SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
DS Bancor, 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)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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4) Date Filed:
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[LOGO]
DS BANCOR, INC.
33 ELIZABETH STREET
DERBY, CONNECTICUT 06418
March 29, 1995
Dear Shareholder:
You are cordially invited to attend the 1995 annual meeting of shareholders
(the "Annual Meeting") of DS Bancor, Inc. (the "Corporation") to be held on
Wednesday, April 26, 1995, at 10:00 a.m., local time, at the Trumbull Marriott,
180 Hawley Lane, Trumbull, Connecticut.
The Annual Meeting has been called for the following purposes: (1) to elect
four directors for terms of three years each; (2) to ratify the appointment of
Friedberg, Smith & Co., P.C. as independent public accountants of the
Corporation for the year ending December 31, 1995; and (3) to transact such
other business as may properly come before the Annual Meeting or any
adjournments thereof.
It is important that your shares be represented at the Annual Meeting.
Whether or not you plan to attend the Annual Meeting, you are requested to
complete, date, sign and return the enclosed proxy card in the enclosed envelope
for which postage has been paid.
Very truly yours,
[LOGO]
HARRY P. DIADAMO JR.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
[LOGO]
DS BANCOR, INC.
33 ELIZABETH STREET
DERBY, CONNECTICUT 06418
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 26, 1995
-------------------
NOTICE IS HEREBY GIVEN that the 1995 annual meeting of shareholders (the
"Annual Meeting") of DS Bancor, Inc. (the "Corporation") will be held at the
Trumbull Marriott, 180 Hawley Lane, Trumbull, Connecticut, on Wednesday, April
26, 1995, at 10:00 a.m., local time, for the following purposes:
1. To elect four directors for terms of three years each (Proposal 1);
2. To ratify the appointment by the Corporation's Board of Directors of
the firm of Friedberg, Smith & Co., P.C. as independent public accountants
of the Corporation for the year ending December 31, 1995 (Proposal 2); and
3. To transact such other business as may properly come before the
Annual Meeting or any adjournments thereof.
Pursuant to the Corporation's bylaws, the Board of Directors of the
Corporation has fixed the close of business on March 17, 1995 as the record date
for the determination of shareholders entitled to notice of and to vote at the
Annual Meeting. Only record holders of Corporation common stock at the close of
business on that date are entitled to notice of and to vote at the Annual
Meeting or any adjournments thereof.
In the event that there are not sufficient votes to approve any one or more
of the foregoing proposals at the time of the Annual Meeting, the Annual Meeting
may be adjourned in order to permit further solicitation by the Corporation.
By Order of the Board of Directors
[LOGO]
HARRY P. DIADAMO JR.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Derby, Connecticut
March 29, 1995
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT
YOU PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE SIGN, DATE AND
COMPLETE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
[LOGO]
DS BANCOR, INC.
33 ELIZABETH STREET
DERBY, CONNECTICUT 06418
(203) 736-9921
-------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
APRIL 26, 1995
-------------------
SOLICITATION, VOTING AND REVOCABILITY OF PROXIES
This Proxy Statement is furnished to shareholders of DS Bancor, Inc.
("Bancor" or the "Corporation") in connection with the solicitation of proxies
by the Board of Directors of Bancor for use at the annual meeting of
shareholders (the "Annual Meeting") to be held on Wednesday, April 26, 1995, at
10:00 a.m., local time, at the Trumbull Marriott, 180 Hawley Lane, Trumbull,
Connecticut, and at any adjournments thereof.
If the enclosed form of proxy is properly executed and returned to Bancor in
time to be voted at the Annual Meeting, the shares represented thereby will be
voted in accordance with the instructions marked thereon. EXECUTED BUT UNMARKED
PROXIES WILL BE VOTED (1) FOR PROPOSAL 1 TO ELECT THE FOUR NOMINEES OF THE BOARD
OF DIRECTORS AS DIRECTORS OF BANCOR; AND (2) FOR PROPOSAL 2 TO RATIFY THE
APPOINTMENT OF FRIEDBERG, SMITH & CO., P.C. AS INDEPENDENT PUBLIC ACCOUNTANTS OF
THE CORPORATION FOR THE YEAR ENDING DECEMBER 31, 1995. The Corporation is not
aware of any other matters that are proposed to be presented at the Annual
Meeting. However, if further business is properly presented, the persons named
in the accompanying proxy will vote such proxy as determined by a majority of
the Board of Directors.
The presence of a shareholder at the Annual Meeting will not automatically
revoke the shareholder's proxy. Shareholders may, however, revoke a proxy at any
time prior to its exercise by filing with the Secretary of the Corporation or
the presiding officer at the Annual Meeting a written notice of revocation, by
delivering to the Secretary of the Corporation or the presiding officer at the
Annual Meeting a duly executed proxy bearing a later date or by attending the
Annual Meeting and voting in person.
The cost of soliciting proxies will be borne by the Corporation. In addition
to use of the mails, proxies may be solicited personally or by telephone or
telegraph by officers, directors and employees of the Corporation or Derby
Savings Bank (the "Bank" or "Derby Savings") who will not be specially
compensated for such solicitation activities. Arrangements will also be made
with brokerage houses and other custodians, nominees and fiduciaries for
forwarding solicitation materials to the beneficial owners of shares held of
record by such persons, and the Corporation will reimburse such persons for
their reasonable expenses incurred in that connection. The Corporation has also
retained Kissell-Blake Inc., a proxy soliciting firm, to assist in the
solicitation of proxies at a fee of $4,000 plus reimbursement of out-of-pocket
expenses. This Proxy Statement, together with the enclosed proxy card, is
initially being mailed to shareholders on or about March 29, 1995.
1
The securities which can be voted at the Annual Meeting consist of shares of
common stock, par value $1.00 per share, of Bancor, with each share entitling
its holder to one vote on all matters, without any right to cumulative voting in
the election of directors. The close of business on March 17, 1995 has been
fixed by the Board of Directors as the record date for determination of
shareholders entitled to notice of, and to vote at, the Annual Meeting. On the
record date, 2,745,071 shares of Bancor common stock were outstanding and
eligible to be voted at the Annual Meeting.
The presence, in person or by proxy, of at least one-third of the total
number of outstanding shares of Bancor common stock entitled to vote is
necessary to constitute a quorum at the Annual Meeting. Assuming the presence of
a quorum at the Annual Meeting, directors will be elected by a plurality of the
votes of the shares of Bancor common stock present in person or represented by
proxy and entitled to vote and the affirmative vote of a majority of the votes
cast is required to ratify the appointment of the Corporation's independent
public accountants. Shareholders' votes will be tabulated by the persons
appointed by the Board of Directors to act as inspectors of election for the
Annual Meeting. Abstentions and broker non-votes will be treated as shares that
are present, or represented, and entitled to vote for purposes of determining
the presence of a quorum at the Annual Meeting. Broker non-votes will not be
counted as a vote cast or entitled to vote on any matter presented at the Annual
Meeting. Abstentions will not be counted in determining the number of votes cast
in connection with the ratification of the appointment of independent public
accountants.
A copy of the annual report to shareholders for the year ended December 31,
1994 accompanies this proxy statement. THE CORPORATION IS REQUIRED TO FILE AN
ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED DECEMBER 31, 1994 WITH THE
SECURITIES AND EXCHANGE COMMISSION (THE "SEC"). SHAREHOLDERS MAY OBTAIN, FREE OF
CHARGE, A COPY OF SUCH ANNUAL REPORT ON FORM 10-K (WITHOUT EXHIBITS) BY WRITING
TO MR. JOHN F. COSTIGAN, DS BANCOR, INC., 33 ELIZABETH STREET, DERBY,
CONNECTICUT 06418.
