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 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
THE FIRST OF LONG ISLAND CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(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:
[_] Fee paid previously with preliminary materials:
________________________________________________________________________________
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
THE FIRST OF LONG ISLAND CORPORATION
10 GLEN HEAD ROAD
GLEN HEAD, NEW YORK 11545
-------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 16, 2002
-------------------------------------------
March 6, 2002
To the Stockholders of
The First of Long Island Corporation:
Notice is hereby given that the Annual Meeting of Stockholders of THE FIRST
OF LONG ISLAND CORPORATION will be held at the OLD BROOKVILLE OFFICE, 209 GLEN
HEAD ROAD, GLEN HEAD, NEW YORK, on Tuesday, April 16, 2002, at 3:30 P.M. local
time for the following purposes:
(1) To elect Directors.
(2) To transact any other business as may properly come before the meeting.
Only stockholders of record at the close of business on February 27, 2002
are entitled to notice of and to vote at such meeting or any adjournment
thereof.
By Order of the Board of Directors
Joseph G. Perri
Senior Vice President and Secretary
IMPORTANT - PLEASE MAIL YOUR PROXY PROMPTLY.
IN ORDER THAT THERE MAY BE PROPER REPRESENTATION AT THE MEETING, YOU ARE URGED
TO SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED. NO POSTAGE
IS REQUIRED IF MAILED IN THE UNITED STATES.
THE FIRST OF LONG ISLAND CORPORATION
10 Glen Head Road
Glen Head, New York 11545
(516) 671-4900
---------------
PROXY STATEMENT
---------------
ANNUAL MEETING OF STOCKHOLDERS
The accompanying proxy is being solicited by the Board of Directors of The
First of Long Island Corporation (the "Corporation") for use at the Annual
Meeting of Stockholders to be held at 3:30 P.M. local time at the Old Brookville
Office, 209 Glen Head Road, Glen Head, New York, on April 16, 2002. The
approximate date on which proxy statements and forms of proxy are first being
sent or given to stockholders is March 6, 2002.
Proxies in the accompanying form that are properly executed and duly
returned to the Corporation will be voted at the meeting. Each proxy granted may
be revoked at any time prior to its exercise either by written notice filed with
the secretary of the meeting or by oral notice given during the meeting by the
stockholder to the presiding officer of the meeting.
VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS
The only class of voting securities of the Corporation is its Common Stock,
$.10 par value ("Common Stock"), each share of which entitles the holder thereof
to one vote except in the election of directors, where votes may be cumulated as
described below. Only stockholders of record at the close of business on
February 27, 2002 are entitled to notice of and to vote at the meeting. For the
election of directors, each share is entitled to as many votes as there are
directors to be elected, and such votes may be cumulated and voted for one
nominee or divided among as many different nominees as is desired. If authority
to vote for any nominee or nominees is withheld on any proxy, the votes will
then be "spread" among the remaining nominees.
As of January 31, 2002, there were issued 2,784,327 shares of the Common
Stock, all of which were outstanding and entitled to vote. To the best knowledge
of the Corporation, the only persons owning beneficially more than five percent
(5%) of the Common Stock of the Corporation as of January 31, 2002 are
identified in the table below.
Title of Name and Address Amount and Nature of Percent
Class of Beneficial Owner Beneficial Ownership of Class
- ----------- ------------------- ----------------------- --------
Common Sidney Canarick 253,725 shares (1) 9.11%
Stock 25 Glen Street
($.10 par value) Glen Cove, N.Y. 11542
Common Paul T. Canarick 253,725 shares (1) 9.11%
Stock 25 Glen Street
($.10 par value) Glen Cove, N.Y. 11542
Common Zachary Levy 238,618 shares 8.57%
Stock 125 Jerusalem Avenue
($.10 par value) Hicksville, N.Y. 11801
1
(1) Including 236,970 shares in the names of Sidney Canarick and Jean C.
Canarick, his wife, (Mr. Paul T. Canarick's parents) as Trustees under a
Trust Agreement dated May 27, 1992; 10,575 shares in the name of Jean C.
Canarick, Dr. Canarick's wife; and 6,180 shares in the name of Paul T.
Canarick. Pursuant to applicable rules, Sidney Canarick and Paul T.
Canarick are both deemed to be beneficial owners of the foregoing shares.
Furnished below is information with respect to the beneficial ownership of
the Corporation's Common Stock as of January 31, 2002 by all directors and
nominees, by the executive officers of the Corporation named in the "Summary
Compensation Table", and by directors and executive officers of the Corporation
as a group.
Amount and Nature of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class
- ---------------- ------------------------ -------------------- ----------
Common Stock Allen E. Busching 1,000 .04%
($.10 par value) Paul T. Canarick 253,725 (1) 9.11%
Beverly Ann Gehlmeyer 28,989 (2) 1.04%
Howard Thomas Hogan, Jr. 36,829 (3) 1.32%
J. William Johnson 47,850 (4) 1.71%
J. Douglas Maxwell, Jr. 9,575 (5) .34%
John R. Miller III 2,008 .07%
Walter C. Teagle III 15,750 (6) .57%
Richard Kick 10,862 (7) .39%
Arthur J. Lupinacci, Jr. 24,296 (8) .87%
Donald L. Manfredonia 16,301 (9) .58%
Joseph G. Perri 12,375 (10) .44%
Directors and Executive
Officers as a group 465,383 (11) 16.70%
(1) Including 236,970 shares in the names of Sidney Canarick and Jean C.
Canarick (Mr. Paul T. Canarick's parents) as trustees under a Trust
Agreement dated May 27, 1992; and 10,575 shares in the name of Jean C.
Canarick, Mr. Paul T. Canarick's mother.
(2) Including 435 shares in the name of Robert Val Gehlmeyer, Mrs. Gehlmeyer's
husband, and 5,283 shares in the name of Gehlmeyer & Gehlmeyer, P.C.
Retirement Trust.
(3) Including 16,515 shares in the name of Mr. Hogan as Trustee for the benefit
of his children, Howard, Kathryn, and Margaret Hogan, and 861 shares in the
name of Mr. Hogan as Trustee for the Hogan Family Trust.
(4) Including 1,224 shares in the name of Gail G. Johnson, Mr. Johnson's wife;
3,079 shares held in Mr. Johnson's individual retirement account; and 9,244
shares which are not presently owned, but which are deemed beneficially
owned under Securities and Exchange Commission Rule 13d-3(d)(1) because
they could be acquired by the exercise of stock options.
(5) Including 5,625 shares held in Mr. Maxwell's retirement account.
(6) Including 225 shares in the name of Janet D. Teagle, Mr. Teagle's wife; and
675 shares each (totaling 2,025 shares) held for the benefit of W. Clark
Teagle IV, Clifton D. Teagle and Janet W. Teagle, Mr. Teagle's children.
(7) Including 10,162 shares which are not presently owned, but which are deemed
beneficially owned under Securities and Exchange Commission Rule
13d-3(d)(1) because they could be acquired by the exercise of stock
options.
2
(8) Including 20,050 shares which are not presently owned, but which are deemed
beneficially owned under Securities and Exchange Commission Rule
13d-3(d)(1) because they could be acquired by the exercise of stock
options.
