. On July 28, 2006, following approval of the Company’s 2006 Stock Incentive Plan by the Company’s stockholders, the Company granted 4,133 shares of restricted stock and 6,767 options to each of its non-employee directors. The options and restricted stock awards vest over a five year period from the date of grant, subject to accelerated vesting upon a change in control of the Company, or upon termination of service on the Board due to death, disability or retirement at the mandatory retirement age set forth in the Company’s by-laws.
The table below shows the compensation paid to non-employee directors of the Company by the Company and by Benjamin Franklin Bank and its subsidiary, CSSI, during 2006:
| Change in | ||||||||||||||||||||||||
| Fees | Pension Value | |||||||||||||||||||||||
| Earned or | and Nonqualified | |||||||||||||||||||||||
| Paid in | Stock | Option | Deferred | All Other | ||||||||||||||||||||
| Cash | Awards | Awards | Compensation | Compensation | Total | |||||||||||||||||||
| Name | ($) | ($)(1) | ($)(1) | Earnings (2) | ($)(3) | ($) | ||||||||||||||||||
| Dr. Mary Ambler | $ | 28,270 | $ | 4,805 | $ | 2,177 | $ | 27,046 | $ | 289 | $ | 62,587 | ||||||||||||
| William P. Bissonnette | 34,000 | 4,805 | 2,177 | 9,586 | 289 | 50,857 | ||||||||||||||||||
| Richard E. Bolton, Jr. | 31,500 | 4,805 | 2,177 | — | 56,289 | 94,771 | ||||||||||||||||||
| William F. Brady, Jr. | 35,000 | 4,805 | 2,177 | 32,348 | 289 | 74,619 | ||||||||||||||||||
| Paul E. Capasso | 24,625 | 4,805 | 2,177 | — | 289 | 31,896 | ||||||||||||||||||
| John C. Fuller | 24,250 | 4,805 | 2,177 | 21,823 | 289 | 53,344 | ||||||||||||||||||
| Jonathan A. Haynes | 32,000 | 4,805 | 2,177 | — | 289 | 39,271 | ||||||||||||||||||
| Anne M. King | 30,000 | 4,805 | 2,177 | 23,851 | 289 | 61,122 | ||||||||||||||||||
| Richard D. Mann | 19,500 | 4,805 | 2,177 | 18,966 | 289 | 45,737 | ||||||||||||||||||
| Daniel F. O’Brien | 26,875 | 4,805 | 2,177 | — | 289 | 34,146 | ||||||||||||||||||
| Charles F. Oteri | 30,000 | 4,805 | 2,177 | 14,463 | 289 | 51,734 | ||||||||||||||||||
| Donald P. Quinn | 28,000 | 4,805 | 2,177 | — | 289 | 35,271 | ||||||||||||||||||
| Dr. Neil E. Todreas | 23,000 | 4,805 | 2,177 | — | 289 | 30,271 | ||||||||||||||||||
| Alfred H. Wahlers | 35,375 | 4,805 | 2,177 | 34,895 | 289 | 77,541 | ||||||||||||||||||
| Charles Yergatian | 32,000 | 4,805 | 2,177 | 27,806 | 289 | 67,077 | ||||||||||||||||||
| (1) | The amounts in the Stock Awards and Option Awards columns represent the compensation costs of the grant on July 28, 2006 to each director of 4,133 shares of restricted stock and 6,767 options, as reflected in the Company’s financial statements, excluding the impact of estimated forfeitures. Both the restricted stock and the options vest over a five year period. No director awards were forfeited during the year. The assumptions used in the valuation of such awards can be found in Note 17, “Stock Compensation Plans” in the Notes to Consolidated Financial Statements filed as part of the Company’s 2006 Annual Report on Form 10-K. The full grant date fair value of the restricted stock awards computed in accordance with FAS 123R was $57,655 per director, or $864,830 in the aggregate, and the full grant date fair value of the option awards was $26,121 per director, or $391,809 in the aggregate. | |
| (2) | Represents the increase in the present value of the accrued benefit under the Director Fee Continuation Plan between December 31, 2005 and December 31, 2006. | |
| (3) | Includes dividends paid on unvested restricted stock awards. For Mr. Bolton, also includes a payment to Mr. Bolton in 2006 under the consulting and non-competition agreement that the Company entered into with him in connection with its acquisition of Chart Bank. Mr. Bolton was the President and Chief Executive Officer of Chart Bank. |
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INFORMATION REGARDING EXECUTIVE OFFICERS
Biographical Information regarding Executive Officers
The names, ages as of March 31, 2007, and positions of each of our executive officers (other than Thomas R. Venables, who is included in the description of directors above), are set forth below.
| Name | Age | Position | ||||
| Claire S. Bean | 54 | Executive Vice President/Chief Financial Officer, Benjamin Franklin Bank; Treasurer and Chief Financial Officer, Benjamin Franklin Bancorp | ||||
| Mariane E. Broadhurst | 50 | Senior Vice President/Retail Banking, Benjamin Franklin Bank | ||||
| Rose M. Buckley | 39 | Senior Vice President/Senior Lending Officer, Benjamin Franklin Bank | ||||
| Michael J. Piemonte | 53 | Senior Vice President/Risk Management and Compliance, Benjamin Franklin Bank | ||||
| Brian E. Ledwith | 38 | Vice President/Senior Retail Lending Officer, Benjamin Franklin Bank | ||||
| Kathleen P. Sawyer | 50 | Vice President/Human Resources, Benjamin Franklin Bank | ||||
Claire S. Beanhas served as Executive Vice President/Chief Financial Officer of Benjamin Franklin Bank since July 2004. She also serves as a director of CSSI, our ATM cash supply and management subsidiary. Prior to her employment with Benjamin Franklin Bank, Ms. Bean served as Banking Advisor in the Capital Markets Group of FINCA International, Inc. and later as Regional Director of FINCA for Eastern Europe and NIS. From May 2002 to June 2003, Ms. Bean served as Director of Economic Development in Kyrgyzstan for Mercy Corps, and from June 2003 to September 2003, she served as Manager of Micro-enterprise and Economic Development for the same organization. In addition, from 1999 to 2001, Ms. Bean served as Chief Operating Officer and Chief Financial Officer of Lighthouse Bank of Waltham, Massachusetts. From 1991 to 1997, Ms. Bean served as Executive Vice President/Treasurer of Grove Bank of Chestnut Hill, Massachusetts.
Mariane E. Broadhursthas served as Senior Vice President/Retail Banking of Benjamin Franklin Bank since April, 2003. Ms. Broadhurst joined the Bank in August 1992 as a Branch Manager. She was promoted to Assistant Vice President/Branch Administrator in December 1997 and in April 2002 was promoted to Vice President of Retail Banking. Prior to her employment with Benjamin Franklin Bank, Ms. Broadhurst was employed as an Assistant Treasurer/Branch Sales Manager of Heritage Bank in Worcester, Massachusetts, beginning in 1988.
Rose M. Buckleywas named Senior Vice President/Senior Lending Officer of Benjamin Franklin Bank in January 2006. From April 2003 through December 2005 she served as Senior Vice President/Senior Commercial Lending Officer. She joined the Bank in 1984 as a commercial loan officer. She was promoted to Assistant Vice President/Commercial Lending in April 1997 and to Vice President/Commercial Lending in April 1998.
Michael J. Piemontehas served as Senior Vice President/Risk Management and Compliance of Benjamin Franklin Bank since December 2003. He joined Benjamin Franklin Bank in March 1998 as Assistant Vice President/Auditor/Compliance and Loan Review Officer in the Internal Audit Department. He became Assistant Vice President/Compliance Officer in the Compliance Department in July 2001 and became Vice President/Risk Management and Compliance in December 2001.
Brian E. Ledwithhas served as Vice President/Senior Retail Lending Officer of Benjamin Franklin Bank since September 2004. He joined the Bank in February 2004 as Vice President/Commercial Lending.
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Prior to his employment with Benjamin Franklin Bank, Mr. Ledwith served as Vice President/Senior Loan Officer of Medway Cooperative Bank of Medway, Massachusetts. From 2000 to 2002, Mr. Ledwith served as Vice President of the Commercial Lending Department of Strata Bank in Franklin, Massachusetts. In addition, from 1998 to April 2000, Mr. Ledwith served as Vice President of Commercial Banking of Rockland Trust in Brockton, Massachusetts.
Kathleen P. Sawyerhas served as Vice President/Human Resources of Benjamin Franklin Bank since April, 2003. Ms. Sawyer served as a Human Resources Officer of Benjamin Franklin Bank from 1996 to 2000, and as Assistant Vice President/Human Resources from 2000 to 2003.
All executive officers of the Company hold office until the first meeting of the Board of Directors following the annual meeting of stockholders or special meeting in lieu thereof and until their successors are chosen and qualified, unless a shorter term is specified in the vote appointing them. Officers may generally be removed from office by vote of a majority of the full Board of Directors.
Compensation Discussion and Analysis
Oversight of the Executive Compensation Program. The Compensation Committee of the Board of Directors (the “Committee”), which is comprised solely of non-employee, independent directors, is responsible for administering the compensation programs for our executive officers, including our principal executive officer (“CEO”), principal financial officer (“CFO”) and our three other most highly-compensated executive officers (collectively “named executive officers” or “NEOs”) in 2006. The Compensation Committee also oversees the compensation program for non-employee directors. The Committee, which operates under a written charter, consists of six (6) independent members of the Board. The current members are William P. Bissonnette, John C. Fuller, Richard D. Mann, Daniel F. O’Brien, Donald P. Quinn, and Alfred H. Wahlers, with Mr. Bissonnette serving as Chair.
