SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20459
AMENDMENT NO.1 TO THE FORM 10-K
Annual report pursuant to Section 13 or 15(d)of the Securities Exchange
Act of 1934
For the fiscal year ended September 30, 1996 Commission file number: 0-16825
BFS BANKORP, INC.
(Exact name of registrant as specified in its charter)
Delaware 13 - 3475050
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
110 William Street NY, NY 10038
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 212-227-4040
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 par value per share
--------------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days. Yes [X] No [_]
----- -----
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) is not contained herein, and will
not be contained, to the best of the registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [X]
The aggregate market value of the voting stock held by non-affiliates of the
registrant, computed by reference to the last reported sales price of such stock
on the NASDAQ National Market system on November 30, 1996 was approximately
$30,259,000.
The number of shares outstanding of the registrant's Common Stock, the
registrant's only class of outstanding capital stock, as of November 30, 1996,
was 1,647,237 (net of treasury stock).
PART III
Item 10. Directors and Executive Officers of the Registrant
Name, Principal Occupation and
Business Experience for Past 5 Years
- ------------------------------------
DIRECTORS
Fredric H. Gould, Age 61. Mr. Gould was appointed a Director of the Company and
the Bank in April 1990. He is Chairman of the Board of BRT Realty Trust, a real
estate investment trust, Vice Chairman of Georgetown Partners, Inc., and
Chairman of the Board of One Liberty Properties, Inc., a publicly-traded real
estate company. Prior to May, 1996, Mr. Gould was President of Georgetown
Partners, Inc., which is the managing general partner of Gould Investors L.P., a
publicly-traded real estate partnership. Mr. Gould also is a director of
Sunstone Hotel Investors, Inc., a real estate investment trust.
Todd M. Poland, Age 49. Mr. Poland has been a Director of the Bank since
September 1989 and of the Company since February 1990. He is a Partner in
McCarter & English, Newark, New Jersey, a law firm.
James A. Randall, Age 41. Mr. Randall has been President and Chief Executive
Officer of the Company and the Bank since August 1989. He has been a Director
of the Bank since 1986 and of the Company since March 1988.
Eldon C. Hanes, Age 72. Mr. Hanes has been Chairman of the Board of Directors
of the Company since August 1987 and of the Bank since January 1987. He has
been a Director of the Bank since 1970. He retired as a Vice President of AT&T
Information Systems in 1985 and he has been employed by Syska & Hennessy Inc.,
an engineering firm, as a consultant and assistant to the Chairman since then.
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
(Name, age and five year employment history of each executive officer of the
Company)
Israel Rosenzweig, Age 48. Mr. Rosenzweig is Executive Vice President and Chief
Lending Officer of the Company and the Bank.
Gerard A. Perri, Age 40. Mr. Perri is Senior Vice President and Chief Financial
Officer of the Company and the Bank.
Edward Powers, Age 58. Mr. Powers is Senior Vice President and Chief Retail
Banking Officer of the Company and the Bank.
Item 11. Executive Compensation.
Executive Compensation
Compensation Committee Report. Under rules established by the SEC, the Company
is required to provide certain data and information in regard to the
compensation and benefits provided to the Company's Chief Executive Officer and
other executive officers of the Company. The disclosure requirements for the
Chief Executive Officer and other executive officers include the use of tables
and a report explaining the
2
rationale and considerations that led to fundamental executive compensation
decisions affecting those individuals. In fulfillment of this requirement, the
following report has been prepared for inclusion in this proxy statement.
All cash compensation paid to executive officers is paid by the Bank. The
Company does not currently pay cash compensation to executive officers. The
Executive Committee of the Board of Directors of the Bank (the "Committee")
functions as the compensation committee of the Board, making recommendations to
the full Board of Directors as to base salaries and incentive bonus awards. The
members of the Bank's Executive Committee are the four members of the Board of
Directors of the Company, including James A. Randall, President and Chief
Executive Officer of the Company and the Bank. Mr. Randall offers input and
advice as to executive compensation decisions affecting the members of senior
management other than himself. Compensation decisions and recommendations as to
Mr. Randall are made without the participation of Mr. Randall. The non-employee
members of the Committee also administer the stock compensation plans previously
adopted by the Company and/or the Bank.
The primary components of executive compensation in 1996 were base salary and
incentive bonus awards. No stock option grants were made in fiscal 1996.