(9) Including 10,301 shares which are not presently owned, but which are deemed
beneficially owned under Securities and Exchange Commission Rule
13d-3(d)(1) because they could be acquired by the exercise of stock
options.
(10) Including 500 shares held in Mr. Perri's individual retirement account; and
11,875 shares which are not presently owned, but which are deemed
beneficially owned under Securities and Exchange Commission Rule
13d-3(d)(1) because they could be acquired by the exercise of stock
options.
(11) Including 65,432 shares which are not presently owned, but which are deemed
beneficially owned under Securities and Exchange Commission Rule
13d-3(d)(1) because they could be acquired by the exercise of stock
options.
ELECTION OF DIRECTORS
The Board of Directors of the Corporation presently consists of eight
members classified into two classes, Class I with four members and Class II with
four members, with each director to serve a two-year term. Only one class of
directors is elected at each annual meeting of stockholders. The following table
sets forth the present composition of the Board.
Expiration
Name Class of Term
----------------------- ----- ----------
Allen E. Busching II 2002
Paul T. Canarick II 2002
Beverly Ann Gehlmeyer II 2002
Howard Thomas Hogan, Jr. I 2003
J. William Johnson II 2002
J. Douglas Maxwell, Jr. I 2003
John R. Miller III I 2003
Walter C. Teagle III I 2003
The nominees for election at this meeting will be the Class II directors.
It is intended that shares represented by properly executed proxies will be
voted at the meeting in accordance with the marking indicated thereon and, in
the absence of contrary indication, for the re-election of Messrs. Busching,
Canarick, and Johnson and Mrs. Gehlmeyer, each to hold office until the 2004
Annual Meeting of Stockholders or until his or her successor is elected and
qualified. If at the time of the 2002 Annual Meeting any of the nominees named
above is not available to serve as a director (an event which management does
not now anticipate), the proxies will be voted for the election as director of
such other person or persons as the Board of Directors may designate.
The Board of Directors recommends a vote FOR all named nominees.
3
Information about the nominees and directors continuing in office follows.
The year set forth for each director is the year in which the person named
became a director of the Bank. Mrs. Gehlmeyer and Messrs. Hogan, Johnson, and
Miller became directors of the Corporation upon its formation in 1984. Messrs.
Busching, Canarick, Maxwell and Teagle became directors of the Corporation and
the Bank in the years set forth next to their names.
Principal Occupations for Last Director
Name 5 Years and Other Directorships Since
- ------------------- ------------------------------- ---------
Allen E. Busching Principal, 1999
(Age 70) B&B Capital
(Consulting and Private Investment);
(formerly: Managing Director,
Unitech p.l.c., Reading, England;
Chairman of the Board, President, and
Chief Executive Officer, Lambda
Electronics, Inc. (formerly Veeco Instruments));
Trustee, North Shore-Long Island Jewish
Health Systems, Inc.
Paul T. Canarick President and Principal, 1992
(Age 45) Paul Todd, Inc.
(Construction Company)
Beverly Ann Gehlmeyer Tax Manager and Principal, 1978
(Age 70) Gehlmeyer & Gehlmeyer, P.C.
(Certified Public Accounting Firm)
Howard Thomas Hogan, Jr. Hogan & Hogan, Lawyer 1978
(Age 57) (Private Practice)
J. William Johnson Chairman of the Board, President, 1979
(Age 61) and Chief Executive Officer,
The First of Long Island Corporation;
Chairman of the Board, President,
and Chief Executive Officer,
The First National Bank of Long Island;
Director, Independent Bankers Association
of New York State
J. Douglas Maxwell, Jr. Chairman, Chief Executive Officer and Director, 1987
(Age 60) NIRx Medical Technologies L.L.C.
(Medical Technology);
(formerly Chairman of the Board and Chief
Executive Officer, Swissray Empower, Inc.,
a Medical Imaging Distributor);
Director, Slater Development Corp. and
Police Relief Association of Nassau County
4
Principal Occupations for Last Director
Name 5 Years and Other Directorships Since
- ------------------- ------------------------------- ---------
John R. Miller III President and Chief Executive Officer, 1982
(Age 61) Equal Opportunity Publications, Inc.
(Publishing);
Director, The Middleby Corporation and
Middleby Marshall, Inc.
Walter C. Teagle III Executive Vice President and Director, 1996
(Age 52) Lexent, Inc.
(Infrastructure Service Provider);
(formerly President, Chief Executive Officer,
and Director, Metro Design Systems, Inc.,
an Engineering Design Services Firm);
President, Chief Investment Officer,
and Director, Teagle Management, Inc.
(Private Investment Firm)
COMPENSATION OF DIRECTORS
All of the members of the Board of Directors of the Corporation also serve
on the Board of Directors of the Bank. Directors are paid for their services as
directors of the Bank and of the Corporation. Directors of the Corporation are
paid a quarterly retainer of $1,000. The Board of Directors of the Bank
currently holds 12 regular meetings a year and such special meetings as deemed
advisable to review significant matters. Directors of the Bank are paid $1,000
for each regularly scheduled Board meeting, provided they attend at least ten
meetings. If a director attends less than ten meetings, the director is paid
$1,000 for each meeting attended. In addition, directors of the Corporation and
the Bank are generally paid $500 for each special Board meeting and $100 for
each telephone Board meeting.
The Chairwoman of the Corporation's Nominating Committee receives an annual
retainer of $700, and other committee members receive annual retainers of $350.
The Chairmen of the Bank's Compensation, Compliance, and Board Trust Committees
are each paid an annual retainer of $1,700, and other members of these
committees are paid annual retainers of $700. The Chairwoman of the Bank's Loan
Committee receives an annual retainer of $1,700, and other committee members
receive annual retainers of $250. In addition, the Chairwoman and all other
members of the Bank's Loan Committee receive $250 per meeting. The Corporation's
and the Bank's Examining Committees consist of the same four independent
directors, three of whom are also members of the Bank's Trust Audit Committee.
The Chairman is paid an annual retainer of $1,700 and the other two members are
paid an annual retainer of $700 for service on the two committees. Each of the
Examining Committees also includes a fourth independent director who is paid an
annual retainer of $600. Neither the Chairman nor the other members of the
Pension Plan Committee receive fees for their services. Mr. Johnson does not
receive director fees or committee fees from the Bank or the Corporation.
The Corporation's Stock Option and Appreciation Rights Plan (the "Stock
Option Plan"), as amended, allows for the granting of stock options to
non-employee directors of the Corporation. In January 2002, each non-employee
director received a stock option grant based on the board and committee fees
that such director received in 2001 and the Corporation's 2001 performance. The
options, which are exercisable in whole or in part during the period beginning
three years from the date of grant and ending ten years from the date of grant,
were granted at an exercise price equal to the fair market value of one share of
the
5
Corporation's stock on the date of grant. The number of options granted to
each non-employee director is as follows: Mr. Busching - 679; Mr. Canarick -
662; Mr. Hogan - 583; Mr. Teagle - 625; Ms. Gehlmeyer - 803; Mr. Miller - 721;
and Mr. Maxwell - 762.