The Committee, with guidance from outside consultants, set forth several objectives for its oversight of the Company’s executive compensation programs, including:
| • | Establish the strategic vision for the executive compensation program; | ||
| • | Analyze competitive total compensation levels for senior executives; | ||
| • | Assess the relationship of pay and performance; | ||
| • | Review the non-employee director total compensation program; and | ||
| • | Assess competitive practices pertaining to executive benefits and perquisites. |
The Committee retained the services of the following independent consultants for advice and counsel regarding executive and director compensation during 2006:
| • | Mercer Human Resources Consulting (“Mercer”), for counsel regarding all matters related to executive and non-employee director compensation. | ||
| • | Luse Gorman Pomerenk & Schick, P.C., a Washington based law firm, to advise the Committee in initial allocation of stock-based awards for a newly public stock company that had recently converted from the mutual form of corporate organization. | ||
| • | Clark Consulting, specializing in the administration of SERPs and Bank Owned Life Insurance (BOLI). |
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Compensation Philosophy and Objectives. The primary goal of the Company’s executive compensation program is to attract, retain, and motivate the executive officer talent necessary to achieving our operating and strategic objectives. Our program is designed to align our executives’ interests with those of our shareholders, with the ultimate goal of improving long-term shareholder value.
Underlying our compensation decisions is a pay-for-performance philosophy. Our compensation program is designed to reward the individual achievements of our executive officers and the Company’s overall financial performance. In carrying out our compensation program, we are guided by the following principles and objectives:
| • | Variable compensation is favored as a means of motivating and rewarding executive officer talent; and | ||
| • | Retention of valuable executives is promoted through long-term incentives that allow them to share in our growth and increases in shareholder returns. |
Elements of the Executive Compensation Program.The Committee uses a total compensation approach in establishing executive compensation, the elements of which include: (i)base salary, (ii) an annual discretionarybonusthat is based on both the Bank’s performance and on individual achievements during the past fiscal year, (iii)long-term equity-based compensation, including stock options and restricted stock awards, and (iv)benefits, including qualified and non-qualified retirement plans, medical plans, life and disability insurance, use of company owned automobile, and employment and change in control agreements.
A significant portion of executive compensation opportunities is provided through variable compensation plans and policies (e.g., long-term incentives and annual bonuses). These plans and policies are generally designed such that the executive receives value when the Company’s financial objectives are achieved and long-term shareholder value is enhanced.
The key elements of our executive compensation program are described in the table below:
| Pay Element | What the Pay Element Rewards | Purpose of the Pay Element | How Determined | |||
Base Salary | • Skills, knowledge and competencies required to fulfill the responsibilities of the position • Annual base salary adjustments reflect an executive’s performance or changed responsibilities | • Primary component of the compensation program, which together with the annual bonus constitutes the short-term compensation | • Position and level of responsibility • Results of performance reviews • Review of peer group data • Review of broader banking surveys | |||
Annual Bonus | • Excellent individual and Company performance in prior fiscal year | • Recognize executives’ individual achievements and Company performance in prior fiscal year • Motivate excellent performance in future years | • Position and level of responsibility • Discretion of the Compensation Committee • Results of performance reviews • Review of peer group data • Review of broader banking surveys |
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| Pay Element | What the Pay Element Rewards | Purpose of the Pay Element | How Determined | |||
Long-Term Equity Incentives (Stock Options and Restricted Stock) | • Long-term effective management decision-making • Sustained stock price appreciation (thereby aligning executives’ interests with those of shareholders) • Continued employment with the Company during the vesting period | • Provide an opportunity for officers, directors and employees to acquire a proprietary interest in the Company • Create a strong link between the interests of executives and shareholders • Retain valuable executives over time | • Reviewed (with expert consultant) data of other institutions that had recently converted from mutual to stock form • Position and level of responsibility within the Company | |||
Retirement Benefits | • Long-term service with the Company (all retirement programs) • Sustained stock price appreciation (thereby aligning executives’ interests with those of shareholders) (ESOP) • Continued employment with the Company during the vesting period (SERP) | 401(k) • Provides a tax-deferred retirement plan to eligible employees including executive officers, subject to IRS limitations ESOP• Enables participants to acquire additional ownership interest in the Company, while increasing retirement benefits • Encourages efforts to strengthen shareholder value | • Based on compensation level, subject to IRS limitations • Based on compensation level, subject to IRS limitations | |||
| Supplemental Executive Retirement Plan (SERP) (For CEO and CFO) • Provides the security of 20-year supplemental retirement income, with vesting increasing over time to 100% after 10 years of service • Ensures competitiveness of retirement program with similarly situated institutions | • Position and level of responsibility within the Company • Review of similarly situated institutions | |||||
| Benefit Enhancement Plan (BEP) • Provides the security of a retirement benefit alternative for amounts exceeding IRS limitations on qualified programs | • Position and level of responsibility within the Company • Review of similarly situated institutions | |||||
Benefits Generally Available to All Employees | • Executives participate in employee benefit plans generally available to our employees, including medical, dental, vision, life insurance, short-term and long-term disability • Continuation of benefits may occur as part of severance upon certain terminations of employment | • These benefits are part of our total compensation program for all employees | • Generally available to all employees |
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| Pay Element | What the Pay Element Rewards | Purpose of the Pay Element | How Determined | |||
Additional Benefits and Perquisites (CEO only: Company automobile) | • Active participation in management of geographically dispersed branch franchise and in community affairs | • The use of a company-owned automobile facilitates the CEO’s transportation to branch locations and as a representative in the community | • Position and level of responsibility within the Company • Travel requirements | |||
Employment Agreements, Change in Control Agreements | Employment Agreements • Continuity of executive leadership • Focusing on the best long term interests of the shareholders in the event that business conditions or external factors make consideration of a change of control appropriate • CEO and CFO only: 3-year employment agreements | Employment Agreements • Recruit and retain qualified executives • Ensure the continuity of executive leadership • Provides post-employment non-competition protection • Make explicit the terms and conditions of executive employment, including termination before or after a change in control | • Position and level of responsibility within the Company • Review of similarly situated financial institutions | |||
| Change in Control Agreements • Focusing on the best long term interests of the shareholders in the event that business conditions or external factors make consideration of a change of control appropriate • Other three NEOs and 3 other senior officers | • Allay concerns caused by executives’ perceived risks associated with change in control transaction Change in Control Agreements• Provide benefits to ease an employee’s transition due to a change-in control • Allay concerns caused by executives’ perceived risks associated with change in control transaction |
The Company’s Employment Agreements and Change in Control Agreements are described in detail in this proxy statement under “Information Regarding Executive Officers—Employment and Change in Control Agreements.” The Company’s Supplemental Executive Retirement Plan and Benefit Enhancement Plan are described in detail under “Information Regarding Executive Officers—Retirement Benefits.”
Factors Considered in Determining Compensation Levels.Annually, each member of the Board of Directors completes a CEO performance evaluation form, which was developed by the Compensation Committee with guidance from an outside consultant. The CEO’s performance is evaluated on key business objectives and leadership competencies such as (i) developing and executing the Company’s strategic plan and vision to create long-term shareholder value; (ii) operating the Company in a sound and prudent manner, consistent with regulatory requirements, legal and audit standards, and appropriate risk management standards remaining current on all relevant market conditions affecting the Company; (iii) exploring and developing new opportunities for the Company; (iv) providing leadership throughout the organization; and (v) representing the Company in the investment community and the Bank’s geographic communities.
The CEO completes an annual performance evaluation for the CFO and other NEOs, evaluating performance relative to the Company’s strategic goals and objectives as well as individual achievements and goals. Based upon the performance evaluation and a review of peer data, the CEO gives recommendations to the Committee regarding compensation for these individuals. The CEO does not participate in, and is not present at, any deliberations or approvals by the Compensation Committee with respect to his own compensation.
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In addition to the evaluation of individual performance, the Compensation Committee conducted a comparative analysis of each of the above compensation elements, comparing our executive compensation levels to a public peer group developed by Mercer, our outside consultant. The peer group includes the following institutions:
| Berkshire Hills Bancorp, Inc. | Massachusetts | |
| Century Bancorp, Inc. | Massachusetts | |
| Willow Financial Bancorp, Inc. | Pennsylvania | |
| Bancorp Rhode Island, Inc. | Rhode Island | |
| Royal Bancshares | Pennsylvania | |
| Peapack-Gladstone Financial Corporation | New Jersey | |
| Center Bancorp, Inc. | New Jersey | |
| Synergy Financial Group, Inc. | New Jersey | |
| Enterprise Bancorp, Inc. | Massachusetts | |
| United Financial Bancorp, Inc. | Massachusetts | |
| Greater Community Bancorp | New Jersey | |
| Massbank Corporation | Massachusetts | |
| Republic First Bancorp, Inc. | Pennsylvania | |
| Westfield Financial, Inc. | Massachusetts | |
| Legacy Bancorp, Inc. | Massachusetts | |
| Harleysville Savings Financial Corporation | Pennsylvania | |
| Bryn Mawr Bank Corporation | Pennsylvania |
The Compensation Committee determined that the peers in this group are appropriate for competitive compensation and financial performance analyses/comparisons as they have comparable industry orientation, size and regional marketplace. Total compensation levels were compared to peer group top five proxy officer total compensation levels. Additionally, the Compensation Committee reviewed executive officer compensation data contained in broader banking surveys to supplement the peer group data.
The Committee determined the appropriate allocation levels for stock options and restricted stock to our CEO, CFO and other NEOs after considerable discussion with and advice from an outside consultant specializing in stock incentive plans for companies recently converted from mutual to stock form. The allocations, which were based on position and level of responsibility within the Company, were considered to be conservative and in line with similarly situated financial institutions. The Committee also allocated awards below the senior executive officer level. The Committee also considered the fact that the adoption of the Company’s stock incentive plan, and the granting of options and restricted stock awards thereunder, was anticipated at the time of the Company’s conversion from mutual to stock form and related initial public offering, and was disclosed in the prospectus relating to that offering.
Compensation Committee Report.We have reviewed and discussed the foregoing Compensation Discussion and Analysis with management. Based on our review and discussion with management, we have recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and in our annual report on Form 10-K for the year ended December 31, 2006.
