[Letterhead of Lakeview Financial Corp.]
October 29, 1997
To Our Stockholders:
On behalf of the Board of Directors and management of Lakeview
Financial Corp. (the "Company"), I cordially invite you to attend the 1997
Annual Meeting of Stockholders to be held at The Valley Regency located at 1129
Valley Road, Clifton, New Jersey 07013 on Tuesday, November 25, 1997 at 10:00
a.m., Eastern time. The attached Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted at the Meeting. During the
Meeting, I will also report on the operations of the Company. Directors and
officers of the Company, as well as representatives of KPMG Peat Marwick LLP,
the Company's independent public accountant, will be present to respond to any
questions stockholders may have.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE SIGN AND
DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE ACCOMPANYING POSTAGE-PAID
RETURN ENVELOPE AS PROMPTLY AS POSSIBLE. This will not prevent you from voting
in person at the Annual Meeting, but will assure that your vote is counted if
you are unable to attend the Annual Meeting. YOUR VOTE IS VERY IMPORTANT.
Sincerely,
Kevin J. Coogan
President and Chief Executive Officer
LAKEVIEW FINANCIAL CORP.
1117 MAIN STREET
PATERSON, NEW JERSEY 07503
(201) 742-3060
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 25, 1997
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NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of Lakeview Financial Corp. (the "Company"), will be held at The
Valley Regency, 1129 Valley Road, Clifton, New Jersey 07013 on November 25,
1997, at 10:00 a.m., Eastern time. The Meeting is for the purpose of considering
and acting upon the following matters:
1. The election of two directors of the Company; and
2. Such other matters as may properly come before the Meeting or
any adjournments thereof.
The Board of Directors is not aware of any other business to come
before the Meeting. Any action may be taken on any one of the foregoing
proposals at the Meeting on the date specified above or on any date or dates to
which, by original or later adjournment, the Meeting may be adjourned.
Stockholders of record at the close of business on October 14, 1997, are the
stockholders entitled to vote at the Meeting and any adjournments thereof.
EACH STOCKHOLDER, WHETHER OR NOT HE PLANS TO ATTEND THE MEETING, IS
REQUESTED TO SIGN, DATE AND RETURN THE ENCLOSED PROXY WITHOUT DELAY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE. ANY PROXY GIVEN BY THE STOCKHOLDER MAY BE
REVOKED BY FILING WITH THE SECRETARY OF THE COMPANY A WRITTEN REVOCATION OR A
DULY EXECUTED PROXY BEARING A LATER DATE. ANY STOCKHOLDER PRESENT AT THE MEETING
MAY REVOKE HIS PROXY AND VOTE PERSONALLY ON EACH MATTER BROUGHT BEFORE THE
MEETING. HOWEVER, IF YOU ARE A STOCKHOLDER WHOSE SHARES ARE NOT REGISTERED IN
YOUR OWN NAME, YOU WILL NEED ADDITIONAL DOCUMENTATION FROM YOUR RECORD HOLDER TO
VOTE PERSONALLY AT THE MEETING.
BY ORDER OF THE BOARD OF DIRECTORS
Helen Saco
Secretary
Paterson, New Jersey
October 29, 1997
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
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PROXY STATEMENT
LAKEVIEW FINANCIAL CORP.
1117 MAIN STREET
PATERSON, NEW JERSEY 07503
(201) 742-3060
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- --------------------------------------------------------------------------------
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 25, 1997
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GENERAL
- --------------------------------------------------------------------------------
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Lakeview Financial Corp. (the "Company")
to be used at the 1997 Annual Meeting of Stockholders of the Company (the
"Meeting") which will be held at The Valley Regency, 1129 Valley Road, Clifton,
New Jersey on November 25, 1997, 10:00 a.m. local time. The accompanying Notice
of Meeting and this Proxy Statement are being first mailed to stockholders on or
about October 29, 1997.
At the Meeting, stockholders will consider and vote upon (i) the
election of two directors, and (ii) such other matters as may properly come
before the Meeting or any adjournments thereof. The Board of Directors of the
Company (the "Board" or the "Board of Directors") knows of no additional matters
that will be presented for consideration at the Meeting. Execution of a proxy,
however, confers on the designated proxy holder discretionary authority to vote
the shares represented by such proxy in accordance with their best judgment on
such other business, if any, that may properly come before the Meeting or any
adjournment thereof.
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VOTING AND REVOCABILITY OF PROXIES
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Stockholders who execute proxies retain the right to revoke them at any
time. Unless so revoked, the shares represented by such proxies will be voted at
the Meeting and all adjournments thereof. Proxies may be revoked by written
notice delivered in person or mailed to the Secretary of the Company at the
address of the Company shown above or by the filing of a later-dated proxy prior
to a vote being taken on a particular proposal at the Meeting. A proxy will not
be voted if a stockholder attends the Meeting and votes in person. Proxies
solicited by the Board of Directors of the Company will be voted in accordance
with the directions given therein. Where no instructions are indicated, signed
proxies will be voted "FOR" the nominees for directors set forth below. The
proxy confers discretionary authority on the persons named therein to vote with
respect to the election of any person as a director where the nominee is unable
to serve, or for good cause will not serve, and matters, incident to the conduct
of the Meeting.