BOARD COMMITTEES AND MEETINGS
The Board of Directors of the Corporation has three standing committees:
the Examining Committee, the Compensation and Stock Option Committee, and the
Nominating Committee.
The Corporation's Examining Committee: (1) meets with the Corporation's
independent public accountants and reviews with them the results of their annual
audit of the Corporation's financial statements, including any recommendations
the accountants may have with respect to internal controls or other business
matters; and (2) reviews the results of examinations of the Corporation
performed by regulatory authorities. The members of the Examining Committee are
Walter C. Teagle III, Allen E. Busching, Beverly Ann Gehlmeyer, and John R.
Miller III. During 2001, the Committee held three meetings.
The Compensation and Stock Option Committee is responsible for determining
an appropriate level of compensation for the Corporation's Chief Executive
Officer and administering the Corporation's Stock Option Plan. Administration of
the Stock Option Plan includes the selection of optionees and the determination
of the timing, duration, amount and type of each award. Members of the Committee
as well as all other non-employee directors of the Corporation are eligible for
stock option grants under the Stock Option Plan. Stock option grants to
non-employee directors are approved by the full Board. The Committee consists of
J. Douglas Maxwell, Jr., Allen E. Busching, and Paul T. Canarick. The Committee
met eight times during 2001.
The Nominating Committee is responsible for the nomination of individuals
to the Board of Directors of the Corporation and the Bank. The members of the
Nominating Committee are Beverly Ann Gehlmeyer, Paul T. Canarick, and John R.
Miller III. The Nominating Committee will consider nominees proposed by
stockholders in accordance with the provisions of the Corporation's bylaws
establishing the information and notice requirements for such nominations. The
Committee met once during 2001.
The Board of Directors of the Bank currently has seven standing committees:
an Examining Committee, a Trust Audit Committee, a Compensation Committee, a
Compliance and Community Reinvestment Act Committee, a Board Trust Committee, a
Loan Committee, and a Pension Plan Committee.
The Bank's Examining Committee: (1) reviews the plan, scope and results of
internal audits performed by both the Bank's in-house audit staff and
independent external firms; (2) reviews the results of examinations performed by
regulatory authorities; and (3) is responsible for insuring that the Bank
fulfills the annual audit and management reporting requirements of Section 112
of the Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA").
The members of the Examining Committee are Walter C. Teagle III, Beverly Ann
Gehlmeyer, Allen E. Busching, and John R. Miller III. During 2001, the Committee
held five meetings.
With respect to audits of the Bank's Trust Department, the Trust Audit
Committee meets with the auditors and reviews with them the nature, extent and
results of their audit effort. The members of the Trust Audit Committee are
Walter C. Teagle III, Beverly Ann Gehlmeyer, and John R. Miller III. During
2001, the Committee held two meetings.
6
The Compensation Committee recommends to the full Board salary policy,
management succession, compensation of officers, incentive compensation, and
employee benefits. The members of the Compensation Committee are J. Douglas
Maxwell, Jr., Allen E. Busching, and Paul T. Canarick. During 2001, the
Committee held five meetings.
The Compliance and Community Reinvestment Act Committee is responsible for
reviewing the Bank's performance of its obligations under the various laws and
regulations affecting consumers, including the Federal Community Reinvestment
Act. The members of the Committee are John R. Miller III and Walter C. Teagle
III. The Committee met four times during 2001, and each meeting was attended by
one or more officers of the Bank whose duties relate to compliance with such
laws and regulations.
The Board Trust Committee is responsible for reviewing the activities of
the Trust and Investment Services Department including the handling of fiduciary
relationships, investment management activities, and compliance. The members of
the Committee are J. Douglas Maxwell, Jr., Allen E. Busching, and J. William
Johnson. During 2001, the Committee held four meetings.
The Loan Committee consists of members who, except for Mr. Johnson, are not
officers of the Bank. Two members of the Loan Committee meet with the officers
of the Bank to review and approve substantial loans and the entire committee
meets on a quarterly basis to review the overall portfolio. The members of the
Loan Committee are Beverly Ann Gehlmeyer, Paul T. Canarick, Howard Thomas Hogan,
Jr., J. Douglas Maxwell, Jr., J. William Johnson, and Allen E. Busching.
Including the meetings to approve large loans, the Committee held forty-one
meetings in 2001.
The Pension Plan Committee has the authority to take such action with
respect to the Bank's Pension Plan and Supplemental Executive Retirement Plan as
may be necessary or advisable to be taken between regular meetings of the Bank's
Board of Directors. The members of the Pension Plan Committee are J. Douglas
Maxwell Jr., Allen E. Busching, and Paul T. Canarick. Beverly Ann Gehlmeyer is
an alternate member of this Committee with the right to replace any absent
member of the Committee at any meeting thereof. The Committee did not meet in
2001.
MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Corporation held twelve regular meetings and
one special meeting during 2001. With respect to meetings of the Corporation,
each director attended at least 75% of the aggregate number of Board meetings
and meetings of the committees on which such director served.
7
MANAGEMENT
The following tables contain information about the executive officers of
the Corporation and the Bank.
Executive Officers Term of Officer
of the Corporation Age Present Capacity Office Since
- ------------------ --- ---------------- --------- -------
J. William Johnson 61 Chairman of the Board, 3 yrs. 1984
President, and Chief
Executive Officer
Arthur J. Lupinacci, Jr. 61 Executive Vice President 1.5 yrs. 1985
and Chief Administrative
Officer
Mark D. Curtis 47 Senior Vice President 1 yr. 1997
and Treasurer
Brian J. Keeney 53 Senior Vice President 1 yr. 2000
Richard Kick 44 Senior Vice President 1 yr. 1991
Donald L. Manfredonia 50 Senior Vice President 1.5 yrs. 1987
Joseph G. Perri 50 Senior Vice President 1.5 yrs. 1990
and Secretary
Executive Officers Term of Officer
of the Bank Age Present Capacity Office Since
- ------------------ --- ---------------- --------- -------
J. William Johnson 61 Chairman of the Board, 1 yr. 1979
President, and Chief
Executive Officer
Arthur J. Lupinacci, Jr. 61 Executive Vice President 1 yr. 1985
and Chief Administrative
Officer
Donald L. Manfredonia 50 Executive Vice President 1 yr. 1982
Joseph G. Perri 50 Executive Vice President 1 yr. 1990
Mark D. Curtis 47 Senior Vice President, 1 yr. 1997
Chief Financial Officer
and Cashier
Brian J. Keeney 53 Senior Vice President 1 yr. 2000
Richard Kick 44 Senior Vice President 1 yr. 1991
Mr. Keeney has been employed by the Corporation and the Bank for less than
five years. From September 1998 to March 2000, Mr. Keeney was President and
Chief Executive Officer of The Rockefeller Trust Company. From December 1996 to
September 1998, he was Chairman of the Board, President & Chief Executive
Officer of Fidelity Management Trust Company of New York and from January 1992
to November 1996, he was Senior Vice President and Chief Operating Officer of
U.S. Trust Company of New Jersey. Previously, he held various positions with
U.S. Trust Company of New York, Irving Trust Company, and The Chase Manhattan
Bank, N.A.