Base Salaries. Base salaries for senior management are reviewed annually on a
cycle that coincides with the Company's September 30 fiscal year end. In
general, the purpose of the annual salary review is to ensure that the Bank's
base salary levels are competitive with financial institutions similar in size,
geographic market and business profile in order for the Bank to attract and
retain persons of high quality. In fiscal 1996, the Bank retained the services
of the Buck Consulting Group to provide an independent outside survey and
analysis of the appropriateness of senior management compensation. Buck
Consulting Group salary data was based upon financial institutions engaged in
comparable activities. The survey provided information as to the median salary
by position for the institutions sampled. The Committee relied upon the median
market salaries as indicated by the survey as a basis for establishing 1996
salary ranges for senior management positions, and it made adjustments to those
ranges on the basis of Bank-specific criteria.
Incentive Bonus Awards. The Bank's Bonus Plan is designed to encourage
individual excellence within a framework of company-wide success. In
combination with competitive salaries and benefits, individual employees are
given the opportunity to earn significant compensation, relative to one's
responsibility, when the Bank's performance and an individual's performance are
both at high levels. Upon the adoption of an incentive bonus plan several years
ago, the Bank discontinued the practice of paying a separate Christmas bonus.
A bonus paid under the Bonus Plan is comprised of two separately calculated
components - company performance and individual performance. An employee's
total target bonus, as a percentage of his/her base salary, will be the sum of
the target bonus based on company performance and the target bonus based on
individual performance. The company performance component is based on net
income and specifically-identified key performance criteria. The criteria for
1996, established at the beginning of the fiscal year, related to the regulatory
capital of the Bank, the regulatory rating of the Bank, the level of non-
performing assets, the level of multi-family originations, net interest income
and net interest margin, and operating expenses. The individual performance
component was based solely on an individual's and/or work team's performance
against established objectives. The bonus for any individual employee can vary
from zero to double their individual target bonus, based on their performance
against these objectives.
3
Following the completion of fiscal 1996, the Chief Executive Officer submitted
to the Committee his analysis under the bonus plan and his recommendations as to
overall levels of bonus awards. Based on this report, the Committee approved,
and recommended to the Board, a total bonus pool of $1,010,000 for all
employees, including senior management. The Chief Executive Officer
subsequently provided the Committee with his recommendations as to individual
bonus awards for senior management, excluding himself, on the basis of the
criteria set forth in the bonus plan and established at the beginning of the
year. On the basis of this report, and after deliberations as to the appropriate
level of bonus award for the Chief Executive Officer, the Committee made its
recommendations to the Board of Directors as to individual bonus awards.
Compensation Of Chief Executive Officer. The Board of Directors approved a base
salary for the Chief Executive Officer for fiscal 1996 of $260,000, which
represented a 9.9% increase from the base salary provided in fiscal 1995. The
1996 salary level was based upon the compensation survey provided to the
Committee. Following the end of the 1996 fiscal year, the Board of Directors
also approved an award to the Chief Executive Officer of a $234,000 bonus for
1996. Each of these decisions was in accordance with the recommendations of the
Committee. The bonus primarily reflected the Company's net income for fiscal
1996 of $9.2 million ($10.6 million prior to the special SAIF assessment), which
significantly exceeded the target level of $6.9 million established at the
beginning of the year for the bonus pool. Certain adjustments to financial
statement net income were taken into account.
Executive Committee
Eldon C. Hanes, Todd M. Poland, Fredric H. Gould and James A. Randall
4
Stock Performance Graph. The following table shows a five year comparison of
cumulative total stockholder return on the Company's Common Stock, based on the
market price of the Common Stock, with the cumulative total return of companies
in the Nasdaq National Market and the S&P Savings and Loan Companies Index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG BFS BANKORP INC., THE NASDAQ STOCCKMARKET-US INDEX
AND THE S&P SAVINGS & LOANS COMPANIES INDEX
[GRAPH APPEARS HERE]
9/91 9/92 9/93 9/94 9/95 9/96
- -----------------------------------------------------------------------------------
BFS BANKORP INC. 100 100 365 612 753 1224
NASDAQ STOCK MARKET-US 100 112 147 148 204 242
S&P SAVINGS & LOANS COMPANIES 100 87 117 118 151 175
- -----------------------------------------------------------------------------------
*$100 INVESTED ON 9/30/91 IN STOCK OR INDEX-
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING SEPTEMBER 30.
