SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. ______)
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[ ] Preliminary Proxy Statement
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Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
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[ ] Soliciting Material Pursuant to ss. 240.14a-12
CLIFTON SAVINGS BANCORP, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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CLIFTON SAVINGS BANCORP, INC.
1433 VAN HOUTEN AVENUE
CLIFTON, NEW JERSEY 07015
(973) 473-2200
July 9, 2008
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders
of Clifton Savings Bancorp, Inc. We will hold the meeting at the Valley Regency
located at 1129 Valley Road, Clifton, New Jersey, on August 14, 2008 at 9:00
a.m., local time.
The notice of annual meeting and proxy statement appearing on the
following pages describe the formal business to be transacted at the meeting.
Directors and officers of the Company, as well as a representative of Beard
Miller Company LLP, the Company's independent registered public accountants,
will be present to respond to appropriate questions of stockholders.
It is important that your shares are represented at this meeting,
whether or not you attend the meeting in person and regardless of the number of
shares you own. To make sure your shares are represented, we urge you to
complete and mail the enclosed proxy card promptly. If you attend the meeting,
you may vote in person even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/ John A. Celentano, Jr.
John A. Celentano, Jr.
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
CLIFTON SAVINGS BANCORP, INC.
1433 VAN HOUTEN AVENUE
CLIFTON, NEW JERSEY 07015
(973) 473-2200
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TIME AND DATE............................... 9:00 a.m. on Thursday, August 14, 2008
PLACE....................................... The Valley Regency, 1129 Valley Road, Clifton, New Jersey
ITEMS OF BUSINESS........................... (1) The election of two directors to serve for a term of
three years;
(2) The ratification of the appointment of Beard Miller
Company LLP as independent registered public
accountants for the Company for the fiscal year ending
March 31, 2009; and
(3) Such other business that may properly come before
the meeting. Note: The Board of Directors is not
aware of any other business to come before the meeting.
RECORD DATE................................. In order to vote, you must have been a stockholder at the
close of business on June 30, 2008.
PROXY VOTING................................ It is important that your shares be represented and voted at the
meeting. Please complete and sign the enclosed proxy card, which is
solicited by the Board of Directors, and mail it promptly
in the enclosed envelope. The proxy will not be used if you
attend the meeting and vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Walter Celuch
Walter Celuch
PRESIDENT AND CORPORATE SECRETARY
Clifton, New Jersey
July 9, 2008
NOTE: WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE VOTE BY
MARKING, SIGNING, DATING AND PROMPTLY RETURNING THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE.
CLIFTON SAVINGS BANCORP, INC.
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PROXY STATEMENT
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GENERAL INFORMATION
We are providing this proxy statement to you in connection with the
solicitation of proxies by the Board of Directors of Clifton Savings Bancorp,
Inc. ("Clifton Savings Bancorp" or the "Company") for the 2008 annual meeting of
stockholders and for any adjournment or postponement of the meeting. Clifton
Savings Bancorp is the holding company for Clifton Savings Bank (formerly known
as Clifton Savings Bank, S.L.A.).
We are holding the 2008 annual meeting at the Valley Regency located at
1129 Valley Road, Clifton, New Jersey, on August 14, 2008 at 9:00 a.m., local
time.
We intend to mail this proxy statement and the enclosed proxy card to
stockholders of record beginning on or about July 9, 2008.
INFORMATION ABOUT VOTING
WHO CAN VOTE AT THE MEETING
You are entitled to vote your shares of Clifton Savings Bancorp common
stock that you owned as of June 30, 2008. As of the close of business on June
30, 2008, a total of 26,894,293 shares of Clifton Savings Bancorp common stock
were outstanding, including 16,791,758 shares of common stock held by Clifton
MHC, the mutual holding company for Clifton Savings Bancorp. Each share of
common stock has one vote.
The Company's Charter provides that, until March 3, 2009, record
holders of the Company's common stock, other than Clifton MHC, who beneficially
own, either directly or indirectly, in excess of 10% of the Company's
outstanding shares are not entitled to any vote with respect to those shares
held in excess of the 10% limit.
OWNERSHIP OF SHARES; ATTENDING THE MEETING
You may own shares of Clifton Savings Bancorp in one or more of the
following ways:
o Directly in your name as the stockholder of record; or
o Indirectly through a broker, bank or other holder of record in
"street name."
If your shares are registered directly in your name, you are the holder
of record of these shares and we are sending these proxy materials directly to
you. As the holder of record, you have the right to give your proxy directly to
us or to vote in person at the meeting.
1
If you hold your shares in street name, your broker, bank or other
holder of record is sending these proxy materials to you. As the beneficial
owner, you have the right to direct your broker, bank or other holder of record
how to vote by filling out a voting instruction form that accompanies your proxy
materials. Your broker, bank or other holder of record may allow you to provide
voting instructions by telephone or by the Internet. Please see the instruction
form provided by your broker, bank or other holder of record that accompanies
this proxy statement. If you hold your shares in street name, you will need
proof of ownership to be admitted to the meeting. A recent brokerage statement
or letter from a bank or broker are examples of proof of ownership. If you want
to vote your shares of Clifton Savings Bancorp common stock held in street name
in person at the meeting, you must obtain a written proxy in your name from the
broker, bank or other holder of record of your shares.
QUORUM AND VOTE REQUIRED
QUORUM. We will have a quorum and will be able to conduct the business
of the annual meeting if the holders of a majority of the outstanding shares of
common stock entitled to vote are present at the meeting, either in person or by
proxy.
VOTES REQUIRED FOR PROPOSALS. At this year's annual meeting,
stockholders will elect two directors to serve for a term of three years. In
voting on the election of directors, you may vote in favor of the nominees,
withhold votes as to all nominees, or withhold votes as to specific nominees.
There is no cumulative voting for the election of directors. Directors must be
elected by a plurality of the votes cast at the annual meeting. This means that
the nominees receiving the greatest number of votes will be elected.
In voting on the ratification of the appointment of Beard Miller
Company LLP as the Company's independent registered public accountants, you may
vote in favor of the proposal, vote against the proposal or abstain from voting.
To ratify the selection of Beard Miller Company LLP as our independent
registered public accountants for fiscal 2009, the affirmative vote of a
majority of the shares represented at the annual meeting and entitled to vote is
required.
ROUTINE AND NON-ROUTINE PROPOSALS. The rules of the New York Stock
Exchange determine whether proposals presented at stockholder meetings are
routine or non-routine. If a proposal is routine, a broker, bank or other entity
holding shares for an owner in street name may vote for the proposal without
receiving voting instructions from the owner. If a proposal is non-routine, the
broker, bank or other entity may vote on the proposal only if the owner has
provided voting instructions. A broker non-vote occurs when a broker, bank or
other entity holding shares for an owner in street name is unable to vote on a
particular proposal because the proposal is non-routine and has not received
voting instructions from the beneficial owner. The election of directors and the
ratification of Beard Miller Company LLP as our independent registered public
accountants for fiscal 2009 are currently considered routine matters.
HOW WE COUNT VOTES. If you return valid proxy instructions or attend
the meeting in person, we will count your shares for purposes of determining
whether there is a quorum, even if you abstain from voting. Broker non-votes, if
any, also will be counted for purposes of determining the existence of a quorum.
In the election of directors, votes that are withheld will have no
effect on the outcome of the election. In counting votes on the proposal to
ratify the selection of the independent registered public accountants,
abstentions will have the same effect as a vote against the proposal.
Because Clifton MHC owns in excess of 50% of the outstanding shares of
Clifton Savings Bancorp common stock, the votes it casts will ensure the
presence of a quorum and control the outcome of the vote on both proposals.
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VOTING BY PROXY
The Board of Directors of Clifton Savings Bancorp is sending you this
proxy statement for the purpose of requesting that you allow your shares of
Clifton Savings Bancorp common stock to be represented at the annual meeting by
the persons named in the enclosed proxy card. All shares of Clifton Savings
Bancorp common stock represented at the annual meeting by properly executed and
dated proxy cards will be voted according to the instructions indicated on the
proxy card. If you sign, date and return a proxy card without giving voting
instructions, your shares will be voted as recommended by the Company's Board of
Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE:
o "FOR" EACH OF THE TWO NOMINEES FOR DIRECTOR; AND
o "FOR" THE RATIFICATION OF THE APPOINTMENT OF BEARD MILLER
COMPANY LLP AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC
ACCOUNTANTS.
If any matters not described in this proxy statement are properly
presented at the annual meeting, the persons named in the proxy card will use
their own best judgment to determine how to vote your shares. This includes a
motion to adjourn or postpone the annual meeting in order to solicit additional
proxies. If the annual meeting is postponed or adjourned, your Clifton Savings
Bancorp common stock may be voted by the persons named in the proxy card on the
new annual meeting date as well, unless you have revoked your proxy. The Company
does not know of any other matters to be presented at the annual meeting.
You may revoke your proxy at any time before the vote is taken at the
meeting. To revoke your proxy you must either advise the Corporate Secretary of
the Company in writing before your common stock has been voted at the annual
meeting, deliver a later dated proxy, or attend the meeting and vote your shares
in person. Attendance at the annual meeting will not in itself constitute
revocation of your proxy.
PARTICIPANTS IN THE BANK'S ESOP OR 401(K) SAVINGS PLAN
If you participate in the Clifton Savings Bank Employee Stock Ownership
Plan (the "ESOP") or if you hold shares through the Clifton Savings Bank 401(k)
Savings Plan (the "401(k) Plan"), you will receive a vote authorization form for
each plan that reflects all shares you may direct the trustees to vote on your
behalf under the plans. Under the terms of the ESOP, the ESOP trustee votes all
shares held by the ESOP, but each ESOP participant may direct the trustee how to
vote the shares of common stock allocated to his or her account. The ESOP
trustee, subject to the exercise of its fiduciary duties, will vote all
unallocated shares of Company common stock held by the ESOP and allocated shares
for which no voting instructions are received in the same proportion as shares
for which it has received timely voting instructions. Under the terms of the
401(k) Plan, a participant is entitled to direct the trustee as to the shares in
the Clifton Savings Bancorp, Inc. Stock Fund credited to his or her account. The
trustee, subject to its fiduciary duties, will vote all shares for which no
directions are given or for which instructions were not received in the same
proportion as shares for which the trustee received timely voting instructions.
THE DEADLINE FOR RETURNING YOUR VOTE AUTHORIZATION FORM TO EACH PLAN'S TRUSTEE
IS AUGUST 7, 2008.
3
CORPORATE GOVERNANCE
DIRECTOR INDEPENDENCE
The Company's Board of Directors consists of seven directors, all of
whom are independent under the listing requirements of the Nasdaq Stock Market,
except for Mr. Celentano, who serves as Chairman of the Board and Chief
Executive Officer of Clifton Savings Bancorp and Chairman of the Board of
Clifton Savings, and Mr. Smith, who is a first cousin of Mr. Celentano and whose
paving construction company occasionally provides services for the Company. In
determining the independence of its directors, the Board considered
transactions, relationships and arrangements between the Company and its
directors that are not required to be disclosed in this proxy statement under
the heading "OTHER INFORMATION RELATING TO DIRECTORS AND EXECUTIVE OFFICERS --
TRANSACTIONS WITH RELATED PERSONS," including loans or lines of credit that the
Bank has directly or indirectly made to Directors Smith, Sisco Parachini, Peto
and Pivirotto.
COMMITTEES OF THE BOARD OF DIRECTORS
The following table identifies the members of the Audit/Compliance
Committee, the Nominating/Corporate Governance Committee and the Compensation
Committee as of June 30, 2008. All members of each committee are independent in
accordance with the listing standards of the Nasdaq Stock Market, Inc. Each of
the committees operates under a written charter that is approved by the Board of
Directors. Each committee reviews and reassesses the adequacy of its charter
annually. The charters of all three committees are available in the Investor
Relations section of the Company's website (www.cliftonsavings.com).
NOMINATING/
AUDIT/ CORPORATE
COMPLIANCE GOVERNANCE COMPENSATION
DIRECTOR COMMITTEE COMMITTEE COMMITTEE
--------------------------------- ---------------- --------------------- --------------------
John A. Celentano, Jr.........
Thomas A. Miller............... X X X*
Cynthia Sisco Parachini........ X X X
John H. Peto................... X X X
Charles J. Pivirotto........... X* X
Joseph C. Smith................
John Stokes.................... X X* X
NUMBER OF MEETINGS IN 2008 12 4 9
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*Chairman
4
AUDIT/COMPLIANCE COMMITTEE. The Board of Directors has a
separately-designated standing Audit/Compliance Committee established in
accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as
amended. The Audit/Compliance Committee meets periodically with the independent
registered public accountants, management and the internal auditors to review
accounting, auditing, internal control structure and financial reporting
matters. The Board of Directors has determined that Mr. Pivirotto is an audit
committee financial expert under the rules of the Securities and Exchange
Commission. The report of the Audit/Compliance Committee required by the rules
of the Securities and Exchange Commission is included in this proxy statement.