STOCK OWNED BY MANAGEMENT
The following table sets forth information as of March 17, 1995 with respect
to the amount of Bancor's common stock beneficially owned by each director of
Bancor, Bancor's Chief Executive Officer, each of the other three executive
officers of Bancor whose cash compensation (salary and bonus) exceeded $100,000
(the "named executive officers") and by all the directors and executive officers
of Bancor as a group.
NAME AND POSITION(S) AMOUNT AND NATURE OF PERCENT OF STOCK
WITH THE CORPORATION BENEFICIAL OWNERSHIP (A) OUTSTANDING
---------------------------------------- ------------------------ ------------------
Achille A. Apicella (b)................. 8,322 *
Director
Walter R. Archer Jr. (b)................ 20,146 *
Director
John J. Brennan (b)(c).................. 5,723 *
Director
John F. Costigan (d).................... 8,131 *
Director, Executive Vice
President and Secretary
Michael F. Daddona Jr. (e).............. 282,046 10.26%
Chairman of the Board
Harry P. DiAdamo Jr. (f)................ 84,431 3.00
Director, President and Chief
Executive Officer
Angelo E. Dirienzo (g).................. 4,041 *
Director
2
NAME AND POSITION(S) AMOUNT AND NATURE OF PERCENT OF STOCK
WITH THE CORPORATION BENEFICIAL OWNERSHIP (A) OUTSTANDING
---------------------------------------- ------------------------ ------------------
Laura J. Donahue (b).................... 9,829 *
Director
Christopher H.B. Mills (h).............. 109,007 3.97
Director
John M. Rak (b)(i)...................... 3,299 *
Director
John P. Sponheimer (j).................. 45,592 1.66
Director
Alfred T. Santoro (k)................... 39,959 1.43
Vice President and Chief
Financial Officer
Thomas H. Wells (l)..................... 31,313 1.13
Senior Vice President
of Derby Savings Bank
Directors and executive officers as a
group
(13 persons)........................... 651,839 22.43%
<FN>
---------
* Less than one percent.
(a) In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, a person is deemed to be the beneficial owner of a security for
purposes of the Rule if he or she has or shares voting power or investment
power with respect to such security or has the right to acquire such
ownership within 60 days after March 17, 1995. All persons shown in the
table have sole voting and investment power except as otherwise indicated.
The table includes 161,361 shares of Bancor's common stock subject to
outstanding stock options which are exercisable by directors and executive
officers of Bancor within 60 days of March 17, 1995.
(b) Includes 2,500 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995.
(c) Includes 3,011 shares owned by Brennan Realty, a partnership of which Mr.
Brennan is a partner.
(d) Includes 2,500 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995. Also includes shares for
which Mr. Costigan has shared voting and investment power as follows: 5,520
shares with Virginia Costigan (wife).
(e) Includes 4,607 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995. Also includes 31,880
shares for which Mr. Daddona has shared voting and investment power with
Sharon Daddona (wife), 2,600 shares with Michael Daddona (son), 2,600
shares with Marielle Daddona (daughter), and 2,600 shares with Michaela
Daddona (daughter).
(f) Includes 66,665 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995. Also includes shares for
which Mr. DiAdamo has shared voting and investment power as follows: 7,683
shares with Maureen E. DiAdamo (wife), 358 shares with Kevin DiAdamo (son),
and 402 shares with Christopher DiAdamo (son).
(g) Includes 1,403 shares for which Mr. Dirienzo has shared voting and
investment power with Claire S. Dirienzo (wife). Also includes 2,500 shares
of Bancor common stock subject to stock options that may be exercised
within 60 days of March 17, 1995.
(h) Includes 3,903 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995. See also footnote (c) to
the Stock Owned By Principal Shareholders table set forth below.
3
(i) Includes shares for which Mr. Rak has shared voting and investment power as
follows: 714 shares with Monica Rak (wife), 47 shares with Aaron Rak (son)
and 38 shares with Michael Rak (son).
(j) Includes 2,500 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995 and 43,092 shares as to
which Mr. Sponheimer exercises voting power but shares ownership with his
law partner. Does not include 3,000 shares owned by Mary Ann Sponheimer
(wife) as trustee for Brian Sponheimer (son) as to which Mr. Sponheimer
disclaims beneficial ownership.
(k) Includes 39,843 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995.
(l) Includes 26,343 shares of Bancor common stock subject to stock options that
may be exercised within 60 days of March 17, 1995. Also includes 700 shares
for which Mr. Wells has shared voting and investment power with Phyllis H.
Wells (wife).
STOCK OWNED BY PRINCIPAL SHAREHOLDERS
The following table sets forth information with respect to the persons
believed by Bancor to be the beneficial owners of more than five percent of the
issued and outstanding shares of Bancor's common stock, based on the most recent
filing with the SEC by each such person or entity as of March 17, 1995 or other
information available to Bancor. All such persons have reported sole voting and
dispositive power over the entire number of shares reported as beneficially
owned by them, except as otherwise indicated.
AMOUNT AND NATURE OF PERCENT OF STOCK
NAME AND ADDRESS BENEFICIAL OWNERSHIP OUTSTANDING
--------------------------------------------- -------------------- ------------------
Michael F. Daddona Jr. (a)................... 282,046 10.26%
156 Wild Rose Drive
Orange, CT 06477
Dimensional Fund Advisors, Inc. (b).......... 177,302 6.46
1299 Ocean Avenue , 11th Floor
Santa Monica, CA 90401
J O Hambro & Company Limited (c)............. 152,104 5.54
30 Queen Anne's Gate
London SW1H 9AL England
<FN>
---------
(a) Includes 39,680 shares for which Mr. Daddona has shared voting and
investment power with Sharon Daddona (wife), Michael Daddona (son),
Marielle Daddona (daughter) and Michaela Daddona (daughter). At the
Corporation's 1992 annual meeting, the Corporation's shareholders approved
the acquisition by Mr. Daddona of up to 24.9% of the Corporation's
outstanding common stock through open market purchases. On May 8, 1992, the
Federal Reserve Bank of Boston approved such proposed acquisition, subject
to the conditions that if the transaction has not been consummated within
one year from such date, or if the terms and conditions concerning the
transaction should change, the Federal Reserve Bank of Boston should be
consulted to determine whether any additional action or notification is
required. On June 8, 1992, the Connecticut State Banking Commissioner
approved Mr. Daddona's proposed acquisition of such shares. Also includes
4,607 shares of Bancor common stock subject to stock options that may be
exercised within 60 days of March 17, 1995.
(b) Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment
advisor, is deemed to have beneficial ownership of 177,302 shares of
Company stock as of December 31, 1994, all of which shares are held in
portfolios of DFA Investment Dimensions Group Inc., a registered open-end
investment company, or in series of the DFA Investment Trust Company, a
Delaware business trust, or the DFA Group Trust and DFA Participation Group
Trust, investment vehicles for qualified employee benefit plans, for all of
which Dimensional Fund Advisors, Inc. serves as investment manager.
Dimensional disclaims beneficial ownership of all such shares.