The Compensation Committee
William P. Bissonnette, Chair
John C. Fuller
Richard D. Mann
Daniel F. O’Brien
Donald P. Quinn
Alfred H. Wahlers
John C. Fuller
Richard D. Mann
Daniel F. O’Brien
Donald P. Quinn
Alfred H. Wahlers
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Summary Compensation Table
The following table sets forth certain information as to the compensation of our President and Chief Executive Officer, our Chief Financial Officer and our three other most highly compensated executive officers who were serving as executive officers at the end of 2006 and who received total annual compensation in excess of $100,000. Each of the individuals listed on the table below is referred to as a “named executive officer” or “NEO.” We do not have a non-equity incentive plan, so that column of the table has been omitted.
| Change in | ||||||||||||||||||||||||||||||||
| Pension Value | ||||||||||||||||||||||||||||||||
| and Nonquali- | ||||||||||||||||||||||||||||||||
| fied Deferred | All Other | |||||||||||||||||||||||||||||||
| Stock | Option | Compensation | Compen- | |||||||||||||||||||||||||||||
| Name and | Salary | Bonus | Awards | Awards | Earnings | sation | Total | |||||||||||||||||||||||||
| Principal Position | Year | ($) | ($)(1) | ($)(2) | ($)(2) | ($)(3) | ($)(4) | ($) | ||||||||||||||||||||||||
| Thomas R. Venables | 2006 | $ | 337,000 | $ | 85,000 | $ | 58,555 | $ | 34,155 | $ | 284,684 | $ | 26,510 | $ | 825,904 | |||||||||||||||||
| President and CEO | ||||||||||||||||||||||||||||||||
| Claire S. Bean | 2006 | 214,000 | 65,000 | 41,825 | 19,635 | 158,183 | 18,834 | 517,477 | ||||||||||||||||||||||||
| EVP/ CFO | ||||||||||||||||||||||||||||||||
| Rose M. Buckley | 2006 | 140,000 | 49,014 | 28,778 | 16,500 | — | 18,464 | 252,756 | ||||||||||||||||||||||||
| SVP/ Senior Lending Officer | ||||||||||||||||||||||||||||||||
| Mariane E. Broadhurst | 2006 | 130,000 | 20,800 | 28,778 | 13,750 | — | 13,108 | 206,436 | ||||||||||||||||||||||||
| SVP/ Retail Banking | ||||||||||||||||||||||||||||||||
| Michael J. Piemonte | 2006 | 94,500 | 18,900 | 7,583 | 1,980 | — | 11,193 | 134,156 | ||||||||||||||||||||||||
| SVP/ Risk Management/ Compliance | ||||||||||||||||||||||||||||||||
| (1) | Represents bonuses earned in 2006 but paid in 2007. | |
| (2) | The assumptions used in the valuation of awards reported in the Stock Awards and the Option Awards columns can be found in Note 17, “Stock Compensation Plans” in the Notes to Consolidated Financial Statements filed as part of the Company’s 2006 Annual Report on Form 10-K. | |
| (3) | Represents the accrued expense under the Supplemental Executive Retirement Plan. See Note 16, “Employee Benefit Plans” in the Notes to Consolidated Financial Statements filed as part of the Company’s 2006 Annual Report on Form 10-K. | |
| (4) | Includes 401(k) matching contributions; the value of allocations of Company common stock to the executives’ accounts under the employee stock ownership plan (based on the $16.30 closing price of the Company’s common stock on December 31, 2006); the value of excess life insurance; dividends paid on restricted stock awards; and, for Mr. Venables, the value of a Company-owned car. |
Employment and Change in Control Agreements
Employment Agreements.Benjamin Franklin Bancorp and Benjamin Franklin Bank have entered into employment agreements with their Chief Executive Officer, Mr. Venables, and Chief Financial Officer, Ms. Bean. The agreements provide for an annual base salary, subject to increase (which increased amount becomes a floor below which the officer’s base salary may not fall during the term of the agreement), and certain benefits. They also guarantee customary corporate indemnification and errors and omissions insurance coverage throughout the employment term and for six years after termination. The current base salary of each of Mr. Venables and Ms. Bean is $370,700 and $235,400, respectively.
The initial term of each agreement is three years, with the term automatically extended by one day for each day that the officer is employed by Benjamin Franklin Bancorp and Benjamin Franklin Bank, although the automatic extensions may be discontinued at any time by Benjamin Franklin Bancorp, Benjamin Franklin Bank or the officer. For a one-year period following termination of the officer’s employment, the officer must adhere to a non-competition restriction and refrain from soliciting employees or certain large commercial loan
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customers. Such provision is not operative after the occurrence of a change in control of Benjamin Franklin Bancorp.
In the event that the officer’s employment is terminated by Benjamin Franklin Bancorp or Benjamin Franklin Bank for other than “specially-defined cause,” or is terminated by the officer for “good reason,” each as defined below (including termination as a result of a change in control), the officer will be entitled to receive a lump sum severance benefit equal to three times the highest yearly compensation paid to the officer in the three fiscal years preceding the termination, plus certain other benefits. These benefits include: payment of a bonus for the year in which the officer’s employment is terminated (pro rata, based on the percentage of the then-current calendar year during which the officer was employed before termination of employment, multiplied by the highest bonus paid or accrued to the officer for the three calendar years preceding the termination of employment); continuation of disability and medical benefits for three years following termination; an adjustment to the officer’s benefits under qualified and non-qualified pension plans; and full acceleration of vesting under outstanding restricted stock awards and options (the vesting under the officer’s options and restricted stock awards would also accelerate in full upon termination of employment by reason of death or disability under the terms of the 2006 Stock Incentive Plan). If the officer’s employment is terminated following a change in control, the non-competition and nonsolicitation provisions described above would not apply.
Mr. Venables and Ms. Bean would also be entitled to receive an additional tax indemnification payment if payments under the employment agreements or any other payments triggered liability under Section 280G of the Internal Revenue Code for the excise tax on “excess parachute payments.” Under applicable law, the excise tax is triggered by change-in-control-related payments and benefits that equal or exceed three times the officer’s average annual compensation over the five calendar years preceding the change in control. The excise tax equals 20.0% of the amount of the payments and benefits in excess of one times the officer’s average compensation over the preceding five calendar year period. The indemnification payment would be an amount sufficient to compensate for the excise tax plus a “gross up” amount to compensate for the income tax imposed on the indemnification payment.
An officer will be deemed terminated for “specially-defined cause” only if he or she (i) has been convicted for the commission of a felony from which all final appeals have been taken, or (ii) has willfully and intentionally engaged in dishonest or gross misconduct in connection with the officer’s employment that results in material and demonstrable financial harm to the Company or its affiliates, and only after certain procedural requirements have been complied with.
An officer will be deemed to have resigned for “good reason” if he or she resigns after (i) the Board fails to continue the officer in the offices he or she holds (or, in the case of Mr. Venables, the stockholders fail to elect him to the Board of Directors); (ii) after the officer’s responsibilities have been significantly diminished; (iii) the Company or the bank materially breaches the employment agreement; (iv) the Board determines not to continue to extend the term of the employment agreement. In addition, after a change in control, “good reason” includes resignation after (v) a change in the officer’s principal place of employment away from the Company’s principal executive office or to a place that increases the officer’s commute by more than 10 miles; (vi) a reduction or termination of the officer’s benefits; (vii) a reasonable determination by the officer that he or she is unable to exercise the responsibilities he or she exercised prior to the change in control, or that his or her working conditions have materially worsened; or (viii) failure of a successor to assume and agree to perform the employment agreement.
If the officer’s employment terminates by reason of disability or death within a year after a change in control (or within a year after certain events preceding a change in control, if an actual change in control occurs within two years after termination of employment), the officer will receive benefits as if he or she terminated his or her employment for “good reason.”
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If the officer’s employment terminates by reason of disability prior to a change in control, the Company will continue to pay the officer his or her normal salary until the earlier of commencement of benefits under the Company’s long term disability insurance policy or 180 days from termination of employment. Thereafter, the Company will pay the officer 60% of his or her salary for the remaining term of the employment agreement, offset by benefits received by the officer under the Company’s long term disability insurance policy. In addition, the officer will continue to participate in the Company’s benefit plans (including medical benefits) for the remaining term of the employment agreement.
If the officer’s employment terminates by reason of death prior to a change in control, his or her beneficiaries will continue to receive payments of the officer’s salary and will continue to participate in the Company’s medical benefit plan for a period of six months following the officer’s death. In addition, the officer’s beneficiary will receive apro ratabonus payment, based on the percentage of the then-current calendar year during which the officer was employed prior to his or her death, multiplied by the highest bonus paid or accrued to the officer for the three calendar years preceding the officer’s death.
The following table quantifies the benefits that would have been payable under the employment agreements (and under the accelerated vesting provisions of the 2006 Stock Incentive Plan and the change-in control provisions of the employee stock ownership plan) if an event triggering such benefits had occurred as of December 31, 2006. If Mr. Venables or Ms. Bean had retired or voluntarily resigned as of December 31, 2006, no additional payments or benefits would have accrued or been paid to him or her under the employment agreements. Additional amounts payable upon termination of employment under the Company’s Supplemental Retirement Agreements are disclosed in the section of this proxy statement entitled “Information Regarding Executive Officers—Nonqualified Retirement Benefits.”