See "REPORT OF THE AUDIT/COMPLIANCE COMMITTEE."
COMPENSATION COMMITTEE. The Compensation Committee approves the
compensation objectives for the Company and the Bank and establishes the
compensation for the Chief Executive Officer and other executives. See
"COMPENSATION DISCUSSION AND ANALYSIS" for more information regarding the role
of the Compensation Committee and management in determining and/or recommending
the amount or form of executive compensation. The report of the Compensation
Committee required by the rules of the Securities and Exchange Commission is
included in this proxy statement. See "REPORT OF THE COMPENSATION COMMITTEE."
NOMINATING/CORPORATE GOVERNANCE COMMITTEE. The Nominating/Corporate
Governance Committee takes a leadership role in shaping governance policies and
practices including recommending to the Board of Directors the corporate
governance policies and guidelines applicable to Clifton Savings Bancorp and
monitoring compliance with these policies and guidelines. In addition, the
Nominating/Corporate Governance Committee is responsible for identifying
individuals qualified to become Board members and recommending to the Board the
director nominees for election at the next annual meeting of stockholders. It
leads the Board in its annual review of the Board's performance and recommends
director candidates for each committee for appointment by the Board. The
procedures of the Nominating/Corporate Governance Committee required to be
disclosed by the rules of the Securities and Exchange Commission are set forth
below.
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE PROCEDURES
MINIMUM QUALIFICATIONS. The Nominating/Corporate Governance Committee
has adopted a set of criteria that it considers when it selects individuals to
be nominated for election to the Board of Directors. First a candidate must meet
the eligibility requirements set forth in the Company's bylaws, which include a
requirement that the candidate not have been subject to certain criminal or
regulatory actions. A candidate also must meet any qualification requirements
set forth in any Board or committee governing documents.
The Nominating/Corporate Governance Committee will consider the
following criteria in selecting nominees for initial election or appointment to
the Board of Directors: financial, regulatory and business experience;
familiarity with and participation in the local community; integrity, honesty
and reputation; dedication to the Company and its stockholders; independence;
and any other factors the Nominating/Corporate Governance Committee deems
relevant, including age, diversity, size of the Board of Directors and
regulatory disclosure obligations.
In addition, before nominating an existing director for re-election to
the Board of Directors, the Nominating/Corporate Governance Committee will
consider and review an existing director's Board and committee attendance and
performance; length of Board service; experience, skills and contributions that
the existing director brings to the Board; and independence.
5
DIRECTOR NOMINATION PROCESS. The Nominating/Corporate Governance
Committee process for identifying and evaluating individuals to be nominated for
election to the Board of Directors is as follows:
IDENTIFICATION. For purposes of identifying nominees for the Board of
Directors, the Nominating/Corporate Governance Committee relies on personal
contacts of the committee members and other members of the Board of Directors as
well as its knowledge of members of the Bank's local communities. The
Nominating/Corporate Governance Committee will also consider director candidates
recommended by stockholders in accordance with the policy and procedures set
forth above. The Nominating/Corporate Governance Committee has not previously
used an independent search firm to identify nominees.
EVALUATION. In evaluating potential nominees, the Nominating/Corporate
Governance Committee determines whether the candidate is eligible and qualified
for service on the Board of Directors by evaluating the candidate under the
selection criteria set forth above. In addition, the Nominating/Corporate
Governance Committee will conduct a check of the individual's background and
interview the candidate.
CONSIDERATION OF RECOMMENDATIONS BY STOCKHOLDERS. It is the policy of
the Nominating/ Corporate Governance Committee of the Board of Directors of the
Company to consider director candidates recommended by stockholders who appear
to be qualified to serve on the Company's Board of Directors. The
Nominating/Corporate Governance Committee may choose not to consider an
unsolicited recommendation if no vacancy exists on the Board of Directors and
the Nominating/Corporate Governance Committee does not perceive a need to
increase the size of the Board of Directors. In order to avoid the unnecessary
use of the Nominating/Corporate Governance Committee's resources, the
Nominating/Corporate Governance Committee will consider only those director
candidates recommended in accordance with the procedures set forth below.
PROCEDURES TO BE FOLLOWED BY STOCKHOLDERS. To submit a recommendation
of a director candidate to the Nominating/Corporate Governance Committee, a
stockholder should submit the following information in writing, addressed to the
Chairman of the Nominating/Corporate Governance Committee, care of the Corporate
Secretary, at the main office of the Company:
1. The name of the person recommended as a director candidate;
2. All information relating to such person that is required to be
disclosed in solicitations of proxies for election of
directors pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended;
3. The written consent of the person being recommended as a
director candidate to being named in the proxy statement as a
nominee and to serving as a director if elected;
4. As to the stockholder making the recommendation, the name and
address, as they appear on the Company's books, of such
stockholder; provided, however, that if the stockholder is not
a registered holder of the Company's common stock, the
stockholder should submit his or her name and address along
with a current written statement from the record holder of the
shares that reflects ownership of the Company's common stock;
and
5. A statement disclosing whether such stockholder is acting with
or on behalf of any other person and, if applicable, the
identity of such person.
6
In order for a director candidate to be considered for nomination at
the Company's annual meeting of stockholders, the recommendation must be
received by the Nominating/Corporate Governance Committee at least 120 calendar
days before the date the Company's proxy statement was released to stockholders
in connection with the previous year's annual meeting, advanced by one year.
BOARD AND COMMITTEE MEETINGS
During the year ended March 31, 2008, the Boards of Directors of the
Company and the Bank held 29 and 15 meetings, respectively. No director attended
fewer than 75% of the total meetings of the Company's and the Bank's respective
Boards of Directors and the committees on which such director served.
DIRECTOR ATTENDANCE AT THE ANNUAL MEETING OF STOCKHOLDERS
The Board of Directors encourages directors to attend the annual
meeting of stockholders. All of the Company's directors attended the 2007 annual
meeting of stockholders.
CODE OF ETHICS AND BUSINESS CONDUCT
Clifton Savings Bancorp has adopted a Code of Ethics and Business
Conduct that is designed to ensure that the Company's directors, executive
officers and employees meet the highest standards of ethical conduct. The Code
of Ethics and Business Conduct requires that the Company's directors, executive
officers and employees avoid conflicts of interest, comply with all laws and
other legal requirements, conduct business in an honest and ethical manner and
otherwise act with integrity and in the Company's best interest. Under the terms
of the Code of Ethics and Business Conduct, directors, executive officers and
employees are required to report any conduct that they believe in good faith to
be an actual or apparent violation of the Code.
REPORT OF THE AUDIT/COMPLIANCE COMMITTEE
The Company's management is responsible for the Company's internal
controls and financial reporting process. The Company's independent registered
public accountants (the "independent accountants") are responsible for
performing an independent audit of the Company's consolidated financial
statements and issuing an opinion on the conformity of those financial
statements with generally accepted accounting principles. The Audit/Compliance
Committee oversees the Company's internal controls and financial reporting
process on behalf of the Board of Directors.
In this context, the Audit/Compliance Committee has met and held
discussions with management, the internal auditors and the independent
accountants. Management represented to the Audit/Compliance Committee that the
Company's consolidated financial statements were prepared in accordance with
generally accepted accounting principles, and the Audit/Compliance Committee has
reviewed and discussed the consolidated financial statements with management and
the independent accountants. The Audit/Compliance Committee discussed with the
independent accountants matters required to be discussed by Statement on
Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1 AV
Section 380), as adopted by the Public Company Accounting Oversight Board in
Rule 3200T, including the quality, not just the acceptability, of the accounting
principles, the reasonableness of significant judgments, and the clarity of the
disclosures in the financial statements.
7
In addition, the Audit/Compliance Committee has received the written
disclosures and the letter from the independent accountants required by the
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), as adopted by the Public Company Accounting Oversight Board in Rule
3600T, and has discussed with the independent accountants the independent
accountants' independence from the Company and its management. In concluding
that the auditors are independent, the Audit/Compliance Committee considered,
among other factors, whether the non-audit services provided by the auditors
were compatible with its independence.
The Audit/Compliance Committee discussed with the Company's independent
accountants the overall scope and plans for their audit. The Audit/Compliance
Committee meets with the independent registered public accountants, with and
without management and the internal accountants present, to discuss the results
of their examination, their evaluation of the Company's internal controls, and
the overall quality of the Company's financial reporting.
In performing all of these functions, the Audit/Compliance Committee
acts only in an oversight capacity. In its oversight role, the Audit/Compliance
Committee relies on the work and assurances of the Company's management, which
has the primary responsibility for financial statements and reports, and of the
independent accountants who, in their report, express an opinion on the
conformity of the Company's financial statements to generally accepted
accounting principles. The Audit/Compliance Committee's oversight does not
provide it with an independent basis to determine that management has maintained
appropriate accounting and financial reporting principles or policies, or
appropriate internal controls and procedures designed to assure compliance with
accounting standards and applicable laws and regulations. Furthermore, the
Audit/Compliance Committee's considerations and discussions with management and
the independent accountants do not assure that the Company's financial
statements are presented in accordance with generally accepted accounting
principles, that the audit of the Company's consolidated financial statements
has been carried out in accordance with the standards of the Public Company
Accounting Oversight Board (United States) or that the Company's independent
accountants are in fact "independent."
In reliance on the reviews and discussions referred to above, the
Audit/Compliance Committee recommended to the Board of Directors, and the Board
has approved, that the audited consolidated financial statements be included in
the Company's Annual Report on Form 10-K for the year ended March 31, 2008 for
filing with the Securities and Exchange Commission. The Audit/Compliance
Committee and the Board of Directors also have approved, subject to stockholder
ratification, the selection of the Company's independent accountants.
AUDIT/COMPLIANCE COMMITTEE THE BOARD OF DIRECTORS OF
CLIFTON SAVINGS BANCORP, INC.
Charles J. Pivirotto, Chairman
Thomas A. Miller
Cynthia Sisco Parachini
John H. Peto
John Stokes
8
DIRECTOR COMPENSATION
The following table provides the compensation received by individuals who served
as non-employee directors of the Company during the 2008 fiscal year.
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CHANGE IN PENSION VALUE
AND NONQUALIFIED
FEES EARNED OR STOCK OPTION DEFERRED COMPENSATION
PAID IN CASH AWARDS AWARDS EARNINGS ALL OTHER TOTAL
NAME ($)(1) ($)(2) ($)(3) ($)(4) COMPENSATION ($) ($)
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Thomas A. Miller $56,000 $61,156 $28,167 -- $3,291 $148,614
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Cynthia Sisco Parachini $55,417 -- -- $13,477 -- $ 68,894
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John H. Peto $56,000 $61,156 $28,167 $19,769 $3,291 $168,383
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Charles J. Pivirotto $56,000 -- -- $14,415 -- $ 70,415
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Joseph C. Smith $48,000 $61,156 $28,167 $11,986 $3,291 $152,600
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John Stokes $56,000 $61,156 $28,167 $25,941 $3,291 $174,555
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(1) Includes fees earned for service with Clifton Savings, Clifton Savings
Bancorp and Clifton MHC.
(2) Reflects the dollar amount recognized for financial statement reporting
purposes in accordance with FAS 123(R) for shares of restricted stock in
fiscal 2008 based upon the Company's stock price of $10.22 on the date of
grant. The aggregate number of unvested restricted stock award shares held
by each of Messrs. Miller, Peto, Smith and Stokes at fiscal year end was
11,968. There were no awards of restricted stock granted in fiscal 2008.
Stock awards vest in five equal annual installments beginning on the date
of grant, which for all shares shown was December 7, 2005.
(3) Reflects the dollar amount recognized for financial statement reporting
purposes in accordance with FAS 123(R) for each director, based upon a fair
value of each option of $2.38 using the Black-Scholes option pricing model.
The aggregate number of options held by each non-employee director at
fiscal year end was 74,795. For further information on the assumptions used
to compute the fair value, see note 13 to the notes to the consolidated
financial statements contained in the Company's Annual Report on Form 10-K.
Options vest in five equal annual installments beginning on the date of
grant, which for all options shown was August 31, 2005, except for the
second annual installment which vested on March 31, 2006.
(4) Amounts represent the aggregate change in the actuarial present value of
accumulated benefit under the Bank's Directors' Retirement Plan. For Mr.
Miller, the aggregate change was a decrease of $11,997.
9
CASH RETAINERS AND MEETING FEES FOR NON-EMPLOYEE DIRECTORS
The following tables set forth the applicable retainers and fees that
will be paid to non-employee directors for their service on the Board of
Directors of Clifton Savings and the Board of Directors of Clifton Savings
Bancorp during fiscal 2009. Employee directors do not receive any retainers or
fees for their services on the Board of Directors.
CLIFTON SAVINGS:
Annual retainer..................................................................$38,500
Additional annual retainer for committee chairmen (1).............................$3,500
--------------
(1) Chairmen of the Audit/Compliance, Nominating/Corporate Governance,
Compensation, Finance, Investment, and Building and Grounds
Committees receive committee chairmen fees.