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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
- --------------------------------------------------------------------------------
Stockholders of record as of the close of business on October 14, 1997
("Record Date") are entitled to one vote for each share of Common Stock then
held. As of the Record Date, the Company had 4,370,594 shares of Common Stock
issued and outstanding.
The Certificate of Incorporation of the Company ("Certificate of
Incorporation") provides that in no event shall any record owner of any
outstanding Common Stock which is beneficially owned, directly or indirectly, by
a person who beneficially owns in excess of 10% of the then outstanding shares
of Common Stock (the "Limit") be entitled or permitted to any vote with respect
to the shares held in excess of the Limit. Beneficial ownership is determined
pursuant to the definition in the Certificate of Incorporation and includes
shares beneficially owned by such person or any of his or her affiliates (as
such terms are defined in the Certificate of Incorporation), or which such
person or any of his or her affiliates has the right to acquire upon the
exercise of conversion rights or options and shares as to which such person or
any of his or her affiliates or associates have or share investment or voting
power, but neither any employee stock ownership or similar plan of the Company
or any subsidiary, nor any trustee with respect thereto or any affiliate of such
trustee (solely by reason of such capacity of such trustee), shall be deemed,
for purposes of the Certificate of Incorporation, to beneficially own any Common
Stock held under any such plan.
The presence in person or by proxy of at least a majority of the
outstanding shares of Common Stock entitled to vote (after subtracting any
shares held in excess of the Limit) is necessary to constitute a quorum at the
Meeting. With respect to any matter, any shares for which a broker indicates on
the proxy that it does not have discretionary authority as to such shares to
vote on such matter (the "Broker Non-Votes") will be considered present for
purposes of determining whether a quorum is present. In the event there are not
sufficient votes for a quorum or to ratify any proposals at the time of the
Meeting, the Meeting may be adjourned in order to permit the further
solicitation of proxies.
As to the election of directors, the proxy being provided by the Board
enables a stockholder to vote for the election of the nominees proposed by the
Board, or to withhold authority to vote for the nominees being proposed.
Directors are elected by a plurality of votes of the shares present in person or
represented by proxy at a meeting and entitled to vote in the election of
directors.
Persons and groups owning in excess of 5% of the Common Stock are
required to file certain reports regarding such ownership pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"). The following
table sets forth, as of the Record Date, persons or groups who own more than 5%
of the Common Stock and the ownership of all executive officers and directors of
the Company as a group. Other than as noted below, management knows of no person
or group that owns more than 5% of the outstanding shares of Common Stock at the
Record Date.
2
Percent of Shares
Amount and Nature of of Common Stock
Name and Address of Beneficial Owner Beneficial Ownership Outstanding
- ------------------------------------ -------------------- -----------------
Lakeview Savings Bank Employee 509,288 11.65%
Stock Ownership Plan ("ESOP")
1117 Main Street
Paterson, New Jersey 07503(1)
Wellington Management Company 324,644 7.42
75 State Street
Boston, Massachusetts 02109(2)
Kevin J. Coogan, President 589,532 12.73
and Chief Executive Officer
of the Company
1117 Main Street
Paterson, New Jersey 07503(3)
All Directors and Executive Officers 1,685,694 32.05
as a Group (9 persons)(4)
- ------------------
(1) The ESOP purchased such shares for the exclusive benefit of ESOP
participants with funds borrowed from a third-party lender. For further
information with respect to voting and investment power regarding
shares held by the ESOP, see "Proposal I - Information with Respect to
Nominees for Directors; Directors Whose Terms Continue and Executive
Officers."
(2) Based upon an Amended Schedule 13G filed with the Securities and
Exchange Commission, dated January 15, 1997, for which shared voting
and depositive power is shown with respect to 324,644 shares.
(3) Includes 328,088 shares over which Mr. Coogan has sole voting and
dispositive power, and 568 over which he holds joint voting and
dispositive power with his wife. Also includes 260,876 shares which may
be purchased through the exercise of stock options.
(4) Includes stock options to purchase 888,306 shares of Common Stock which
are exercisable within 60 days of the Voting Record Date. Also includes
60,822 shares of Common Stock held by the ESOP which are allocated to
executive officers. Excludes shares which are unallocated to
participating employees. For further information, see Proposal I -
"Information with Respect to Nominees for Directors; Directors Whose
Terms Continue and Executive Officers."
3
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
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Section 16(a) of the 1934 Act requires the Company's officers and
directors, and persons who own more than ten percent of the Common Stock, to
file reports of ownership and changes in ownership of the Common Stock, on Forms
3, 4 and 5, with the Securities and Exchange Commission ("SEC") and to provide
copies of those Forms 3, 4 and 5 to the Company.
Based upon a review of the copies of the forms furnished to the
Company, or written representations from certain reporting persons, the Company
believes that all Section 16(a) filing requirements applicable to its executive
officers and directors, except as otherwise noted, were complied with during the
fiscal year ended July 31, 1997. Due to an administrative delay, the Form 4
reports for two of the directors were filed late.