| Termination not for | ||||||||||||||||||||
| Specially-Defined Cause; | ||||||||||||||||||||
| Termin- | Resignation with Good | |||||||||||||||||||
| ation for | Reason | |||||||||||||||||||
| Specially- | Prior to a | After a | Termination | |||||||||||||||||
| Defined | Change in | Change in | Due to | |||||||||||||||||
| Cause | Control | Control | Disability | Death | ||||||||||||||||
Thomas R. Venables | ||||||||||||||||||||
| Cash Compensation: | ||||||||||||||||||||
| Severance based on salary | — | $ | 1,011,000 | $ | 1,011,000 | $ | 478,800 | $ | 168,500 | |||||||||||
| Severance based on bonus | — | 375,000 | 375,000 | — | — | |||||||||||||||
| Bonus for year of termination | — | 125,000 | 125,000 | — | 125,000 | |||||||||||||||
| Stock Compensation: | — | |||||||||||||||||||
| Acceleration of option vesting | — | 243,225 | 243,225 | 243,225 | 243,225 | |||||||||||||||
| Acceleration of restricted stock vesting | — | 818,097 | 818,097 | 818,097 | 818,097 | |||||||||||||||
| Allocation of unallocated ESOP shares(1) | — | — | — | — | — | |||||||||||||||
| Medical benefits | — | 36,792 | 36,792 | 36,792 | 5,712 | |||||||||||||||
| IRS 280G excise tax plus gross up | — | — | 2,412,517 | — | — | |||||||||||||||
Claire S. Bean | ||||||||||||||||||||
| Cash Compensation: | ||||||||||||||||||||
| Severance based on salary | — | $ | 642,000 | $ | 642,000 | $ | 183,600 | $ | 107,000 | |||||||||||
| Severance based on bonus | — | 210,000 | 210,000 | — | — | |||||||||||||||
| Bonus for year of termination | — | 70,000 | 70,000 | — | 70,000 | |||||||||||||||
| Stock Compensation: | — | |||||||||||||||||||
| Acceleration of option vesting | — | 139,825 | 139,825 | 139,825 | 139,825 | |||||||||||||||
| Acceleration of restricted stock vesting | — | 584,355 | 584,355 | 584,355 | 584,355 | |||||||||||||||
| Allocation of unallocated ESOP shares(1) | — | — | — | — | — | |||||||||||||||
| Medical benefits | — | 36,792 | 36,792 | 36,792 | 5,712 | |||||||||||||||
| IRS 280G excise tax plus gross up | — | — | 1,056,805 | — | — | |||||||||||||||
| (1) | Employee stock ownership plan benefits are offset against the benefits otherwise payable under the SERP agreements of Mr. Venables and Ms. Bean. See “ — Nonqualified Retirement Benefits.” |
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Change in Control Agreements.Benjamin Franklin Bancorp has entered into change in control agreements with its five executive officers other than Mr. Venables and Ms. Bean, and with one other senior officer of Benjamin Franklin Bank. The change in control agreements provide for a lump sum severance payment equal to approximately one times (in the case of Mr. Ledwith, Mr. Piemonte and Ms. Sawyer) or two times (in the case of Ms. Broadhurst and Ms. Buckley) the officer’s base salary plus the highest annual bonus paid during the three most recent calendar years and certain other benefits upon termination of the officer’s employment under certain circumstances.
Pursuant to the terms of the change in control agreements, these severance payments will be triggered if, within two years after a “change in control,” as defined in the agreements, of Benjamin Franklin Bancorp or Benjamin Franklin Bank, the officer’s employment is terminated for any reason other than death, deliberate dishonesty or gross misconduct of the officer with respect to Benjamin Franklin Bancorp or any of its subsidiaries, or conviction of the officer for the commission of a felony. These payments will also be triggered if the officer terminates his or her employment following: (i) a reduction in the officer’s annual base salary; (ii) a relocation of the offices of Benjamin Franklin Bancorp or Benjamin Franklin Bank at which the officer is principally employed by more than a specified number of miles; (iii) a failure of Benjamin Franklin Bancorp or Benjamin Franklin Bank to pay any portion of compensation due to the officer within seven days of the date such compensation is due; (iv) a failure by Benjamin Franklin Bancorp or Benjamin Franklin Bank to continue the officer’s participation in any material compensation, incentive bonus or benefit plan (or in a successor plan); (v) the failure of a successor in interest to make available its benefits plans to the officer on a basis that is not substantially less favorable than the successor generally affords to its other employees holding similar positions; or (vi) a failure of Benjamin Franklin Bancorp or Benjamin Franklin Bank to obtain a satisfactory agreement from any successor to assume and agree to perform the officer’s change in control agreement.
In addition, if the officer’s employment is terminated for the reasons described above, Benjamin Franklin Bancorp will continue to pay to the officer the disability and medical benefits existing as of and at the level in effect on the date of termination, at no greater cost to the officer than the officer is currently paying, for one year (in the case of Mr. Ledwith, Mr. Piemonte and Ms. Sawyer) or two years (in the case of Ms. Broadhurst and Ms. Buckley). In the event payments and benefits under the change in control agreements, together with other payments and benefits the officers may receive, would constitute an excess parachute payment under Section 280G of the Internal Revenue Code, such payments would be reduced to an amount necessary to avoid such payments constituting parachute payments.
In addition, upon a change in control, or upon termination of employment due to death or disability, the vesting schedules under the options and restricted stock awards held by Ms. Broadhurst, Ms. Buckley, Mr. Piemonte, Ms. Sawyer and Mr. Ledwith would accelerate in full, as provided in the Company’s 2006 Stock Incentive Plan. Moreover, upon a change in control, all unallocated shares then held by the Company’s employee stock ownership plan will be allocated to participants.
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The following table quantifies the benefits that would have been payable to our named executive officers who have change in control agreements under those agreements (and under the accelerated vesting provisions of the 2006 Stock Incentive Plan and the change-in control provisions of the employee stock ownership plan) if an event triggering such benefits had occurred as of December 31, 2006:
| Termination or | ||||||||||||
| Resignation in Certain | ||||||||||||
| Circumstances | ||||||||||||
| following a Change in | Termination Due to | |||||||||||
| Control | Disability | Death | ||||||||||
Rose M. Buckley | ||||||||||||
| Cash Compensation: | ||||||||||||
| Severance based on salary | $ | 280,000 | $ | — | $ | — | ||||||
| Severance based on bonus | 79,200 | — | — | |||||||||
| Stock Compensation: | ||||||||||||
| Acceleration of option vesting | 70,500 | 70,500 | 70,500 | |||||||||
| Acceleration of restricted stock vesting | 241,240 | 241,240 | 241,240 | |||||||||
| Allocation of unallocated ESOP shares | 176,396 | |||||||||||
| Medical benefits | 22,848 | — | — | |||||||||
| 870,184 | 311,740 | 311,740 | ||||||||||
| Less: amount exceeding 280G limits | (616,533 | ) | — | — | ||||||||
Net Termination Benefit | $ | 253,651 | $ | 311,740 | $ | 311,740 | ||||||
Mariane E. Broadhurst | ||||||||||||
| Cash Compensation: | ||||||||||||
| Severance based on salary | $ | 260,000 | $ | — | $ | — | ||||||
| Severance based on bonus | 44,800 | — | — | |||||||||
| Stock Compensation: | ||||||||||||
| Acceleration of option vesting | 58,750 | 58,750 | 58,750 | |||||||||
| Acceleration of restricted stock vesting | 241,240 | 241,240 | 241,240 | |||||||||
| Allocation of unallocated ESOP shares | 154,033 | |||||||||||
| Medical benefits | 22,848 | — | — | |||||||||
| 781,671 | 299,990 | 299,990 | ||||||||||
| Less: amount exceeding 280G limits | (558,480 | ) | — | — | ||||||||
Net Termination Benefit | $ | 223,191 | $ | 299,990 | $ | 299,990 | ||||||
Michael Piemonte | ||||||||||||
| Cash Compensation: | ||||||||||||
| Severance based on salary | $ | 94,500 | $ | — | $ | — | ||||||
| Severance based on bonus | 16,200 | — | — | |||||||||
| Stock Compensation: | ||||||||||||
| Acceleration of option vesting | 14,100 | 14,100 | 14,100 | |||||||||
| Acceleration of restricted stock vesting | 105,950 | 105,950 | 105,950 | |||||||||
| Allocation of unallocated ESOP shares | 118,434 | |||||||||||
| Medical benefits | 11,424 | — | — | |||||||||
| 360,608 | 120,050 | 120,050 | ||||||||||
| Less: amount exceeding 280G limits | (129,156 | ) | — | — | ||||||||
Net Termination Benefit | $ | 231,452 | $ | 120,050 | $ | 120,050 | ||||||
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Grants of Plan-Based Awards
The following table sets forth information concerning award grants to the named executive officers of the Company during 2006. The Company does not maintain a non-equity or equity plan that provides for payments based upon achievement of threshold, target and maximum goals, so those columns of the table have been omitted.
| All Other Stock | All Other Option | |||||||||||||||||||
| Awards: Number of | Awards: Number of | Grant Date Fair | ||||||||||||||||||
| Shares of Stock or | Securities | Exercise or Base | Value of Stock and | |||||||||||||||||
| Units | Underlying Options | Price of Option | Option Awards | |||||||||||||||||
| Name | Grant Date | (#)(1) | (#)(2) | Awards ($/Sh) | ($) | |||||||||||||||
| Thomas R. Venables | 7/28/06 | 50,190 | $ | 700,150 | ||||||||||||||||
| President/CEO | 7/28/06 | 103,500 | $ | 13.95 | $ | 399,510 | ||||||||||||||
| Claire S. Bean | 7/28/06 | 35,850 | $ | 500,107 | ||||||||||||||||
| EVP/CFO | 7/28/06 | 59,500 | $ | 13.95 | $ | 229,670 | ||||||||||||||
| Rose M. Buckley | 7/28/06 | 14,800 | $ | 206,460 | ||||||||||||||||
| SVP/Senior Lending Officer | 7/28/06 | 30,000 | $ | 13.95 | $ | 115,800 | ||||||||||||||
| Mariane E. Broadhurst | 7/28/06 | 14,800 | $ | 206,460 | ||||||||||||||||
| SVP/Retail Banking | 7/28/06 | 25,000 | $ | 13.95 | $ | 96,500 | ||||||||||||||
| Michael J. Piemonte | 7/28/06 | 6,500 | $ | 90,675 | ||||||||||||||||
| SVP/Risk Management/ Compliance | 7/28/06 | 6,000 | $ | 13.95 | $ | 23,160 | ||||||||||||||
| (1) | Represents the grants of restricted stock on July 28, 2006. The grants to Mr. Venables, Ms. Bean, and Mr. Piemonte vest over five years, and the grants to Ms. Buckley and Ms. Broadhurst vest over three years. | |
| (2) | Represents the grants of options on July 28, 2006. The grants to Mr. Venables, Ms. Bean, and Mr. Piemonte vest over five years, and the grants to Ms. Buckley and Ms. Broadhurst vest over three years. |
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Outstanding Equity Awards at Fiscal Year End 2006
The following table provides information regarding awards outstanding to our named executive officers as of December 31, 2006 under our 2006 Stock Incentive Plan.