CLIFTON SAVINGS BANCORP:
Annual retainer...................................................................$6,000
Additional annual retainer for Audit/Compliance Committee members.................$5,000
Additional fee per Audit Committee meeting attended.................................$250
DIRECTORS' RETIREMENT PLAN
Clifton Savings maintains the Clifton Savings Bank Directors'
Retirement Plan to provide directors with supplemental retirement income. All
current directors participate in the plan and future directors may become
participants upon designation as such by the Board of Directors. The plan
provides benefits upon a director's retirement, death or disability, and upon a
change in control of Clifton Savings or Clifton Savings Bancorp.
Upon their retirement following the completion of three years of
service and the attainment of age 68, participants receive an annual retirement
benefit, payable for life, equal to a percentage of the sum of the annual fees
and retainer paid (or, for employee directors, that would have been paid) during
the twelve-month period ending on the date preceding retirement. For an employee
serving as Chairman of the Board of Directors, the annual retirement benefit
equals a percentage of an amount that equals 137.5% of the annual fees and
retainer that would have been paid if the Chairman was a non-employee. The
percentage paid as an annual benefit is determined by multiplying the
participant's years of service (up to a maximum of 10) by 10 percent.
A participant who completes a minimum of three years of service,
regardless of age, may receive death and disability benefits under the plan. If
the participant dies prior to the start of the normal retirement benefit, the
participant's surviving spouse or other designated beneficiary receives an
annual death benefit, payable over a ten-year period, equal to the sum of the
annual fees and retainer paid (or, for employee directors, that would have been
paid or, for an employee director serving as Chairman, 137.5% of the amount that
would have been paid) to the director during the twelve-month period ending on
the last day of the month preceding the date of death. If a participant dies
while receiving the annual retirement benefit under the plan, the beneficiary
continues to receive the same annual benefit for ten years, minus the number of
years the participant already received the annual retirement benefit. The
disability benefit under the plan equals the sum of the annual fees and retainer
paid (or, for employee directors, that would have been paid or, for an employee
director serving as Chairman, 137.5% of the amount that would have been paid)
during the twelve-month period ending on the last day of the month immediately
preceding the participant's termination of service due to disability. If a
participant dies while receiving the annual disability benefit, the beneficiary
continues to receive the annual disability benefit for a period of 10 years,
less the number of years the participant previously received disability
benefits.
10
Upon the completion of one year of service, regardless of age,
participants receive a benefit upon a change in control of Clifton Savings or
Clifton Savings Bancorp. The annual change in control benefit, payable for the
life of the participant, equals the sum of the annual fees and retainer paid
(or, for employee directors, that would have been paid or, for an employee
director serving as Chairman, 137.5% of the amount that would have been paid) to
the participant during the twelve-month period preceding the date of a
termination of service due to a change in control. If a participant dies while
receiving the annual change in control benefit, the designated beneficiary
continues to receive the annual change in control benefit for a period of
fifteen years, minus the number of years the participant had already received
benefits under the plan. Based on current director compensation and membership,
the minimum annual change in control benefits payable to all directors
(including the Chairman) under the Directors' Retirement Plan would total
approximately $391,700 per year. This expense would represent approximately
16.5% of Clifton Savings' reported net income of $2.37 million for the year
ended March 31, 2008.
The plan provides for the payment of retirement, death, disability or
change in control benefits in equal monthly installments, commencing on the
first business day of the month after the participant becomes entitled to a
benefit, or, if a director so elects, in an actuarial equivalent lump sum.
STOCK OWNERSHIP
The following table provides information as of June 30, 2008 about the
persons and entities known to Clifton Savings Bancorp to be the beneficial
owners of more than 5% of the Company's outstanding common stock. A person or
entity may be considered to beneficially own any shares of common stock over
which the person or entity has, directly or indirectly, sole or shared voting
authority.
PERCENT
NUMBER OF OF COMMON STOCK
NAME AND ADDRESS SHARES OWNED OUTSTANDING(1)
----------------------- ------------------- -----------------------
Clifton MHC 16,791,758(2) 62.4%
1433 Van Houten Avenue
Clifton, New Jersey 07015
- ---------------------------
(1) Based on 26,894,293 shares of the Company's common stock outstanding and
entitled to vote as of June 30, 2008.
(2) Acquired in the Bank's mutual holding company reorganization, which was
completed on March 3, 2004. The members of the Board of Directors of Clifton
Savings Bancorp and Clifton Savings also constitute the Board of Directors
of Clifton MHC.
11
The following table provides information as of May 30, 2008 about the
shares of Clifton Savings Bancorp common stock that may be considered to be
beneficially owned by each director, nominee for director, named executive
officers listed in the SUMMARY COMPENSATION TABLE and all directors and
executive officers of the Company as a group. A person may be considered to
beneficially own any shares of common stock over which he or she has, directly
or indirectly, sole or shared voting or investment power. Unless otherwise
indicated, none of the shares listed are pledged as security, and each of the
named individuals has sole voting and sole investment power with respect to the
number of shares shown.
NUMBER OF SHARES
NUMBER OF THAT MAY BE ACQUIRED PERCENT OF
SHARES WITHIN 60 DAYS BY COMMON STOCK
NAME OWNED(1)(2) EXERCISING OPTIONS OUTSTANDING(3)
- ---------- ---------------- ---------------------- ----------------
John A. Celentano, Jr. 274,072 (4) 197,400 1.74%
Walter Celuch 91,250 (5) 107,700 *
Bart D'Ambra 51,710 71,760 *
Stephen A. Hoogerhyde 48,625 71,760 *
Thomas A. Miller 23,936 44,877 *
Cynthia Sisco Parachini 50,000 -- *
John H. Peto 47,420 44,877 *
Charles J. Pivirotto 1,130 (6) -- *
Christine R. Piano 53,499 71,760 *
Joseph C. Smith 91,920 (7) 44,877 *
John Stokes 39,920 44,877 *
ALL DIRECTORS AND EXECUTIVE OFFICERS
AS A GROUP (11 PERSONS) 773,482 699,888 5.33%
- --------------------------------------------------------
* Does not exceed 1.0% of the Company's voting securities.
(1) Includes shares of unvested restricted stock held in trust as part of the
Company's 2005 Equity Incentive Plan with respect to which individuals have
voting but not investment power as follows: Mr. Celentano-- 50,264 shares,
Mr. Celuch--26,329 shares, Mr. D'Ambra--16,754 shares, Mr.
Hoogerhyde--16,754 shares, Mr. Miller--11,968 shares, Mr. Peto--11,968
shares, Ms. Piano--16,754 shares, Mr. Smith--11,968 shares, and Mr.
Stokes--11,968 shares. All restricted stock awards vest in two equal annual
installments on December 7, 2008 and December 7, 2009.
(2) Includes shares allocated to the account of individuals under the Bank's
employee stock ownership plan with respect to which individuals have voting
but not investment power as follows: Mr. Celentano--19,314 shares, Mr.
Celuch--18,827 shares, Mr. D'Ambra--10,426 shares, Mr. Hoogerhyde--11,531
shares, and Ms. Piano--11,825 shares.
(3) Based on 26,961,595 shares of the Company's common stock outstanding and
entitled to vote as of May 30, 2008, plus the number of shares that may be
acquired by each individual (or group of individuals) by exercising options.
(4) Includes 50,000 shares held by Mr. Celentano's spouse and 13,743 shares
held in trust for Mr. Celentano under the Bank's supplemental executive
retirement plan as to which he has shared voting power.
(5) Includes 5,000 shares held jointly by Mr. Celuch's spouse and daughters and
297 shares held in trust for Mr. Celuch under the Bank's supplemental
executive retirement plan as to which he has shared voting power.
(6) Includes 30 shares held by Mr. Pivirotto's son and 100 shares held in trust
by Mr. Pivirotto's spouse as custodian for their son.
(7) Includes 2,000 shares held by Mr. Smith's son.
12
ITEMS TO BE VOTED UPON BY STOCKHOLDERS
ITEM 1 -- ELECTION OF DIRECTORS
The Company's Board of Directors currently consists of seven members.
The Board is divided into three classes with three-year staggered terms, with
approximately one-third of the directors elected each year. The Board of
Directors' nominees for election this year, to serve for a three-year term or
until their respective successors have been elected and qualified, are John A.
Celentano, Jr. and Thomas A. Miller. Each of the nominees is currently a
director of Clifton Savings Bancorp and Clifton Savings.
Unless you indicate on the proxy card that your shares should not be
voted for a certain nominee, the Board of Directors intends that the proxies
solicited by it will be voted for the election of both of the Board's nominees.
If either nominee is unable to serve, the persons named in the proxy card will
vote your shares to approve the election of any substitute nominee proposed by
the Board of Directors. At this time, the Board of Directors knows of no reason
why either nominee might be unable to serve.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF MESSRS.
CELENTANO, JR. AND MILLER.
Information regarding the Board of Directors' nominees and the
directors continuing in office is provided below. Unless otherwise stated, each
individual has held his or her current occupation for the last five years. The
age indicated for each individual is as of March 31, 2008. The indicated period
of service as a director includes the period of service as a director of Clifton
Savings.
NOMINEES FOR ELECTION AS DIRECTORS
THE NOMINEES STANDING FOR ELECTION TO SERVE FOR A THREE-YEAR TERM ARE:
JOHN A. CELENTANO, JR. has served as the Chairman of the Board and
Chief Executive Officer of Clifton Savings Bancorp since March 2004 and as
Chairman of the Board of Clifton Savings, as an employee, since 2003. Prior to
April 2003, Mr. Celentano was also a partner at the law firm of Celentano,
Stadtmauer & Walentowicz, L.L.P. Age 73. Director since 1962.
THOMAS A. MILLER is the owner of The T.A. Miller & Co., Inc., a full
service marketing research organization servicing the pharmaceutical industry
located in Spring Lake Heights, New Jersey. Age 70. Director since 1990.
DIRECTORS CONTINUING IN OFFICE
THE FOLLOWING DIRECTORS HAVE TERMS ENDING IN 2009:
JOHN H. PETO is a real estate investor and previously was the owner of
The Peto Agency, a real estate and insurance broker located in Clifton, New
Jersey. Age 62. Director since 1995.
JOSEPH C. SMITH is the President of Smith-Sondy Asphalt Construction
Co., a paving construction company located in Wallington, New Jersey. Age 55.
Director since 1994.
THE FOLLOWING DIRECTORS HAVE TERMS ENDING IN 2010:
CYNTHIA SISCO PARACHINI owns and manages an apartment complex and also
manages several residential complexes. Age 51. Director since 2007.
13
CHARLES J. PIVIROTTO, a certified public accountant, has been the
President of Pivirotto & Foster, CPA's PA, a certified public accounting firm,
since 1997. Age 53. Director since 2007.
JOHN STOKES has been a General Partner at O.I.R. Realty Co., a real
estate investment company, since 1980. From 1978 to 1992, Mr. Stokes was a
General Partner at Brigadier Realty, a real estate investment company. Age 78.
Director since 2001.
ITEM 2 -- RATIFICATION OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
The Audit/Compliance Committee of the Board of Directors has appointed
Beard Miller Company LLP to be the Company's independent registered public
accountants for the 2009 fiscal year, subject to ratification by stockholders. A
representative of Beard Miller Company LLP is expected to be present at the
annual meeting to respond to appropriate questions from stockholders and will
have the opportunity to make a statement should he or she desire to do so.
If the ratification of the appointment of the independent registered
public accountants is not approved by a majority of the shares represented at
the annual meeting and entitled to vote, the Audit/Compliance Committee will
consider other independent registered public accountants.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF BEARD MILLER COMPANY LLP AS THE COMPANY'S
INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS.
AUDIT FEES. The following table sets forth the fees billed to the
Company for the fiscal years ended March 31, 2008 and 2007 by Beard Miller
Company LLP:
2008 2007
----------------- ---------------
Audit fees(1)....................................... $118,070 $114,602
Audit related fees.................................. -- --
Tax fees(2)......................................... $ 10,500 $ 10,000
All other fees...................................... -- --
-------------
(1) Includes professional services rendered for the audit of the
Company's annual consolidated financial statements and review of
consolidated financial statements included in Forms 10-Q, or
services normally provided in connection with statutory and
regulatory filings (i.e., attest services required by FDICIA or
Section 404 of the Sarbanes-Oxley Act), including out-of-pocket
expenses.
(2) Tax fees include the preparation of state and federal tax
returns.
POLICY ON AUDIT/COMPLIANCE COMMITTEE PRE-APPROVAL OF AUDIT AND
PERMISSIBLE NON-AUDIT SERVICES OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS. The
Audit/Compliance Committee is responsible for appointing, setting compensation,
and overseeing the work of the independent registered public accountants. In
accordance with its charter, the Audit/Compliance Committee approves, in
advance, all audit and permissible non-audit services to be performed by the
independent registered public accountants to ensure that the external auditor
does not provide any non-audit services to the Company that are prohibited by
law or regulation.