8
BOARD COMPENSATION COMMITTEE REPORT
The Corporation's executive compensation program is administered by the
Compensation and Stock Option Committee of the Corporation's Board of Directors
and the Compensation Committee of the Bank's Board of Directors (the
"Committees"). Both Committees consist of the same three independent directors,
who are not employed by the Bank or the Corporation.
Compensation for executive officers consists of direct salary, incentive
bonuses paid under the Bank's Incentive Compensation Plan, and stock options and
appreciation rights awarded under the Corporation's Stock Option and
Appreciation Rights Plan. The payment or awarding of compensation is approved by
the Committees. Following approval by the Committees, the full Boards of
Directors of the Corporation and the Bank approve the salary package for all
executive officers and review the proposed payment of incentive compensation and
granting of stock options.
The Committees adhere to the practice that compensation for executive
officers be directly and materially linked to bank performance, individual
performance, and to what is paid to individuals in similar positions within the
industry. As such, (1) salaries are related to the Bank in light of overall Bank
performance; (2) incentive compensation, an objective means of rewarding
individual performance, is paid pursuant to the Incentive Compensation Plan
based on achievement by the individual of objective goals and the Bank's
performance with respect to profitability and financial strength; and (3) base
salary and incentive compensation for executive officers is compared to the
amounts of such compensation paid to individuals with reasonably similar
responsibilities employed by banks that are similar in size and scope to the
Corporation. In addition, from time to time the Corporation retains outside
consultants to determine the appropriateness of executive officer compensation.
Regarding Mr. Johnson's compensation, the Committees have considered, in
addition to the factors described above, the profitability and growth of the
Corporation during Mr. Johnson's tenure as Chief Executive Officer.
J. Douglas Maxwell, Jr.
Allen E. Busching
Paul T. Canarick
9
COMPENSATION OF EXECUTIVE OFFICERS
Furnished below is information with respect to the aggregate compensation
paid or accrued during the fiscal year ended December 31, 2001 to the Chief
Executive Officer and to each of the additional four most highly compensated
executive officers of the Bank who received compensation of more than $100,000
for services rendered to the Corporation or the Bank. This information is
provided pursuant to the Securities and Exchange Commission executive
compensation disclosure rules for proxy statements. All of the listed officers
are also officers of the Corporation but received salaries only from the Bank;
no compensation for their employment, other than Stock Options or Stock
Appreciation Rights ("SARs"), was received from the Corporation. A description
of the Incentive Compensation Plan under which the bonuses were paid follows.
SUMMARY COMPENSATION TABLE
- ---------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
----------------------------- ---------------------------
Awards Payouts
------------------- -------
Other Restricted All Other
Name and Principal Compen- Stock Options/ Compen-
Position Year Salary Bonus sation Award(s) SARs LTIP sation (2)
($) ($) ($) ($) # ($) ($)
(a) (b) (c) (d) (e) (f) (g) (h) (i)
- ----------------------- ---- -------- -------- -------- ---------- -------- ----- ----------
J. William Johnson 2001 $357,000 $129,950 See None 7,313 None $47,294
Chairman of the Board, 2000 $340,000 $ 94,200 Footnote None 3,200 None $39,331
Director, President and 1999 $325,000 $ 98,735 (1) None 1,800 None $38,409
Chief Executive Officer
Arthur J. Lupinacci, Jr. 2001 $215,000 $ 69,660 See None 4,316 None $29,228
Executive Vice President 2000 $201,000 $ 48,610 Footnote None 2,000 None $23,252
and Chief Administrative 1999 $185,500 $ 47,715 (1) None 1,300 None $21,923
Officer
Donald L. Manfredonia 2001 $169,000 $ 54,760 See None 3,495 None $19,202
Senior Vice President 2000 $162,000 $ 33,050 Footnote None 1,600 None $16,291
1999 $150,000 $ 40,770 (1) None 1,000 None $15,459
Joseph G. Perri 2001 $162,000 $ 50,285 See None 2,334 None $18,407
Senior Vice President 2000 $151,000 $ 31,050 Footnote None 1,200 None $15,185
and Secretary 1999 $134,000 $ 36,950 (1) None 800 None $13,810
Richard Kick 2001 $145,000 $ 45,165 See None 2,061 None $15,118
Senior Vice President 2000 $138,000 $ 26,000 Footnote None 1,200 None $13,380
1999 $121,000 $ 28,040 (1) None 800 None $12,035
- ----------------------------------------------------------------------------------------------------------
(1) Other annual compensation excludes the value of perquisites and other
personal benefits since the Corporation and the Bank have concluded that
for the named executive officers the aggregate amount of such compensation
does not exceed the lesser of either $50,000 or 10% of the total of annual
salary and bonus reported in columns (c) and (d).
10
(2) All other compensation for 2001 (column (i) of the "Summary Compensation
Table") includes the following amounts either paid for or contributed on
behalf of the named executive officers. The 401(k) and profit sharing
contributions shown in the table include amounts paid under the Bank's
Profit Sharing and Supplemental Executive Retirement ("SERP") Plans.
- --------------------------------------------------------------------------------
Life 401(k) Profit
Insurance Matching Sharing
Name Premiums Contributions Contributions Total
- ----------------------- --------- ------------- ------------- -------
J. William Johnson........... $12,558 $7,140 $27,596 $47,294
Arthur J. Lupinacci, Jr. .... $ 8,308 $4,300 $16,620 $29,228
Donald L. Manfredonia ....... $ 2,758 $3,380 $13,064 $19,202
Joseph G. Perri ............. $ 2,644 $3,240 $12,523 $18,407
Richard Kick ................ $ 1,009 $2,900 $11,209 $15,118
- --------------------------------------------------------------------------------
COMPENSATION PURSUANT TO PLANS
Pension Plan
The Bank is a participant in the New York State Bankers Retirement System
Pension Plan ("Plan") and maintains the SERP described below. Set forth in the
table that follows are total estimated annual benefits payable under the Plan
and SERP upon retirement based on various levels of compensation and years of
service.