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||||
| Incentive | Equity | |||||||||||||||||||||||||||||||||||
| Plan | Incentive | |||||||||||||||||||||||||||||||||||
| Equity | Awards: | Plan Awards: | ||||||||||||||||||||||||||||||||||
| Incentive | Number of | Market or | ||||||||||||||||||||||||||||||||||
| Number | Plan | Number | Market | Unearned | Payout Value | |||||||||||||||||||||||||||||||
| of | Number of | Awards: | of Shares | Value of | Shares, | of Unearned | ||||||||||||||||||||||||||||||
| Securities | Securities | Number of | or Units | Shares or | Units or | Shares, Units | ||||||||||||||||||||||||||||||
| Underlying | Underlying | Securities | of Stock | Units of | Other | or Other | ||||||||||||||||||||||||||||||
| Unexercised | Unexercised | Underlying | Option | Option | That | Stock That | Rights That | Rights That | ||||||||||||||||||||||||||||
| Options | Options | Unexercised | Exercise | Expir- | Have Not | Have Not | Have Not | Have Not | ||||||||||||||||||||||||||||
| (#) | (#) | Unearned Options | Price | ation | Vested | Vested | Vested | Vested | ||||||||||||||||||||||||||||
| Name | Exercisable | Unexercisable | (#) | ($) | Date | (#) | ($)(1) | (#) | ($) | |||||||||||||||||||||||||||
| Thomas R. Venables President/CEO | 0 | 103,500 | 0 | $ | 13.95 | 7/28/13 | 50,190 | $ | 818,097 | 0 | 0 | |||||||||||||||||||||||||
| Claire S. Bean, EVP/CFO | 0 | 59,500 | 0 | $ | 13.95 | 7/28/13 | 35,850 | $ | 584,355 | 0 | 0 | |||||||||||||||||||||||||
| Rose M. Buckley, SVP/Senior Lending Officer | 0 | 30,000 | 0 | $ | 13.95 | 7/28/13 | 14,800 | $ | 241,240 | 0 | 0 | |||||||||||||||||||||||||
| Mariane E. Broadhurst, SVP/ Retail Banking | 0 | 25,000 | 0 | $ | 13.95 | 7/28/13 | 14,800 | $ | 241,240 | 0 | 0 | |||||||||||||||||||||||||
| Michael J. Piemonte, SVP/Risk Management/ Compliance | 0 | 6,000 | 0 | $ | 13.95 | 7/28/13 | 6,500 | $ | 105,950 | 0 | 0 | |||||||||||||||||||||||||
| (1) | Based on the $16.30 closing price of the Company’s common stock on December 31, 2006. |
Option Exercises and Stock Vesting in 2006
Our 2006 Stock Incentive Plan was approved by our stockholders in May, 2006 and our first awards of options and restricted stock under the Plan were made in July, 2006. All grants of restricted stock awards and options were made subject to a five-year vesting schedule except for the awards to Ms. Buckley and Ms. Broadhurst, whose awards were made subject to a three-year vesting schedule. No awards of either options or restricted stock had vested at December 31, 2006. As a result, no options were (or could have been) exercised during 2006.
Nonqualified Retirement Benefits
Supplemental Retirement Agreements.Benjamin Franklin Bank has entered into Supplemental Retirement Agreements with Mr. Venables and Ms. Bean. This benefit arrangement is sometimes referred to as a “SERP.”
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Under the terms of their SERPs, each of Mr. Venables and Ms. Bean is entitled to receive a lump sum retirement benefit upon the earlier to occur of his or her separation from service or attaining age 65, in an amount that represents the present value of a 20-year stream of payments that is assumed to commence at age 65. Such 20-year stream of payments would be determined based on the officer’s final average compensation (for the three years of the final 10 calendar years in which the officer’s compensation was highest) multiplied by 75% (in the case of Mr. Venables) or 65% (in the case of Ms. Bean), reduced (i) by amounts payable to the officer as his or her annual annuity retirement benefit from Benjamin Franklin Bank’s contributions to his or her 401(k) plan; (ii) by amounts payable to the officer under the employee stock ownership plan and benefit restoration plan, and (iii) by one-half of his or her annual social security benefit, and then multiplied by a vesting percentage. The vesting schedules set forth in the SERPs will result in Mr. Venables’s SERP being fully vested in 2012 and Ms. Bean’s SERP being fully vested in 2014. The vesting will fully accelerate upon the officer’s death or disability, termination of the officer’s employment without “specially-defined cause” (as defined in the SERPs), resignation of the officer for “good reason” (as defined in the SERPs), or a “change in control” (as defined in the SERPs). The lump sum value of the benefit, assuming full vesting as of December 31, 2006 and compensation levels adjusted for inflation at the rate of 5%, were $6,453,532 and $2,586,456 for Mr. Venables and Ms. Bean, respectively. In the event of disability as of December 31, 2006, the benefit would be available upon attaining normal retirement age. The discounted values of such benefit in the event of disability at December 31, 2006 were $2,947,511 and $1,406,030 for Mr. Venables and Ms. Bean, respectively. In the event of early retirement or voluntary resignation as of December 31, 2006, the lump sum values of Mr. Venables’ and Ms. Bean’s SERP benefits are the present values of the accumulated benefits on that date, as set forth in the table on the next page. No amount payable under the SERP upon the officer’s termination of employment would be paid until at least six months after the officer’s termination of employment, except in the event of termination by reason of the officer’s death or disability. Certain additional provisions will also apply in the event of a change in control of Benjamin Franklin Bancorp.
Based upon current compensation levels (adjusted for inflation at the rate of 5%) and assuming retirement at age 65, Mr. Venables and Ms. Bean would be entitled to an annual benefit of $487,000 and $194,200, respectively, under their SERPs.
Benefit Restoration Plan. Benjamin Franklin Bank has established a Benefit Restoration Plan, a non-tax-qualified plan that will provide restorative payments to certain executives who are prevented from receiving earned benefits under Benjamin Franklin Bank’s 401(k) plan or employee stock ownership plan because of limitations in the Internal Revenue Code applicable to tax-qualified plans. The initial participants in the benefit restoration plan are Mr. Venables and Ms. Bean, and the Board of Directors of Benjamin Franklin Bank may designate certain management personnel or highly compensated employees as additional participants in the benefit restoration plan from time to time. The Board of Directors of Benjamin Franklin Bank may also limit which benefits such additional participants will receive under the benefit restoration plan.
Eligible participants will receive a restorative payment equal to the amount of additional benefits the participants would receive under the 401(k) plan if there were no income limitations imposed by the Internal Revenue Code. Eligible participants will also receive a restorative payment in lieu of shares that cannot be allocated to participants under the employee stock ownership plan due to the legal limitations imposed on tax-qualified plans. In addition, eligible participants who “retire” before the repayment in full of the loan to the employee stock ownership plan will receive restorative payments equal to the projected value of shares of Benjamin Franklin Bancorp common stock that would have been allocated to the executive over the remaining term of any loan, as if employment had continued through the full term of the loan, regardless of limitations in the Internal Revenue Code. “Retirement” is defined in the benefit restoration plan as the first to occur of termination of employment at any time following satisfaction of the requirements for early or normal retirement under the employee stock ownership plan (unless otherwise permitted by the Benjamin Franklin Bank Board of Directors), death while employed as a full-time employee, or the occurrence of a “change in control,” regardless of whether the participant continues in the employ of the employer or any successor following the change in control.
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Benefits payable to Mr. Venables and Ms. Bean under the benefit restoration plan will be fully offset against benefits payable to such officers under their SERPs, as described above.
The following table provides details of the present value of the accumulated benefit and years of credited service for the named executive officers under the Company’s Supplemental Retirement Agreements. The Company does not maintain a tax-qualified defined benefit plan.