In addition, the Audit/Compliance Committee has established a policy
regarding pre-approval of all audit and permissible non-audit services provided
by the independent registered public accountants. Requests for services by the
independent registered public accountants for compliance with the auditor
services policy must be specific as to the particular services to be provided.
14
The request may be made with respect to either specific services or a
type of service for predictable or recurring services.
During the year ended March 31, 2008, all services were approved, in
advance, by the Audit/Compliance Committee in compliance with these procedures.
COMPENSATION DISCUSSION AND ANALYSIS
OUR COMPENSATION PHILOSOPHY
Our compensation philosophy is based on the provision of incentives and
rewards to those employees who are largely responsible for the success and
growth of Clifton Savings Bancorp and its affiliates. Our compensation
philosophy enables the Company and its affiliates to reward, attract and retain
employees and directors with experience and ability. It also provides incentives
and rewards to officers and directors for their valuable and faithful years of
service, and helps the Bank to attract and retain highly qualified individuals
as directors, while encouraging directors who terminate their Board service to
continue providing advice in an emeritus capacity and to help ensure the
efficient transfer of responsibilities to their successors. We also recognize
that we operate in a highly competitive environment for talent. Therefore, our
approach to compensation considers a wide range of compensation techniques.
We ground our compensation philosophy on four basic principles:
o MEETING THE DEMANDS OF THE MARKET -- Our goal is to compensate
our named executive officers at competitive levels that
position us as an employer of choice among institutions
providing similar financial services in the markets we serve.
o ALIGNING WITH SHAREHOLDERS -- We use equity compensation as a
component of our compensation mix and as a means to develop a
culture of ownership while aligning the financial interests of
our named executive officers with those of our shareholders.
o PERFORMANCE -- We structure our compensation program to reward
our named executive officers for performance and management
skills. In keeping with this philosophy, we maintain a
short-term cash-based incentive compensation program for
executive officers, as described below under "SHORT-TERM
CASH-BASED INCENTIVE COMPENSATION."
o REFLECTING OUR BUSINESS PHILOSOPHY -- Our approach to
compensation reflects our values and the way we do business in
the communities we serve.
ELEMENTS USED TO IMPLEMENT OUR COMPENSATION OBJECTIVES
Our compensation program relies on three primary elements: (1) base
compensation or base salary; (2) cash-based, short-term incentive compensation;
and (3) equity-based, long-term incentive compensation. We believe that we can
best satisfy the objectives of our compensation philosophy by achieving a
balance among these three elements that is competitive with our industry peers
and creates appropriate incentives for our named executives. We combine the
above compensation elements for each executive in a manner we believe optimizes
the executive's contributions to the Company.
15
BASE COMPENSATION. Base salaries for our named executive officers
depend on the scope of their responsibilities and their performance. Decisions
regarding salary increases also take into account the executive's current salary
and the amounts paid to the executive's peers within and outside the company.
Our goal is to maintain salary levels for our officers at a level consistent
with base pay received by those in comparable positions at our peers. Base
salaries are reviewed at least annually by the Compensation Committee. Based on
the Committee's review of base salaries in fiscal 2008, each named executive
officer other than Mr. Celentano received a three percent increase in base
salary over the levels established in fiscal 2007. See "EXECUTIVE
COMPENSATION--SUMMARY COMPENSATION TABLE" for salaries paid to the named
executives in fiscal 2008.
SHORT-TERM CASH-BASED INCENTIVE COMPENSATION. We have established a
short-term, cash-based incentive program designed to reward executive management
with a modest bonus based on the attainment of certain corporate objectives.
Upon review, the Committee determined that the Company's overall performance did
satisfy these criteria. Therefore, each named executive officer was awarded a
$2,500 bonus under this program in fiscal 2008.
LONG-TERM EQUITY-BASED COMPENSATION. Our long-term, incentive
compensation program is based on the delivery of competitive equity awards to
our named executives under the equity incentive plan approved by shareholders in
2005. Although each of the named executive officers currently holds shares of
restricted stock or stock options pursuant to this plan (See "EXECUTIVE
COMPENSATION--OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END"), we did not make
any additional equity grants to the named executive officers in fiscal 2008.
While the Committee considers these past grants when reviewing the overall
compensation of its named executive officers, it is also mindful when setting
compensation levels that equity grants are not routinely made under the equity
incentive plan.
ROLE OF THE COMPENSATION COMMITTEE
We rely on the Compensation Committee to develop the broad outline of
our compensation program and to monitor the success of the program in achieving
the objectives of our compensation philosophy. The Committee, which consists of
five independent directors, is also responsible for the administration of our
compensation programs and policies, including our cash- and stock-based
incentive programs. The Committee operates under the mandate of a formal charter
that establishes the framework for its overall responsibilities. The Committee
reviews the charter at least annually to ensure the scope of the charter is
consistent with the Committee's expected role. The Committee is authorized to
engage consultants and other professionals without management approval to the
extent deemed necessary to discharge its responsibilities. See "CORPORATE
GOVERNANCE--COMMITTEES OF THE BOARD OF DIRECTORS" for the members of the
Committee and the number of meetings in fiscal 2008.
ROLE OF THE COMPENSATION CONSULTANT
The Moore Consulting Group provides consulting services with respect to
compensation paid to the Chief Executive Officer and other named executive
officers, as well as other management and non-management employees.
Specifically, The Moore Consulting Group provided a base salary review of our
executive management staff. The Moore Consulting Group prepared a report for the
Compensation Committee to provide the Committee with a means of identifying
relevant survey data for the determination of competitive base salary practices
and to compare current base salaries with competing financial institutions of
similar size in the northeast region and the nation as a whole. During fiscal
2008, we paid The Moore Consulting Group $1,272.
16
PEER GROUP ANALYSIS
A critical element of our compensation philosophy and a key driver of
specific compensation decisions for our management team is a comparative
analysis of our compensation mix and levels relative to a peer group of banks
and thrifts. We firmly believe that the cornerstone of our compensation program
is the maintenance of a competitive compensation program relative to the
companies with whom we compete for talent. In fiscal 2008, this group of banks
and thrifts was selected on the basis of several factors, including geographic
location and asset size. We utilized the report prepared by The Moore Consulting
Group, which relied on survey information published by AMERICA'S COMMUNITY
BANKERS, the ECONOMIC RESEARCH INSTITUTE and the SNL EXECUTIVE COMPENSATION
REVIEW. In addition, the Committee utilized survey information prepared by The
Moore Consulting Group using a peer group of the following financial
institutions (all ranging in asset size from $434.0 million to $2.0 billion):
American Bancorp of New Jersey, Inc.
BCB Bancorp, Inc.
Boardwalk Bancorp, Inc.
Center Bancorp, Inc.
Central Jersey Bancorp
Community Partners Bancorp
Greater Community Bancorp
Kearny Financial Corp.
Magyar Bancorp, Inc.
Ocean Shore Holding Company
Ocean First Financial Corp.
Oritani Financial Corp.
Pamrapo Bancorp, Inc.
Peapack -- Gladstone Financial Corp.
Roma Financial Corp.
Stewardship Financial Corp.
Synergy Financial Group, Inc.
Unity Bancorp, Inc.
ROLE OF MANAGEMENT
Our Chief Executive Officer, in conjunction with our Compensation
Committee, develops recommendations regarding the appropriate mix and level of
compensation for our management team, including our named executive officers.
The recommendations consider the objectives of our compensation philosophy and
the range of compensation programs authorized by the Committee, as well as the
peer group analysis and survey data described above. The Chief Executive Officer
17
meets with the Committee to discuss the compensation recommendations for the
named executive officers. Our Chief Executive Officer is absent from Committee
discussions and from the review of Committee documents relating to the
determination of his compensation. Compensation for our Chief Executive Officer
and other named executive officers is determined by the Compensation Committee
and approved by the Board of Directors.
TAX AND ACCOUNTING CONSIDERATIONS
In consultation with our advisors and in collaboration with the Bank
and Company Audit Committees, we evaluate the tax and accounting treatment of
our compensation programs at the time of adoption and periodically thereafter to
ensure that we understand the financial impact of each program on the Company.
Our analysis includes a review of recently adopted and pending changes in tax
and accounting requirements. During fiscal 2008, we continued to consider the
implications of two significant developments in the tax and accounting areas -
the new rules under Section 409A of the Internal Revenue Code applicable to
nonqualified deferred compensation and the revised accounting treatment for
equity compensation under FAS 123R. We are continuing to implement changes in
plan design or compensation practices to address these developments as they are
interpreted and put into practice, including certain formal plan amendments
required by December 31, 2008 to comply with the final regulations recently
issued under Section 409A of the Internal Revenue Code.
EMPLOYMENT AGREEMENTS AND CHANGE IN CONTROL AGREEMENTS
We currently maintain employment agreements with our Chairman and Chief
Executive Officer (Mr. Celentano) and our President and Secretary (Mr. Celuch),
as well as change in control severance agreements with Messrs. Hoogerhyde and
D'Ambra and Ms. Piano. See "EXECUTIVE COMPENSATION--EMPLOYMENT AGREEMENTS" and
"--CHANGE IN CONTROL AGREEMENTS" for a description of the terms of the
agreements and the severance and change in control benefits payable to the named
executive officers under these agreements.
RETIREMENT BENEFITS; EMPLOYEE WELFARE BENEFITS
Our 401(k) Plan and employee stock ownership plan are important
retention tools for the Company.
The 401(k) Plan and the employee stock ownership plan are broad-based
tax-qualified defined contribution plans that provide our employees with
valuable retirement benefits. Under the 401(k) Plan, we provide an employer
matching contribution equal to 50% of a participant's voluntary salary
deferrals, up to a maximum of 4.5% of a participant's eligible compensation
under the plan. Participants are fully vested in employer matching contributions
under the plan. Under the employee stock ownership plan, we provide participants
with a retirement benefit allocated in our common stock at no cost to the
participant. Participants also vest in their employee stock ownership plan
allocations at the rate of 20% per year over a five-year period.
In addition to our retirement programs, we provide our employees with
coverage under medical, dental, life insurance and disability plans on terms
consistent with industry practice. We also maintain a Section 125 cafeteria plan
which allows our employees to set aside pre-tax dollars to pay for certain
benefits.
PERQUISITES
We provide certain named executive officers with certain perquisites,
an automobile allowance and cellular telephone, as deemed appropriate to their
positions and responsibilities. We believe the perquisites provided to the named
executives are reasonable, competitive and consistent with the Company's overall
compensation program. We also believe that these benefits further our officers'
abilities to promote our business interests in our markets and reflect
competitive industry practices for similarly situated officers employed by our
peers. The perquisites provided to our named executive officers are included in
the "ALL OTHER COMPENSATION" column of the "SUMMARY COMPENSATION TABLE" under
"EXECUTIVE COMPENSATION."
18
DIRECTOR COMPENSATION
We compensate our outside directors through a combination of retainers,
meeting fees and stock option and restricted stock awards. Directors who are
also employees of the Company do not receive additional compensation for service
on the Board. The level and mix of director compensation is reviewed by the
Compensation Committee on a periodic basis to ensure consistency with the
objectives of our overall compensation philosophy. We also offer a director
retirement plan to provide eligible directors with certain benefits following
their termination of board service. See "DIRECTOR COMPENSATION--DIRECTORS'
RETIREMENT PLAN" for a description of this plan.
STOCK COMPENSATION GRANT AND AWARD PRACTICES; TIMING ISSUES
Our Compensation Committee considers whether to recommend to the Board
of Directors that the Company make stock option grants and/or award other forms
of equity during the third quarter of each year. However, grants or awards may
be made at other times during the year based on specific circumstances such as a
new hire, a contractual commitment or a change in position or responsibility.
Under our current plan, which was approved by the Company's shareholders in
2005, the exercise price of an option is the closing market price on the date of
grant. The grant date is the date the full Board of Directors approves the award
and grants the awards to the participants.
As a general matter, the Compensation Committee's process is
independent of any consideration of the timing of the release of material,
nonpublic information, including with respect to the determination of grant
dates or stock option exercise prices. The Compensation Committee's decisions
are reviewed and ratified by the full Board of Directors. Similarly, we have
never timed the release of material, nonpublic information with the purpose or
intent of affecting the value of executive compensation.
COMPENSATION FOR THE NAMED EXECUTIVES IN FISCAL 2008
CHIEF EXECUTIVE OFFICER COMPENSATION. In determining Mr. Celentano's
compensation, the Board of Directors conducted a performance appraisal that
reviewed Mr. Celentano's financial, strategic and operational achievements and
the findings of the peer group analysis conducted by The Moore Consulting Group,
as described above. In its review, the Board of Directors noted that Mr.
Celentano exhibits strong leadership skills and is moving the Company in a
direction that has the potential to enhance long-term shareholder value. Mr.