4
(c) Bancor has been advised by the reporting person that these shares are
beneficially owned as follows: (i) J O Hambro & Partners Limited ("Hambro
Partners"), Growth Financial Services Limited ("GFSL"), North Atlantic
Smaller Companies Investment Trust PLC (formerly Consolidated Venture Trust
PLC) ("NASCIT"), Christopher H.B. Mills, J O Hambro Investment Management
Limited ("Hambro Investment"), J O Hambro & Company Limited ("Hambro
Company") and J O Hambro Asset Management Limited ("Hambro Asset") own or
control, directly or indirectly, an aggregate of 145,859 shares or 5.74% of
the Corporation's outstanding common stock, as follows: (i) Mr. Mills
beneficially owns 105,104 shares, which amount includes the 5,104 shares he
personally owns and has sole voting and dispositive power over as well as
the 100,000 shares in respect of which he shares voting and dispositive
power with Hambro Partners by virtue of his role as chief executive and
co-investment adviser to NASCIT; (ii) NASCIT beneficially owns 100,000
shares and shares voting and dispositive power with Mr. Mills and Hambro
Partners, its co-investment advisers; (iii) GFSL shares voting and
dispositive power with NASCIT and Hambro Partners with respect to the
100,000 shares owned by NASCIT because of its agreement to provide to
NASCIT the services of Mr. Mills; (iv) Hambro Partners, as co-investment
adviser to NASCIT, shares voting and dispositive power with Mr. Mills and
NASCIT with respect to the 100,000 shares owned by NASCIT; (v) Hambro
Investment controls voting and dispositive power with respect to 47,000
shares owned by a private client; (v) Hambro Asset, by virtue of its
control of Hambro Partners and Hambro Investment, controls (in the case of
the 47,000 shares controlled by Hambro Investment) and shares control of
(in the case of the remaining 100,000 shares) the voting and dispositive
power with respect to the 147,000 shares controlled by Hambro Partners and
Hambro Investment; and (vi) Hambro Company, by virtue of its control of
Hambro Asset, controls (or, as the case may be, shares control of) the
voting and dispositive power with respect to the 147,000 shares controlled
by Hambro Asset or in respect of which Hambro Asset shares control.
ELECTION OF DIRECTORS
(PROPOSAL 1)
The Corporation's certificate of incorporation provides for a minimum of
nine directors and a maximum of 16. The number of directors of the Corporation
is currently set at 11. Pursuant to the Corporation's certificate of
incorporation, the Board of Directors is divided into three classes, with the
number of directors in each class to be as nearly equal in number as possible.
At the Annual Meeting, four directors will be elected to terms of three years
each.
Unless otherwise specified on the proxy, it is the intention of the persons
named in the proxy to vote the shares represented by each proxy for the election
as directors of the nominees listed below. The Board of Directors believes that
such nominees will stand for election and will serve if elected as directors.
If, however, any person nominated by the Board of Directors fails to stand for
election or is unable to accept election, the proxies will be voted for the
election of such other person or persons as the Board of Directors may
recommend. Assuming the presence of a quorum at the Annual Meeting, directors
will be elected by a plurality of the votes of the shares of Bancor common stock
present in person or represented by proxy and entitled to vote at the Annual
Meeting. There are no cumulative voting rights in the election of directors.
There are no arrangements or understandings between the Corporation and any
person pursuant to which such person has been nominated or elected as a
director.
INFORMATION AS TO NOMINEES AND CONTINUING DIRECTORS. The following table
sets forth the names of the four nominees for election as directors and the
names of the seven other directors whose terms of office will continue after the
Annual Meeting. Also set forth is certain other information, some of which has
been supplied by the directors, with respect to each nominee's or director's
principal occupation or employment
5
during the past five years, his or her age, the periods during which he or she
has served as a director of the Corporation and positions currently held with
the Corporation. All of the directors, except Mr. Mills, serve as directors of
Derby Savings.
AGE AT
DECEMBER 31, DIRECTOR FOR TERM POSITION(S) HELD
NAMES 1994 SINCE EXPIRING WITH THE CORPORATION
------------------------------ -------------- --------- --------- ---------------------
NOMINEES FOR 3-YEAR TERMS:
Achille A. Apicella........... 51 1986 1998 Director
John J. Brennan............... 62 1986 1998 Director
John F. Costigan.............. 64 1986 1998 Executive Vice
President, Secretary
and Director
Angelo E. Dirienzo............ 64 1986 1998 Director
TERM
CONTINUING DIRECTORS: EXPIRES
---------
Walter R. Archer Jr........... 64 1990 1996 Director
Harry P. DiAdamo Jr........... 51 1986 1996 President, Chief
Executive Officer and
Director
Laura J. Donahue.............. 46 1986 1996 Director
John M. Rak................... 48 1986 1996 Director
Michael F. Daddona Jr......... 41 1991 1997 Chairman of the Board
Christopher H.B. Mills........ 42 1988 1997 Director
John P. Sponheimer............ 47 1988 1997 Director
The principal occupations for the past five years of each of the Board of
Directors' four nominees and the seven other directors whose terms of office
will continue after the Annual Meeting are set forth below:
ACHILLE A. APICELLA, a director of Derby Savings since 1983, is president of
the certified public accounting firm of Apicella, Testa & Company P.C. in
Shelton, Connecticut. Mr. Apicella chairs the Audit/Ethics Committee. He is a
director and vice chairman of Hewitt Management Corporation, a service company
which manages long term care facilities, and serves as a trustee and vice
president of Hewitt Memorial Hospital and as corporator of Valley United Way and
Griffin Hospital. Mr. Apicella is also a member of the Connecticut Society of
Certified Public Accountants and American Institute of Certified Public
Accountants.
JOHN J. BRENNAN, a director of Derby Savings since 1983, has been the
president of John J. Brennan Construction Co., Inc. located in Shelton,
Connecticut since 1958. Mr. Brennan is a member of the Executive, Nominating and
Stock Option Committees. He also serves as a director of The Recreation Camp in
Derby, and a corporator of Hewitt Memorial Hospital and Griffin Hospital.
JOHN F. COSTIGAN, Executive Vice President and Secretary of the Corporation
and the Bank, joined the staff of Derby Savings in 1961 and has been a director
of the Bank since 1975. He has served in various capacities of increasing
responsibility, and since October 1984 has been the Bank's Executive Vice
President and Chief Operating Officer. Mr. Costigan serves on the Nominating
Committee of the Corporation. He is president of Friend A. Russ Fund, Inc. of
Shelton, an educational and charitable organization, and the secretary and past
chairman of the Tele-Media of Western Connecticut Advisory Council. Tele-Media
is a cable television company located in Seymour, Connecticut. He serves on the
Finance Committee of St. Mary's parish in Derby, and is past trustee and past
vice chairman of Griffin Health Services Corporation, and past trustee and past
chairman of Griffin Hospital, a community hospital located in Derby. In 1994 he
received the Charles H. Flynn Humanitarian Award for volunteer service that has
raised the quality of life in some areas of the community.