| Present | ||||||||
| Number of Years | Value of | Payments During | ||||||
| Credited Service | Accumulated Benefit (1) | Last Fiscal Year | ||||||
| Name | Plan Name | (#) | ($) | ($) | ||||
| Thomas R. Venables President and CEO | SERP | 4 | $610,232 | 0 | ||||
| Claire S. Bean EVP and CFO | SERP | 2 | $252,080 | 0 | ||||
| Rose M. Buckley SVP and Senior Lending Officer | N/A | N/A | N/A | N/A | ||||
| Mariane E. Broadhurst SVP/ Retail Banking | N/A | N/A | N/A | N/A | ||||
| Michael J. Piemonte SVP/Risk Management/ Compliance | N/A | N/A | N/A | N/A |
| (1) | For the present value of the accumulated benefit, the Company assumed an annual discount rate of 6.25%. In addition, the accrued benefit for each participant was calculated based on the participant’s age and expected mortality. |
Deferred Compensation
Benjamin Franklin Bank does not sponsor deferred compensation programs for its executives. A table regarding nonqualified deferred compensation is therefore omitted.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of March 31, 2007 regarding each director of Benjamin Franklin Bancorp, each named executive officer, all directors and executive officers of the Company as a group and each person known by the Company to own beneficially more than 5% of the Company’s common stock.:
| Amount and Nature of | ||||||||
| Beneficial Ownership | Percent of | |||||||
| Name | (1)(2) | Class (3) | ||||||
| Wellington Management Company, LLP 75 State Street Boston, MA 02109 | 693,180 | (4) | 8.23 | % | ||||
| Benjamin Franklin Bank Employee Stock Ownership Plan 58 Main Street Franklin, MA 02038 | 478,194 | (5) | 5.68 | % | ||||
| John L. Matthews 49 Sterling Street Newton, MA 02465 | 468,263 | (6) | 5.56 | % | ||||
| Dr. Mary Ambler | 24,933 | (7) | * | |||||
| William P. Bissonnette | 14,133 | (8) | * | |||||
| Richard E. Bolton, Jr. | 32,759 | * | ||||||
| William F. Brady, Jr., D.D.S | 19,133 | * | ||||||
| Paul E. Capasso | 88,294 | (9) | 1.05 | % | ||||
| John C. Fuller | 19,333 | (10) | * | |||||
| Jonathan A. Haynes | 173,245 | (11) | 2.06 | % | ||||
| Anne M. King | 9,133 | (12) | * | |||||
| Richard D. Mann | 14,133 | (13) | * | |||||
| Daniel F. O’Brien | 20,438 | * | ||||||
| Charles F. Oteri | 9,333 | * | ||||||
| Donald P. Quinn | 54,306 | (14) | * | |||||
| Dr. Neil E. Todreas | 106,051 | 1.26 | % | |||||
| Thomas R. Venables | 104,038 | (15) | 1.24 | % | ||||
| Alfred H. Wahlers | 9,133 | (16) | * | |||||
| Charles Yergatian | 21,833 | (17) | * | |||||
| Claire S. Bean | 73,697 | (18) | * | |||||
| Mariane E. Broadhurst | 33,321 | (19) | * | |||||
| Rose M. Buckley | 24,026 | (20) | * | |||||
| Michael J. Piemonte | 9,316 | (21) | * | |||||
| Directors and executive officers as a group (22 persons) | 881,878 | (22) | 10.48 | % | ||||
| * | Less than 1% | |
| (1) | Except as otherwise noted, all persons have sole voting and investment power over their shares. The shares reported as owned by directors and officers include shares of unvested restricted stock granted under the Company’s 2006 Stock Incentive Plan over which the directors and officers have sole voting power, but do not have investment power because the shares are not transferable until they vest. |
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| (2) | Does not include 372,500 shares owned by the Benjamin Franklin Bank Charitable Foundation. The directors of the foundation are Messrs. Capasso, Mann, Venables, and Ms. Broadhurst, and the President, Treasurer and Clerk of the foundation are Mr. Venables, Ms. Bean and Ms. Broadhurst, respectively. | |
| (3) | Calculated based on outstanding shares of common stock on March 31, 2007 of 8,418,137. | |
| (4) | Based on a Schedule 13G filed by Wellington Management Company, LLP on February 14, 2007. According to the filing, Wellington Management, in its capacity as investment adviser, may be deemed to beneficially own 693,180 shares of Benjamin Franklin Bancorp common stock which are held of record by clients of Wellington Management. The filing indicates that Wellington Management does not have sole voting or dispositive power over any shares; has shared voting power over 572,480 shares; and has shared dispositive power over 693,180 shares. | |
| (5) | Represents the total number of shares of common stock beneficially owned by the ESOP. Of these shares, 446,314 shares are unallocated and 31,880 are allocated to participants. The ESOP provides that the Trustee shall vote unallocated shares held by it in proportion to instructions received by ESOP participants as to the voting of allocated shares. Shares allocated to the executive officers under the ESOP are reflected both in the beneficial ownership of the ESOP and in the beneficial ownership of the officers. | |
| (6) | Based on a Schedule 13G filed by Mr. Matthews on April 19, 2005. According to the filing, Mr. Matthews has sole voting and dispositive power over 468,263 shares of Benjamin Franklin Bancorp common stock. | |
| (7) | Includes 10,000 shares owned by trust of which Dr. Ambler is a trustee and 10,000 shares owned by a trust of which Dr. Ambler’s spouse is a trustee. | |
| (8) | Includes 2,000 shares owned jointly with Mr. Bissonnette’s spouse. | |
| (9) | Includes 20,017 shares owned by a trust for the benefit of Mr. Capasso’s children, of which Mr. Capasso is a trustee. | |
| (10) | Includes 200 shares owned by Mr. Fuller’s spouse and 5,000 shares owned by a trust of which he is trustee. | |
| (11) | Includes 120,181 shares owned by a trust of which Mr. Haynes is trustee. | |
| (12) | Includes 5,000 shares owned jointly with Mrs. King’s spouse. | |
| (13) | Includes 10,000 shares owned jointly with Mr. Mann’s spouse. | |
| (14) | Includes 3,210 shares owned by a partnership in which Mr. Quinn is a partner and over which he has voting power (but in only 802 shares of which he has a pecuniary interest), 2,717 shares owned by a corporation that is controlled by Mr. Quinn and his spouse and over which he has voting power (but in only 2,174 shares of which he has a pecuniary interest), and 6,360 shares owned by Mr. Quinn’s spouse. | |
| (15) | Includes 10,000 shares owned jointly with Mr. Venables’s spouse, 14,579 shares held in the 401(k) plan and 1,054 shares allocated to Mr. Venables’s account under the ESOP. | |
| (16) | Includes 5,000 shares owned by a trust of which Mr. Wahlers is trustee. | |
| (17) | Includes 12,000 shares owned by Mr. Yergatian’s spouse, over which Mr. Yergatian disclaims beneficial ownership. | |
| (18) | Includes 10,000 shares owned by Ms. Bean’s spouse, 4,793 shares held in the 401(k) plan and 1,054 shares allocated to Ms. Bean’s account under the ESOP. | |
| (19) | Includes 6,845 shares held by the 401(k) plan and 675 shares allocated to Ms. Broadhurst’s account under the ESOP. | |
| (20) | Includes 7,454 shares held by the 401(k) plan and 772 shares allocated to Ms. Buckley’s account under the ESOP. | |
| (21) | Includes 2,299 shares held by the 401(k) plan and 517 shares allocated to Mr. Piemonte’s account under the ESOP. | |
| (22) | Includes 5,139 shares allocated to executive officers’ accounts under the ESOP, as to which executive officers have the power to direct the voting. |
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CORPORATE GOVERNANCE
We believe that good corporate governance and fair and ethical business practices are crucial not only to our proper operation, but also to building and maintaining confidence in the integrity, reliability and transparency of the securities markets. We take our responsibilities in this area very seriously.
Code of Ethics
Our Board of Directors has adopted a code of ethics that applies to all of our employees, officers and directors. The code covers compliance with law; conflicts of interest; confidentiality and integrity of bank and company records; fair and accurate disclosure to the public; and procedures for compliance with the code. You can review our code of ethics on our website located atwww.benfranklinbank.com under the section entitled “About Us—Board of Directors—Corporate Governance.”
Board, Committee and Stockholder Meetings
The Board of Directors of Benjamin Franklin Bancorp currently has four standing committees: the Executive Committee, the Audit and Risk Management Committee, the Compensation Committee and the Governance Committee. The responsibilities and membership of these committees are set forth above under the section entitled “Information Regarding Directors—Committees of the Board of Directors.” You can review the charters of our Audit and Risk Management Committee, Compensation Committee and Governance Committee on our website located atwww.benfranklinbank.comunder the section entitled “About Us—Board of Directors—Corporate Governance.”
During 2006, the Board of Directors met 14 times, the Executive Committee met 26 times, the Audit and Risk Management Committee met 12 times, the Compensation Committee met 15 times and the Governance Committee met five times. No incumbent director attended fewer than 75% of the total number of meetings of the Board and its committees of which he or she was a member. The Board of Directors of Benjamin Franklin Bank, which consists of the same individuals as the Board of Directors of Benjamin Franklin Bancorp, met jointly with the Board of Directors of the Company at each of its 14 meetings during 2006.
Our Board of Directors has adopted a policy strongly encouraging all directors to attend annual meetings of our stockholders, and providing that if any director believes that he or she may be unable to attend for any reason, such director will discuss the matter as promptly as practicable with the Chairman of the Board and will make all reasonable efforts to rearrange his or her schedule to enable him or her to attend the annual meeting. All of our directors attended our 2006 annual meeting.
Board and Committee Independence
Board of Directors.Under Nasdaq rules, a majority of our Board of Directors must be “independent,” and no director qualifies as independent until the Board makes an affirmative determination to that effect. In making this determination, the Board must affirmatively conclude that the director does not have a material relationship with us that would interfere with the exercise of his or her independent judgment in carrying out the responsibilities of a director, including in particular, certain relationships specified in the Nasdaq rules. Nasdaq rules require that the independent directors meet on a regular basis as often as necessary to fulfill their responsibilities, and suggest that executive sessions occur at least twice a year.
As a result of this review, the Board determined that the following directors, comprising a majority of the whole Board, are independent within the applicable Nasdaq rule: Mary Ambler, William P. Bissonnette, William F. Brady, Jr., Paul E. Capasso, John C. Fuller, Jonathan A. Haynes, Anne M. King, Richard D. Mann, Daniel F. O’Brien, Charles F. Oteri, Donald P. Quinn, Neil E. Todreas, Alfred H. Wahlers, and Charles Yergatian. In determining that Mr. Haynes is independent, the Board considered the lease transactions
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between Benjamin Franklin Bank and Mr. Haynes’s real estate management firm and obtained a certification from Mr. Haynes that the payments made by the Bank to Mr. Haynes’s firm in the current or any of the past three fiscal years did not exceed 5% of the consolidated gross revenues of Mr. Haynes’s firm for any of those years.
Chairman and Chief Executive Officer.Our Chairman of the Board is Alfred H. Wahlers, an independent director, and our Chief Executive Officer is Thomas R. Venables. Although many bank holding companies and other companies in the United States have CEOs who also hold the position of chairman of the board, a number of studies on corporate governance have recommended that the positions be held by two different persons, with the chairman being an independent director.
Committees.The Board has determined that each of the Audit and Risk Management Committee, Compensation Committee and Governance Committee is comprised solely of “independent” directors within Nasdaq rules. For more information about these committees and their functions, see “Proposal 1: Election of Directors—Committees of the Board of Directors” in this proxy statement.
In addition, under Nasdaq rules, our Board of Directors is required to make certain findings about the qualifications of the members of the Audit and Risk Management Committee (“Audit Committee”). Our Board determined that:
| • | each member of the Audit Committee is, as required by Nasdaq rules, able to read and understand fundamental financial statements; and | ||
| • | at least one member of the Audit Committee, Mr. O’Brien, is “financially sophisticated” under the Nasdaq rules and is an “audit committee financial expert” under applicable provisions of the federal securities laws. |
Nominating Process
Nominations by Governance Committee.Under Nasdaq rules, nominees for our Board must be selected either by a nominating committee consisting entirely of independent directors or by a majority of the independent directors, acting pursuant to a standing resolution governing the nominating process. We have delegated this responsibility to our Governance Committee, which consists entirely of independent directors. Among the criteria considered by the Governance Committee in identifying and evaluating director candidates are: requirements of applicable law or listing standards, a candidate’s strength of character, judgment, business experience and specific area of expertise, factors relating to the composition of the Board (including its size and structure), principles of diversity, and such other factors as the Committee shall deem appropriate. The Committee’s charter provides that the Committee will review any candidate recommended by stockholders in light of these same criteria.