Celentano also serves as our chief spokesperson, communicating effectively with
the shareholders of the Company and customers of the Bank. Given the positive
evaluations of his performance, the Compensation Committee awarded Mr. Celentano
a $2,500 bonus. Notwithstanding the Committee's assessment of Mr. Celentano's
performance, Mr. Celentano requested that he not be considered for a salary
increase. See "EXECUTIVE COMPENSATION--SUMMARY COMPENSATION TABLE" for Mr.
Celentano's current base salary. We believe that Mr. Celentano's current
compensation is consistent with our objectives to reward, motivate and challenge
Mr. Celentano to continue to lead our company successfully. The Board of
Directors also renewed Mr. Celentano's employment agreement for another year.
COMPENSATION FOR THE OTHER NAMED EXECUTIVE OFFICERS. In determining
compensation for Messrs. Celuch, Hoogerhyde and D'Ambra and Ms. Piano, the
Compensation Committee reviewed the performance appraisals presented by the
Chief Executive Officer, as well as the report prepared by The Moore Consulting
Group. Given the positive evaluations of the named executive officers and in
order to remain competitive as compared to their peers, the Compensation
Committee awarded each of the other named executive officers a three percent
increase in salary and also awarded each a $2,500 bonus. See "EXECUTIVE
COMPENSATION--SUMMARY COMPENSATION TABLE" for the current base salaries of the
19
named executive officers. The Board of Directors also renewed Mr. Celuch's
employment agreement, and the other named executive officers' change in control
agreements, for an additional year. We believe that the current compensation
levels for Messrs. Celuch, Hoogerhyde and D'Ambra and Ms. Piano are consistent
with our compensation objectives.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following information is furnished for all individuals serving as
the principal executive officer or principal financial officer of the Company
for the 2008 fiscal year and the other three most highly compensated executive
officers of the Company whose total compensation for the 2008 fiscal year
exceeded $100,000.
- -------------------------------------------------------------------------------------------------------------------------
CHANGE IN
PENSION VALUE
AND
NONQUALIFIED
DEFERRED
STOCK OPTION COMPENSATION ALL OTHER
NAME AND PRINCIPAL SALARY BONUS AWARDS AWARDS EARNINGS COMPENSATION
POSITION YEAR ($) ($) ($)(1) ($)(2) ($)(3) ($)(4)(5) TOTAL ($)
- -------------------------------------------------------------------------------------------------------------------------
John A. Celentano, Jr. 2008 $362,438 $2,500 $256,859 $123,868 - $111,102 $856,767
CHAIRMAN OF THE BOARD AND 2007 $362,438 - $256,859 $169,503 - $131,452 $920,252
CHIEF EXECUTIVE
OFFICER
- -------------------------------------------------------------------------------------------------------------------------
Walter Celuch 2008 $196,463 $2,500 $134,536 $ 67,581 - $ 72,120 $473,200
PRESIDENT AND SECRETARY 2007 $195,000 - $134,536 $ 92,480 - $ 85,337 $507,353
- -------------------------------------------------------------------------------------------------------------------------
Bart D'Ambra 2008 $113,344 $2,500 $ 85,623 $ 45,029 - $ 33,186 $279,682
EXECUTIVE VICE PRESIDENT 2007 $112,500 - $ 85,623 $ 61,619 - $ 42,571 $302,313
AND CHIEF OPERATING
OFFICER OF THE BANK
- -------------------------------------------------------------------------------------------------------------------------
Stephen Hoogerhyde 2008 $125,938 $2,500 $ 85,623 $ 45,029 - $ 36,081 $295,171
EXECUTIVE VICE PRESIDENT 2007 $125,000 - $ 85,623 $ 61,619 - $ 45,959 $318,201
AND CHIEF LENDING OFFICER
OF THE BANK
- -------------------------------------------------------------------------------------------------------------------------
Christine R. Piano, CPA 2008 $136,013 $2,500 $ 85,623 $ 45,029 - $ 38,309 $307,474
CHIEF FINANCIAL OFFICER 2007 $135,000 - $ 85,623 $ 61,619 - $ 48,658 $330,900
AND TREASURER
- -------------------------------------------------------------------------------------------------------------------------
- --------------------------
(1) Reflects the dollar amount recognized for financial statement reporting
purposes in accordance with FAS 123(R) of the vesting of 25,133, 13,165,
8,378, 8,378 and 8,378 shares of restricted stock in 2008 for Mr.
Celentano, Mr. Celuch, Mr. D'Ambra, Mr. Hoogerhyde and Ms. Piano,
respectively, based upon the Company's stock price of $10.22 on the date of
grant.
(2) Reflects the dollar amount recognized for financial statement reporting
purposes in accordance with FAS 123(R) in 2008 for each executive, based
upon a fair value of each option of $2.38 the Black-Scholes option pricing
model. For further information on the assumptions used to compute the fair
value, see note 13 to the notes to the consolidated financial statements
contained in the Company's Annual Report on Form 10-K.
(3) For Mr. Celentano, the aggregate change in the actuarial present value of
accumulated benefit under the Bank's Directors' Retirement Plan was a
decrease of $17,442 and $17,803 in 2008 and 2007, respectively.
(4) For 2008, amounts include, but are not limited to, employee stock ownership
plan contributions valued at $46,509, $25,897, $28,509 and $30,482, for
Messrs. Celuch, D'Ambra and Hoogerhyde and Ms. Piano, respectively,
dividends paid on unvested stock awards and matching contributions under
the Bank's 401(k) Plan for all executive officers listed and Mr. Celuch's
supplemental executive retirement plan contributions, automobile usage,
cell phone expenses and travel expenses.
20
(5) All other compensation for Mr. Celentano includes dividends paid on
unvested stock awards of $13,823, a supplemental executive retirement plan
contribution valued at $33,649 and an ESOP contribution valued at $48,165.
This column also includes perquisites and personal benefits for automobile
usage and cell phone expenses for Mr. Celentano.
EMPLOYMENT AGREEMENTS
Clifton Savings Bancorp and Clifton Savings have entered into
employment agreements with Messrs. Celentano and Celuch. Each employment
agreement provides for a three-year term. The terms of the employment agreements
may be renewed annually after review by the respective Boards of Directors.
Under their respective employment agreements, Mr. Celentano's current base
salary is $362,438 and Mr. Celuch's current base salary is $200,850. The Boards
of Directors review annually Mr. Celentano's and Mr. Celuch's base salaries. The
employment agreements provide for, among other things, participation in
stock-based benefit plans and fringe benefits applicable to Messrs. Celentano
and Celuch. The agreements also provide for certain payments to Messrs.
Celentano and Celuch following their termination of employment due to a change
in control, their disability, or upon termination without just cause (as defined
in each agreement). See "--POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT OR
CHANGE IN CONTROL" for a discussion of the benefits upon termination under each
circumstance.
The Bank or the Company will pay or reimburse Messrs. Celentano and
Celuch for all reasonable costs and legal fees paid or incurred by the
executives in any dispute or question of interpretation relating to the
employment agreement if the executive is successful on the merits in a legal
judgment, arbitration or settlement. The employment agreements also provide that
the Bank and the Company will indemnify Messrs. Celentano and Celuch to the
fullest extent legally allowable.
CHANGE IN CONTROL AGREEMENTS
Clifton Savings has entered into change in control agreements with
Messrs. Hoogerhyde and D'Ambra and Ms. Piano. Each change in control agreement
has a two-year term, subject to renewal on an annual basis. The change in
control agreements provide each executive with a severance benefit upon
termination in connection with a change in control. See "--POTENTIAL PAYMENTS ON
TERMINATION OF EMPLOYMENT OR CHANGE IN CONTROL" for discussion of the benefits
payable upon termination.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Clifton Savings has implemented a supplemental executive retirement
plan to provide for supplemental retirement benefits with respect to its
employee stock ownership plan and the 401(k) Plan. The plan provides
participating executives with benefits otherwise limited by certain provisions
of the Internal Revenue Code or the terms of the employee stock ownership plan
loan. Specifically, the plan provides benefits to eligible officers (those
designated by the Board of Directors of Clifton Savings) that cannot be provided
under the 401(k) Plan or the employee stock ownership plan as a result of
limitations imposed by the Internal Revenue Code, but that would have been
provided under the plans, but for these Internal Revenue Code limitations.
Messrs. Celentano and Celuch are the only officers currently participating in
the plan. In addition to providing benefits that would otherwise be lost as a
result of the Internal Revenue Code limitations on tax-qualified plans, the plan
also provides a supplemental benefit upon a change of control prior to the
scheduled repayment of the employee stock ownership plan loan. See "--POTENTIAL
PAYMENTS ON TERMINATION OF EMPLOYMENT OR CHANGE IN CONTROL" for further
discussion of these benefits.
21
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following table provides information concerning unexercised options
and stock awards that have not vested for each named executive officer
outstanding as of March 31, 2008.
- ------------------------------------------------------------------------------------------------------------------------
OPTION AWARDS STOCK AWARDS
- ------------------------------------------------------------------------------------------------------------------------
NUMBER OF NUMBER OF NUMBER OF MARKET VALUE
SECURITIES SECURITIES SHARES OR OF SHARES OR
UNDERLYING UNDERLYING UNITS OF UNITS OF
UNEXERCISED UNEXERCISED STOCK THAT STOCK THAT
OPTIONS OPTIONS OPTION EXERCISE HAVE NOT HAVE NOT
(#) (#) PRICE OPTION VESTED VESTED
NAME EXERCISABLE UNEXERCISABLE(1) ($) EXPIRATION DATE (#)(2) ($)(3)
- ------------------------------------------------------------------------------------------------------------------------
John A. Celentano, Jr. 197,400 131,600 $10.24 8/31/2015 50,264 $506,661
- ------------------------------------------------------------------------------------------------------------------------
Walter Celuch 107,700 71,800 $10.24 8/31/2015 26,329 $265,396
- ------------------------------------------------------------------------------------------------------------------------
Bart D'Ambra 71,760 47,840 $10.24 8/31/2015 16,754 $168,880
- ------------------------------------------------------------------------------------------------------------------------
Stephen Hoogerhyde 71,760 47,840 $10.24 8/31/2015 16,754 $168,880
- ------------------------------------------------------------------------------------------------------------------------
Christine R. Piano 71,760 47,840 $10.24 8/31/2015 16,754 $168,880
- ------------------------------------------------------------------------------------------------------------------------
- -------------------------------
(1) Unexercisable stock options vest in two equal annual installments on August
31, 2008 and August 31, 2009.
(2) The restricted stock awards vest in two equal annual installments on
December 7, 2008 and December 7, 2009.
(3) Based upon the Company's closing stock price of $10.08 on March 31, 2008.
OPTION EXERCISES AND STOCK VESTED
The following table provides information concerning the vesting of stock
awards for each named executive officer, on an aggregate basis, during the 2008
fiscal year. No named executive officer exercised any stock options during 2008.
- -----------------------------------------------------------------------------
STOCK AWARDS
- -----------------------------------------------------------------------------
NUMBER OF
SHARES
ACQUIRED VALUE REALIZED
ON VESTING ON VESTING
NAME (#) ($)(1)
- -----------------------------------------------------------------------------
John A. Celentano, Jr. 25,133 $ 261,383
- -----------------------------------------------------------------------------
Walter Celuch 13,165 $ 136,916
- -----------------------------------------------------------------------------
Bart D'Ambra 8,378 $ 87,131
- -----------------------------------------------------------------------------
Stephen Hoogerhyde 8,378 $ 87,131
- -----------------------------------------------------------------------------
Christine R. Piano 8,378 $ 87,131
- -----------------------------------------------------------------------------
- ----------------------------------
(1) The value realized on vesting represents the market value on the day of
vesting, which for all shares shown was $10.40 on December 7, 2007.
22
PENSION BENEFITS
Clifton Savings sponsors the Clifton Savings Bank Director Retirement
Plan to provide retirement benefits for eligible directors. John A. Celentano,
Jr., as an employee director, participates in the plan. See "DIRECTORS
COMPENSATION--DIRECTORS' RETIREMENT PLAN." The following table provides
information with respect to the Directors' Retirement Plan for fiscal 2008.
- -------------------------------------------------------------------------------------------------------------------
PRESENT
NUMBER OF VALUE OF
YEARS OF ACCUMULATED
CREDITED BENEFIT
NAME PLAN NAME SERVICE ($)(1)
- -------------------------------------------------------------------------------------------------------------------
John A. Celentano, Jr. Directors' Retirement Plan 45 $540,256
- -------------------------------------------------------------------------------------------------------------------
- ----------------------
(1) The material assumptions used to calculate the accumulated benefit were
as follows: interest rate of 6.50%; a benefit formula equal to 133% of
annual Board fees and retainers immediately prior to retirement for each
year of service with a maximum of 137.5% of Board fees and retainers; and
a straight line form of payment.
NONQUALIFIED DEFERRED COMPENSATION
The following table provides information with respect to each deferred
compensation plan in which the named executive officers participated during
fiscal 2008.