5
Summary Compensation Table. The following table sets forth the cash
compensation paid by the Bank, for services rendered during the fiscal years
ended September 30, 1996, 1995 and 1994, to the Chief Executive Officer and
other executive officers of the Bank, who received an amount in salary and bonus
in excess of $100,000 in the fiscal year ended September 30, 1996 ("Named
Executive Officers").
=======================================================================================================================
Annual Compensation Long-Term Compensation
-----------------------------------------------------------------
Fiscal Awards Payouts
Year Other ------------------------------
Ended Annual Restricted All Other
Name and September Compensation Stock Options/ LTIP Compensation
Principal Position 30, Salary Bonus (1) Awards SARS (#) Payouts (3)
=======================================================================================================================
James A. Randall 1996 $257,831 $234,000 $-- $-- -- $-- $--
President and Chief 1995 235,616 174,160 -- -- -- -- --
Executive Officer 1994 225,654 137,500 -- -- -- -- 9,358
- -----------------------------------------------------------------------------------------------------------------------
Israel Rosenzweig (2) 1996 $163,615 $118,000 $-- $-- -- $-- $--
Executive Vice 1995 134,423 84,000 -- -- -- -- --
President and 1994 -- -- -- -- -- -- --
Chief Lending
Officer
- -----------------------------------------------------------------------------------------------------------------------
Gerard A. Perri 1996 $122,466 $ 76,000 $-- $-- -- $-- $--
Senior Vice 1995 111,875 54,000 -- -- -- -- --
President and Chief 1994 102,762 45,500 -- -- -- -- 2,755
Financial Officer
- ------------------------------------------------------------------------------------------------------------------------
Edward Powers 1996 $ 89,618 $ 35,000 $-- $-- -- $-- $--
Senior Vice 1995 85,508 30,000 -- -- -- -- --
President and Chief 1994 79,770 24,000 -- -- -- -- 3,753
Retail Banking
Officer
=======================================================================================================================
- -------------------------------------
(1) Perquisites for the fiscal years ended September 30, 1996, 1995 and 1994
did not exceed the lesser of $50,000 or 10% of the total of the salary and
bonus as reported for the Named Executive Officers.
(2) Mr. Rosenzweig first became an employee of the Bank in fiscal 1995.
(3) Represents the market value of shares allocated to the account of the
employee under the ESOP during the fiscal year, which market value is as of
December 31 of the respective year.
Employment Agreements
On August 1, 1996, the Bank and the Company each entered into a revised
employment agreement with Mr. Randall providing for a 36-month term at a minimum
aggregate annual base salary of $273,000. Pursuant to the revised agreements,
Mr. Randall is to serve as President and Chief Executive Officer of the Company
and the Bank, and is to be nominated to the Board of Directors. Commencing each
August 1st thereafter unless notice to the contrary is given by the Board of
Directors, the agreements are renewed for an additional year such that the
remaining term of the employment agreements will be 36 months. If not renewed,
the agreements expire 36 calendar months following August 1 of the year in which
notice is given. In addition to the base salary, the agreements provide, among
other things, for participation in stock option plans, stock bonus plans and
other fringe benefits applicable to executive personnel. Each agreement
provides for termination of employment by the Bank or the Company for "cause,"
as defined therein, at any time. If termination of employment, purported to be
for cause, is disputed, the parties shall proceed to arbitration. If it is
subsequently determined that grounds for termination for cause did not exist,
Mr. Randall is entitled to payments required under the employment agreements in
the event of a termination other than for cause (as discussed below) or
termination following a change in control, as
6
appropriate. In the event the Bank and the Company choose to terminate Mr.
Randall's employment for reasons other than for cause; or in the event of his
resignation from the Bank and the Company upon failure to reappoint or reelect
him to each of his current offices or because of a material lessening of his
functions, duties or responsibilities without his consent, or in the event of a
liquidation, dissolution, consolidation or merger of the Bank or the Company in
which the Bank or the Company is not the surviving entity and to which Mr.