Nominations by Stockholders. Section 3.3 and related sections of our by-laws set forth procedural requirements for stockholders of record who wish to propose a candidate for nomination to the Board. To be timely, such a proposal must generally be received by our corporate secretary at our principal executive offices at least 120 days and not more than 150 days in advance of the anniversary date of our proxy statement for our prior year’s annual meeting. The proxy statement for our 2006 annual meeting was dated April 4, 2006; as a result, for our 2007 annual meeting, notice of any proposed candidate must have reached us by not later than the close of business on December 5, 2006. Section 3.3 specifies the type of information about the qualifications and background of the proposed nominee that the shareholder must supply to us, including the consent of the proposed nominee to serve as a director if he or she is elected. The Governance Committee may reject any nomination by a shareholder that is not timely made or does not satisfy the information delivery requirements of the by-law.
Our by-laws do not obligate us to include information about the candidate in our proxy materials, nor does it require us to permit the stockholder to solicit proxies for the candidate using our proxy materials. The
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Securities and Exchange Commission has adopted rules that may require us to include in our future proxy statements information about a recommended stockholder nominee, but only when the following criteria are met:
| • | the proposed nomination is received by a date not later than the 120th day before the date of our proxy statement released to stockholders in connection with the prior year’s annual meeting; and | ||
| • | the stockholder or stockholder group making the proposal has beneficially owned more than 5% of our common stock for at least a year. |
If these criteria are met, and provided that we have written consent from the proposed candidate and from the stockholder or stockholder group, we would be obliged to identify in our proxy statement the name of the candidate and the stockholder or stockholder group making the nomination, and to disclose our position regarding the nomination. By way of illustration, since this proxy statement was first sent to stockholders on or about April 11, 2007, the deadline for submission of a candidate’s name by an eligible stockholder pursuant to this new SEC rule would be December 14, 2007 for the 2008 annual stockholder meeting.
Stockholder Communications
Our stockholders may communicate directly with the members of the Board of Directors by writing directly to those individuals in care of the Secretary of the Corporation, Benjamin Franklin Bancorp, Inc., 58 Main Street, Franklin, Massachusetts 02038. The Secretary of the Corporation will promptly forward or cause to be forwarded any such correspondence, without opening it, to the director to whom the correspondence is addressed, using the same address to which Board materials and other corporate materials are sent to that director.
AUDIT AND RISK MANAGEMENT COMMITTEE REPORT
The information set forth in this report is not “soliciting material” and is not “filed” with the SEC or subject to Regulation 14A under, or the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent we specifically request that the information be treated as soliciting material or specifically incorporates it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
The following is the report of the Audit and Risk Management Committee (“Audit Committee”) with respect to the audited financial statements of Benjamin Franklin Bancorp, Inc. for the fiscal year ended December 31, 2006. The Audit Committee acts under a written charter that specifies the scope of the Audit Committee’s responsibilities and how it carries out those responsibilities. Each member of the Audit Committee is independent within the definition of the applicable Nasdaq rules.
While the Audit Committee oversees Benjamin Franklin Bancorp’s financial reporting process for the Board of Directors, consistent with the Audit Committee charter, management has primary responsibility for this process, including Benjamin Franklin Bancorp’s system of internal controls, and for the preparation of Benjamin Franklin Bancorp’s consolidated financial statements in accordance with U.S. generally accepted accounting principles. In addition, Benjamin Franklin Bancorp’s independent registered public accounting firm and not the Audit Committee is responsible for auditing those financial statements.
The Audit Committee has reviewed and discussed Benjamin Franklin Bancorp’s December 31, 2006 audited financial statements with management and with Wolf & Company, P.C., our independent registered public accounting firm. The Audit Committee also has discussed with the independent registered public accounting firm the matters required to be discussed by Statement on Auditing Standards No. 61 (communication with audit committees) as amended by Statement on Auditing Standards No. 90 (audit committee communications). In addition, the Audit Committee has also received from the independent registered public accounting firm the written disclosures and the letter required by Independence Standards
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Board Standard No. 1 (Independence Discussions with Audit Committees), and has discussed with Wolf & Company, P.C. its independence from Benjamin Franklin Bancorp. The Audit Committee also considered whether the Wolf & Company, P.C.’s provision of non-audit services to Benjamin Franklin Bancorp is compatible with that firm’s independence.
Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2006 for filing with the Securities and Exchange Commission.
The Audit and Risk Management Committee
Charles F. Oteri, Chair
Mary Ambler
John C. Fuller
Anne M. King
Daniel F. O’Brien
Donald P. Quinn
Mary Ambler
John C. Fuller
Anne M. King
Daniel F. O’Brien
Donald P. Quinn
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
William P. Bissonnette, Richard D. Mann, Donald P. Quinn and Alfred H. Wahlers served on our Compensation Committee for all of 2006, Paul E. Capasso served on the Committee until May 11, 2006, when he resigned from the Committee and was replaced by Daniel F. O’Brien, and John C. Fuller was added to the Committee on October 25, 2006. Persons serving on our Compensation Committee had no relationships with us other than their relationship as directors entitled to the receipt of standard compensation as directors and members of certain committees of our Board and their relationship to us as stockholders. No person serving on our Compensation Committee or on our Board of Directors is an executive officer of another entity for which any of our executive officers serves on the board of directors or on that entity’s compensation committee.
TRANSACTIONS WITH RELATED PARTIES
Loans and Extensions of Credit. Certain of our directors, executive officers, and members of their families, and corporations, trusts, or partnerships controlled by them, have loans from Benjamin Franklin Bank in the ordinary course of business. Such loans were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and did not involve more than normal risk of collectibility or present other unfavorable features. The Sarbanes-Oxley Act of 2002 generally prohibits an issuer from: (i) extending or maintaining credit; (ii) arranging for the extension of credit; or (iii) renewing an extension of credit in the form of a personal loan for an officer or director. There are several exceptions to this general prohibition, however, including that this prohibition does not apply to loans made by a depository institution that is insured by the FDIC and is subject to the insider lending restrictions of the Federal Reserve Act. All loans to our directors and officers by Benjamin Franklin Bank are made in conformity with the Federal Reserve Act and regulations promulgated thereunder, including prior approval requirements.
Review, Approval and Ratification of Transactions with Related Persons.The Company’s Code of Ethics sets forth the procedures applicable to contracts with, and the retention of services of, any director or officer (or his or her related interest) in an amount exceeding $100,000, as required by our banking regulator. In general, the Code of Ethics requires that such contracts or services shall be entered into only on substantially the same terms and conditions as those prevailing for comparable market transactions. The Code of Ethics further requires that an insider who is a director who has an interest in a covered contract or service is required to formally abstain from negotiating, entering into, reviewing or approving any such contract or service. Moreover, the Code of Ethics provides that any covered contract or service with an insider will require the
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formal prior approval of a majority of the Board of Directors, excluding any individual(s) interested in such transaction. Although the foregoing written policy applies only with respect to transactions in excess of $100,000, we generally follow the guidelines of such policy in connection with smaller transactions as well.
Agreements and Payments Related to Chart Bank Merger.In connection with our acquisition of Chart Bank, which became effective on April 4, 2005, we entered into a consulting and non-competition agreement with Mr. Bolton (as well as with one other former Chart Bank officer). Under this agreement, Mr. Bolton agreed to provide consulting services to us and agreed to non-competition obligations for a period of one year after the effectiveness of the Chart Bank acquisition. During 2006, we paid Mr. Bolton a fee of $56,000, and reimbursed him for his travel or other expenses incurred in connection with the services provided under this consulting and non-competition agreement.
Leases from a Director. Benjamin Franklin Bank leases space in two buildings owned by limited liability companies of which Jonathan A. Haynes is manager and a member. Mr. Haynes is a director of Benjamin Franklin Bancorp and is in the business of commercial real estate management. Mr. Haynes’s entities own and manage our Moody Street branch in Waltham, Massachusetts (which we acquired in April, 2005 as part of our acquisition of Chart Bank) and our new branch in Wellesley, Massachusetts (which opened in September, 2006). The current annual rent under these two leases is $168,900 and $101,000, respectively. During 2006, we paid an aggregate of $260,160 as rent under these two leases. The total periodic payments due under these two leases from January 1, 2007 through their remaining fixed terms is $615,100. This amount does not include the amount that Benjamin Franklin Bank might pay under any renewal options, which could be exercised in the bank’s discretion and under which the rent would be adjusted to the then-market rate.
PROPOSAL 2 — RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Wolf & Company, P.C. currently serves as our independent registered public accounting firm, and that firm conducted the audit of our financial statements for the fiscal year ended December 31, 2006. The Audit Committee has appointed Wolf & Company, P.C. to serve as the independent registered public accounting firm to conduct an audit of our consolidated financial statements for the fiscal year ending December 31, 2007.
Appointment of our independent registered public accounting firm is not required to be submitted to a vote of our shareholders for ratification. However, the Audit Committee has recommended that the Board of Directors submit this matter to the shareholders as a matter of good corporate practice, and the Board of Directors is following that recommendation.
If the shareholders fail to ratify the appointment, the Audit Committee will reconsider whether to retain Wolf & Company, P.C., and may retain that firm or another without re-submitting the matter to the shareholders. Even if the appointment is ratified, the Audit Committee may, in its discretion, direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of Benjamin Franklin Bancorp, Inc. and its shareholders.
A representative of Wolf & Company, P.C. is expected to be present at the Annual Meeting with an opportunity to make a statement if he desires to do so. He is also expected to be able to respond to appropriate questions.