- ----------------------------------------------------------------------------------------------------------------------
REGISTRANT AGGREGATE AGGREGATE BALANCE AT
CONTRIBUTIONS IN LAST EARNINGS IN LAST FISCAL YEAR END
NAME PLAN NAME FISCAL YEAR ($)(1) 2008 (2) ($)(3)(4)
- ----------------------------------------------------------------------------------------------------------------------
John A. Celentano, Jr. Supplemental Executive
Retirement Plan $33,649 $3,012 $127,429
- ----------------------------------------------------------------------------------------------------------------------
Walter Celuch Supplemental Executive -- $ 318 $ 8,161
Retirement Plan
- ----------------------------------------------------------------------------------------------------------------------
- --------------------------
(1) Registrant contributions are reported as compensation in 2008 in the
SUMMARY COMPENSATION TABLE.
(2) The amount disclosed in the earnings column represents interest earned
at a rate of approximately 4.65% plus dividends of $0.20 per share.
Interest and dividends earned are not reported as compensation in 2008
in the SUMMARY COMPENSATION TABLE since such earnings were not above
market or preferential.
(3) Reflects the market value as of March 31, 2008, of 10,686 and 297
shares held for the benefit of Messrs. Celentano and Celuch,
respectively, and cash balances of $19,714 and $5,167, respectively,
under the supplemental executive retirement plan.
(4) The market value of the shares allocated to Messrs. Celentano and
Celuch under the supplemental executive retirement plan was previously
reported as compensation to Messrs. Celentano and Celuch in the SUMMARY
COMPENSATION TABLE in the proxy statement in the year in which the
allocation occurred.
POTENTIAL PAYMENTS ON TERMINATION OF EMPLOYMENT OR CHANGE IN CONTROL
PAYMENTS MADE UPON TERMINATION FOR CAUSE OR UPON VOLUNTARY RESIGNATION.
If either Mr. Celentano or Mr. Celuch is terminated for just cause (as defined
in the executive's employment agreement) or if either executive voluntary
resigns under circumstances that would not constitute good reason (as defined in
the executive's employment agreement), he will receive his base salary through
the date of termination and retain the rights to any vested benefits subject to
the terms of the plan or agreement under which those benefits are provided.
23
All benefits credited to Messrs. Celentano and Celuch under the
supplemental executive retirement plan are nonforfeitable under the plan, and
therefore, will be distributed to each executive upon termination of employment
for any reason.
All unvested stock awards and unvested or unexercised stock options
granted under the 2005 Equity Incentive Plan will be forfeited in the event of
termination for cause. In addition, in the event an executive voluntarily
resigns from the Company, the executive will forfeit all unvested stock options
and stock awards as of the date of the executive's resignation. An executive has
three months following his or her voluntary termination of employment or service
to exercise all vested stock options.
Mr. Celentano is 100% vested under the terms of the Clifton Savings
Bank Directors' Retirement Plan. As a result, upon Mr. Celentano's removal as a
director, his resignation or retirement as a director or his termination as a
director due to disability, Mr. Celentano will be entitled to receive a lifetime
annual benefit equal to 137.5% of the annual fees and retainer he would have
earned had he been a non-employee director and thus compensated for his board
service during the 12-month period ending on the last day of the month preceding
his termination from service as a director. This benefit may be paid in equal
monthly installments for life or, if Mr. Celentano so elects, in an actuarial
equivalent lump sum.
PAYMENTS MADE UPON TERMINATION WITHOUT CAUSE OR RESIGNATION FOR GOOD
REASON. Upon the occurrence of an event of termination for Mr. Celentano or Mr.
Celuch (as defined in the executive's employment agreement), including
involuntary termination for any reason other than just cause, or voluntary
resignation for good reason (certain circumstances outlined in the agreement
that constitute constructive termination), each executive (or, upon his death,
his beneficiary) would be entitled to a lump sum cash payment equal to the sum
of (a) base salary and incentive compensation that would have been paid for the
remaining term of the employment agreement; (b) the value of any unvested
restricted stock and stock options as of the termination date (that would not
otherwise vest as a result of the termination), plus (c) the value of continued
employee benefits provided under tax-qualified and non-tax-qualified benefit
plans that would have been provided for the remaining term, based on the most
recent level of contribution, accrual or other participation by or on behalf of
the executive. The executives are also entitled to continued life, medical,
health, disability and dental insurance coverage for the remaining term of the
agreement. Upon termination of the executive's employment under these
circumstances, he must adhere to a one-year non-competition restriction.
All benefits credited to Messrs. Celentano and Celuch under the
supplemental executive retirement plan are nonforfeitable under the plan and,
therefore, will be distributed to each executive upon termination of employment
for any reason.
All unvested stock awards and unvested stock options granted under the
2005 Equity Incentive Plan will be forfeited in the event of termination without
cause or termination of employment or service for good reason. An executive has
three months following his or her termination of employment or service to
exercise all vested stock options.
See also discussion above in "--PAYMENTS MADE UPON TERMINATION FOR
CAUSE OR UPON VOLUNTARY RESIGNATION" for a discussion of payments made upon Mr.
Celentano's removal or resignation as a director under the directors' retirement
plan.
PAYMENTS MADE UPON DISABILITY. Under Mr. Celentano's and Mr. Celuch's
employment agreements, if the executive becomes disabled, Clifton Savings
Bancorp and Clifton Savings Bank agree to provide the executive with monthly
disability pay equal to 100% of his monthly base salary through the 180th day
following their termination due to disability, and 60% of their base salary from
24
the 181st day after termination through the earlier of the executive's death or
attainment of age 70. In addition, during any period of disability, the
executive and his dependents will receive continued benefit plan coverage under
employer benefit plans. Mr. Celentano will not receive a disability payment
under the employment agreement, as he has attained age 70.
Mr. Celuch, Mr. D'Ambra, Mr. Hoogerhyde and Ms. Piano participate in
the Bank-sponsored disability plan and are entitled to benefits based on age and
compensation.
Upon termination due to disability, outstanding stock options granted
pursuant to our 2005 Equity Incentive Plan automatically vest and remain
exercisable until the earlier of one year from the date of termination due to
disability or the expiration date of the stock options. Restricted stock awards
granted to these executive's under the plan also vest in full upon termination
due to disability.
See also discussion above in "--PAYMENTS MADE UPON TERMINATION FOR
CAUSE OR UPON VOLUNTARY RESIGNATION" for a discussion of payments made upon Mr.
Celentano's termination as a director due to disability under the directors'
retirement plan.
PAYMENTS MADE UPON DEATH. Under Mr. Celentano's and Mr. Celuch's
employment agreements, upon the executive's death, the executive's estate is
entitled to receive any accrued but unpaid salary or bonus payments through the
date of death. In addition, for a period of six months after the executive's
death, the Company and the Bank must continue to provide his dependents medical
insurance benefits existing on the date of his death and shall pay the
executive's beneficiary all salary compensation that would otherwise be payable
to him under the employment agreement.
All benefits credited to Messrs. Celentano and Celuch under the
supplemental executive retirement plan are nonforfeitable under the plan and
therefore will be distributed to each executive upon termination of employment
for any reason.
Upon an executive's death, outstanding stock options granted pursuant
to our 2007 Equity Incentive Plan automatically vest and remain exercisable
until the earlier of one year from the date the executive dies or the expiration
of the stock options. Restricted stock awards granted to the executives under
the plan also vest in full upon the executive's death.
Under the directors' retirement plan, upon Mr. Celentano's death prior
to receiving any retirement or disability benefits under the plan, Mr.
Celentano's surviving spouse or beneficiary would be entitled to an annual
benefit equal to the annual retirement benefit for a period of ten years. If Mr.
Celentano died after commencement of the retirement or disability benefits
described above, but had received those benefits over a period of less than ten
years, his surviving spouse or beneficiary would continue to receive the annual
benefit through the end of the ten-year period following his death.
PAYMENTS MADE UPON RETIREMENT. Under Mr. Celentano's and Mr. Celuch's
employment agreements, the executive will receive the compensation due to him
through his retirement date.
All benefits credited to Messrs. Celentano and Celuch under the
supplemental executive retirement plan are nonforfeitable under the plan and
therefore will be distributed to each executive upon termination of employment
for any reason.
All unvested stock awards and unvested or unexercised stock options
granted under the 2007 Equity Incentive Plan will be forfeited upon retirement.
25
See also discussion above in "--PAYMENTS MADE UPON TERMINATION FOR
CAUSE OR UPON VOLUNTARY RESIGNATION" for a discussion of payments made upon Mr.
Celentano's retirement as a director under the directors' retirement plan.
PAYMENTS MADE UPON TERMINATION FOLLOWING A CHANGE IN CONTROL. The
employment agreements for Mr. Celentano and Mr. Celuch provide the executive
with severance benefits if, following a change in control, the executive is
involuntarily or constructively terminated. The severance benefit generally
would be equal to three times the sum of the average taxable income over the
five years preceding the change in control, excluding stock option income and
benefit payments received under employee benefit plans, and the average of the
value of the deferrals, allocations or contributions made by or on behalf of the
executive over the five years preceding the change in control, under the
employee stock ownership plan, 401(k) plan and supplemental executive retirement
plan. The executives and their dependents also receive the value of continued
health, medical, dental, life and disability insurance for three years following
termination of employment.
The change in control agreements for Mr. D'Ambra, Mr. Hoogerhyde and
Ms. Piano provide the executives with a severance benefit if, following a change
in control of Clifton Savings Bancorp or Clifton Savings Bank, the executive
voluntarily resigns under certain circumstances specified in the agreement or if
the Bank, the Company or a successor of the Company or the Bank terminates the
executive's employment for reasons other than Just Cause within the term of the
agreement. The severance benefit would be equal to two times the executive's
average annual taxable income for the five most recent taxable years (excluding
income attributable to the exercise or disqualifying disposition of stock
options and benefits distributed under employee benefit plans), plus the sum of
the average value of the deferrals, allocations or contributions made by or on
behalf of the officer under the 401(k) and employee stock ownership plans over
the five most recently completed calendar years preceding termination of
employment. Clifton Savings will also continue life, medical, health, dental and
disability insurance coverage for the executive and any dependents through the
earliest of the executive's employment with another employer, death or the
expiration of 24 months following termination of employment.
Section 280G of the Internal Revenue Code provides that severance
payments that equal or exceed three times an individual's base amount are deemed
to be "excess parachute payments" if they are contingent upon a change in
control (the "Section 280G Limitation"). An individual's base amount is equal to
an average of the individual's Form W-2 compensation for the five years
preceding the year a change in control occurs (or such lesser number of years if
the individual has not been employed for five years). Individuals receiving
excess parachute payments are subject to a 20% excise tax on the amount of the
payment in excess of the base amount, and the employer may not deduct such
amount for federal tax purposes. The employment agreements and the change in
control agreements limit payments made to the executives in connection with a
change in control to amounts that will not exceed the limits imposed by Section
280G.
Under the terms of our employee stock ownership plan, upon a change in
control (as defined in the plan), the plan will terminate and the plan trustee
will repay in full any outstanding acquisition loan. After repayment of the
acquisition loan, all remaining shares of Company common stock held in the loan
suspense account, all other stock or securities, and any cash proceeds from the
sale or other disposition of any shares of Company common stock held in the loan
suspense account will be allocated among the accounts of all participants in the
plan who were employed on the date immediately preceding the effective date of
the change in control. The allocations of shares or cash proceeds shall be
credited to each eligible participant in proportion to the opening balances in
their accounts as of the first day of the valuation period in which the change
in control occurred. Payments under our employee stock ownership plan are not
categorized as parachute payments and, therefore, do not count towards each
executive's Section 280G Limitation.
26
Under the terms of the supplemental executive retirement plan, Mr.
Celentano and Mr. Celuch will receive a cash payment in the event of a change in
control equal to the benefit the executives would have received under the
employee stock ownership plan had the executives remained employed throughout
the term of the loan, less the benefits actually provided under the employee
stock ownership plan on each executive's behalf. In addition, all benefits
credited to Messrs. Celentano and Celuch under the supplemental executive
retirement plan are nonforfeitable under the plan and therefore will be
distributed to each executive upon termination of employment for any reason.
In the event of a change in control of the Company or the Bank,
outstanding stock options granted pursuant to our 2007 Equity Incentive Plan
automatically vest and, if the option holder is terminated other than for cause
within 12 months of the change in control, will remain exercisable until the
expiration date of the stock options. Restricted stock awards granted to the
executives under the plan also vest in full upon a change in control. The value
of the accelerated options and restricted stock grants count towards the
executives' Section 280G Limitations.
See also discussion above in "--PAYMENTS MADE UPON TERMINATION FOR
CAUSE OR UPON VOLUNTARY RESIGNATION" for a discussion of payments made upon Mr.
Celentano's retirement as a director under the directors' retirement plan.
Under the directors' retirement plan, upon a change in control, Mr.