Randall does not consent (such terminations shall be deemed to have occurred
pursuant to an "event of termination"); he or, in the event of his death, his
beneficiary would be entitled to a severance payment equal to three times the
sum of (i) the highest rate of base salary paid to him at any time under the
agreements, and (ii) the greater of (x) the average annual cash bonus paid to
him for the three completed fiscal years prior to the event of termination or
(y) the cash bonus paid with respect to the fiscal year ended prior to the event
of termination. If termination of Mr. Randall's employment by the Bank or
Company follows a change in control of the Bank and the Company, as defined in
the agreements, Mr. Randall would be entitled to a severance payment calculated
in the same manner as set forth above for terminations upon the occurrence of an
event of termination. If Mr. Randall voluntarily resigns following a change in
control, he would instead be entitled to receive an amount equal to three times
the highest annual rate of base salary paid to Mr. Randall at any time under the
employment agreement. If his employment is terminated by the Company or the Bank
other than for cause, or if Mr. Randall were to resign for the reasons referred
to above, the Bank and the Company must also continue his life, health and
disability insurance coverage until the earlier of 36 months following
termination of employment or until he is employed by another employer. In the
event of Mr. Randall's termination of employment due to disability, then during
the first 12 months after such termination, Mr. Randall will be entitled to
disability pay equal to his monthly rate of base salary, and thereafter his
disability pay will equal 3/4 of his monthly rate of base salary until the
earlier of his re-employment, normal retirement or death. In addition, the Bank
or Company shall continue to provide Mr. Randall with life, health and
disability coverage during this period.
In August 1996, Bankers Federal also entered into employment agreements
with Messrs. Perri and Rosenzweig, each providing for a 24-month term, with a
minimum annual base salary of $129,675 and $173,250, respectively. Under the
employment agreements, Mr. Perri is to serve as Senior Vice President and Chief
Financial Officer and Mr. Rosenzweig is to serve as Executive Vice President and
Chief Lending Officer for the Bank. On December 1 of each year, each employment
agreement will be extended, unless notice of non-extension is given to the
executive, so that the remaining term will be 24 months. If not renewed, the
employment agreement will expire within 24 months following December 1 of the
year in which notice is given. In addition to base salary, the agreements
provide, among other things, for participation in stock option plans, stock
bonus plans and other fringe benefits applicable to executive personnel. Similar
to the employment agreement for Mr. Randall, the employment agreements provide
for the termination of the executives employment by the Bank for "cause," as
defined therein, at any time, subject to the requirement of arbitration in the
event of dispute, and the requirement of payments to the executive in accordance
with the employment agreement in the event that "cause" is found not to have
existed. Also, if the Bank chooses to terminate Messrs. Perri or Rosenzweig's
employment for reasons other than "cause" or the executive resigns his
employment due to the occurrence of the same events of termination as set forth
in Mr. Randall's employment agreement, the executive will be entitled to a
severance payment equal to two times the highest annual rate of base salary plus
average annual cash bonus (calculated in the same manner as under Mr. Randall's
employment agreement). If termination of the executive's employment by the Bank
follows a change in control, the executive will be entitled to a severance
payment calculated in the same manner as calculated upon termination following
an event of termination. If the executive resigns following a change in control,
the executive will be entitled to receive
7
an amount equal to the one times the highest annual rate of base salary paid to
the executive at any time under the agreement. An executive entitled to
severance payments under the employment agreement will also be entitled to
continued life, health and disability coverage until the earlier of 24 months
following termination of employment or until he is employed by another employer.
In the event the executive is unable to perform his duties under the employment
agreement for a period of 6 months due to disability, the Bank may terminate the
employment agreement provided that it continues the executive's base salary and
any other cash compensation paid to the executive for a period of one year.
Special Termination Agreement
In addition, the Company had entered into an eighteen month special
termination agreement with Mr. Edward Powers. The special termination agreement
provided for payment of a severance benefit to Mr. Powers in the event of his
involuntary termination of employment other than for "cause" or certain
voluntary terminations of employment following a "change in control."
However, pursuant to an agreement with the Bank, Mr. Powers will take an early
retirement from the Bank, effective March 1, 1997, and in connection therewith,
the Bank will supplement his retirement benefit through payments with an
aggregate present value of $150,000. This supplement is in lieu of any severance
payment to which he would be entitled under the Special Termination Agreement
upon termination following a change in control.