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I - INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR, DIRECTORS
CONTINUING IN OFFICE, AND EXECUTIVE OFFICERS
- --------------------------------------------------------------------------------
Election of Directors
The Certificate of Incorporation require that the Board of Directors be
divided into three classes, each of which contains approximately one-third of
the members of the Board. The directors are elected by the stockholders of the
Company for staggered three-year terms, or until their successors are elected
and qualified. The Board of Directors currently consists of seven members. Two
directors will be elected at the Meeting each to serve for a three-year term or
until their successors have been elected and qualified.
Robert J. Davenport and Dennis D. Pedra have been nominated by the
Board of Directors to serve as directors. Messrs. Davenport and Pedra are
currently members of the Board and have been nominated for a three-year term to
expire in 2000. It is intended that the persons named in the proxies solicited
by the Board will vote for the election of the named nominees. If any of the
nominees are unable to serve, the shares represented by all valid proxies will
be voted for the election of such substitute as the Board of Directors may
recommend or the size of the Board may be reduced to eliminate the vacancy. At
this time, the Board knows of no reason why the nominees might be unavailable to
serve.
The following table sets forth information with respect to the nominees
and the directors continuing in office, their name, age, the year they first
became a director of the Company or the Savings Bank, the expiration date of
their current term as a director, and the number and percentage of shares of the
Common Stock beneficially owned. Each director of the Company is also a member
of the Board of Directors of the Savings Bank. Beneficial ownership of executive
officers and directors of the Company, as a group, is shown in the table under
"Voting Securities and Principal Holders Thereof."
4
Common Stock Beneficially
Year First Owned (2)
Elected Term to ----------------------------
Name Age(1) Director Expire Shares % of Class
- ---- ------ -------- ------ ------ ----------
BOARD NOMINEES FOR TERMS TO EXPIRE IN 2000
Robert J. Davenport 59 1994 2000 37,880 (3) .86
Dennis D. Pedra 44 1994 2000 63,602 (3) 1.44
DIRECTORS CONTINUING IN OFFICE
Kevin J. Coogan 48 1986 1998 589,532 (4) 12.73
Michael R. Rowe 47 1987 1998 186,932 (5)(11) 4.18
Vincent A. Scola 62 1995 1998 50,188 (6) 1.14
Leo J. Costello 72 1955 1999 160,604 (7)(11) 3.57
Leo J. Dean 81 1981 1999 161,716 (8)(11) 3.62
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Kevin M. McCloskey 39 -- -- 219,544 (9) 4.91
Anthony G. Gallo 44 -- -- 215,694 (10) 4.82
- ---------------------
(1) At July 31, 1997.
(2) As of Record Date, October 14, 1997.
(3) Includes 35,460 shares which may be purchased through the exercise of
stock options.
(4) Includes 328,088 shares over which Mr. Coogan has sole voting and
dispositive power and 568 shares over which he holds in joint ownership
with his wife. Also includes 260,876 shares which may be purchased
through the exercise of stock options.
(5) Includes 101,890 shares which may be purchased through the exercise of
stock options.
(6) Includes 35,460 shares which may be purchased through the exercise of
stock options and 9,278 shares which he holds
in joint ownership with his wife.
(7) Includes 121,218 shares which may be purchased through the exercise of
stock options and includes 10,848 shares over which Mr. Costello has
shared voting and investment power as co-trustee of the Lakeview
Savings Bank Pension Plan.
(8) Includes 101,890 shares which may be purchased through the exercise of
stock options and 19,964 shares which Mr. Dean holds in joint ownership
with his wife.
(9) Includes 120,722 shares over which Mr. McCloskey has sole voting and
investment power, 798 shares over which he has beneficial ownership,
and 98,024 shares which may be purchased through the exercise of stock
options.
(10) Includes 100,302 shares over which Mr. Gallo has sole voting and
dispositive power, 6,520 shares over which he exercises shared voting
and dispositive power with his spouse, and 98,024 shares which may be
purchased through the exercise of stock options. Also, includes 10,848
shares over which Mr. Gallo has shared voting and dispositive power as
a co-trustee of the Lakeview Savings Bank Pension Plan.
(11) Excludes 299,066 shares of Common Stock held under the ESOP for which
such individual serves as either a member of the ESOP Committee or as
an ESOP Trustee. Such individual disclaims beneficial ownership with
respect to shares held in a fiduciary capacity. The ESOP purchased such
shares for the exclusive benefit of ESOP participants with funds
borrowed from the Company. These shares are held in a suspense account
and will be allocated among ESOP participants annually on the basis of
compensation as the ESOP debt is repaid. The Board of Directors has
appointed Messrs. Rowe, Costello, and Dean to serve on the ESOP
Committee and to serve as ESOP Trustees. The ESOP Committee or the
Board instructs the ESOP Trustee regarding investment of ESOP plan
assets. The ESOP Trustees must vote all shares allocated to participant
accounts under the ESOP as directed by ESOP participants. Unallocated
shares and shares for which no timely voting direction is received will
be voted by the ESOP Trustees as directed by the ESOP Committee.
5
Biographical Information
The principal occupation during the past five years of each nominee and
director of the Company is set forth below.
Kevin J. Coogan has been the President and Chief Executive Officer of
the Savings Bank since 1986. Mr. Coogan began his service as an officer with the
Savings Bank in 1982. Mr. Coogan has served as a director since 1987.