6
ANGELO E. DIRIENZO, a director of Derby Savings since 1979, retired as
Superintendent of Schools in Sherman, Connecticut in 1992, a post he had held
since 1987. He had previously served as School Superintendent in Oxford,
Connecticut, as well as in Derby. Dr. Dirienzo serves on the Audit/Ethics
Committee. He is an Adjunct Professor at Western Connecticut State University,
and a Mediator for the Connecticut State Department of Education. He has chaired
the Scholarship Committee of the New Haven County Sheriffs' Association since
its inception in 1972. A past president of Griffin Hospital, he currently serves
as a corporator of Griffin Hospital and at Hewitt Memorial Hospital and the
Valley United Way. Dr. Dirienzo is also a member of the Connecticut
Superintendents' Association, the American Association of College and University
Professors, the American Association of School Administrators, and a life member
of the Connecticut Association of Public School Superintendents. He chaired the
1993 Annual Giving Program of the Olde Derby Historical Society and is a member
of its Board of Directors.
WALTER R. ARCHER JR., a director of Derby Savings since 1988, became a
director of the Corporation in 1990. He serves on the Executive, Nominating and
Stock Option Committees. Mr. Archer is founder of Burtville Associates, a real
estate holding company, and Archer Landfill Service Company, both in Derby. A
corporator of Hewitt Memorial Hospital, Mr. Archer also serves as an executive
board member and assistant treasurer of the Housatonic Council, Boy Scouts of
America, and several years ago received that organization's first annual Good
Scout Award.
HARRY P. DIADAMO JR., President and Chief Executive Officer of the
Corporation and the Bank, has been a director of Derby Savings since 1980 and
served as Chairman of the Board from March 1984 to March 1985. He became
President, Treasurer and Chief Executive Officer of the Bank in October 1984.
Mr. DiAdamo is also a member of the Executive Committee of the Corporation. He
is serving his second two-year term on the Board of the Federal Home Loan Bank
of Boston and is chairman of its Audit Committee. Mr. DiAdamo is a member of the
Mortgage Finance Committee of America's Community Bankers, and the Executive and
Legislative Committees of the Connecticut Bankers Association, as well as a
director of Griffin Health Services and the New Haven Symphony Orchestra, and
president of the Shelton Educational Fund. He previously served as president of
the board of Notre Dame High School in West Haven and chairman of the Valley
United Way Campaign. Mr. DiAdamo is also a member of the New Britain Downtown
Council.
LAURA J. DONAHUE, a director of Derby Savings since 1979, has been engaged
in the practice of law in Derby since 1973 and is presently with the law firm of
Donahue & Donahue. Ms. Donahue is a member of the Audit/Ethics and Nominating
Committees. She is a trustee of Hewitt Memorial Hospital, a director of Hewitt
Management Corporation, a service company which manages long term care
facilities, a trustee and secretary of Friend A. Russ Fund, Inc., an educational
and charitable organization, and a director of Derby Neck Library. She is also
an Advisory Board member of the Katharine Matthies Foundation and a member of
the Grievance Panel of the Superior Court for the Judicial District of New
Haven.
JOHN M. RAK, a director of Derby Savings since 1984, operates a real estate
and appraisal company under his own name in Derby, and is a consultant to
Insurance Management Incorporated. He is chairman of the Stock Option Committee
and a member of the Audit/Ethics, Executive and Nominating Committees. Mr. Rak
serves as chairman of the City of Derby's Economic Development Commission, a
director of Derby Neck Library, and as treasurer and past president of
Housatonic Council, Boy Scouts of America, and trustee of Johnson Trust of
Tulsa, Oklahoma, which benefits scouting programs in the Naugatuck Valley.
MICHAEL F. DADONNA JR., a director of the Corporation and Derby Savings Bank
since 1991, became Chairman of the Board of the Corporation and the Bank in
November 1992. Mr. Daddona is the owner/ general manager of Automated Services,
a vending machine and food distribution company he founded in Milford,
Connecticut in 1972. He is also the managing partner of M & M Realty, a real
estate holding company. Mr. Daddona is chairman of the Executive Committee and
also serves on the Stock Option Committee. A member of the United Way Founders
Club, he is a benefactor of the Toys for Tots program and the Christian
Children's Fund. Mr. Daddona also serves as a corporator for Hewitt Memorial
Hospital.
7
CHRISTOPHER H.B. MILLS, who became a director of the Corporation in 1988, is
chief executive of North American Smaller Companies Trust PLC ("NASCIT"), a
London investment trust company whose investment manager is J O Hambro &
Partners Limited. Mr. Mills' services are provided by an agreement between
NASCIT and Growth Financial Services Limited. He is a member of the Executive
Committee. Mr. Mills serves as a director of 15 companies in the United Kingdom,
as well as the following companies in the United States: American Electronic
Components Inc. (electronics), American Plastic Technologies Inc. (plastics),
Copy Duplicating Products Inc. (office equipment), Magic Seasoning Blends Inc.
(food preparations), Oak Industries Inc. (electronics), Service Stations Inc.
(petroleum industry), and W-H Holdings Inc. (petrochemical, refinery and oil
industry services).
JOHN P. SPONHEIMER, who became a director of the Corporation and Derby
Savings in 1988, has been a partner in the Ansonia, Connecticut law firm of
Hoyle & Sponheimer since 1978. He is Chairman of the Nominating Committee and
also serves on the Executive Committee. Mr. Sponheimer was a member of the
Connecticut State Legislature from 1975 to 1981, and served as chairman of the
Banking Committee of the Connecticut General Assembly and as a member of the
Special Committee on Interstate Banking of the General Assembly from 1980 to
1982.
MANAGEMENT RECOMMENDS A VOTE FOR APPROVAL
OF MANAGEMENT'S NOMINEES FOR DIRECTOR
COMPENSATION OF DIRECTORS
Non-management directors of Bancor receive $400 for each Board of Directors
meeting attended, $350 for each committee meeting attended and $150 for each
"mini-meeting". Assuming attendance at not less than three of the four regular
meetings of the board, a stipend of $12,000 per annum is paid to the chairman of
the Board of Directors. Compensation to non-management directors of Derby
Savings is $12,000 per annum ($26,000 per annum for the chairman of the board),
assuming attendance at not less than nine of the 12 regular meetings of the
board, plus $400 for each special meeting of the Bank's Board of Directors, $350
for each committee meeting and $150 for each "mini-meeting" attended. Mr.
Daddona and Ms. Donahue also receive $150 for each meeting of the advisory board
of the New Britain/Hartford division of the Bank attended. Directors who are
officers of Bancor or Derby Savings receive no additional compensation for
serving as directors or attending meetings of the board or its committees.
Pursuant to the terms of the 1994 Stock Option Plan approved by shareholders
at the 1994 annual meeting, each non-employee director of the Corporation who
was serving on the board on February 28, 1994, the effective date of the Plan
(each director of the Company except Messrs. DiAdamo and Costigan) was granted a
ten-year nonqualified option to purchase 1,500 shares of the Corporation's
common stock. The per-share option exercise price of each of those options was
$24.00, which equaled the fair market value of a share of common stock on the
effective date of the Plan, as determined in accordance with the Plan.
Thereafter, subject to the availability of shares, on the date of the first
meeting of the board next following the 1994 Annual Meeting and following each
annual meeting of shareholders of the Corporation thereafter, an option to
purchase 1,000 shares of Corporation common stock will be granted to each person
who is then serving as a non-employee director of the Corporation. If the number
of shares remaining available for grant is insufficient to make any such annual
option grants, the annual option grants for that year shall be correspondingly
reduced on a pro rata basis.
In 1986, the Bank established a deferred compensation plan for the benefit
of its directors. This plan is no longer available to the members of the Board
of Directors. Directors were entitled to defer all or a portion of the fees paid
to them as directors of the Bank over a four-year period. Directors who were
officers of the Bank could have also participated in the plan and pursuant to
the plan could have deferred compensation paid to them as officers of the Bank.