- ----------------------------------------------------------------------------------------------
Years of Creditable Service
Average Annual ---------------------------------------------------------------------------
Compensation 10 15 20 25 30 35
- -------------- -------- -------- -------- -------- -------- --------
$100,000 $ 15,677 $ 23,515 $ 31,353 $ 39,191 $ 47,030 $ 54,868
$125,000 $ 20,052 $ 30,077 $ 40,103 $ 50,129 $ 60,155 $ 70,180
$150,000 $ 24,427 $ 36,640 $ 48,853 $ 61,066 $ 73,280 $ 85,493
$175,000 $ 28,802 $ 43,202 $ 57,603 $ 72,004 $ 86,405 $100,805
$200,000 $ 33,177 $ 49,765 $ 66,353 $ 82,941 $ 99,530 $116,118
$225,000 % 37,552 $ 56,327 $ 75,103 $ 93,879 $112,655 $131,430
$250,000 $ 41,927 $ 62,890 $ 83,853 $104,816 $125,780 $146,743
$300,000 $ 50,677 $ 76,015 $101,353 $126,691 $152,030 $177,368
$400,000 $ 68,177 $102,265 $136,353 $170,441 $204,530 $238,618
$500,000 $ 85,677 $128,515 $171,353 $214,191 $257,030 $299,868
$600,000 $103,177 $154,765 $206,353 $257,941 $309,530 $361,118
- ----------------------------------------------------------------------------------------------
The Plan covers employees who are over the age of 21 years and have been
employed for over one year. The normal retirement age is 65 and early retirement
with reduced benefits is available at age 55. However, an unreduced benefit is
available at age 62 or above to a participant with at least 10 years of service
whose employment terminates after age 55 and who begins receiving benefits after
attaining age 62. Upon retirement, each participant is paid a benefit in the
form of a joint and survivor annuity computed by (i) multiplying the
participant's final average compensation (the average of the participant's
Annual Earnings, as defined, during the five highest consecutive years of
employment) by the product of 1.75 percent and the participant's credited years
of service (to a maximum of 35 years), (ii) adding 1.25 percent
11
of average compensation multiplied by the participant's credited years of
service in excess of 35 years (up to five such years), and (iii) subtracting the
product of .49 percent of the participant's final three year average
compensation (limited to covered compensation) and the participant's credited
years of service (to a maximum of 35 years). The .49 percent represents the
minimum Social Security offset to the pension benefit.
The Bank makes annual payments to a trust fund, computed on an actuarial
basis, to fund these benefits. A contribution of $365,202 is required for the
plan year ending September 30, 2002. No contribution was required for the plan
year ended September 30, 2001. Employees also make contributions of 2 percent of
their compensation. An employee becomes fully vested after 4 years of
participation in the Plan. No vesting occurs during that 4-year period.
The compensation covered by the Plan includes: (1) salary and bonus as set
forth in the "Summary Compensation Table"; (2) value realized from the exercise
of stock appreciation rights; and (3) generally all other taxable compensation
except that resulting from the Bank's contributions to the SERP or reimbursement
for taxes on SERP earnings and amounts realized after April 15, 1998 from the
exercise of disqualified incentive stock options. Sections 401(a)(17) and 415 of
the Internal Revenue Code of 1986, as amended, limit the annual benefits which
may be paid from a tax-qualified retirement plan. Any benefits which may be
above the limits under these sections would be payable under the SERP.
The credited years of service, for purposes of calculating benefits, for
the executive officers of the Bank named in the Summary Compensation Table and
all executive officers of the Bank as a group are as follows: Mr. Johnson - 21
years; Mr. Lupinacci - 15 years; Mr. Manfredonia - 18 years; Mr. Perri - 10
years; Mr. Kick - 9 years; and all executive officers as a group - 78 years.
Supplemental Executive Retirement Plan
On August 3, 1995, the Corporation adopted The First National Bank of Long
Island Supplemental Executive Retirement Plan ("SERP"). The SERP provides
benefits that would have been provided under the Pension Plan and Profit Sharing
Plan, in the absence of Internal Revenue Code ("IRC") limitations, to certain
employees whose benefits under those plans are limited by the IRC. The
Compensation Committee of the Board of Directors designates the employees
eligible to participate in the SERP.
Supplemental retirement program and profit sharing plan contributions under
the SERP are made to a "secular trust" for the benefit of the participants.
Amounts contributed to the secular trust are not subject to the claims of
creditors of the Bank. Accordingly, the contributions are taxable to each
participant and deductible by the Bank when made. Trust income is also taxable
to each participant. Taxes are withheld from the contributions to pay each
participant's taxes. In addition, the Bank makes tax payments in an amount
sufficient to cover each participant's taxes on both the trust income and the
tax payment.
The SERP and related secular trust are intended to meet the requirements of
the Employee Retirement Income Security Act (ERISA) as they pertain to vesting,
reporting and disclosure information.
Profit Sharing Plan
The Bank has a combined profit sharing/401(k) plan (the "Profit Sharing
Plan"). Employees are eligible to participate provided they are at least 21
years of age and have completed one year of service in which they worked 1,000
hours if full-time and 700 hours if part-time. Participants may elect to
contribute, on a tax-deferred basis, up to 25% of gross compensation, as
defined, subject to the limitations of Section 401(k) of the Internal Revenue
Code. The Bank may, at its sole discretion, make "Additional 401(k)
12
Contributions" to each participant's account based on the amount of the
participant's tax deferred contributions and make "Profit Sharing Contributions"
to each participant's account equal to a percentage of the participant's
compensation, as defined. Forfeitures are allocated among participants in
proportion to their annual compensation. Participants are fully vested in their
elective contributions and, after five years of participation in the Profit
Sharing Plan, are fully vested (20% vesting per year) in the Additional 401(k)
and Profit Sharing Contributions made by the Bank. Also, a participant becomes
fully vested in Additional 401(k) and Profit Sharing Contributions upon death or
disability. The Additional 401(k) and Profit Sharing Contributions for 2001 were
$130,000 and $587,000, respectively. The Profit Sharing Contributions
represented approximately 4.3% of the Bank's 2001 pre-tax profits.
Normal retirement age is 65, although the Profit Sharing Plan also contains
provisions allowing pre-termination withdrawals and loans under certain
circumstances. The amount of retirement benefits will depend upon the
accumulation of contributions and forfeitures and the investment performance of
the Plan. The amount allocated under the Profit Sharing Plan and related SERP to
the account of the Chief Executive Officer for 2001 and to each of the
additional four most highly compensated executive officers of the Bank who
received compensation of more than $100,000 for services to the Corporation or
the Bank in 2001 is set forth in footnote (2) to the "Summary Compensation
Table."
Retirement Plan For Directors
On June 18, 1991, the Board of Directors of the Bank adopted The First
National Bank of Long Island Retirement Plan for Directors (the "Retirement
Plan"). In order to be eligible to receive benefits under the Retirement Plan, a
retired director must have served on the Board of Directors for three (3) years
and, except in the case of retirement due to substantial physical disability,
must have attained the age of sixty (60) years. Pursuant to the terms of the
Retirement Plan, an eligible director receives a credit (the "Credit
Percentage") of ten percent (10%) multiplied by the number of years of service
on the Board, to a maximum of one hundred percent (100%). The annual benefit
(the "Annual Benefit") under the Retirement Plan is equal to the monthly Board
of Directors attendance fee in effect as of December 31, 2000, multiplied by
twelve (12) and then multiplied by the Credit Percentage. The Annual Benefit is
payable for a period of seven (7) years from the date of retirement (the
"Payment Period"), in quarterly installments. In the event of the death of a
director or a retired director, the surviving spouse of such director shall be
entitled to receive an annual payment equal to seventy-five percent (75%) of the
Annual Benefit, calculated as set forth above, and payable over the remainder of
the applicable Payment Period.
An amendment to the Stock Option Plan that allows for the granting of stock
options to non-employee directors was approved by the Board of Directors in
February 2001 and subsequently approved by the shareholders. Upon approval of
the amendment by stockholders, the Retirement Plan was terminated effective
December 31, 2000, the benefits earned by directors under the Retirement Plan
for services rendered through December 31, 2000 were frozen, and the ability of
directors to earn additional benefits under the Retirement Plan was
discontinued.