Leo J. Costello has been a director of the Savings Bank since 1955 and
was the President and Chief Executive Officer of the Savings Bank from 1959 and
1986. Mr. Costello has served as the Chairman of the Board since 1986.
Robert J. Davenport currently serves as the Executive Director of the
Passaic Valley Sewerage Commissioners, a public company. He has been employed by
the Passaic Valley Sewerage Commissioners since 1972.
Leo J. Dean has been a director of the Savings Bank since 1981. He is
the retired owner of an automotive parts and service business and has also
worked with civic organizations.
Dennis D. Pedra has served as the President and CEO of N.E. Restaurant
Co. located in Randolph, Massachusetts, a 30 unit restaurant company since 1991.
Michael R. Rowe has served as a director of the Savings Bank since
1987. Mr. Rowe has been President of the New Jersey Nets since 1996. Prior to
this position Mr. Rowe served as the General Manager of the New Jersey Sports
and Exhibition Authority, which properties include Giant Stadium, the
Meadowlands Arena and Racetrack.
Vincent A. Scola was appointed to the Board of Directors in January
1995. Mr. Scola retired from his position as Senior Vice President of First
Fidelity Bank, Newark, New Jersey in 1994.
Executive Officers Who Are Not Directors
Kevin M. McCloskey has been the Vice President and Chief Operating
Officer of the Savings Bank since 1989.
Anthony G. Gallo has been the Chief Financial and Accounting Officer of
the Savings Bank since 1989.
Nominations for Directors
Pursuant to Article II, Section 15 of the Company's Bylaws,
nominations, other than those made by or at the direction of the Board of
Directors, shall be made pursuant to a notice in writing to the Secretary of the
Company that is delivered to, or mailed and received at, the principal executive
offices of the Company not less than 60 days prior to the anniversary date of
the immediately preceding annual meeting of stockholders of the Company;
provided, however, that with respect to the first scheduled annual meeting,
notice by the stockholder must be so delivered or received no later than the
close of business on the tenth day following the day on which notice of the date
of the scheduled meeting must
6
be delivered or received no later than the close of business on the fifth day
preceding the date of the meeting.
Such stockholder's notice shall set forth (a) as to each person whom
the stockholder proposes to nominate for election or re-election as a director
and as to the stockholder giving the notice (i) the name, age, business address,
and residence address of such person, (ii) the principal occupation or
employment of such person, (iii) the class and number of shares of Common Stock
which are beneficially owned by such person on the date of such stockholder
notice, and (iv) any other information relating to such person that is required
to be disclosed in solicitations of proxies with respect to nominees for
election as directors; and (b) as to the stockholder giving the notice (i) the
name and address, as they appear on the Company's books, of such stockholder and
any other stockholders known by such stockholder to be supporting such nominees
and (ii) the class and number of shares of Common Stock which are beneficially
owned by such stockholder on the date of such stockholder notice and, to the
extent known, by any other stockholders known by such stockholder to be
supporting such nominees on the date of such stockholder notice. At the request
of the Board of Directors, any person nominated by, or at the direction of, the
Board for election as a director at an annual meeting shall furnish to the
Secretary of the Company that information required to be set forth in a
stockholder's notice of nomination which pertains to the nominee.
The Board of Directors may reject any nomination by a stockholder not
made in accordance with the requirements of the Bylaws. If the presiding officer
at the meeting determines that a nomination was not made in accordance with the
terms of the Bylaws, he shall so declare at the annual meeting and the defective
nomination shall be disregarded.
Meetings and Committees of the Board of Directors
The Company's Board of Directors conducts its business through meetings
of the Board, Board committees and committees of the Savings Bank. During the
fiscal year ended July 31, 1997, the Board of Directors of the Company held
twelve (12) regular meetings and two (2) special meetings. No director attended
fewer than 75% of the total meetings of the Board of Directors of the Company
and the Savings Bank and committees on which such director served during the
fiscal year ended July 31, 1997.
The Personnel and Salary Committee consists of Leo J. Dean (Chairman)
and Messrs. Pedra and Rowe. This standing committee determines the compensation
and benefits of all officers and employees of the Company and Savings Bank.
During fiscal 1997, the Personnel and Salary Committee met one time.
The Audit and Control Committee consists of Michael R. Rowe (Chairman)
and Messrs. Davenport and Scola. This standing committee meets quarterly and
reviews the actions and reports of the internal audit department, and the
independent auditor. The Committee also provides direction to the internal
auditor. During fiscal 1997, this committee met four times.
The Company's full Board of Directors acts as a Nominating Committee.
This non-standing committee met once during the 1997 fiscal year.
7
Director Compensation
Directors' Fees. During the fiscal year ended July 31, 1997, each
member of the Board of Directors of the Company received $500 per meeting upon
attendance. Members of the Board of Directors of the Savings Bank receive an
annual retainer of $15,000. The Chairman of the Board of the Savings Bank
received an annual retainer fee of $27,500. No additional fees are paid for
committee meetings. Directors emeritus receive a fee of $5,000 per year. For the
year ended July 31, 1997, the Company paid a total of $162,000 in directors'
fees.