Severance Compensation Plan
In August 1996, the Company and Bankers Federal have adopted an Employee
Severance Compensation Plan ("Severance Plan") to provide certain officers and
employees who are not parties to a written employment or special termination
agreement with certain benefits in the event of certain terminations of
employment at or following a change in control (as defined in the Severance
Plan) of the Company or Bankers Federal. Under the Severance Plan, a covered
employee whose employment is terminated at or following a change in control
other than for "cause," or who resigns following a change in control due to a
reduction in salary or bonus, the assignment of duties, responsibilities, or
status inconsistent with that prior to the change in control, a change in job
location by more than 30 miles, or the employer's failure to continue any
vacation benefits, pension plan, certain insurance benefits or its obligations
under the Severance Plan following the change in control, is entitled to receive
a severance payment from Bankers Federal, or its successor. The severance
payment will be a lump sum cash payment equal to the sum of (i) the highest rate
of annualized salary (total annual salary divided by 12) and (ii) the highest
bonus paid with respect to any one year; in either case as to either (x) the
three years preceding the termination of employment, or (y) the three years
preceding the Change in Control, whichever is greater. In addition, a
terminated participant will be entitled to continued life, medical and dental
coverage for a period of 12 months following termination of employment. Any
payment under the Severance Plan is subject to reduction in order to avoid an
"excess parachute payment" as defined under Section 280G of the Internal Revenue
Code.
Incentive Stock Option Plans
The Board of Directors of the Company has established the Incentive Stock
Option Plans which provide discretionary awards to its officers and key
employees. The grant of awards under the Incentive Stock Option Plans is
determined by a committee of the Board of Directors consisting of outside
directors
8
(the "Option Plan Committee"), none of whom is eligible to receive options under
the Plans. No options under the Stock Option Plans were granted to, or
exercised by, the Named Executive Officers during the fiscal year ended
September 30, 1996.
Set forth below is certain information concerning options outstanding with
respect to such Named Executive Officers at September 30, 1996.
====================================================================================================
AGGREGATED FISCAL YEAR-END OPTION VALUES
====================================================================================================
Number of Unexercised Value of Unexercised In-
Options at The-Money Options at
Fiscal Year-End Fiscal Year-End (1)
----------------------------------------------------
Shares Acquired Value Exercisable/Unexercisable Exercisable/Unexercisable
Name Upon Exercise Realized (#) ($)
- ----------------------------------------------------------------------------------------------------
James A. Randall -- -- 104,952/-- $4,609,895/--
- ----------------------------------------------------------------------------------------------------
Gerard A. Perri -- -- 9,000/-- $ 389,000/--
- ----------------------------------------------------------------------------------------------------
Edward Powers -- -- 10,268/-- $ 462,060/--
====================================================================================================
- ----------------------------------
(1) Equals the difference between the aggregate exercise price of such options
and the aggregate fair market value of the shares of Common Stock that
would be received upon exercise, assuming such exercise occurred on
September 30, 1996, at which date the last sale price of the Common Stock
as quoted on the Nasdaq National Market was $52.00.
Retirement Plan
The Bank maintains and funds a tax-qualified defined benefit pension plan
for its employees. All full-time employees age twenty-one and one-half years or
older who have completed at least six months of service participate in the plan.
The plan provides for a monthly benefit at age 65 equal to 1% of the "Average
Monthly Compensation" (the average of the highest five years base salary)
multiplied by the total number of years of employment, up to a maximum of forty
years, plus one-half of one percent of the Average Monthly Compensation in
excess of $400 multiplied by the total number of years of employment, computed
to the nearest dollar. The maximum monthly benefit under the retirement plan is
$10,000.
9
The following table sets forth the estimated annual benefits payable upon
retirement at age 65 in calendar year 1996, expressed in the form of a single
life annuity, for the final average salary and benefit service classifications
specified.
Amount of Annual Retirement Benefit with Credited
Five Year Service of
Average -------------------------------------------------
Annual Salary 15 Years 20 Years 25 Years 30 Years
- ------------- ---------- ----------- ----------- -----------
$20,000 $ 4,140 $ 5,520 $ 6,900 $ 8,280
$40,000 8,640 11,520 14,400 17,280
$60,000 13,140 17,520 21,900 26,280
$80,000 17,640 23,520 29,400 35,280
$125,000 27,765 37,020 46,275 55,530
$150,000 33,390 44,520 55,650 66,780
Compensation covered by the retirement plan is total compensation
received from the Bank, excluding bonuses, overtime, commissions, director's
fees or other forms of special compensation, before reducing such compensation
pursuant to a deferral election of the employee under any plan of the Bank
established in accordance with the provisions of Section 401(k) or Section 125
of the Internal Revenue Code of 1986, as amended. At September 30, 1996,
Messrs. Randall, Rosenzweig, Perri and Powers had 8, 1, 6 and 32 years of
credited service, respectively.