Incentive Compensation Plan
The executive officers of the Bank are eligible for compensation under the
Bank's Incentive Compensation Plan (the "Plan") described in the Board
Compensation Committee Report herein. Incentive compensation paid to the Chief
Executive Officer for 2001 and to each of the additional four most highly
compensated executive officers of the Bank who received compensation of more
than $100,000 for services to the Corporation or the Bank in 2001 is set forth
in the "Summary Compensation Table."
13
Stock Option and Appreciation Rights Plan
The Corporation's 1986 Stock Option and Appreciation Rights Plan (the "1986
Plan") expired on January 21, 1996. The 1986 Plan was adopted by the Board of
Directors in January 1986 and approved by the stockholders in April 1986 as a
Stock Option Plan and subsequently was amended to include provisions for the
granting of Stock Appreciation Rights ("SARs"), which amendment was adopted by
the Board of Directors in May 1988 and approved by the stockholders in April
1989.
In January 1996, the Board of Directors unanimously adopted a new plan
entitled The First of Long Island Corporation Stock Option and Appreciation
Rights Plan (the "Stock Option Plan") as a successor to the 1986 Plan. The
Corporation's stockholders approved the 1996 Stock Option Plan in April 1996. An
amendment to the Stock Option Plan that allows for the granting of stock options
to non-employee directors and limits the number of stock options and stock
appreciation rights that can be granted to any one person in any one fiscal year
to 25,000 was approved by the Board of Directors in February 2001 and
subsequently approved by the shareholders. Except for this amendment, the terms
of the Stock Option Plan are substantially identical to the terms of the 1986
Plan.
Under the Stock Option Plan, options to purchase up to 360,000 shares of
common stock were made available for grant to key employees and, as amended,
non-employee directors of the Corporation and its subsidiaries through January
15, 2006. Each option granted under the Stock Option Plan is granted at an
exercise price equal to the fair market value of one share of the Corporation's
stock on the date of grant. Options granted on or before December 31, 2000 are
exercisable in whole or in part commencing six months from the date of grant and
ending ten years after the date of grant. Options granted after December 31,
2000 are exercisable in whole or in part commencing three years from the date of
grant and ending ten years after the date of grant. The date on which options
first become exercisable is subject to acceleration in the event of a change in
control, retirement, death, disability, and certain other limited circumstances.
Each option granted to an employee under the Stock Option Plan may be
granted with or without a SAR attached. The Stock Option Plan also provides for
the granting of stand-alone SARs to employees. Non-employee directors are not
eligible for SAR grants, whether stand alone or attached to options. An employee
who is granted an option with a SAR attached may elect to exercise either the
option or the SAR, at which point the related SAR or option shall be deemed to
have been cancelled. If a SAR is exercised, the participant is entitled to a
payment equal to the amount by which the fair market value of the shares of the
Common Stock allocable to the SAR on the exercise date exceeds the fair market
value of such shares on the date of grant. Payment to a holder who exercises a
SAR is made in cash. Unexercised options which expire or terminate are again
available for grant, but options cancelled because an attached SAR was exercised
are not again available for grant.
Options may be granted under the Stock Option Plan as incentive stock
options ("ISOs") qualified under Section 422 of the Internal Revenue Code or as
non-qualified stock options ("NQSOs"). Generally, options and SARs have a
maximum duration of 10 years. The total fair market value of stock, determined
as of the date of grant of the option, for which ISOs are first exercisable by a
holder in any year is limited to $100,000. A holder may elect to exercise
options or SARs in any order without regard to the date on which the options or
SARs were granted.
Options and SARs are not transferable, except upon death (i) by will, (ii)
by the laws of descent and distribution, or (iii) by beneficiary designation.
The purchase price for the Common Stock must be paid in full in either common
stock of the Corporation and/or cash when an option is exercised. Generally,
options and SARs are exercisable only during the holder's continued employment
or service as a director with the Corporation
14
or the Bank. However, in accordance with the terms of the Stock Option Plan
and/or administrative guidelines adopted by the Compensation and Stock Option
Committee, there are additional limited periods following termination of
employment or service as a director during which options or SARs may be
exercised in the event employment or service is terminated as a result of
resignation, death, disability, retirement, or a change in control of the
Corporation.
Subject to the provisions of applicable law and the terms of the Stock
Option Plan, the designation of those officers and non-employee directors who
will be granted options, or those officers who will be granted SARs, as well as
the terms of the options or SARs granted, is solely within the discretion of the
Compensation and Stock Option Committee which administers the Stock Option Plan.
No consideration is received by the Corporation or the Bank for the granting of
options or SARs.
During 2001, options to purchase 45,688 shares were granted under the Stock
Option Plan at a per share, weighted average exercise price of $38.27. The
following table shows, as to the executive officers named in the "Summary
Compensation Table", information for 2001 with respect to the options granted.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
- -----------------------------------------------------------------------------------------------------------
Individual Grants
- -----------------------------------------------------------------------------------------------------------
Percent of Potential Realizable
Total Value at Assumed
Options/ Annual Rates of
SARs Stock Price
Options/ Granted to Appreciation
SARs Employees Exercise or For Option Term
Granted in Fiscal Base Price Expiration --------------------
Name (#) Year ($/Sh) Date 5% ($) 10% ($)
(a) (b) (c) (d) (e) (f) (g)
- ----------------------- ------- --------- ---------- ---------- ------- --------
J. William Johnson.................... 3,663 8.02% $37.94 1/15/11 $ 87,400 $221,489
J. William Johnson.................... 3,650 7.99% $38.94 3/19/11 $ 89,380 $226,506
Arthur J. Lupinacci, Jr............... 2,166 4.74% $37.94 1/15/11 $ 51,681 $130,971
Arthur J. Lupinacci, Jr............... 2,150 4.71% $38.94 3/19/11 $ 52,648 $133,421
Donald L. Manfredonia................. 1,745 3.82% $37.94 1/15/11 $ 41,636 $105,514
Donald L. Manfredonia................. 1,750 3.83% $38.94 3/19/11 $ 42,853 $108,599
Joseph G. Perri....................... 1,434 3.14% $37.94 1/15/11 $ 34,216 $ 86,709
Joseph G. Perri....................... 900 1.97% $38.94 3/19/11 $ 22,039 $ 55,851
Richard Kick.......................... 1,311 2.87% $37.94 1/15/11 $ 31,281 $ 79,272
Richard Kick.......................... 750 1.64% $38.94 3/19/11 $ 18,366 $ 46,542
- -----------------------------------------------------------------------------------------------------------
15
The following table sets forth the aggregated options/SARs exercised in the
last fiscal year and the aggregated number and value of unexercised options and
SARs at December 31, 2001 for each of the executive officers named in the
"Summary Compensation Table."