Executive Compensation
SUMMARY COMPENSATION TABLE
Long Term
Compensation
Annual Compensation Awards
--------------------------------------------------- ------
Securities
Fiscal Other Annual Underlying All Other
Name and Principal Position Year Salary Bonus Compensation(1) Options(#) Compensation
- ----------------------------- ------- ------ ----- --------------- -------------- ------------
Kevin J. Coogan 1997 $300,000 $62,700 -- 4,000 $ 147,377 (2)
President, and Chief Executive 1996 270,000 50,000 -- 15,400 116,736 (3)
Officer 1995 250,000 50,000 -- 12,100 37,352 (4)
Kevin M. McCloskey 1997 $148,000 $31,350 4,000 $ 97,790 (2)
Vice President and 1996 133,000 25,000 -- 15,400 69,848 (3)
Chief Operating Officer 1995 125,000 25,000 -- 12,100 37,352 (4)
Anthony G. Gallo 1997 $137,000 $31,350 4,000 $ 92,201 (2)
Vice President and 1996 122,000 25,000 -- 15,400 65,440 (3)
Chief Financial Officer 1995 115,016 25,000 -- 12,100 34,866 (4)
- -----------------------
(1) Except as otherwise disclosed, for fiscal years 1997, 1996 and 1995,
there were no (a) prerequisites over the lesser of $50,000 or 10% of
any of such executive officers' total salary and bonus for the year;
(b) payments of above-market preferential earnings on deferred
compensation; (c) payments of earnings with respect to long-term
incentive plans prior to settlement of maturation; (d) tax payment
reimbursement; or (e) preferential discounts on stock.
(2) Includes the value of 4,848 shares allocated under the ESOP for each
named executive which had a market value of $16.50 per share at July
31, 1997. Also includes $67,385, $17,798, and $12,209 of accrued
benefits under the SERP Plan for Messrs. Coogan, McCloskey and Gallo,
respectively.
(3) Includes the value of 5,464 shares allocated under the ESOP for each
named executive which had a market value of $10.25 per share at July
31, 1996. Also includes $60,730, $13,842, and $9,434 of accrued
benefits under the SERP Plan for Messrs. Coogan, McCloskey and Gallo,
respectively.
(4) For Messrs. Coogan, McCloskey and Gallo, respectively, includes the
value of 4,296 shares, 4,296 shares and 4,010 shares allocated under
the ESOP which had a market price of $8.695 at July 31, 1995.
Employment Agreements
The Savings Bank entered into employment agreements (the "Agreements")
with Messrs. Coogan, McCloskey and Gallo for terms of three years, renewable
monthly. Under the Agreements, the employees may be terminated for "just cause"
as defined in the Agreements. If the employees are terminated "without just
cause," the employees are entitled to a continuation of salary for a period of
one
8
year thereafter. In the event of the termination of employment in connection
with any change of control of the Savings Bank, the employees will be paid a
lump sum amount equal to 2.99 times the prior five year average of the
employees' annual taxable compensation. In the event of a change in control at
July 31, 1997, and subsequent termination of employment, Messrs. Coogan,
McCloskey, and Gallo would have been entitled to severance payments of
approximately $897,000, $442,520, and $409,630.
Benefits
Pension Plan. The Savings Bank sponsors a tax-qualified defined benefit
pension plan (the "Pension Plan"). All full-time employees of the Savings Bank
are eligible to participate after one year of service and attainment of age 21.
A qualifying employee becomes fully vested in the Pension Plan upon completion
of five years of service. The Pension Plan is intended to comply with the
Employee Retirement Income Security Act of 1974, as amended ("ERISA").
The Pension Plan provides for monthly payments to each participating
employee at normal retirement age (age 62). The annual benefit payable as a life
annuity under the Pension Plan is equal to the sum of the participants accrued
benefit as of January 31, 1995, and the benefit which can be provided by the
actuarial accumulations of the contributions made on the participant's behalf
each year. For Participant's with one to five years of service, the contribution
is equal to 2.25% of compensation up to the Social Security taxable wage base
for the plan year of reference plus 4.5% of compensation in excess of the Social
Security taxable wage base for the plan year of reference. For participants with
six to ten years of service, the contribution is equal to 3.00% of compensation
up to the Social Security taxable wage base for the plan year of reference plus
6.00% of compensation in excess of the Social Security taxable wage base for the
plan year of reference. For participants with more than ten years of service,
the contributions equal to 4.00% of compensation up to the Social Security
taxable wage base for the plan year of reference plus 8.00% of compensation in
excess of the Social Security Taxable Wage Base for the plan year of reference.
A participant may elect an early retirement at age 60 with 20 years of service
and may elect to receive a reduced monthly benefit. At July 31, 1997, Messrs.
Coogan, McCloskey, and Gallo had 14, 12 and 8 years of credited service,
respectively, under the Pension Plan. Upon normal retirement at age 62, Messrs.
Coogan, McCloskey, and Gallo would each receive an annual benefit of $61,780,
$77,725 and $46,538, respectively.
Supplemental Executive Retirement Plan. The Savings Bank has adopted a
supplemental executive retirement plan ("SERP") for the benefit of Messrs.