Although there was no limitation in the plan on the amount of compensation that
could have been deferred by directors who were also officers of the Bank,
directors who participated in the plan only deferred compensation in an amount
which approximated the fees that would have been paid to them if they were
non-management directors of the Bank.
8
Under the plan, a director who has participated in the plan for four years
or who reaches the age of 65, whichever is later (the "Retirement Date"), and
who is still serving as a director, is entitled to receive benefits payable in
monthly installments over a ten-year period. The aggregate amount of the
benefits payable to a director is actuarially determined using mortality tables.
The plan also provides for the payment of pre-retirement disability benefits in
the event that a director is disabled as a result of illness or injury to the
extent that he or she is unable to perform his or her usual service to the Board
of Directors. Benefit payments pursuant to this provision of the plan would be
paid in the same manner and amount as normal retirement benefits under the plan
if the director had completed four years of service as a director, and would be
in an aggregate amount equal to 100 percent of the director's deferred fees at
10% interest per annum if the director had not completed four years of service.
In the event of a director's death prior to reaching the Retirement Date, the
plan provides for the payment of benefits to the designated beneficiary of the
director on a monthly basis over a ten-year period in an aggregate amount
actuarially determined using mortality tables. The plan provides that if the
service of a director is terminated voluntarily or involuntarily prior to the
Retirement Date, the director is entitled to receive all amounts deferred plus
interest thereon at a rate of 10% per annum.
BOARD OF DIRECTORS COMMITTEES AND NOMINATIONS BY SHAREHOLDERS
The Board of Directors of the Corporation has designated Messrs. Archer,
Brennan, Daddona, DiAdamo, Mills, Rak and Sponheimer as the Executive Committee
of the Board. Mr. Daddona currently serves as Chairman of the Executive
Committee. The Executive Committee, when the Board of Directors is not in
session, has and may exercise all of the power and authority of the Board of
Directors except as limited pursuant to Article IV, Section 2 of the
Corporation's bylaws, pursuant to which the Executive Committee may not, among
other things, amend the Corporation's certificate of incorporation or bylaws,
adopt an agreement of merger or consolidation, or recommend to the shareholders
the sale, lease or exchange of all or substantially all of the Corporation's
assets or the dissolution of the Corporation. During 1994, the Executive
Committee did not meet.
The Board of Directors of the Corporation has appointed an Audit/Ethics
Committee, whose members are Messrs. Apicella, Dirienzo and Rak and Ms. Donahue.
Mr. Apicella serves as Chairman of the Audit/ Ethics Committee. The Committee
reviews the Corporation's financial statements and reviews the report of the
annual audit by the Corporation's independent accountants prior to submission of
that report to the full Board of Directors. The Audit/Ethics Committee also
reviews management's response to the independent accountant's report. The
Audit/Ethics Committee annually reviews the Corporation's contract with its
independent accountants and makes recommendations to the Board of Directors
regarding renewal of that contract. Additionally, the Committee administers the
Corporation's ethics policy for directors, officers and employees. During 1994,
the Audit/Ethics Committee met seven times.
The Board of Directors of the Corporation has appointed a standing Stock
Option Committee consisting of Messrs. Archer, Brennan, Daddona and Rak with Mr.
Rak serving as Chairman. The Stock Option Committee administers the
Corporation's stock option plans. During 1994, the Stock Option Committee met
five times.
Messrs. Archer, Brennan, Costigan, Rak and Sponheimer and Ms. Donahue
currently serve as the Nominating Committee for selecting the nominees of the
board for election as directors. Mr. Sponheimer currently serves as chairman of
the Nominating Committee. The Nominating Committee met two times in 1994.
Shareholders of Bancor may nominate directors pursuant to timely notice in
writing to the secretary of Bancor in accordance with Bancor's bylaws. To be
timely, a shareholder's notice must be delivered to or mailed and received at
the principal executive offices of the Corporation not less than 30 nor more
than 90 days prior to the Annual Meeting; provided, however, that in the event
less than 45 days' notice or prior public disclosure of the date of the meeting
is given or made to shareholders, notice by the shareholder to be timely must be
so received by Bancor not later than the close of business on the 15th day
following the day on which notice of the date of the meeting was mailed or such
public disclosure was made. Under the Corporation's bylaws, shareholder
nominations for the Annual Meeting will be required to have been
9
received on or before April 13, 1995 in order to be timely. A shareholder's
notice of nomination must set forth certain information specified in Article
III, Section 13 of Bancor's bylaws concerning each person the shareholder
proposes to nominate for election and the shareholder giving the notice. The
bylaws provide that no person shall be eligible for election as a director of
Bancor unless nominated in accordance with the procedures set forth in Article
III, Section 13 of the bylaws.
During 1994 the Corporation's Board of Directors held four quarterly
meetings and four special meetings and the Bank's Board of Directors held twelve
regular monthly meetings and five special meetings. No incumbent director
attended fewer than 75 percent of the total number of meetings of the Board of
Directors of the Corporation and the total number of meetings held by all
committees of the Board of Directors of the Corporation on which he or she
served.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Because the business of the Corporation currently consists of the business
of Derby Savings, no separate cash compensation is paid to the executive
officers of the Corporation, all of whom are executive officers of Derby Savings
and receive compensation as such. The following table shows, for the years ended
December 31, 1994, 1993 and 1992, the cash compensation paid by Derby Savings,
as well as certain other compensation paid or accrued for those years, to the
chief executive officer and each of the named executive officers.
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
AWARDS
-----------------
ANNUAL COMPENSATION SECURITIES
NAME AND ------------------------------------ UNDERLYING ALL OTHER
PRINCIPAL POSITION(S) FISCAL YEAR SALARY ($) BONUS ($) OPTIONS/SARS (#) COMPENSATION ($)(A)
---------------------------------------- ----------- ---------- ----------- ----------------- -------------------
Harry P. DiAdamo Jr..................... 1994 $ 246,040 $ -- 10,000 $ 2,250
President, Chief Executive 1993 232,113 -- 19,000 3,491
Officer and Director 1992 228,521 25,000 -- 3,803
John F. Costigan........................ 1994 156,543 -- 2,500 2,250
Executive Vice President, 1993 153,362 -- 4,000 2,317
Secretary and Director 1992 150,913 17,500 -- 2,526
Alfred T. Santoro....................... 1994 138,427 -- 5,000 2,139
Vice President and Chief 1993 139,584 -- 11,000 2,163
Financial Officer 1992 125,997 15,000 -- 2,115
Thomas H. Wells......................... 1994 125,569 -- -- 1,916
Senior Vice President of 1993 112,291 -- 2,500 1,717
Derby Savings Bank 1992 106,654 10,000 -- 1,750
<FN>
---------
(a) Consists of employer matching contributions made to the Bank's thrift plan
for the account of each individual.
10
OPTION/SAR GRANTS
The following table contains information with respect to grants of stock
options to each of the named executive officers during 1994. All such options
were granted under the Corporation's 1994 Stock Option Plan, which does not
provide for the grant of stock appreciation rights ("SARs").