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION VALUES
- ------------------------------------------------------------------------------------------------------
Value of
Number of Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
at Fiscal Year-End at Fiscal Year-
Shares Value (#) End ($)
Acquired on Realized Exercisable/ Exercisable/
Name Exercise (#) ($) Unexercisable Unexercisable
(a) (b) (c) (d) (e)
- -------------------------------- ------------ -------- -------------------- -----------------
J. William Johnson ............. 11,625 $181,363 9,244 / 7,313 $109,042 / $2,601
Arthur J. Lupinacci, Jr......... -- -- 20,050 / 4,316 $360,806 / $1,538
Donald L. Manfredonia........... 1,141 $33,738 10,900 / 3,495 $169,483 / $1,239
Joseph G. Perri................. -- -- 11,875 / 2,334 $211,655 / $1,018
Richard Kick.................... -- -- 10,162 / 2,061 $162,547 / $931
- ------------------------------------------------------------------------------------------------------
There were no long-term incentive plan awards granted in the last fiscal
year.
Employment Contracts
Messrs. Johnson, Lupinacci, Manfredonia, and Perri have employment
contracts with the Corporation pursuant to which Mr. Johnson is employed in the
position of President and Chief Executive Officer of the Corporation, Mr.
Lupinacci is employed as Executive Vice President of the Corporation, and
Messrs. Manfredonia and Perri are each employed in the position of Executive
Vice President of the Bank. In addition, each of these officers is also employed
in such other senior executive positions of the Corporation or the Bank as may
be determined by the Board of Directors of the Corporation or the Bank. Mr.
Johnson's contract has a term of three years effective January 1, 2002, Mr.
Lupinacci's contract has a term of eighteen months effective July 1, 2001, and
Messrs. Manfredonia and Perri each have a contract with a term of eighteen
months effective January 1, 2002. The term of each of these contracts is
automatically extended at the expiration of each year for an additional period
of one year, thus resulting in a new three-year term for Mr. Johnson and new
eighteen-month terms for Messrs. Lupinacci, Manfredonia, and Perri. The
contracts currently provide for base annual salaries of $370,000, $223,000,
$176,000, and $168,500 for Messrs. Johnson, Lupinacci, Manfredonia, and Perri,
respectively, to be paid by the Corporation or the Bank. The base annual salary
for Mr. Johnson includes services as a director of the Corporation and the Bank.
Under these contracts, Messrs. Johnson, Lupinacci, Manfredonia, and Perri
are entitled to severance compensation. Generally upon an involuntary
termination of employment or upon a resignation of employment following a change
in control, Messrs. Johnson and Lupinacci are entitled to receive single sum
payments equal to three (3) times and one and one-half (1.5) times,
respectively, the base annual salaries under their contracts, together with
continued insurance coverage. Upon an involuntary termination of employment or a
resignation of employment for Good Reason, as defined, within twenty-
16
four months following a change of control, Messrs. Manfredonia and Perri are
entitled to receive single sum "Termination Payments" equal to one and one-half
(1.5) times and one and one-quarter (1.25) times, respectively, the base annual
salaries under their contracts. In addition, upon a resignation of employment
for any reason during the period beginning on the thirty-first day and ending on
the sixtieth day following a change of control, Mr. Manfredonia and Mr. Perri
are each entitled to receive a single sum payment equal to 66 2/3% of the
Termination Payment under their contracts. Mr. Manfredonia and Mr. Perri are
entitled to continued medical coverage after termination.
Severance Agreements
Messrs. Curtis, Kick, and Keeney have severance agreements with the
Corporation. Each such agreement has a term of one year effective January 1,
2002. The term of each agreement is automatically renewed for an additional
one-year term, unless the Board of Directors of the Corporation chooses not to
renew and notifies the officer at least thirty days prior to the end of a term.
Each officer's agreement entitles him to a "Termination Payment" and continued
health insurance coverage for a period of twelve months in the event that the
officer's employment is terminated within twenty-four months following a change
of control or, under certain circumstances, following the acquisition of more
than 20% of the voting shares of the Corporation by any entity, person, or
group. The Termination Payment and continued health insurance coverage also
apply if the officer resigns for Good Reason, as defined, within twenty-four
months following a change of control. Each officer's Termination Payment is
equal to 125% of his then current annual base salary. Alternatively, each
officer's agreement entitles him to a payment in the amount of 66 2/3% of the
Termination Payment and continued health insurance coverage in the event that
the officer resigns for any reason during the period beginning on the
thirty-first day and ending on the sixtieth day following a change of control.
17
PERFORMANCE GRAPH
The following graph compares the Corporation's total stockholder return
over a 5-year measurement period with (i) the NASDAQ Market Index, and (ii) the
National Commercial Banks Index*.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
1/1/97 12/31/97 12/31/98 12/31/99 12/31/00 12/31/01
-------- ---------- ---------- ---------- ---------- ----------
The First of Long Island 100 183.24 202.40 136.23 182.42 186.72
National Commercial Banks 100 148.72 160.58 136.47 157.94 159.80
NASDAQ Market Index 100 122.32 172.52 304.29 191.25 152.46
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
THE FIRST OF LONG ISLAND CORPORATION,
NATIONAL COMMERCIAL BANKS INDEX, AND NASDAQ MARKET INDEX
Assumes $100 Invested on January 1, 1997
Assumes Dividend Reinvested
Fiscal Year Ended December 31, 2001
* The National Commercial Banks Index consists of nationally chartered
commercial banks and certain other financial institutions which, on the
basis of Standard Industrial Classification (S.I.C.) codes developed by the
U.S. Office of Management and Budget, have been included in the same
industry group as the Corporation.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
In 1992, the Bank, as tenant, entered into a lease with Howard Thomas
Hogan, Jr., a director of the Corporation and the Bank, covering premises in a
building located in Locust Valley, New York, used as a branch office. The lease
has a term of ten years and one month and expires on October 30, 2002. However,
the Bank may cancel the lease at any time upon giving Mr. Hogan ninety days
written notice. The lease provides for annual base rentals of $27,385 for the
year ending October 30, 2001 and $28,206 for the year ending October 30, 2002.
In addition to the base rent, the Bank is responsible for certain charges for
real estate taxes and common area maintenance. The Corporation believes that the
foregoing is comparable to the rent that would be charged by an unrelated third
party.
The Bank has had, and expects to have in the future, banking transactions
in the ordinary course of its business with directors, officers, principal
stockholders of the Corporation and their associates. Such transactions,
including borrowings and loan commitments, were made in the ordinary course of
business on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for
18
comparable transactions with others, and in the opinion of management do not
involve more than a normal risk of collectibility, nor do they present other
unfavorable features.
Certain directors are officers, directors, partners, and/or stockholders of
companies or partnerships which (or associates of which) may have been customers
of the Bank in the ordinary course of business during 2001 and up to the present
time. Additional transactions of this type may occur in the future. All such
transactions were effected on substantially the same terms as comparable
transactions with other persons.
EXAMINING COMMITTEE
Report of Examining Committee
We have reviewed and discussed with management the Company's audited
financial statements as of and for the year ended December 31, 2001.
We have discussed with the independent auditors the matters required to be
discussed by Statement of Auditing Standards No. 61 "Communication with Audit
Committees", as amended, by the Auditing Standards Board of the American
Institute of Certified Public Accountants.