Coogan, McCloskey and Gallo. The purpose of the SERP is to furnish each
participant with supplemental post-retirement benefits in addition to those
which will be provided under the Savings Bank's pension plan and other
retirement benefits. The SERP will provide a supplemental benefit necessary to
furnish the pension benefits based upon the formula contained in the Pension
Plan, without regard to the limitations under the Code regarding maximum
benefits levels. Payments under the SERP will be accrued for financial reporting
purposes based upon the vesting of such benefits. The SERP shall be unfunded.
There are no tax consequences to either the participant or the Savings Bank
related to the SERP prior to payment of benefits. Upon receipt of payment of
benefits, the participant will recognize taxable ordinary income in the amount
of such payments received and the Savings Bank will be entitled to recognize a
tax-deductible compensation expense at that time. Benefits under the SERP shall
be immediately payable upon death or disability of the participant, or upon
termination of participant within one year of a change in control of the Savings
Bank. Upon normal retirement at age 62, Messrs. Coogan, McCloskey and Gallo
would each receive an annual benefit of $91,300, $34,267, and $18,252,
respectively.
9
401(k) Profit Sharing Plan. The Savings Bank sponsors a tax-qualified
defined contribution profit sharing plan, ("401(k) Plan"), for the benefit of
its employees. All full-time employees become eligible to participate under the
Plan after completing one year of service. Under the 401(k) Plan, employees may
voluntarily elect to defer up to 5% of compensation, not to exceed applicable
limits under the Code (i.e., $9,500 in 1997). Additionally, the Savings Bank may
contribute an annual discretionary contribution to the plan. Such benefits are
allocated to participant accounts as a percentage of base compensation of such
participant to the base compensation of all participants. At the end of each
fiscal year, the Board of Directors determines whether to make a discretionary
contribution and the amount of the contribution to the 401(k) Plan, based upon a
number of factors, such as the Savings Bank's retained income, profits,
regulatory capital and employee performance. For the fiscal year ended July 31,
1997, there were no employer contributions to the 401(k) Plan by the Savings
Bank for all employees.
Employee Stock Ownership Plan. The Savings Bank maintains an employee
stock ownership plan, the ESOP, for the exclusive benefit of participating
employees. Participating employees are full-time employees who have completed
one year of service with the Savings Bank or its subsidiary and attained age 21.
The ESOP is funded by contributions made by the Savings Bank in cash or
the Common Stock. Benefits may be paid either in shares of the Common Stock or
in cash. The ESOP has borrowed funds from an unrelated third party lender in
order to purchase Common Stock in the Conversion and during fiscal 1997
purchased additional shares of the Company. This loan is secured by the shares
purchased and earnings of ESOP assets. Shares purchased with such loan proceeds
are held in a suspense account for allocation among participants as the loan is
repaid. The Savings Bank is contributing approximately $267,722 annually to the
ESOP to meet principal obligations under the ESOP loan. This loan is expected to
be fully repaid by the year 2005.
Contributions to the ESOP and shares released from the suspense account
will be allocated among participants on the basis of total compensation,
excluding bonuses. All participants must be employed at least 1,000 hours in a
plan year and be employed on the last day of the plan year in order to receive
an allocation. Participant benefits become 100% vested after five years of
service. Employment prior to the adoption of the ESOP shall count toward
vesting. Vesting will be accelerated upon retirement, death, disability or
termination of the ESOP. Forfeitures will be reallocated to participants on the
same basis as other contributions in the plan year. Benefits may be payable in
the form of a lump sum upon retirement, death, disability or separation from
service. The Savings Bank's contributions to the ESOP are discretionary;
therefore, benefits payable under the ESOP cannot be estimated.
Stock Option Plan. In connection with the Savings Bank's conversion
from mutual to stock form in December 1993 (the "Conversion") and acquisition of
the outstanding stock of the Bank by the Company, (the "Reorganization"), the
Company's Board of Directors adopted the 1993 Stock Option Plan (the "Option
Plan"), which was ratified by stockholders of the Company on May 26, 1994 at a
special meeting of stockholders. Pursuant to the Option Plan, 959,948 shares of
Common Stock are reserved for issuance upon exercise of stock options granted or
to be granted to officers, directors and key employees of the Company from time
to time. The purpose of the Option Plan is to provide additional incentive to
certain officers, directors and key employees by facilitating their purchase of
a stock interest in the Company. The Option Plan, which became effective upon
the Reorganization, provides for a term of ten years, after which no awards may
be made, unless earlier terminated by the Board of Directors pursuant to the
Option Plan. Options become immediately vested in the event of death, disability
or a
10
"change-in-control" of the Company or the Savings Bank. Options to purchase
40,000 shares of Common Stock were granted in fiscal 1997.
The following table sets forth additional information concerning
options granted under the 1993 Stock Option Plans.