The Board of Directors recommends that shareholders vote FOR the proposal to ratify the appointment of Wolf & Company, P.C. as our independent registered public accounting firm for the fiscal year ending December 31, 2007.
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Public Accountant’s Fees
The following is a summary of the fees for professional services rendered by Wolf & Company, P.C. for the fiscal years ended December 31, 2006 and 2005:
| Fee Category | 2006 Fees | 2005 Fees | ||||||
| Audit Fees (1) | $ | 208,500 | $ | 109,500 | ||||
| Audit-Related Fees (2) | 2,500 | 2,200 | ||||||
| Tax Fees (3) | 18,500 | 27,700 | ||||||
| All Other Fees (4) | 0 | 20,000 | ||||||
| Total Fees | 229,500 | $ | 159,400 | |||||
| (1) | Audit Fees. Audit fees were for professional services rendered for the audit of our annual financial statements, the audit of internal control over financial reporting, the review of quarterly financial statements and the preparation of statutory and regulatory filings. | |
| (2) | Audit-Related Fees. Audit-related fees were for professional services rendered in connection with employee benefit plan audits. | |
| (3) | Tax Fees. Tax fees consist of fees billed for professional services for tax compliance, tax planning and tax advice. These services include assistance regarding federal, state and international tax compliance and planning, tax audit defense, and mergers and acquisitions. The Audit and Risk Management Committee considered and determined that the provision of non-audit services provided by Wolf & Company, P.C., is compatible with maintaining that firm’s independence. | |
| (4) | All Other Fees. Other fees in 2005 were for professional services provided for information technology controls review and assessment and review of regulatory filings in connection with our stock subscription offering and acquisition of Chart Bank. |
Pre-Approval Policies And Procedures
At present, our Audit and Risk Management Committee approves each engagement for audit and non-audit services before we engage Wolf & Company, P.C., to provide those services. Our Audit and Risk Management Committee has not established any pre-approval policies or procedures that would allow our management to engage Wolf & Company, P.C., to provide any specified services with only an obligation to notify the Audit and Risk Management Committee of the engagement for those services. None of the services provided by Wolf & Company, P.C. for fiscal 2006 was obtained in reliance on the waiver of the pre-approval requirement afforded in SEC regulations.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
During 2006, we were subject to Section 16(a) of the Securities Exchange Act of 1934, as amended, which requires our officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and greater-than-10% shareholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on its review of the copies of Forms 3, 4 and 5 furnished to us during and with respect to 2006, we believe that all Section 16(a) filing requirements applicable to our officers, directors and greater-than-10% beneficial owners were complied with during 2006, except that Mr. Bolton was three weeks late in reporting his broker’s purchase for his Individual Retirement Account of 1,283 shares on May 12, 2006.
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SOLICITATION OF PROXIES
Brokers, banks and other nominees will be reimbursed for out-of-pocket expenses and other reasonable clerical expenses incurred in obtaining instructions from beneficial owners of common stock. In addition to the solicitation by mail, solicitations of proxies may be made personally or by telephone by our directors, officers and employees.
We have retained Morrow & Co. to assist in the solicitation of proxies, for a fee of $4,500 plus expenses. All expenses incurred in connection with this solicitation will be borne by Benjamin Franklin Bancorp.
SUBMISSION OF STOCKHOLDER PROPOSALS
FOR THE 2008 ANNUAL MEETING
FOR THE 2008 ANNUAL MEETING
In order to be eligible for inclusion in our proxy statement and form of proxy for the annual meeting scheduled to be held in 2007, stockholder proposals must comply with SEC Rule 14a-8 and any other applicable rules and must be delivered to our principal executive offices at least 120 days prior to the anniversary date of mailing of this proxy statement. This proxy statement was sent on or about April 11, 2007, so the date by which proposals are required to be received under Rule 14a-8 will be December 14, 2007.
In addition, Section 2.4 of our By-laws requires that a stockholder who wishes to propose an item of business for consideration at an annual meeting must provide notice of such item of business to us at our principal executive offices not less than 120 days nor more than 150 days in advance of the first anniversary of the date of our proxy statement for the previous year’s Annual Meeting. For next year’s scheduled annual meeting, the deadline for submission of notice is December 12, 2007. Section 3.3 of the By-laws imposes the same deadline on the nomination by a stockholder of a candidate for election to the Board of Directors. Any proposal or nomination submitted after December 12, 2007 will be untimely. The By-laws contain a number of other substantive and procedural requirements which should be reviewed by any stockholder who wishes to submit a proposal or nomination. A copy of our By-laws will be provided to any stockholder of the Company at no cost upon written request to the Secretary of the Company.
MISCELLANEOUS
The Board was not aware, a reasonable time before mailing this proxy statement to stockholders, of any business that may properly be presented at the Annual Meeting, other than the matters specifically listed in the Notice of Annual Meeting of Stockholders. However, if any further business is properly presented, the persons present will have discretionary authority to vote the shares they own or represent by proxy in accordance with applicable rules.
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ANNUAL MEETING OF STOCKHOLDERS OF
BENJAMIN FRANKLIN BANCORP, INC.
May 10, 2007
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
your proxy card in the
envelope provided as soon
as possible.
â Please detach along perforated line and mail in the envelope provided. â
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF DIRECTORS AND “FOR” PROPOSAL 2. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HEREý | |||||||||||||||||||||
| 1. | Election of Directors. | FOR | AGAINST | ABSTAIN | |||||||||||||||||
| NOMINEES: | 2. | To ratify the appointment of Wolf & Company, P.C. as Benjamin Franklin Bancorp, Inc.’s independent registered public accounting firm for fiscal 2007. | o | o | o | ||||||||||||||||
| o | FOR ALL NOMINEES | ¡ ¡ ¡ ¡ | William F. Brady, Jr. Donald P. Quinn Thomas R. Venables Alfred H. Wahlers | ||||||||||||||||||
o o | WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) | The undersigned hereby acknowledges receipt of a copy of the accompanying Notice of the Annual Meeting of Stockholders and Proxy Statement for the Annual Meeting of Stockholders and hereby revokes any proxy or proxies heretofore given. This proxy may be revoked at any time before it is voted on any matter (without, however, affecting any vote taken prior to such revocation) pursuant to the revocation methods specified in the Proxy Statement. | |||||||||||||||||||
INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark“FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here:= | |||||||||||||||||||||
| To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. | o | ||||||||||||||||||||
| Signature of Stockholder | Date: | Signature of Stockholder | Date: | |||||||||||
| Note: | Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. |
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BENJAMIN FRANKLIN BANCORP, INC.
58 MAIN STREET, P.O. BOX 309, FRANKLIN, MASSACHUSETTS 02038-0309
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 10, 2007
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 10, 2007
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking any proxy heretofore given, hereby constitutes and appoints Alfred H. Wahlers, Thomas R. Venables and Claire S. Bean and each of them the attorney and proxy of the undersigned, with full power of substitution to vote all shares of common stock of Benjamin Franklin Bancorp, Inc. (the “Corporation”) held of record by the undersigned at the close of business on March 20, 2007, on behalf of the undersigned at the Annual Meeting of Stockholders of the Corporation to be held on Thursday, May 10, 2007 at 10:00 a.m., local time, at Lake Pearl Luciano’s, 299 Creek Street, Wrentham, Massachusetts 02093, and any adjournments thereof, hereby granting full power and authority to act on behalf of the undersigned at said meeting and any adjournments thereof. In their discretion, the proxies are each authorized to vote upon such other business as may properly come before said meeting and any adjournments thereof.
When properly executed, this proxy will be voted in the manner directed herein by the undersigned stockholder. If no direction is given, this proxy will be voted FOR election of the four nominees proposed by the Board of Directors as Directors of the Corporation, and FOR the other proposal described in the accompanying Proxy Statement.
(Continued and to be signed on the reverse side.)
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ANNUAL MEETING OF STOCKHOLDERS OF
BENJAMIN FRANKLIN BANCORP, INC.
May 10, 2007
| PROXY VOTING INSTRUCTIONS |
MAIL- Date, sign and mail your proxy card in the envelope provided as soon as possible.
- OR -
TELEPHONE- Call toll-free1-800-PROXIES
(1-800-776-9437) from anytouch-tonetelephone and follow the instructions. Have your proxy card available when you call.
(1-800-776-9437) from anytouch-tonetelephone and follow the instructions. Have your proxy card available when you call.
- OR -
INTERNET- Access “www.voteproxy.com” and follow theon-screeninstructions. Have your proxy card available when you access the web page.
COMPANY NUMBER | |||||
ACCOUNT NUMBER | |||||
You may enter your voting instructions at 1-800-PROXIES or www.voteproxy.com up until 11:59 PM Eastern Time the day before the date of the Annual meeting.
â Please detach along perforated line and mail in the envelope providedIF you are not voting via telephone or the Internet. â
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF DIRECTORS AND “FOR” PROPOSAL 2. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HEREý | |||||||||||||||||||||
| 1. | Election of Directors: | FOR | AGAINST | ABSTAIN | |||||||||||||||||
| NOMINEES: | 2. | To ratify the appointment of Wolf & Company, P.C. as Benjamin Franklin Bancorp, Inc.’s independent registered public accounting firm for fiscal 2007. | o | o | o | ||||||||||||||||
| o | FOR ALL NOMINEES | ¡ ¡ ¡ ¡ | William F. Brady. Jr. Donald P. Quinn Thomas R. Venables Alfred H. Wahlers | ||||||||||||||||||
o o | WITHHOLD AUTHORITY FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) | The undersigned hereby acknowledges receipt of a copy of the accompanying Notice of the Annual Meeting of Stockholders and Proxy Statement for the Annual Meeting of Stockholders and hereby revokes any proxy or proxies heretofore given. This proxy may be revoked at any time before it is voted on any matter (without, however, affecting any vote taken prior to such revocation) pursuant to the revocation methods specified in the Proxy Statement. | |||||||||||||||||||
INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark“FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here:= | |||||||||||||||||||||
| To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. | o | ||||||||||||||||||||
| Signature of Stockholder | Date: | Signature of Stockholder | Date: | |||||||||||
| Note: | Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. |
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