Supplemental Executive Retirement Plan
The Company has adopted a Supplemental Executive Retirement Plan ("SERP")
for certain senior executives of the Company. Presently, Mr. Randall is the
only participant in the SERP. The SERP supplements the benefits payable under
the Retirement Plan and ESOP. The SERP provides a benefit, with respect to the
Retirement Plan, equal to the amount to which a participant would have been
entitled under the Retirement Plan but for maximum limitations under the
Internal Revenue Code on annual benefits and the amount of compensation that may
be taken into consideration in determining such benefit, reduced by the benefit
actually paid from the Retirement Plan. The SERP also provides a benefit, with
respect to the ESOP, equal to dollar amount which represents the difference (in
fair market value of shares allocated to a participants account, plus earnings)
between the ESOP benefit that a participant would have been entitled to but for
the limitations on the maximum compensation that can be taken into account and
the maximum contribution that can be made to a participants account; and the
benefit that is actually paid from the ESOP. The SERP supplemental Retirement
Plan benefit shall be paid in the same form and at the same time as the
participant's benefit under the Retirement Plan. The SERP supplemental ESOP
benefit shall be paid in cash, or in the event a trust has been established
under the SERP to hold Common Stock and if elected by the participant, in stock
of the Company. In the event of the participant's termination of employment in
connection with a change of control (as defined in the SERP), the participant's
SERP benefit shall become immediately due and payable in a lump sum amount equal
to the sum of (i) the present actuarial value of the supplemental Retirement
Plan benefit and (ii) the present value of the supplemental ESOP benefit.
Directors' Compensation
Fees. Directors of the Bank are paid an annual retainer of $10,000
($13,000 for the Chairman of the Board). The Chairman of the Audit Committee
and the Savings Committee are also paid an annual retainer of $2,000. In
addition, the Directors are paid a fee of $500 for each Board meeting attended.
10
Directors are paid a fee of $250 for attendance at Committee meetings, a fee of
$200 for telephone participation at Board meetings, and a fee of $100 for
telephone participation at Committee meetings. Directors of the Company
currently do not receive cash fees for service on the Company's Board.
Directors Stock Plan. Under the 1994 Incentive Stock Plan for Outside
Directors (the "Directors Stock Plan"), each outside director of the Bank is
granted an award of Common Stock, as of the date of each Annual Meeting of
Stockholders of the Company, in an amount equal to $4,500 divided by the market
value of the Common Stock on the grant date. An Award of Common Stock will be
granted to each outside director of the Company, as of the date of each Annual
Meeting of Stockholders of the Company, in an amount equal to $3,000 divided by
the market value of the Common Stock on the grant date. In connection with the
execution of the Merger Agreement by and among the Company, Dime Bancorp, Inc.
and Fifth Avenue Property Corp., the Company has agreed that the outside
directors will receive cash payments in lieu of restricted stock awards. Such
payments will be made on or about the date of the Annual Meeting. All Awards
under the Directors Stock Plan are subject to the restriction that if the Common
Stock subject to such Award is sold within five years of the date of grant, 50%
of the proceeds of sale would be required to be returned to the Company. The
shares of Common Stock issued pursuant to any Award will bear a legend
reflecting such restriction. The forfeiture provision would not apply to any
sales of Common Stock following retirement from the Board at the normal director
retirement age (73 years of age) or following the death or disability of an
outside director, or to any sales following a change in control of the Company
representing the acquisition by any person of 75% or more of the Common Stock of
the Company. An aggregate of 10,000 shares are reserved for issuance pursuant to
Awards to be granted under the Directors Stock Plan. As of January 27, 1997,
4,082 shares of Common Stock had been issued under the Directors Stock Plan.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Persons and groups owning in excess of 5% of the Company's Common Stock are
required to file certain reports regarding such ownership with the Company and
with the SEC, in accordance with the Exchange Act. The following table sets
forth information regarding persons known to be beneficial owners of more than
5% of the Company's Common Stock outstanding as of January 27, 1997.