Option/SAR Grants Table
Option/SAR Grants in Fiscal Year Ended July 31, 1997
----------------------------------------------------
Potential Realizable
Value at Assumed Annual
Rates of Stock Price
Appreciation for
Individual Grants Option Term(1)
- ----------------------------------------------------------------------------------- -----------------
(a) (b) (c) (d) (e) (f) (g)
% of Total
# of Securities Options Exercise
Underlying Granted to or Base
Options Employees in price Expiration
Name Granted (#) Fiscal Year ($/SH) Date 5% ($) 10% ($)
- ---- ----------- ----------- ------ ---------- -------- -------
Kevin J. Coogan 4,000 10% $12.07 12/06 $41,507 $105,187
Kevin M. McCloskey 4,000 10% 12.07 12/06 41,507 105,187
Anthony G. Gallo 4,000 10% 12.07 12/06 41,507 105,187
- -------------------------
(1) The amounts represent certain assumed rates of appreciation based upon the
closing price of stock as of July 31, 1997 of $16.50 per share. Actual
gains, if any, on stock option exercises and Common Stock holdings are
dependent on the future performance of the Common Stock and overall stock
market conditions. There can be no assurances that the amount reflected in
the table will be achieved.
Option/SAR Exercises and Fiscal Year End Value Table
Aggregated Option/SAR Exercises in Last Fiscal Year, and FY-End Option/SAR Value
- --------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Number of
Securities Value of
Underlying Unexercised
Unexercised In-The-Money
Options/SARs Options/SARs
at FY-End (#) at -End ($) (1)
------------- ---------------
Shares Acquired Exercisable/ Exercisable
Name on Exercise (#) Value Realized ($) (1) Unexercisable Unexercisable
- ---- --------------- ---------------------- ------------- ---------------
Kevin J. Coogan 0 0 260,876 / 0 $ 3,206,898
Kevin M. McCloskey 0 0 98,024 / 0 1,131,349
Anthony G. Gallo 0 0 98,024 / 0 1,131,349
- ------------------------------
(1) Based upon the closing price of the Common Stock as of July 31, 1997 of
$16.50 per share.
11
Compensation Committee Interlocks and Insider Participation
The Compensation Committee of the Company consists of Director Dean -
Chairman, and Directors Pedra and Rowe. The committee serves as the Compensation
Committee for the Savings Bank. Members of the committee are non-employee
directors of the Company and the Savings Bank. The committee meets annually to
review the performance of the Savings Bank's officers and employees, and to
determine compensation programs and salary actions for the Savings Bank and its
personnel.
Board Compensation Committee Report on Executive Compensation
The Savings Bank's Compensation Committee met once during the fiscal
year ended July 31, 1997 to review compensation paid to executive officers and
to determine the level of any increases in the salary budget for executive
officers to take effect during the following year. As to each executive officer,
the committee first considers recommendations presented by the Chief Executive
Officer. The committee reviews various published surveys of compensation paid to
executives performing similar duties for depository institutions and their
holding companies, with a particular focus on the level of compensation paid by
comparable institutions in and around the Savings Bank's market area. During the
fiscal year ended July 31, 1997, the committee looked at institutions with total
assets of $300 million to $600 million. Although the committee does not set
compensation levels for executive officers based on whether particular financial
goals have been achieved by the Company, the committee does consider the overall
profitability of the Company when making these decisions. With respect to each
particular executive officer, his or her particular contributions to the Company
over the past year are also evaluated.
For the fiscal year ended July 31, 1997, Kevin J. Coogan, President and
Chief Executive Officer, received an increase in salary from $270,000 to
$300,000, Kevin McCloskey, Vice President and Chief Operating Officer received
an increase in salary from $133,000 to $148,000, and Anthony G. Gallo, Vice
President and Chief Financial Officer received an increase from $122,000 to
$137,000. Messrs. Coogan, McCloskey and Gallo received awards of stock options,
as disclosed in the Summary Compensation Table. The committee considered the
annual compensation paid to chief executive officers of financial institutions
with assets of $300 million to $600 million and the individual job performance
of such other executive officers in consideration of its specific salary
increase decision with respect to compensation paid to Messrs. Coogan, McCloskey
and Gallo.
The Compensation Committee:
Leo J. Dean - Chairman
Dennis D. Pedra
Michael R. Rowe
Performance Graph
Set forth on the following page is a stock performance graph comparing
the cumulative total shareholder return on the Company's Common Stock for the
period from December 1993 through July 31, 1997. The performance graph compares
the cumulative total shareholder return on the Company's Common Stock with (a)
the yearly cumulative total stockholder return on stocks included in the Nasdaq
Total Market index and (b) the yearly cumulative total stockholder return on
stocks included in the Nasdaq Bank index ("Bank Index"), as prepared for Nasdaq
by the Center for Research in Securities Prices ("CRSP") at the University of
Chicago. All three investment comparisons assume the
12
investment of $100 as of December 22, 1993. All of these cumulative total
returns are computed assuming the reinvestment of dividends at the frequency
with which dividends were paid during the applicable years. The Company's Common
Stock was first issued on December 22, 1993.
There can be no assurance that the Company's stock performance will
continue into the future with the same or similar trends depicted in the graph
below. The Company will not make nor endorse any predictions as to future stock
performance.