We have reviewed the written disclosures and letter from the independent
auditors required by Independence Standard No. 1, "Independence Discussions with
Audit Committees", as amended, by the Independence Standard Board, and have
discussed with the auditors the auditors' independence.
Based on the review and discussions referred to above, we recommend to the
Board of Directors that the financial statements referred to above be included
in the Company's Annual Report on Form 10-K for the year ended December 31,
2001.
Walter C. Teagle III
Allen E. Busching
Beverly Ann Gehlmeyer
John R. Miller III
Examining Committee Charter and Independence
The Examining Committee is governed by a written charter adopted by the
Board of Directors of both the Corporation and the Bank. All of the members of
the Examining Committee are independent directors as defined in Marketplace Rule
4200(a)(14) of The Nasdaq Stock Market, Inc.
The preceding report and information and the Examining Committee charter
shall not be deemed incorporated by reference by any general statement
incorporating by reference this Proxy Statement into any filing under the
Securities Act of 1933 (the "1933 Act") or the Securities Act of 1934 (the "1934
Act"), except to the extent the Corporation specifically incorporates this
information by reference, and shall not otherwise be deemed filed under the 1933
Act or the 1934 Act.
INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated financial statements for the year ended December 31, 2001
were examined by Arthur Andersen LLP. A representative of Arthur Andersen LLP
will be present at the Annual Meeting of Stockholders and will have the
opportunity to make a statement and respond to appropriate questions from
stockholders. The Board of Directors has not yet decided who will serve as the
Corporation's independent public accountants for the current year and normally
makes this decision at their April meeting.
19
Audit Fees
Arthur Andersen LLP billed the Corporation $85,000 for the following
services performed with respect to the 2001 year: (1) professional services
rendered for the audit of the Corporation's annual financial statements; (2)
reviews of the financial statements included in the Corporation's Forms 10-Q;
(3) a reading of the Corporation's annual report on Form 10-K; (4) rendering an
opinion on management's assertion about the effectiveness of the Bank's internal
control structure over financial reporting; and (5) consultation on matters
related to accounting and financial reporting.
All Other Fees
Other than audit fees, the aggregate fees billed to the Corporation by
Arthur Andersen LLP for the most recent fiscal year were $29,000. These fees
were paid for tax services. The Examining Committee of the Board of Directors
determined that these services are not incompatible with Arthur Andersen LLP
maintaining their independence.
OTHER MATTERS
The Board of Directors of the Corporation does not know of any matters for
action by stockholders at the annual meeting other than the matters described in
the notice. However, the enclosed Proxy will confer discretionary authority with
respect to matters which are not known to the Board of Directors at the time of
the printing hereof and which may properly come before the meeting. It is the
intention of the persons named in the Proxy to vote such Proxy with respect to
such matters in accordance with their best judgment.
The entire expense of preparing, assembling and mailing the enclosed
material will be borne by the Corporation. In addition to using the mails,
directors, officers and employees of The First National Bank of Long Island (the
"Bank"), a wholly-owned subsidiary of the Corporation, acting on behalf of the
Corporation, and without extra compensation, may solicit proxies in person, by
telephone or by facsimile.
STOCKHOLDER PROPOSALS
Any proposals of stockholders intended to be submitted at the 2003 Annual
Meeting of Stockholders must be received by the Chairman of the Board or the
President no later than November 6, 2002 in order to be included in the proxy
statement and form of proxy for such meeting. If the Corporation is not notified
of a stockholder proposal by January 19, 2003, then the proxies held by
management of the Corporation may provide the discretion to vote against such
stockholder proposal, even though such proposal is not included in the proxy
statement and form of proxy.
ANNUAL REPORTS TO STOCKHOLDERS
Consolidated financial statements for the Corporation and the Bank are
included in the Corporation's 2001 Annual Report to Stockholders, which was
mailed with this Proxy Statement. In addition, copies of the 2001 Annual Report
or the annual report on Form 10-K as filed with the Securities and Exchange
Commission for 2001 will be sent to any stockholder upon written request without
charge. Such request should be directed to Mark D. Curtis, Senior Vice President
and Treasurer, at the Corporation's principal office, 10 Glen Head Road, Glen
Head, New York, 11545. The financial statements contained in the Corporation's
2001 Annual Report are not part of this Proxy Statement.
By Order of the Board of Directors
Joseph G. Perri
March 6, 2002 Senior Vice President and Secretary
20
REVOCABLE PROXY
THE FIRST OF LONG ISLAND CORPORATION
------------------
|X| PLEASE MARK VOTES
AS IN THIS EXAMPLE
------------------
ANNUAL MEETING OF STOCKHOLDERS
APRIL 16, 2002
KNOW ALL PERSONS BY THESE PRESENTS that I, the undersigned, being a
stockholder of THE FIRST OF LONG ISLAND CORPORATION, GLEN HEAD, NEW YORK, do
hereby constitute and appoint STEPHEN P. LYON AND JOHN H. TREIBER or either one
of them (with full power to act alone), my true and lawful attorney(s), with
full power of substitution, to attend the Annual Meeting of Stockholders of said
Corporation, to be held at the OLD BROOKVILLE OFFICE, 209 GLEN HEAD ROAD, GLEN
HEAD, NEW YORK, on Tuesday, April 16, 2002, at 3:30 P.M. local time, or any and
all adjournments thereof, and to vote all stock owned by me or standing in my
name, place and stead on the proposals of the Board of Directors specified in
the Notice of Meeting dated March 6, 2002, with all powers I would possess if I
were personally present, hereby ratifying and confirming all that my said Proxy
or Proxies may do, in my name, place and stead, as follows:
With- For All
For hold Except
1. Election of Directors |__| |__| |__|
To elect four (4) Directors, each
for a term of two (2) years (except
as marked to the contrary below)
ALLEN E. BUSCHING PAUL T. CANARICK
BEVERLY ANN GEHLMEYER J. WILLIAM JOHNSON
INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark
"For All Except" and write the name(s) of any such nominee(s) in the space
provided below.
- --------------------------------------------------------------------------------
2. Other Matters: If any other business is presented at said meeting, this
Proxy shall be voted in accordance with the best judgement of the Proxies.
IF NO DESIGNATIONS ARE MADE IN THE BOXES PROVIDED ABOVE AS TO THE ELECTION
OF DIRECTORS, THIS PROXY WILL BE VOTED "FOR" SUCH ELECTION.
The shares represented by a properly executed Proxy will be voted as
directed.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. IT MAY BE
REVOKED PRIOR TO ITS EXERCISE.
ALL JOINT OWNERS MUST SIGN INDIVIDUALLY. WHEN SIGNING AS ATTORNEY,
EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN OR CUSTODIAN, PLEASE GIVE FULL TITLE.
IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN.
------------
Please be sure to sign and date this Proxy in the box below. Date
- --------------------------------------------------------------------------
Stockholder sign above Co-holder (if any) sign above
- --------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Detach above card, sign, date and mail in postage paid envelope provided.
THE FIRST OF LONG ISLAND CORPORATION
- -----------------------------------------------------------------------------
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
- -----------------------------------------------------------------------------