Celentano would be entitled to receive the lifetime annual retirement benefit;
however, if he died after a change in control and had received benefits over
less than a 15-year period, his surviving spouse or beneficiary would receive
the annual change in control benefit for a period of years equal to 15 minus the
number of years Mr. Celentano had already received the annual change in control
benefit.
POTENTIAL POST-TERMINATION OR CHANGE IN CONTROL BENEFITS TABLES. The
amount of compensation payable to each named executive officer upon termination
for cause, termination without cause, change in control with termination of
employment, disability and retirement is shown below. The amounts shown assume
that such termination was effective as of March 31, 2008, and thus include
amounts earned through such time and are estimates of the amounts which would be
paid out to the executives upon their termination. The amounts do not include
the executive's account balances in the Bank's tax-qualified retirement plans or
executive account balances in the supplemental income agreements to which each
executive has a non-forfeitable interest. The amounts shown relating to unvested
options and awards are based on the fair market value of Clifton Savings Bancorp
common stock on March 31, 2008, of $10.08. The actual amounts to be paid out can
only be determined at the time of such executive's separation from Clifton
Savings Bancorp.
27
The following table provides the amount of compensation payable to Mr.
Celentano for each of situations listed below.
PAYMENTS DUE UPON
------------------------------------------------------------------------------------------------
TERMINATION CHANGE IN
TERMINATION WITHOUT CONTROL
FOR CAUSE OR CAUSE OR WITH
VOLUNTARY RESIGNATION TERMINATION
PAYMENT AND BENEFIT RESIGNATION WITH GOOD REASON DISABILITY DEATH RETIREMENT OF EMPLOYMENT
- ----------------------------------- -------------- ------------------ -------------- ---------------- ------------- ----------------
Base salary....................... $ - $1,072,418 $ 178,737(5) $ 181,218(7) $ - $1,544,875(1)
Bonuses........................... - 7,397 - 1,199(8) - -
Income attributable to grant
or exercise of stock options... - - - - - -
Income attributable to vesting
of restricted stock............ - - 506,661 506,661 - 506,661
401(k) matching contribution
and ESOP benefit............... - 187,452 - - - 190,056
Health and welfare benefits and
fringe benefits .................. - 59,569 6,547(6) 6,547(6) - 67,963(9)
Payment under SERP(2)............. 161,936 161,936 161,936 161,936 161,936 1,080,687(3)
Payment under directors'
retirement plan................ 0(4) 0(4) 611,880(10) 611,880(10) 611,880(10) 611,880(10)
-------------- ------------------ -------------- ---------------- --------------- --------------
Total payment (11)................ $161,936 $1,488,772 $1,465,761 $1,469,441 $773,816 $4,002,122
============== ================== ============== ================ =============== ==============
(1) Equals three times Mr. Celentano's average taxable income over the five
years preceding the change in control.
(2) Value of accrued benefit at the time Mr. Celentano terminated service with
the Company. This payment will be distributed at the same time and in the
same manner as Mr. Celentano's ESOP benefit.
(3) Includes Mr. Celentano's annual make up benefit and a one time change in
control benefit.
(4) Assumes Mr. Celentano will not serve as a director emeritus upon the
occurrence of these events and therefore will receive no benefit under the
Directors' Retirement Plan. However, Mr. Celentano is currently eligible to
retire and receive a retirement benefit under the plan.
(5) Equals 100% of Mr. Celentano's base salary for 180 days.
(6) Equals six months of benefit coverage (medical, life and retirement plans)
for Mr. Celentano and his dependents under the same terms as if he was
actively employed by the Bank and Mr. Celentano terminates employment due
to a disability. Equals six months benefit coverage for Mr. Celentano's
dependents if Mr. Celentano dies while actively employed by the Company.
(7) Equals the value of Mr. Celantano's base salary for six months.
(8) Equals Mr. Celentano's accrued bonus as of his termination of service from
the Company based on the bonus paid in 2007.
(9) Includes the value of coverage under the Company's life, medical, health
and disability insurance programs for a period of 36 months, as well as the
value of Mr. Celentano's automobile usage for the same time period.
(10) Represents the value of the stream of payments that would be made under the
directors' retirement plan.
(11) The amounts shown above do not reflect the fact that if, in the event
payments to the executive in connection with a change in control or
otherwise would result in an excise tax under Section 4999 of the Internal
Revenue Code of 1986, such payments may be reduced to the extent necessary
so that the excise tax does not apply.
28
The following table provides the amount of compensation payable to Mr.
Celuch for each of situations listed below.
PAYMENTS DUE UPON
------------------------------------------------------------------------------------------------
TERMINATION CHANGE IN
TERMINATION WITHOUT CONTROL
FOR CAUSE OR CAUSE OR WITH
VOLUNTARY RESIGNATION TERMINATION
PAYMENT AND BENEFIT RESIGNATION WITH GOOD REASON DISABILITY DEATH RETIREMENT OF EMPLOYMENT
- ----------------------------------- -------------- ------------------ -------------- ---------------- ------------- ----------------
Base salary.......................... $ - $594,296 $1,304,149(2) $ 96,298(7) $ - $ 838,231(5)
Bonuses.............................. - 7,397 - 1,199(8) - -
Income attributable to grant
or exercise of stock options...... - - - - - -
Income attributable to vesting
of restricted stock............... - - 265,396 265,396 - 265,396
401(k) matching contribution
and ESOP benefit.................. - 180,041 - - - 182,541
Health and welfare benefits and
fringe benefits...................... - 59,385 133,887(3) 6,419(4) - 67,167(9)
Payment under SERP(1)................ 8,161 8,161 8,161 8,161 8,161 537,597(6)
------------- ---------------- -------------- ---------------- -------------- --------------
Total payment(10).................... $8,161 $849,280 $1,711,593 $377,473 $8,161 $1,890,932
============= ================ ============== ================ ============== ==============
(1) Value of accrued benefit at the time Mr. Celuch terminated service with the
Company. This payment will be distributed at the same time and in the same
manner as Mr. Celuch's ESOP benefit.
(2) Equals 100% of Mr. Celuch's base salary for 180 days, plus 60% of his base
salary until age 70 (assumes he does not die before 70 years of age).
(3) Assumes ten years of health coverage for Mr. Celuch and his dependents
under the same terms as if he was actively employed by the Bank.
(4) Equals six months medical coverage for Mr. Celuch's dependents.
(5) Equals three times Mr. Celuch's average taxable income over the five years
preceding the change in control.
(6) Includes Mr. Celuch's annual make up benefit and a one time change in
control benefit.
(7) Equals the value of Mr. Celuch's base salary for six months.
(8) Equals Mr. Celuch's accrued bonus as of his termination of service from the
Company based on the bonus paid in 2007.
(9) Includes the value of coverage under the Company's life, medical, health
and disability insurance programs for a period of 36 months, as well as the
value of Mr. Celuch's automobile usage for the same time period.
(10) The amounts shown above do not reflect the fact that if, in the event
payments to the executive in connection with a change in control or
otherwise would result in an excise tax under Section 4999 of the Internal
Revenue Code of 1986, such payments may be reduced to the extent necessary
so that the excise tax does not apply.
29
The following table provides the amount of compensation payable to Mr.
D'Ambra, Mr. Hoogerhyde and Ms. Piano for each of situations listed below.
-------------------------------------------------------------
PAYMENTS DUE UPON CHANGE IN CONTROL
FOLLOWED BY A TERMINATION OF EMPLOYMENT
- ---------------------------------------------- -------------------------------------------------------------
PAYMENT AND BENEFIT MR. D'AMBRA MR. HOOGERHYDE MS. PIANO
- ---------------------------------------------- ------------------- -------------------- --------------------
Average Annual Compensation.................. $312,349 $333,417 $347,884
Income attributable to vesting of restricted
stock (1)................................. 168,880 168,880 168,880
401(k) matching contribution
and ESOP benefit.......................... 77,603 88,731 81,678
Health and welfare benefits.................. 23,144 13,506 13,650
------------------- -------------------- --------------------
Total severance payment (2).................. $581,976 $604,534 $612,092
=================== ==================== ====================
- -------------------------------
(1) Represents full value of accelerated restricted stock awards, assuming
change in control date of March 31, 2008.
(2) The "parachute payment" values of all payments for purposes of Section 280G
do not exceed the executive officers' limit into Section 280G.
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed the Compensation
Discussion and Analysis that is required by the rules established by the
Securities and Exchange Commission. Based on such review and discussions, the
Compensation Committee recommended to the Board of Directors that the
Compensation Discussion and Analysis be included in this proxy statement. See
"COMPENSATION DISCUSSION AND ANALYSIS."
THE COMPENSATION COMMITTEE OF CLIFTON SAVINGS BANCORP, INC.
Thomas A. Miller, Chairman
Cynthia Sisco Parachini
John H. Peto
Charles J. Pivirotto
John Stokes
OTHER INFORMATION RELATING TO
DIRECTORS AND EXECUTIVE OFFICERS
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who own more than 10% of
any registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Executive officers, directors and greater than 10% stockholders are required by
regulation to furnish the Company with copies of all Section 16(a) reports they
file.
Based solely on the Company's review of copies of the reports it has
received and written representations provided to it from the individuals
required to file the reports, the Company believes that each of its executive
officers and directors has complied with applicable reporting requirements for
transactions in Clifton Savings Bancorp common stock during the year ended March
30
31, 2008, except for (i) one late report filed by Mr. Smith regarding a purchase
of shares of Company common stock; (ii) two late reports filed by Mr. Pivirotto,
each regarding a purchase of shares of Company common stock; and (iii) one late
report filed by Mr. Miller regarding a sale of shares of Company common stock.
POLICIES AND PROCEDURES FOR APPROVAL OF RELATED PERSONS TRANSACTIONS
We maintain a Policy and Procedures Governing Related Person
Transactions, which is a written policy and set of procedures for the review and
approval or ratification of transactions involving related persons. Under the
policy, related persons consist of directors, director nominees, executive
officers, persons or entities known to us to be the beneficial owner of more
than five percent of any outstanding class of the voting securities of the
Company, or immediate family members or certain affiliated entities of any of
the foregoing persons.
Transactions covered by the policy consist of any financial
transaction, arrangement or relationship or series of similar transactions,
arrangements or relationships, in which:
o the aggregate amount involved will or may be expected to exceed
$50,000 in any calendar year;
o the Company is, will, or may be expected to be a participant; and
o any related person has or will have a direct or indirect material
interest.
The policy excludes certain transactions, including:
o any compensation paid to an executive officer of the Company if
the Compensation Committee of the Board approved (or recommended
that the Board approve) such compensation;
o any compensation paid to a director of the Company if the Board
or an authorized committee of the Board approved such
compensation; and
o any transaction with a related person involving consumer and
investor financial products and services provided in the
ordinary course of the Company's business and on substantially
the same terms as those prevailing at the time for comparable
services provided to unrelated third parties or to the
Company's employees on a broad basis (and, in the case of
loans, in compliance with the Sarbanes-Oxley Act of 2002).
Related person transactions will be approved or ratified by the
Audit/Compliance Committee. In determining whether to approve or ratify a
related person transaction, the Audit/Compliance Committee will consider all
relevant factors, including:
o whether the terms of the proposed transaction are at least as
favorable to the Company as those that might be achieved with
an unaffiliated third party;
o the size of the transaction and the amount of consideration
payable to the related person;
o the nature of the interest of the related person;
o whether the transaction may involve a conflict of interest; and
31
o whether the transaction involves the provision of goods and
services to the Company that are available from unaffiliated
third parties.
A member of the Audit/Compliance Committee who has an interest in the
transaction will abstain from voting on approval of the transaction, but may, if
so requested by the chair of the Audit/Compliance Committee, participate in some
or all of the discussion.
TRANSACTIONS WITH RELATED PERSONS
LOANS AND EXTENSIONS OF CREDIT. The Sarbanes-Oxley Act of 2002
generally prohibits loans by the Company to its executive officers and
directors. However, the Sarbanes-Oxley Act contains a specific exemption from
such prohibition for loans by the Bank to its executive officers and directors
in compliance with federal banking regulations. Federal regulations require that
all loans or extensions of credit to executive officers and directors of insured
financial institutions must be made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons and must not involve more than the normal risk
of repayment or present other unfavorable features. The Bank is therefore
prohibited from making any new loans or extensions of credit to executive
officers and directors at different rates or terms than those offered to the
general public. Notwithstanding this rule, federal regulations permit the Bank
to make loans to executive officers and directors at reduced interest rates if
the loan is made under a benefit program generally available to all other
employees and does not give preference to any executive officer or director over
any other employee, although the Bank does not currently have such a program in
place.
The Company maintains a comprehensive written policy for the review,
approval or ratification of certain transactions with related persons. In
accordance with banking regulations and its policy, the Board of Directors
reviews all loans made to a director or executive officer in an amount that,
when aggregated with the amount of all other loans to such person and his or her
related interests, exceed the greater of $25,000 or 5% of the Company's capital
and surplus (up to a maximum of $500,000) and such loan must be approved in
advance by a majority of the disinterested members of the Board of Directors.