OPTION/SAR GRANTS IN 1994 FISCAL YEAR
POTENTIAL REALIZABLE
VALUE
AT ASSUMED ANNUAL
INDIVIDUAL GRANTS RATES
------------------------------------------------------- OF STOCK PRICE
% OF TOTAL APPRECIATION FOR
OPTIONS/SARS OPTION
OPTIONS/ GRANTED TO EXERCISE OR TERM (A)
SARS EMPLOYEES IN BASE PRICE EXPIRATION ----------------------
NAME GRANTED (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
----------------------------------- ----------- ---------------- ----------- ----------- ---------- ----------
Harry P. DiAdamo Jr................ 10,000 54.1% $ 24.75 3/16/2004 $ 155,651 $ 394,451
John F. Costigan................... 2,500 13.5 24.75 3/16/2004 38,913 98,613
Alfred T. Santoro.................. 5,000 27.0 24.75 3/16/2004 77,826 197,226
Thomas H. Wells.................... -- -- -- -- -- --
<FN>
---------
(a) Estimated market value of underlying securities at assumed annual rates of
stock price appreciation for option term minus the exercise price.
OPTION/SAR EXERCISES AND HOLDINGS
The following table sets forth the 1994 year end value of all unexercised
in-the-money options and SARs held by the named executive officers. All options
and SARs held by the named executive officers as of December 31, 1994 are
presently exercisable. SARs are granted in tandem with options granted under the
Corporation's 1985 stock option plan.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
VALUE OF SECURITIES
UNDERLYING
NUMBER OF SECURITIES UNEXERCISED
SHARES ACQUIRED VALUE UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/
NAME ON EXERCISE (#) REALIZED ($) OPTIONS/SARS AT FY-END (#) SARS AT FY-END ($)(A)
---------------------------------------- --------------- ---------------- --------------------------- ---------------------
Harry P. DiAdamo Jr..................... 22,719 $ 463,083 66,665 $ 359,170
John F. Costigan........................ 44,192 652,988 2,500 0
Alfred T. Santoro....................... 4,218 93,505 39,843 188,415
Thomas H. Wells......................... 2,811 59,843 26,343 149,102
<FN>
---------
(a) Market value of underlying securities at exercise or year-end minus the
exercise or base price.
EMPLOYMENT AND CHANGE-IN-CONTROL AGREEMENTS
Derby Savings and the Corporation have entered into employment agreements
with Harry P. DiAdamo Jr. and John F. Costigan. The current term of each
employment agreement is through December 31, 1998. On each December 31, unless
the Bank, the Corporation or the employee has previously given written notice to
the contrary, an additional one-year period is added to the term of the
agreement. The employment agreements provided for initial annual salaries with a
six percent minimum annual increase in subsequent years. In 1994, the annual
salaries pursuant to their employment agreements for Messrs. DiAdamo and
Costigan were $236,927 and $156,543 respectively. The employment agreements also
provide, among other things, for participation in discretionary bonuses as
authorized by the Board of Directors and for participation in pension, stock
option and other benefits applicable to executive personnel.
The employment agreements may be terminated for cause at any time by the
Board of Directors. Each contract is also terminable by the Corporation or the
Bank without cause, whereupon the employee would be entitled to a lump sum cash
payment equal to the full amount of his salary for the remaining term of the
11
agreement, and continuation for the remaining term of the agreement of all
vested retirement or employee benefits and then existing fringe benefits. The
employees have no right to terminate their agreements prior to the end of the
terms without approval of the Boards of Directors of the Bank and the
Corporation except in connection with or within two years after a "change in
control" of the Corporation or the Bank, in which case they will receive
severance payments of three times average annual compensation based on the prior
five-year period. The agreements include an employee covenant not to compete for
a period of the lesser of one year or the balance of the term plus six months in
the event the employee terminates his employment during the term of the
agreement without board approval. Under the terms of the agreements, if the
employment of Messrs. DiAdamo or Costigan were terminated by the Bank or the
Corporation other than for cause or by the employee during 1995, the severance
payment which each would receive is $1,099,000 and $726,000, respectively. If
their employment was terminated in 1995 voluntarily or involuntarily in
connection with or within two years after a "change in control," they would be
entitled to receive severance payments of $933,000 and $821,000, respectively.
As defined in the agreements, a "change in control" will be deemed to have
occurred if (i) any person becomes the beneficial owner of 20% or more of the
total number of voting shares of the Corporation; (ii) any person becomes the
beneficial owner of 10% or more, but less than 20%, of the total number of
voting shares of the Corporation if the Board of Directors determines that such
beneficial ownership constitutes or will constitute control of the Corporation;
(iii) any person (other than the persons named as proxies solicited on behalf of
the Board of Directors of the Corporation) holds revocable or irrevocable
proxies, as to the election or removal of two or more directors of the
Corporation, for 25% or more of the total number of voting shares of the
Corporation; (iv) any person has commenced a tender or exchange offer, or
entered into an agreement or received an option, to acquire beneficial ownership
of 20% or more of the total number of voting shares of the Corporation; or (v)
as a result of, or in connection with, any cash tender or exchange offer,
merger, or other business combination, sale of assets or contested election or
any combination of the foregoing transactions, the persons who were directors of
the Corporation before such transaction shall cease to constitute at least
two-thirds of the Board of Directors of the Corporation or any successor
institution. A "change in control" of the Bank will be deemed to have taken
place if the Corporation's beneficial ownership of the total number of voting
shares of the Bank is reduced to less than 50% unless the transaction that
causes such reduction is approved by two-thirds of the Board of Directors of the
Bank. For purposes of the foregoing, the term "person" includes an individual, a
corporation, a partnership, a trust, or a group acting in concert.
The Bank and the Corporation have entered into severance payment agreements
with Alfred T. Santoro and Thomas H. Wells which generally provide that in the
event the employee's employment is terminated, voluntarily or involuntarily
(other than by normal retirement, disability or death), in connection with or
within two years after a change in control of the Bank or the Corporation, they
would be entitled to receive lump sum cash severance payments. The amount of
this payment would equal approximately three times the employee's average annual
compensation includible in his income for federal income tax purposes with
respect to the five-year period prior to the change in control of the Bank or
the Corporation. For purposes of the agreements, the term "change in control"
has a definition substantially the same definition of "change in control" in the
employment agreements of Messrs. DiAdamo and Costigan. Under the terms of the
agreements, if the employment of Messrs. Santoro and Wells were terminated by
the Bank or the Corporation in 1995, in connection with a change in control, the
severance payment which each would receive is $408,000 and $349,000,
respectively.
REPORT ON EXECUTIVE COMPENSATION
Pursuant to the rules adopted by the SEC designed to enhance the disclosure
of company policies toward executive compensation, set forth below is a report
submitted by the Executive Compensation Committee of the Board of Directors of
the Bank and the Stock Option Committee of the Board of Directors of the
Corporation addressing executive officer compensation policies for 1994. As
noted above, because the business of the Corporation currently consists of the
business of the Bank, no separate cash compensation is paid to the executive
officers of the Corporation.
12
Decisions on compensation (other than stock options) for Messrs. DiAdamo and
Costigan are made by the Bank's Board of Directors (with Messrs. DiAdamo and
Costigan not participating) based upon the recommendations of the Executive
Compensation Committee of the Board. Decisions on compensation paid to other
executive officers of the Bank (other than stock options) are made by Messrs.
DiAdamo and Costigan. Decisions as to the grant of stock options are made by the
Stock Option Committee of the Board of Directors of the Corporation.