11
Amount and Nature
Name and Address of Beneficial Percent
Beneficial Owner Ownership of Class
- ----------------------------- -------------------- ---------
Gould BFS, Inc. 891,664(1) 53.71%
60 Cutter Mill Road
Great Neck, New York 11021
James A. Randall 155,674(2) 8.96%
110 William Street
New York, New York 10038
- -----------------------------
(1) Gould Investors, L.P. is the sole stockholder of Gould BFS, Inc.
Fredric H. Gould, a director of the Company, is the sole director and
President of Gould BFS, Inc. The shares reported include shares owned by
Mr. Gould.
(2) Includes 77,817 shares of Common Stock that may be acquired pursuant to
presently exercisable stock options.
SECURITY OWNERSHIP OF MANAGEMENT
Set forth below is information regarding the beneficial ownership of the
Common Stock by the directors and officers of the Company:
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP PERCENT
NAME AND PRINCIPAL OCCUPATION OF STOCK (1) OF CLASS
- ----------------------------- -------------------- --------
Fredric H. Gould 891,644(2) 53.71%
Todd M. Poland 6,567 0.40%
James A. Randall 155,674(3) 8.96%
Eldon C. Hanes 7,314 0.44%
Israel Rosenzweig 247 0.01%
Gerard A. Perri 15,328(4) 0.92%
Edward Powers 21,269(5) 1.27%
All directors and executive officers
as a group (nine persons) 1,131,094(6)(7) 64.36%
- --------------
(1) Unless otherwise indicated, each person effectively exercises sole (or
shared with spouse) voting and dispositive power as to the shares
reported.
(2) Includes 891,604 shares owned by Gould BFS, Inc.
(3) Includes 77,817 shares that may be acquired pursuant to presently
exercisable stock options.
(4) Includes 9,000 shares that may be acquired pursuant to presently
exercisable stock options.
(5) Includes 10,268 shares that may be acquired pursuant to presently
exercisable stock options.
(6) Includes 33,031 shares owned by two persons who are Directors of Bankers
Federal Savings FSB (the "Bank"), but not Directors of the Company. Also
includes 97,085 shares that may be acquired pursuant to presently
exercisable stock options.
(7) Includes 10,398 shares of Common Stock owned by the Company's ESOP and
allocated to the accounts of executive officers, and 1,670 shares held
by the ESOP and allocated to the account of a director of the Bank who
is also a former executive officer of the Bank and the Company, as to
which shares the individuals may direct the voting. Excludes the
remaining 34,480 shares owned by the ESOP, for the benefit of the
employees of the Company and the Bank. The ESOP Administrative Committee
administers the ESOP. Under the terms of the ESOP, shares of Common
Stock allocated to the account of employees are voted in accordance with
the instructions of the respective employees. Unallocated shares are
voted by the ESOP Trustee as directed by the Administrative Committee.
The Administrative Committee shall vote the unallocated shares in a
manner that reflects the directions received from employees as to
allocated shares, unless their fiduciary duties require otherwise.
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Item 13. Certain Relationships and Related Transactions.
Prior to August 1989, the Bank had a policy of making loans, in the ordinary
course of business, to its Directors, officers and employees. Such loans did
not involve more than the normal risk of January 27, 1997 collectibility and
were on substantially the same terms as were available to the general public,
except that the interest rate applicable to such loans was set at 1% above the
Bank's average cost of funds and origination fees were waived. The current
policy of the Bank is to extend loans to officers and Directors on substantially
the same terms as those granted to others, including the interest rate,
collateral and origination fees. Such loans do not involve more than the normal
risk of collectibility.
Set forth below is certain information as of September 30, 1996,
relating to loans, that in the aggregate exceeded $60,000 during fiscal 1996,
outstanding to executive officers and Directors of the Bank or the Company who
had any loans from the Bank under the policy in effect prior to August 1989:
Unpaid
Highest Balance
Balance at
Date of Type of in Fiscal September 30,
Name Loan Loan (1) 1996 1996 Rate
- -------------- -------- --------- --------- ------------ ----
Edward Powers.............. 12/31/86 Mortgage $156,537 $146,173 7.5%
Senior Vice President and
Chief Retail Banking
Officer
- --------------------------
(1) Represents a first mortgage loan secured by the individual's primary
residence.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Date: January 28, 1997 BFS BANKORP, INC.
By: /s/ James A. Randall
--------------------
James A. Randall
President and Chief Executive Officer
14