Additionally, pursuant to the Company's Code of Ethics and Business Conduct, all
executive officers and directors of the Company must disclose any existing or
potential conflicts of interest to the Chief Executive Officer of the Company.
Such potential conflicts of interest include, but are not limited to, the
following: (i) the Company conducting business with or competing against an
organization in which a family member of an executive officer or director has an
ownership or employment interest and (ii) the ownership of more than 5% of the
outstanding securities or 5% of total assets of any business entity that does
business with or is in competition with the Company.
OTHER TRANSACTIONS. In fiscal 2005, Clifton MHC, the mutual holding
company and majority stockholder of the Company, and the Company entered into a
Loan Agreement pursuant to which the Company agreed to lend Clifton MHC up to
$250,000. Pursuant to the terms of the Loan Agreement, funds advanced to Clifton
MHC bear no interest. At March 31, 2008, the Company had advanced $250,000 to
Clifton MHC.
32
SUBMISSION OF BUSINESS PROPOSALS AND STOCKHOLDER NOMINATIONS
The Company must receive proposals that stockholders seek to include in
the proxy statement for the Company's next annual meeting no later than March
11, 2009. If next year's annual meeting is held on a date more than 30 calendar
days from August 14, 2009, a stockholder proposal must be received by a
reasonable time before the Company begins to print and mail its proxy
solicitation material for such annual meeting. Any stockholder proposals will be
subject to the requirements of the proxy rules adopted by the Securities and
Exchange Commission.
The Company's Bylaws provide that in order for a stockholder to make
nominations for the election of directors or proposals for business to be
brought before the annual meeting, a stockholder must deliver notice of such
nominations and/or proposals to the Secretary not less than 30 days before the
date of the annual meeting; provided that if less than 40 days' notice or prior
public disclosure of the date of the annual meeting is given to stockholders,
such notice must be received not later than the close of business on the 10th
day following the day on which notice of the date of the annual meeting was
mailed to stockholders or prior public disclosure of the meeting date was made.
A copy of the Bylaws may be obtained from the Company.
STOCKHOLDER COMMUNICATIONS
The Company encourages stockholder communications to the Board of
Directors and/or individual directors. Communications regarding financial or
accounting policies may be made to the Chairman of the Audit/Compliance
Committee, Charles J. Pivirotto, at (973) 473-2200. Other communications to the
Board of Directors may be made to the Chairman of the Nominating/Corporate
Governance Committee, John Stokes, at (973) 473-2200. Communications to
individual directors may be made to such director at (973) 473-2200.
MISCELLANEOUS
The Company will pay the cost of this proxy solicitation. The Company
will reimburse brokerage firms and other custodians, nominees and fiduciaries
for the reasonable expenses they incur in sending proxy materials to the
beneficial owners of Clifton Savings Bancorp common stock. In addition to
soliciting proxies by mail, directors, officers and regular employees of the
Company may solicit proxies personally or by telephone without receiving
additional compensation.
The Company's Annual Report to Stockholders has been mailed to persons
who were stockholders as of the close of business on June 30, 2008. Any
stockholder who has not received a copy of the Annual Report may obtain a copy
by writing to the Corporate Secretary of the Company. The Annual Report is not
to be treated as part of the proxy solicitation material or as having been
incorporated in this proxy statement by reference.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K, WITHOUT EXHIBITS,
FOR THE YEAR ENDED MARCH 31, 2008, AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, WILL BE FURNISHED WITHOUT CHARGE TO PERSONS WHO WERE STOCKHOLDERS AS
OF THE CLOSE OF BUSINESS ON JUNE 30, 2008 UPON WRITTEN REQUEST TO BART D'AMBRA,
CLIFTON SAVINGS BANCORP, INC., 1433 VAN HOUTEN AVENUE, CLIFTON, NEW JERSEY
07015.
If you and others who share your address own your shares in street
name, your broker or other holder of record may be sending only one annual
report and proxy statement to your address. This practice, known as
"householding," is designed to reduce our printing and postage costs. However,
if a stockholder residing at such an address wishes to receive a separate annual
report or proxy statement in the future, he or she should contact the broker or
other holder of record. If you own your shares in street name and are receiving
multiple copies of our annual report and proxy statement, you can request
householding by contacting your broker or other holder of record.
33
Whether or not you plan to attend the annual meeting, please vote by
marking, signing, dating and promptly returning the enclosed proxy card in the
enclosed envelope.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Walter Celuch
Walter Celuch
President and Corporate Secretary
34
CLIFTON SAVINGS BANCORP, INC.
1433 VAN HOUTEN AVENUE
CLIFTON, NEW JERSEY 07015
(973) 473-2200
ANNUAL MEETING OF STOCKHOLDERS
AUGUST 14, 2008
9:00 A.M., LOCAL TIME
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Cynthia Sisco Parachini, Charles J.
Pivirotto and John Stokes, each with full power of substitution, to act as proxy
for the undersigned, and to vote all shares of common stock of the Company which
the undersigned is entitled to vote only at the Annual Meeting of Stockholders,
to be held on August 14, 2008, at 9:00 a.m., local time, at the Valley Regency,
1129 Valley Road, Clifton, New Jersey with all of the powers the undersigned
would possess if personally present at such meeting, as indicated to the right:
1. The election as directors of all nominees listed (except as marked
to the contrary below).
John A. Celentano, Jr. and Thomas A. Miller
FOR WITHHOLD FOR ALL EXCEPT
/_/ /_/ /_/
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL NOMINEE, MARK "FOR ALL
EXCEPT" AND WRITE THAT NOMINEE'S NAME ON THE LINE PROVIDED BELOW.
- --------------------------------------------------------------------------------
2. The ratification of the appointment of Beard Miller Company LLP as
independent registered public accountants of Clifton Savings
Bancorp, Inc. for the year ending March 31, 2009.
FOR AGAINST ABSTAIN
/_/ /_/ /_/
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" EACH OF THE LISTED
PROPOSALS.
THIS PROXY, PROPERLY SIGNED AND DATED, IS REVOCABLE AND WILL BE VOTED
AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED
"FOR" THE PROPOSALS LISTED. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL
MEETING THIS PROXY WILL BE VOTED BY THE PROXIES IN THEIR BEST JUDGMENT. AT THE
PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED
AT THE ANNUAL MEETING. THIS PROXY ALSO CONFERS DISCRETIONARY AUTHORITY ON THE
BOARD OF DIRECTORS TO VOTE WITH RESPECT TO THE ELECTION OF ANY PERSON AS
DIRECTOR WHERE THE NOMINEES ARE UNABLE TO SERVE OR FOR GOOD CAUSE WILL NOT SERVE
AND MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
PLEASE COMPLETE, DATE, SIGN AND PROMPTLY MAIL THIS PROXY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
Please sign exactly as your name appears on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder may sign but only one signature
is required.
Date ______________________ __________________________________________
Signature of Stockholder
Date ______________________ __________________________________________
Signature of Stockholder
The above signed acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Annual Meeting of Stockholders and of a
Proxy Statement dated July 9, 2008 and of the Annual Report to Stockholders.
[Clifton Savings Bancorp, Inc. Letterhead]
Dear ESOP Participant:
On behalf of the Board of Directors, I am forwarding to you the
attached YELLOW vote authorization form for the purpose of conveying your voting
instructions to RSGroup Trust Company, our ESOP Trustee, on the proposals
presented at the Annual Meeting of Stockholders of Clifton Savings Bancorp, Inc.
(the "Company") on August 14, 2008. Also enclosed is a Notice and Proxy
Statement for the Company's Annual Meeting of Stockholders and a Clifton Savings
Bancorp, Inc. Annual Report to Stockholders.
As a participant in the Clifton Savings Bank Employee Stock Ownership
Plan (the "ESOP"), you are entitled to instruct the ESOP Trustee how to vote the
shares of Company common stock allocated to your ESOP account as of June 30,
2008, the record date for the Annual Meeting.
The Trustee will vote all allocated shares of Company common stock as
directed by participants. The Trustee will vote unallocated shares of Common
Stock held in the ESOP Trust and the shares for which timely instructions are
not received in a manner calculated to most accurately reflect the instructions
the ESOP Trustee receives from participants, subject to its fiduciary duties.
To direct the ESOP Trustee how to vote the shares of common stock
allocated to your ESOP account, please complete and sign the enclosed YELLOW
vote authorization form and return it in the enclosed, postage-paid envelope no
later than THURSDAY, AUGUST 7, 2008. Your vote will not be revealed, directly or
indirectly, to any employee or director of the Company or Clifton Savings Bank.
Sincerely,
/s/ Walter Celuch
Walter Celuch
PRESIDENT AND CORPORATE SECRETARY
VOTE AUTHORIZATION FORM
-----------------------
I understand that RSGroup Trust Company (the "ESOP Trustee"), is the
holder of record and custodian of all shares of Clifton Savings Bancorp, Inc.
(the "Company") common stock under the Clifton Savings Bank Employee Stock
Ownership Plan. I understand that my voting instructions are solicited on behalf
of the Company's Board of Directors for the Annual Meeting of Stockholders to be
held on August 14, 2008.
You are to vote my shares as follows:
1. The election as directors of all nominees listed (except as marked
to the contrary below).
John A. Celentano, Jr. and Thomas A. Miller
FOR VOTE WITHHELD FOR ALL EXCEPT
/_/ /_/ /_/
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL NOMINEE, MARK "FOR ALL
EXCEPT" AND WRITE THAT NOMINEE'S NAME ON THE LINE PROVIDED BELOW.
- --------------------------------------------------------------------------------
2. The ratification of the appointment of Beard Miller Company LLP as
independent registered public accountants of Clifton Savings
Bancorp, Inc. for the year ending March 31, 2009.
FOR AGAINST ABSTAIN
/_/ /_/ /_/
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
The ESOP Trustee is hereby authorized to vote all shares of Company
common stock allocated to me in its trust capacity as indicated above.
- ----------------------------- --------------------------------
Date Signature
PLEASE DATE, SIGN AND RETURN THIS FORM IN THE ENCLOSED POSTAGE-PAID ENVELOPE NO
LATER THAN AUGUST 7, 2008.
[Clifton Savings Bancorp, Inc. Letterhead]
Dear 401(k) Plan Participant:
On behalf of the Board of Directors, I am forwarding to you the
attached BLUE vote authorization form for the purpose of conveying your voting
instructions to RSGroup Trust Company, the Trustee for the Clifton Savings
Bancorp, Inc. Stock Fund (the "Employer Stock Fund") in the Clifton Savings Bank
401(k) Savings Plan (the "401(k) Plan"), on the proposals presented at the
Annual Meeting of Stockholders of Clifton Savings Bancorp, Inc. (the "Company")
on August 14, 2008. Also enclosed is a Notice and Proxy Statement for the
Company's Annual Meeting of Stockholders and a Clifton Savings Bancorp, Inc.
Annual Report to Stockholders.
As a participant in the Employer Stock Fund, you are entitled to direct
the Employer Stock Fund Trustee how to vote the shares of Company common stock
credited to your account as of June 30, 2008, the record date for the Annual
Meeting. To direct the Trustee how to vote the shares credited to your account,
please complete and sign the enclosed BLUE vote authorization form and return it
in the enclosed, postage-paid envelope no later than AUGUST 7, 2008. Your vote
will not be revealed, directly or indirectly, to any employee or director of the
Company or Clifton Savings Bank.
Sincerely,
/s/ Walter Celuch
Walter Celuch
PRESIDENT AND CORPORATE SECRETARY
VOTE AUTHORIZATION FORM
-----------------------
I understand that RSGroup Trust Company (the "Trustee") is the holder
of record and custodian of all shares of Clifton Savings Bancorp, Inc. (the
"Company") common stock credited to me under the Clifton Savings Bank 401(k)
Savings Plan. I understand that my voting instructions are solicited on behalf
of the Company's Board of Directors for the Annual Meeting of Stockholders to be
held on August 14, 2008.
You are to vote my shares as follows:
1. The election as directors of all nominees listed (except as marked
to the contrary below).
John A. Celentano, Jr. and Thomas A. Miller
FOR VOTE WITHHELD FOR ALL EXCEPT
/_/ /_/ /_/
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL NOMINEE, MARK "FOR ALL
EXCEPT" AND WRITE THAT NOMINEE'S NAME ON THE LINE PROVIDED BELOW.
- --------------------------------------------------------------------------------
2. The ratification of the appointment of Beard Miller Company LLP as
independent registered public accountants of Clifton Savings
Bancorp, Inc. for the year ending March 31, 2009.
FOR AGAINST ABSTAIN
/_/ /_/ /_/
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
The Trustee is hereby authorized to vote all shares of Company common
stock allocated to me in its trust capacity as indicated above.
- ----------------------------- ---------------------------------
Date Signature
PLEASE DATE, SIGN AND RETURN THIS FORM IN THE ENCLOSED POSTAGE-PAID ENVELOPE NO
LATER THAN AUGUST 7, 2008.