[GRAPHICS OMITTED]
12/93 7/31/94 7/31/95 7/31/96 7/31/97
----- ------- ------- ------- -------
Total Market Index $100.00 $95.90 $134.66 $146.71 $216.48
Bank Index 100.00 109.68 127.94 157.07 267.24
Lakeview Financial Corp. 100.00 170.18 199.10 256.38 478.67
13
- --------------------------------------------------------------------------------
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- --------------------------------------------------------------------------------
The Savings Bank has followed a policy of not granting loans to
officers, directors and employees. However, loans may be made to members of the
immediate families of officers, directors and employees. The loans have been
made in the ordinary course of business and on substantially the same terms and
conditions, including interest rates and collateral, that apply to the Savings
Bank's other customers, and do not involve more than the normal risk of
collectibility, or present other unfavorable features.
- --------------------------------------------------------------------------------
INDEPENDENT PUBLIC ACCOUNTANT
- --------------------------------------------------------------------------------
KPMG Peat Marwick LLP was the Company's independent public accountant
for the 1997 fiscal year. The Board of Directors of the Company presently
intends to renew the Company's arrangement with KPMG Peat Marwick LLP to be its
auditors for the fiscal year ending July 31, 1998. A representative of KPMG Peat
Marwick LLP is expected to be present at the Meeting to respond to stockholders'
questions and will have the opportunity to make a statement if the
representative so desires.
- --------------------------------------------------------------------------------
FINANCIAL INFORMATION
- --------------------------------------------------------------------------------
The audited financial statements of the Company for the fiscal year
ended July 31, 1997, prepared in conformity with generally accepted accounting
principles, are included in the Company's 1997 Annual Report to Stockholders,
which accompanies this Proxy Statement. Any stockholder who has not received a
copy of the Company's Annual Report may obtain a copy by writing to the
Secretary of the Company. The Annual Report is not to be treated as a part of
the Company's proxy solicitation materials or as having been incorporated herein
by reference.
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS
- --------------------------------------------------------------------------------
In order to be considered for inclusion in the Company's proxy
materials for the 1998 Annual Meeting of Stockholders, any stockholder proposal
to take action at such meeting must be received at the Company's main office at
1117 Main Street, Paterson, New Jersey 07503 no later than July 1, 1998. Any
such proposals shall be subject to the requirements of the proxy rules adopted
under the 1934 Act.
- --------------------------------------------------------------------------------
OTHER MATTERS
- --------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Meeting, it is
intended that proxies in the accompanying form will be voted in respect thereof
in accordance with the judgment of the person or persons voting the proxies.
14
- --------------------------------------------------------------------------------
SOLICITATION OF PROXIES
- --------------------------------------------------------------------------------
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitations by mail,
directors, officers, and regular employees of the Company may solicit proxies
personally or by telegraph or telephone without payment of additional
compensation.
BY ORDER OF THE BOARD OF DIRECTORS
Helen Saco
Secretary
Paterson, New Jersey
October 29, 1997
15
ANNEX A
- --------------------------------------------------------------------------------
LAKEVIEW FINANCIAL CORP.
1117 MAIN STREET
PATERSON, NEW JERSEY 07503
(201) 742-3060
ANNUAL MEETING OF STOCKHOLDERS
- --------------------------------------------------------------------------------
November 25, 1997
- --------------------------------------------------------------------------------
The undersigned hereby appoints the Board of Directors of Lakeview
Financial Corp. ("Company"), or its designee, with full powers of substitution,
to act as attorneys and proxies for the undersigned, to vote all shares of
Common Stock of the Company which the undersigned is entitled to vote at the
Annual Meeting of Stockholders ("Meeting"), to be held at The Valley Regency,
1129 Valley Road, Clifton, New Jersey, on November 25, 1997, at 10:00 a.m. and
at any and all adjournments thereof, as follows:
VOTE FOR VOTE WITHHELD
-------- -------------
1. The election as a director of the two
nominees listed below for terms to |_| |_|
expire in 2000 (except as marked to the
contrary).
Robert J. Davenport
Dennis D. Pedra
INSTRUCTIONS: To withhold your vote for any individual nominee, insert the
nominee's name on the line provided.
-------------------------------------------
The Board of Directors recommends a vote "FOR" the above listed
proposition.
- --------------------------------------------------------------------------------
THIS SIGNED PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS SIGNED PROXY WILL BE VOTED FOR THE PROPOSITION STATED. IF ANY
OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS SIGNED PROXY WILL BE VOTED BY
THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD
OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Meeting, or
at any adjournments thereof, and after notification to the Secretary of the
Company at the Meeting of the stockholder's decision to terminate this proxy,
the power of said attorneys and proxies shall be deemed terminated and of no
further force and effect. The undersigned may also revoke this proxy by filing a
subsequently dated proxy or by notifying the Secretary of the Company of his or
her decision to terminate this proxy.
The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of the Meeting, a Proxy Statement dated
October 29, 1997, and the 1997 Annual Report to Stockholders.
Dated: , 1997
----------------
- ----------------------------- --------------------------------
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
- ----------------------------- --------------------------------
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
Please sign exactly as your name appears on this Proxy card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.
- --------------------------------------------------------------------------------
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN
THE ENCLOSED POSTAGE-PREPAID ENVELOPE.
- --------------------------------------------------------------------------------
ANNEX B
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
LAKEVIEW FINANCIAL CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
LAKEVIEW FINANCIAL CORP.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (set forth the amount on which the filing
fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------