The Bank's executive compensation policies provide competitive levels of
compensation designed to integrate pay with the Bank's and the Corporation's
annual and long term performance goals. Underlying this objective are the
following concepts: supporting an individual pay-for-performance policy that
differentiates compensation levels based on corporate, business unit, and
individual performance; motivating key senior officers to achieve strategic
business objectives and rewarding them for that achievement; providing
compensation opportunities which are competitive to those offered in the
marketplace, thus allowing the Bank and the Corporation to compete for and
retain talented executives who are critical to the Bank's and the Corporation's
long term success; and aligning the interests of executives with the long term
interests of the Corporation's shareholders.
Executive compensation consists of three components: cash compensation,
including base salary and cash bonuses; long term incentive compensation in the
form of stock options; and executive and retirement benefits. The components are
intended to provide incentives to achieve short term and long term objectives
and to reward exceptional performance. Performance is evaluated not only with
respect to earnings but also with respect to comparable industry performance,
the accomplishment of business objectives, and the individual's contribution to
earnings and shareholder value.
CASH COMPENSATION. Pursuant to their employment agreements with the
Corporation and the Bank, Messrs. DiAdamo and Costigan annually are entitled to
receive a minimum 6.0% increase in their base salaries. For 1994, Messrs.
DiAdamo and Costigan received increases in their base salaries of 6.0%, as
determined by the Board after evaluation of the factors set forth above. The
Corporation's two other executive officers, Messrs. Santoro and Wells, received
increases of 0% and 13%, respectively, as determined by Messrs. DiAdamo and
Costigan after evaluation of the above criteria.
Bonus awards to executive officers are discretionary. No bonuses were
awarded in 1994.
STOCK OPTIONS. To encourage growth in shareholder value, stock options are
granted by the Corporation from time to time under the Corporation's stock
option plan to officers and other employees. During 1994, the Company granted a
total of 18,500 stock options, including 17,500 options to the Company's four
executive officers. All options that were granted during 1994 had an exercise
price of $24.75 per share and will expire in 2004.
EXECUTIVE AND RETIREMENT BENEFITS. In addition to the compensation
described above, the executive officers receive all normal employee fringe
benefits, as well as benefits under the Bank's thrift plan and pension plan. The
Bank also provides automobile allowances to executive officers, club memberships
(in the case of Messrs. DiAdamo and Costigan), and pays life and disability
insurance premiums for Mr. DiAdamo.
13
CEO COMPENSATION. As noted above, under the terms of Mr. DiAdamo's
employment agreement, Mr. DiAdamo is entitled to a 6.0% minimum annual increase
in salary. In 1994, Mr. DiAdamo received a salary increase of 6.0%. During 1994,
Mr. DiAdamo also received a grant of a ten year stock option for 10,000 shares
of Corporation common stock. The per share exercise price was $24.75, which
equaled the fair market value of a share of Corporation common stock on the date
of grant. The Board believes the compensation Mr. DiAdamo received for 1994
appropriately rewards Mr. DiAdamo for the results he achieved during that year.
EXECUTIVE COMPENSATION STOCK OPTION COMMITTEE OF THE
COMMITTEE OF THE BOARD OF DIRECTORS OF THE CORPORATION
BOARD OF DIRECTORS
OF THE BANK
Walter R. Archer Jr., Chairman John M. Rak, Chairman
Achille A. Apicella John J. Brennan
Angelo E. Dirienzo Walter R. Archer Jr.
Michael F. Daddona Jr., ex officio Michael F. Daddona Jr.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. DiAdamo and Costigan serve on the Board of Directors of the Bank. As
such, they participate in compensation decisions with respect to the Bank's
executive officers. Nether Mr. DiAdamo nor Mr. Costigan participate or vote in
decisions on their own compensation.
During 1994, the Bank paid (i) $14,250 in legal fees to the law firm of
Hoyle & Sponheimer, of which John P. Sponheimer, a director of the Corporation
and the Bank, is a partner and (ii) $7,600 in legal fees to the law firm of
Donahue & Donahue, of which Laura J. Donahue, a director of the Corporation and
the Bank, is a partner. Additionally, during 1994 the Bank made payments
totaling $120,500 to John J. Brennan Construction Co., Inc. for snow removal
services for the Bank and its branches and construction repairs to several of
the Bank's offices. Mr. Brennan, a director of the Corporation and the Bank, is
president of John J. Brennan Construction Co., Inc. The Corporation believes the
terms of all such transactions were substantially the same as the terms that
could have been obtained at the time from an unaffiliated third party.
14
COMPARATIVE COMPANY PERFORMANCE
The following graph shows a five year comparison of cumulative total returns
for the Corporation, the NASDAQ Stock Market's National Market and the KBW New
England Savings Bank Index.
DEC-89 DEC-90 DEC-91 DEC-92 DEC-93 DEC-94
D.S. Bancor, Inc. 100.0 69.7 53.6 139.9 181.0 179.0
NASDAQ Stock Market Index (US) 100.0 84.9 136.3 158.6 180.9 176.9
KBW New England Savings Bank Index 100.0 50.2 88.1 154.7 206.5 207.9
Assumes $100 invested on December 31, 1989 with full reinvestment of dividends,
if any.
PENSION PLAN
The following table sets forth estimated annual retirement benefits of
representative years of service and annual compensation under the Company's
pension plan.
PENSION PLAN TABLE
YEARS OF SERVICE (A)
--------------------------------------------------------
REMUNERATION 15 20 25 30 35
------------- --------- --------- ---------- ---------- ----------
$ 125,000 $ 34,059 $ 45,412 $ 56,765 $ 68,118 $ 71,243
150,000 or 41,559 55,412 69,265 83,118 86,868
more
<FN>
---------
(a) For participants aged 65 retiring in 1994 and based on 1994 Social Security
benefit levels. Pension benefits payable beginning January 1, 1995 are
currently subject to a statutory maximum of $120,000 per year, subject to
cost of living adjustments. Additionally, annual compensation earned in
excess of $150,000 (subject to cost of living adjustments) may not be used
in the calculation of retirement benefits.
At December 31, 1994, Messrs. DiAdamo, Costigan, Santoro and Wells had 9,
32, 8 and 19 years, respectively, of credited service.
Contributions to the pension plan are determined on an actuarial basis for
the benefit of all qualifying employees. Employees become eligible for
participation on attainment of age 21 and the accumulation of 1,000 hours of
employment in a year. Annual normal retirement benefits are computed at the rate
of 60 percent of the participant's final earnings less 50 percent of the
participant's social security amount for participants with exactly 30 years of
credited service.
15
For participants with more than 30 years of credited service, annual normal
retirement benefits are computed as for participants with exactly 30 years of
credited service plus 1/2 of 1 percent of the participant's final earnings for
each year (up to ten) of credited service in excess of 30 years. For
participants with less than 30 years of credited service, annual normal
retirement benefits are computed by multiplying the annual normal retirement
benefit of a participant with exactly 30 years of credited service by the ratio
that the number of that participant's years of credited service bears to 30. The
plan also provides for optional early retirement benefits within ten years of a
participant's normal retirement date provided the participant has completed 15
years of credited service.
A participant's final earnings equals the highest average annual earnings
received in any five consecutive years during the last ten years before the
normal retirement date. Years of credited service equals the number of years of
employment, not including the first year of service, between ages 25 (for an
employee who became a participant prior to July 1, 1985, otherwise age 21) and
65. For participants retiring at normal or early retirement dates, a pension
equal to 50 percent of the participant's retirement income is payable to the
surviving spouse. As an alternative to the 50 percent continuation, a
participant when he or she retires may elect to pay 100 percent to the
participant's spouse or 66 2/3 percent to the spouse and retain 33 1/3 percent
of the benefit.
CERTAIN TRANSACTIONS
Derby Savings makes loans to its directors, officers, members of their
immediate families and other employees and holders of five percent or more of
the issued and outstanding shares of Bancor's common stock for the financing of
their homes as well as for home improvement and consumer loans. The Bank also
makes loans to business entities with which such shareholders of Bancor,
directors or officers of the Bank or members of their immediate families may be
associated. It is the Bank's policy that these loans are made in the ordinary
course of business and neither involve more than normal risk of collectability
nor present other unfavorable features. These loans are made on substantially
the same terms (including interest rate, fees and collateral) as those
prevailing at the time for comparable transactions with non-affiliated persons
and have been made in compliance with the requirements of state and federal law
applicable to loans to such persons. As of December 31, 1994, loans to holders
of five percent or more of Bancor's issued and outstanding common stock,
directors and executive officers of Derby Savings and their affiliated
businesses totaled approximately $1,305,000.
For a description of certain transactions regarding the Bank and Messrs.
Sponheimer and Brennan and Ms. Donahue, see "Compensation Committee Interlocks
and Insider Participation."
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
(PROPOSAL 2)
The Board of Directors has appointed the firm of Friedberg, Smith & Co.,
P.C. to continue as independent public accountants for the Corporation for the
year ending December 31, 1995. Friedberg, Smith & Co., P.C. has been acting as
independent public accountants of the Corporation since its formation in 1987
and for Derby Savings since 1982. Unless otherwise indicated, properly executed
proxies will be voted in favor of ratifying the appointment of Friedberg, Smith
& Co., P.C., independent public accountants, to audit the books and accounts of
the Corporation and its subsidiary for the year ending December 31, 1995. No
determination has been made as to what action the Board of Directors would take
if the shareholders do not ratify the appointment.
Assuming the presence of a quorum at the Annual Meeting, the affirmative
vote of the holders of at least a majority of the votes cast at the Annual
Meeting is required to ratify the appointment of Friedberg, Smith & Co., P.C. as
the Corporation's independent public accountants for the year ending December
31, 1995.
Representatives of Friedberg, Smith & Co., P.C. will be present at the
Annual Meeting. They will be given an opportunity to make a statement if they
desire to do so and will be available to respond to appropriate questions.
16
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1996 annual
meeting of shareholders must be received by Bancor at its principal executive
offices on or before November 29, 1995 in order to be considered for inclusion
in its proxy statement and form of proxy relating to the 1996 annual meeting.
Nothing in this paragraph should be deemed to require the Corporation to include
in its proxy statement and proxy relating to the 1996 annual meeting any
shareholder proposal which may be omitted from the Corporation's proxy materials
pursuant to applicable regulations of the SEC in effect at the time such
proposal is received.
The bylaws of Bancor provide that in order for any director nominations and
new business to be properly brought before an annual meeting by a shareholder,
the shareholder must have given timely notice thereof in writing to the
secretary of the Corporation. To be timely, a shareholder's notice must be
delivered to or mailed and received at the principal executive offices of Bancor
not less than 30 nor more than 90 days prior to the date of the meeting;
provided, however, that in the event less than 45 days' notice or prior public
disclosure of the date of the meeting is given or made to shareholders, notice
by the shareholder to be timely must be so received not later than the close of
business on the 15th day following the day on which such notice of the date of
the annual meeting was mailed or such public disclosure was made. A
shareholder's notice must set forth certain information specified in Article II,
Section 3 of Bancor's bylaws with respect to each matter the shareholder
proposes to bring before the annual meeting. Bancor's bylaws provide that no
business shall be conducted at an annual meeting except in accordance with the
procedures set forth in Article II, Section 3 of the bylaws.
OTHER MATTERS
As of the date of this proxy statement, the Board of Directors of Bancor
knows of no matters to be brought before the Annual Meeting other than those
specifically listed in the Notice of Annual Meeting of Shareholders. However, if
further business is properly presented, the persons named in the accompanying
proxy will vote such proxy as determined by a majority of the Board of
Directors.
The Board of Directors of Bancor urges each shareholder, whether or not he
or she intends to be present at the Annual Meeting, to complete, sign and return
the enclosed proxy as promptly as possible.
By Order of the Board of Directors
[LOGO]
HARRY P. DIADAMO JR.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Derby, Connecticut
March 29, 1995
17
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TABLE OF CONTENTS
PAGE
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Solicitation, Voting and Revocability of
Proxies...................................... 1
Stock Owned by Management...................... 2
Stock Owned by Principal Shareholders.......... 4
Election of Directors.......................... 5
Executive Compensation and Other Information... 10
Ratification of Appointment of Independent
Public Accountants........................... 16
Shareholder Proposals.......................... 17
Other Matters.................................. 17
[LOGO]
DS BANCOR, INC.
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PROXY STATEMENT
MARCH 29, 1995
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DS BANCOR, INC.
33 ELIZABETH STREET, DERBY, CONNECTICUT 06418
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS - APRIL 26, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
The undersigned shareholder of DS Bancor, Inc. (the "Corporation") hereby
appoints Harry P. DiAdamo Jr. and Alfred T. Santoro, and each of them, with
full power of substitution, as proxies to cast all votes, as designated below,
which the undersigned shareholder is entitled to cast at the 1995 annual
meeting of shareholders (the "Annual Meeting") to be held on April 26, 1995 at
10:00 a.m., local time, at the Trumbull Marriott, 180 Hawley Lane, Trumbull,
Connecticut, and at any adjournments thereof, upon the following matters.
This proxy will be voted as directed by the undersigned shareholder. UNLESS
CONTRARY DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE
NOMINEES LISTED IN PROPOSAL 1, FOR PROPOSAL 2, AND IN ACCORDANCE WITH THE
RECOMMENDATIONS OF A MAJORITY OF THE BOARD OF DIRECTORS AS TO OTHER MATTERS.
The undersigned shareholder hereby acknowledges receipt of the Notice of Annual
Meeting and Proxy Statement and hereby revokes any proxy or proxies heretofore
given. This proxy may be revoked at any time prior to its exercise.
SEE REVERSE SIDE / /
(CONTINUED AND TO BE SIGNED AND DATED ON REVERSE SIDE)
/X/ Please mark your
votes as in this
example.
3101
1. To elect four directors each for a three-year term.
FOR all nominees WITHHOLD
listed (except as AUTHORITY to vote
marked to the for all nominees
contrary below) listed
/ / / /
Nominees: Achille A. Apicella
John J. Brennan
John F. Costigan
Angelo E. Dirienzo
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.)
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2. To ratify the appointment by the Corporation's Board of Directors of the
firm of Friedberg, Smith & Co., P.C. as independent public accountants of the
Corporation for the year ending December 31, 1995.
FOR AGAINST ABSTAIN
/ / / / / /
If you receive more than one proxy card, please date, sign and return all cards
in the accompanying envelope.
SIGNATURE(S)___________________________________________ DATE_________________
(Please date and sign here exactly as name appears at left. When signing as
attorney, administrator, trustee or guardian, give full title as such; and when
stock has been issued in the name of two or more persons, all should sign.)